<PAGE>
As filed with the Securities and Exchange Commission on October 30, 1995
File No. 2-73428
File No. 811-3231
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /_/
POST-EFFECTIVE AMENDMENT NO. 19 /X/
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 /_/
AMENDMENT NO. 19 /X/
SEI LIQUID ASSET TRUST
----------------------
(Exact name of registrant as specified in charter)
c/o CT Corporation
2 Oliver Street
Boston, Massachusetts 02109
----------------------------
(Address of Principal Executive Offices)(Zip Code)
Registrant's Telephone Number, including Area Code (800) 342-5734
David G. Lee
c/o SEI Corporation
680 E. Swedesford Road
Wayne, Pennsylvania 19087
-------------------------
(Name and Address of Agent for Service)
<TABLE>
Copies to:
<S> <C>
Richard W. Grant, Esq. John H. Grady, Jr., Esq.
Morgan, Lewis & Bockius LLP Morgan, Lewis & Bockius LLP
2000 One Logan Square 1800 M Street, N.W.
Philadelphia, Pennsylvania 19103 Washington, D.C. 20036
</TABLE>
- --------------------------------------------------------------------------------
CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933
<TABLE>
<CAPTION>
======================================================================================================================
Title of Securities Being Amount Being Proposed Maximum Proposed Amount of
Registered Registered Offering Price Per Maximum Registration
Unit Aggregate Offering Fee(1)
Price
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Units of beneficial interest $1,528,892,244 $1.00 per share $1,528,892,244 $100
======================================================================================================================
</TABLE>
(1) Registrant had actual aggregate redemptions of $11,679,664,849 for its
fiscal year ended June 30, 1995; has used $10,151,062,628 of available
redemptions for reductions pursuant to Rule 24f-2(c) under the 1940 Act and has
previously used no available redemptions for reductions pursuant to Rule 24e-
2(a) of the 1940 Act during the current year. Registrant elects to use
redemptions in the aggregate amount of $1,528,602,221 for reductions in its
current amendment.
- --------------------------------------------------------------------------------
It is proposed that this filing become effective (check
appropriate box):
X immediately upon filing pursuant to paragraph (b)
- ---
___ on [date] pursuant to paragraph (b)
___ 60 days after filing pursuant to paragraph (a)
___ on [date] pursuant to paragraph (a) of Rule 485
- --------------------------------------------------------------------------------
DECLARATION PURSUANT TO RULE 24F-2: Pursuant to Rule 24f-2 under the
Investment Company Act of 1940 the Registrant has registered an indefinite
number or amount of its shares of beneficial interest under the Securities Act
of 1933. The Rule 24f-2 Notice for the Registrant's fiscal year ending June
30, 1995 was filed August 25, 1995.
<PAGE>
SEI LIQUID ASSET TRUST
CROSS REFERENCE SHEET
<TABLE>
<CAPTION>
N-1A Item No. Location
- ------------- --------
PART A-All Portfolios - Class A
- -------------------------------
<C> <S> <C>
Item 1. Cover Page.................................... Cover Page
Item 2. Synopsis...................................... *
Item 3. Condensed Financial Information............... Financial Highlights
Item 4. General Description of Registrant............. The Trust; Investment
Objectives and Policies
Item 5. Management of the Fund........................ Trustees of the Trust;
The Manager and
Shareholder Servicing
Agent; The Adviser
Item 6. Capital Stock and Other Securities............ Voting Rights;
Shareholder Inquiries;
Dividends; Taxes
Item 7. Purchase of Securities Being Offered.......... Purchase and
Redemption of Shares
Item 8. Redemption or Repurchase...................... Purchase and
Redemption of Shares
Item 9. Pending Legal Proceedings..................... *
<CAPTION>
PART A-Treasury Securities Portfolio - Class D
- ----------------------------------------------
<C> <S> <C>
Item 1. Cover Page.................................... Cover Page
Item 2. Synopsis...................................... *
Item 3. Condensed Financial Information............... Financial Highlights
Item 4. General Description of Registrant............. The Trust; Investment
Objectives and Policies
Item 5. Management of the Fund........................ Trustees of the Trust;
The Manager and
Shareholder Servicing
Agent; The Adviser
Item 6. Capital Stock and Other Securities............ Voting Rights;
Shareholder Inquiries;
Dividends; Taxes
Item 7. Purchase of Securities Being Offered.......... Purchase and
Redemption of Shares
Item 8. Redemption or Repurchase...................... Purchase and
Redemption of Shares
Item 9. Pending Legal Proceedings..................... *
<CAPTION>
PART B-All Portfolios
- ---------------------
<C> <S> <C>
Item 10. Cover Page................................... Cover Page
Item 11. Table of Contents............................ Table of Contents
Item 12. General Information and History.............. The Trust
Item 13. Investment Objectives and Policies........... Description of Permitted
Investments; Investment
Limitations
Item 14. Management of the Registrant................. Trustees and Officers of
the Trust (Prospectus);
The Manager and
Shareholder Servicing
Agent; The Adviser
Item 15. Control Persons and Principal Holders of
Securities................................. 5% Shareholders;
Trustees and Officers of
the Trust
Item 16. Investment Advisory and Other Services....... The Adviser; The
Manager and
Shareholder Servicing
Agent; Distribution;
Experts
Item 17. Brokerage Allocation......................... Portfolio Transactions
Item 18. Capital Stock and Other Securities........... Description of Shares
Item 19. Purchase, Redemption, and Pricing of
Securities Being Offered.................... Purchase and
Redemption of Shares
(Prospectus);
Determination of Net
Asset Value
Item 20. Tax Status................................... Taxes (Prospectus); Tax
Item 21. Underwriters................................. Distribution
Item 22. Calculation of Performance Data.............. Performance
Item 23. Financial Statements......................... Financial Information
- ----------
</TABLE>
* Not Applicable
PART C
------
Information required to be included in Part C is set forth under the
appropriate Item, so numbered, in Part C of this Registration Statement.
<PAGE>
SEI LIQUID ASSET TRUST
OCTOBER 30, 1995
- --------------------------------------------------------------------------------
TREASURY SECURITIES PORTFOLIO
GOVERNMENT SECURITIES PORTFOLIO
PRIME OBLIGATION PORTFOLIO
INSTITUTIONAL CASH PORTFOLIO
MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
This Prospectus sets forth concisely information about the above-referenced
Portfolios that an investor needs to know before investing. Please read this
Prospectus carefully, and keep it on file for future reference.
A Statement of Additional Information dated October 30, 1995, has been filed
with the Securities and Exchange Commission and is available upon request and
without charge by writing the Distributor, SEI Financial Services Company, 680
East Swedesford Road, Wayne, Pennsylvania 19087-1658, or by calling 1-800-342-
5734. The Statement of Additional Information is incorporated into this
Prospectus by reference.
SEI Liquid Asset Trust (the "Trust") is an open-end management investment
company certain classes of which offer financial institutions a convenient
means of investing their own funds, or funds for which they act in a fiduciary,
agency or custodial capacity, in one or more professionally managed diversified
portfolios of securities. Some portfolios offer separate classes of units of
beneficial interest that differ from each other primarily in the allocation of
certain distribution expenses and minimum investment amounts. This Prospectus
offers Class A shares of each of the Trust's five money market portfolios
(each, a "Portfolio," and together, the "Portfolios") listed above.
AN INVESTMENT IN A PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT A PORTFOLIO WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
- --------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE AC-
CURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THE TRUST'S SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK. THE SHARES ARE NOT FEDERALLY INSURED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD
OR ANY OTHER GOVERNMENT AGENCY. INVESTMENT IN THE SHARES INVOLVES
RISK, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL AMOUNT INVESTED.
<PAGE>
ANNUAL OPERATING EXPENSES (As a percentage of average net assets)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TREASURY GOVERNMENT PRIME INSTITUTIONAL MONEY
SECURITIES SECURITIES OBLIGATION CASH MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
---------- ---------- ---------- ------------- ---------
<S> <C> <C> <C> <C> <C>
Management/Advisory fees
(after fee waivers)/1/ .36% .36% .36% .39% .36%
12b-1 fees/2/ .04% .04% .04% .00% .04%
Other Expenses .04% .04% .04% .05% .04%/3/
- -------------------------------------------------------------------------------------
Total Operating Expenses .44%/1/ .44%/1/ .44%/1/ .44% .44%/1/
- -------------------------------------------------------------------------------------
</TABLE>
1 The Manager has agreed contractually to waive its fee in an amount that
limits the total operating expenses of such Portfolio to not more than .44%
of its average net assets, except for the Institutional Cash Portfolio for
which the waiver is voluntary and may be terminated at any time in the
Manager's sole discretion. Absent this waiver, management/advisory fees for
the Treasury Securities, Government Securities, Prime Obligation,
Institutional Cash and Money Market Portfolios, would be .45%, .45%, .45%,
.39% and .45%, respectively, and, total operating expenses for the Treasury
Securities, Government Securities, Prime Obligation and Money Market
Portfolios would be .53%, .53%, .53%, and .53%, respectively, for the fiscal
year ended June 30, 1995. Additional information may be found under "The
Manager and Shareholder Servicing Agent," "The Adviser" and "Distribution."
2 The 12b-1 fees shown reflect each Portfolio's current 12b-1 budget for
reimbursement of expenses except that there has been a waiver of any 12b-1
fees for the Institutional Cash Portfolio. Absent this waiver, total
operating expenses for the Institutional Cash Portfolio would be .48%.
3 Other Expenses for the Money Market Portfolio are based on estimated amounts
for the current fiscal year.
EXAMPLE
<TABLE>
- -------------------------------------------------------------------------------
<CAPTION>
An investor in any Portfolio would pay the
following expenses on a $1,000 investment assuming
(1) 5% annual return and (2) redemption at the end 1 YR. 3 YRS. 5 YRS. 10 YRS.
of each time period: ----- ------ ------ -------
<S> <C> <C> <C> <C>
$5.00 $14.00 $25.00 $55.00
- -------------------------------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN. The purpose of this
table is to assist the investor in understanding the various costs and expenses
that may be directly or indirectly borne by investors in the Portfolios. A
person who purchases shares through a financial institution may be charged
separate fees by that institution. The information set forth in the foregoing
table and example relates only to the Portfolios' Class A shares. The Treasury
Securities Portfolio also offers Class D shares, which are subject to the same
expenses except that Class D shares bear different distribution and transfer
agent costs. Additional information regarding these differences may be found
under "The Manager and Shareholder Servicing Agent," "The Adviser" and
"Distribution." Long-term shareholders may eventually pay more than the
economic equivalent of the maximum front-end sales charges otherwise permitted
by the Rules of Fair Practice (the "Rules") of the National Association of
Securities Dealers, Inc. (the "NASD").
2
<PAGE>
FINANCIAL HIGHLIGHTS ___________________________________________________________
The following financial highlights for a share outstanding throughout each
year, insofar as they relate to each of the years in the period ended June 30,
1995, have been audited by Price Waterhouse LLP, independent public
accountants, whose report thereon was unqualified. This information should be
read in conjunction with the Trust's financial statements and notes thereto
which are included in the Statement of Additional Information under the heading
"Financial Information." As of June 30, 1995, the Money Market Portfolio had
not commenced operations. Additional performance information is set forth in
the Trust's 1995 Annual Report to Shareholders, which is available upon request
and without charge by calling 1-800-342-5734.
For a Class A Share Outstanding Throughout each Period
<TABLE>
<CAPTION>
Ratio of
Distributions Net
Net Asset Distributions from Ratio of Investment
Value Net Realized and from Net Realized Net Asset Net Assets Expenses Income
Beginning Investment Unrealized Investment Capital Value End Total End of to Average to Average
of Period Income Gains on Securities Income Gains of Period Return Period (000) Net Assets Net Assets
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TREASURY SECURITIES
- ----------------------------------------------------------------------------------------------------------------------------------
1995 $1.00 $0.05 -- $(0.05) -- $1.00 5.05% 1,254,888 0.44% 4.93%
1994 1.00 0.03 -- (0.03) -- 1.00 3.00 1,501,510 0.44 2.91
1993 1.00 0.03 -- (0.03) -- 1.00 3.03 2,219,701 0.44 2.99
1992 1.00 0.05 -- (0.05) -- 1.00 4.69 2,304,153 0.44 4.60
1991 1.00 0.07 -- (0.07) -- 1.00 7.04 2,248,497 0.44 6.80
1990 1.00 0.08 -- (0.08) -- 1.00 8.41 2,076,845 0.44 8.10
1989 1.00 0.08 -- (0.08) -- 1.00 8.51 2,318,763 0.44 8.20
1988 1.00 0.06 -- (0.06) -- 1.00 6.56 2,671,802 0.44 6.40
1987 1.00 0.06 -- (0.06) -- 1.00 5.91 2,580,118 0.44 5.70
1986 1.00 0.07 -- (0.07) -- 1.00 7.40 2,041,343 0.44 7.20
- ----------------------------------------------------------------------------------------------------------------------------------
GOVERNMENT SECURITIES
- ----------------------------------------------------------------------------------------------------------------------------------
1995 $1.00 $0.05 -- $(0.05) -- $1.00 5.18% 200,768 0.44% 5.04%
1994 1.00 0.03 -- (0.03) -- 1.00 3.04 255,554 0.44 2.96
1993 1.00 0.03 -- (0.03) -- 1.00 3.05 507,832 0.44 3.00
1992 1.00 0.05 -- (0.05) -- 1.00 4.72 399,938 0.44 4.60
1991 1.00 0.07 -- (0.07) -- 1.00 7.08 520,187 0.44 6.80
1990 1.00 0.08 -- (0.08) -- 1.00 8.48 368,318 0.44 8.10
1989 1.00 0.08 -- (0.08) -- 1.00 8.69 467,056 0.44 8.30
1988 1.00 0.07 -- (0.07) -- 1.00 6.83 523,274 0.44 6.70
1987 1.00 0.06 -- (0.06) -- 1.00 5.99 479,968 0.44 5.80
1986 1.00 0.07 -- (0.07) -- 1.00 7.52 222,215 0.44 7.30
- ----------------------------------------------------------------------------------------------------------------------------------
PRIME OBLIGATION
- ----------------------------------------------------------------------------------------------------------------------------------
1995 $1.00 $0.05 -- $(0.05) -- $1.00 5.20% 940,863 0.44% 5.21%
1994 1.00 0.03 -- (0.03) -- 1.00 3.08 918,509 0.44 3.03
1993 1.00 0.03 -- (0.03) -- 1.00 3.07 1,173,109 0.44 3.04
1992 1.00 0.05 -- (0.05) -- 1.00 4.73 1,515,554 0.44 4.70
1991 1.00 0.07 -- (0.07) -- 1.00 7.36 1,729,845 0.44 7.10
1990 1.00 0.08 -- (0.08) -- 1.00 8.57 1,804,367 0.44 8.30
1989 1.00 0.09 -- (0.09) -- 1.00 8.85 2,160,859 0.44 8.50
1988 1.00 0.07 -- (0.07) -- 1.00 7.12 2,224,159 0.44 6.90
1987 1.00 0.06 -- (0.06) -- 1.00 6.08 1,851,072 0.44 5.90
1986 1.00 0.07 -- (0.07) -- 1.00 7.58 1,469,066 0.44 7.30
- ----------------------------------------------------------------------------------------------------------------------------------
INSTITUTIONAL CASH*
- ----------------------------------------------------------------------------------------------------------------------------------
1995 $1.00 $0.0003 -- $(0.0003) -- $1.00 4.94% -- 0.44% 5.19%
1994 1.00 0.0003 -- (0.0003) -- 1.00 2.60 -- 0.44 2.63
1993 1.00 0.0003 -- (0.0003) -- 1.00 2.83 -- 0.44 2.66
1992 1.00 0.0002 -- (0.0002) -- 1.00 3.47 -- 0.44 3.50
1991 1.00 0.0003 0.0001 (0.0003) (0.0001) 1.00 7.12 -- 0.42 5.90
1990 1.00 0.0008 0.0003 (0.0008) (0.0003) 1.00 10.22 -- 0.44 7.80
1989 1.00 0.0007 0.0002 (0.0007) (0.0002) 1.00 8.49 -- 0.44 6.80
1988 1.00 0.0006 0.0001 (0.0006) (0.0001) 1.00 4.02 -- 0.44 5.20
1987(1) 1.00 0.0003 -- (0.0003) -- 1.00 5.48 -- 0.44 5.30
<CAPTION>
Ratio of
Net
Ratio of Investment
Expenses Income
to Average to Average
Net Assets Net Assets
(Excluding (Excluding
Waivers) Waivers)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
TREASURY SECURITIES
- ----------------------------------------------------------------------------------------------------------------------------------
1995 0.54% 4.83%
1994 0.51 2.84
1993 0.50 2.93
1992 0.50 4.50
1991 0.47 6.80
1990 0.45 8.10
1989 0.44 8.20
1988 0.44 6.40
1987 0.45 5.70
1986 0.44 7.20
- ----------------------------------------------------------------------------------------------------------------------------------
GOVERNMENT SECURITIES
- ----------------------------------------------------------------------------------------------------------------------------------
1995 0.53% 4.95%
1994 0.51 2.89
1993 0.50 2.94
1992 0.50 4.60
1991 0.48 6.70
1990 0.45 8.10
1989 0.46 8.30
1988 0.44 6.70
1987 0.46 5.80
1986 0.44 7.30
- ----------------------------------------------------------------------------------------------------------------------------------
PRIME OBLIGATION
- ----------------------------------------------------------------------------------------------------------------------------------
1995 0.53% 5.12%
1994 0.51 2.96
1993 0.50 2.98
1992 0.49 4.60
1991 0.47 7.10
1990 0.45 8.30
1989 0.44 8.50
1988 0.44 6.90
1987 0.45 5.90
1986 0.44 7.30
- ----------------------------------------------------------------------------------------------------------------------------------
INSTITUTIONAL CASH*
- ----------------------------------------------------------------------------------------------------------------------------------
1995 0.44% 5.19%
1994 0.44 2.63
1993 0.44 2.66
1992 0.44 3.50
1991 0.42 5.90
1990 0.44 7.80
1989 0.44 6.80
1988 0.44 5.20
1987(1) 0.44 5.30
</TABLE>
(1) Institutional Cash Fund commenced operations on December 31, 1986.
* Annualized
Amounts designated as "--" are either $0 or have been rounded to $0.
<PAGE>
THE TRUST ______________________________________________________________________
SEI Liquid Asset Trust (the "Trust") is an open-end management investment
company that offers units of beneficial interest ("shares") in separate
diversified investment portfolios. This Prospectus offers Class A shares of the
Trust's Treasury Securities, Government Securities, Prime Obligation,
Institutional Cash and Money Market Portfolios (each a "Portfolio," and,
together, the "Portfolios"). The Treasury Securities Portfolio also offers
Class D shares. Additional information pertaining to the Trust may be obtained
by writing to SEI Financial Services Company, 680 East Swedesford Road, Wayne,
Pennsylvania 19087-1658, or by calling 1-800-342-5734.
INVESTMENT
OBJECTIVES AND
POLICIES _______________________________________________________________________
TREASURY The Treasury Securities Portfolio seeks to preserve
SECURITIES principal value and maintain a high degree of liquidity
PORTFOLIO while providing current income.
The Portfolio invests exclusively in U.S. Treasury
obligations and repurchase agreements involving such
obligations. The repurchase agreement dealers selected for
the Treasury Securities Portfolio must meet certain
creditworthiness criteria established by Standard & Poor's
Corporation ("S&P").
GOVERNMENT The Government Securities Portfolio seeks to preserve
SECURITIES principal value and maintain a high degree of liquidity
PORTFOLIO while providing current income.
The Portfolio invests exclusively in U.S. Treasury
obligations, obligations issued or guaranteed as to
principal and interest by agencies or instrumentalities of
the U.S. Government, and repurchase agreements involving
such obligations.
PRIME The Prime Obligation Portfolio seeks to preserve principal
OBLIGATION value and maintain a high degree of liquidity while
PORTFOLIO providing current income.
The Portfolio invests exclusively in (i) commercial paper
rated at least A-1 by S&P or Prime-1 by Moody's Investors
Service, Inc. ("Moody's") at the time of investment or, if
not rated, determined by the Adviser to be of comparable
quality; (ii) obligations (including certificates of
deposit, time deposits, bankers' acceptances and bank notes)
of U.S. commercial banks that are members of the Federal
Reserve System or the Federal Deposit Insurance Corporation
or savings and loan institutions, which banks or
institutions have total assets of $500 million or more as
shown on their most recent public financial statements, at
the time of investment, provided that such obligations are
rated in the top two short-term rating categories by two or
more nationally recognized statistical rating organizations
("NRSROs"), or one NRSRO if only one NRSRO has rated the
security at the time of investment or, if not rated,
determined by the Adviser to be of comparable quality; (iii)
short-term corporate obligations rated AAA or AA by S&P or
Aaa or Aa by Moody's at the time of investment or, if not
rated, determined by the Adviser to be of comparable
quality; (iv) short-term obligations issued by state and
local governmental issuers, which
4
<PAGE>
are rated, at the time of investment, by at least two NRSROs
in one of the two highest municipal bond rating categories,
and which carry yields that are competitive with those of
other types of money market instruments of comparable
quality; (v) U.S. Treasury obligations, obligations issued
or guaranteed as to principal and interest by agencies or
instrumentalities of the U.S. Government; and (vi)
repurchase agreements involving any of the foregoing
obligations.
The Prime Obligation Portfolio may invest in restricted
securities and may invest up to 10% of its net assets in
illiquid securities. Rule 144A Securities and Section 4(2)
commercial paper that meet the criteria established by the
Board of Trustees of the Trust may be considered liquid.
INSTITUTIONAL The Institutional Cash Portfolio seeks to preserve principal
CASH PORTFOLIO value and maintain a high degree of liquidity while
providing current income.
The Portfolio invests exclusively in U.S. Treasury
obligations.
MONEY MARKET The Money Market Portfolio seeks to preserve principal value
PORTFOLIO and maintain a high degree of liquidity while providing
current income.
The Portfolio invests in the following U.S. dollar
denominated obligations: (i) commercial paper rated in the
highest rating category by at least one NRSRO at the time of
investment or, if not rated, determined by the Adviser to be
of comparable quality; (ii) obligations (including
certificates of deposit, time deposits, bankers' acceptances
and bank notes) of U.S. savings and loan institutions, U.S.
commercial banks (including foreign branches of such banks),
and U.S. and London branches of foreign banks, provided that
such institutions (or, in the case of a branch, the parent
institution) have total assets of $1 billion or more as
shown on their most recent public financial statements, at
the time of investment; (iii) short-term corporate
obligations rated in one of the two highest rating
categories by at least one NRSRO at the time of investment,
or, if not rated, determined by the Adviser to be of
comparable quality; (iv) U.S. Treasury obligations and
obligations issued or guaranteed as to principal and
interest by the agencies or instrumentalities of the U.S.
Government; (v) repurchase agreements involving any of the
foregoing obligations; and (vi) custodial receipts
representing investments in component parts of U.S. Treasury
obligations.
The Money Market Portfolio may invest in restricted
securities and may invest up to 10% of its net assets in
illiquid securities. Rule 144A securities and Section 4(2)
commercial paper that meet the criteria established by the
Board of Trustees of the Trust may be considered liquid.
There can be no assurance that the Portfolios will
achieve their respective investment objectives.
5
<PAGE>
GENERAL INVESTMENT POLICIES ____________________________________________________
In purchasing obligations, each Portfolio complies with the
requirements of Rule 2a-7 under the 1940 Act, as that Rule
may be amended from time to time. The quality, maturity and
diversification requirements of the Government Securities
and Prime Obligation Portfolios are more restrictive than
those imposed by Rule 2a-7. If Shareholders of these
Portfolios elect to be governed by Rule 2a-7 in the future,
the Portfolios will become subject to the Rule 2a-7
restrictions applicable to the Trust's other Portfolios.
Rule 2a-7's requirements currently provide that each
Portfolio must limit its investments to securities with
remaining maturities of 397 days or less, and must maintain
a dollar-weighted average maturity of 90 days or less. In
addition, each Portfolio may only invest in securities
(other than U.S. Government Securities) rated in one of the
two highest categories for short-term securities by at least
two NRSROs (or by one NRSRO if only one NRSRO has rated the
security), or, if unrated, determined by the Adviser (in
accordance with procedures adopted by the Trust's Board of
Trustees) to be of equivalent quality to rated securities in
which the Portfolio may invest. Purchases of unrated
securities and securities rated by only one NRSRO will be
ratified by the Trust's Board of Trustees.
Securities rated in the highest rating category (e.g., A-
1 by S&P) by at least two NRSROs (or, if unrated, determined
by the Adviser to be of comparable quality) are "first tier"
securities. Securities rated in the second highest rating
category (e.g., A-2 by S&P) by at least one NRSRO (or, if
unrated, determined by the Adviser to be of comparable
quality) are considered to be "second tier" securities. Each
Portfolio will invest, in the aggregate, no more than 5% of
its assets in second tier securities, and any investment in
any one second tier security is limited to the greater of 1%
of a Portfolio's total assets or $1 million.
The Government Securities and Prime Obligation Portfolios
may only purchase securities with a remaining maturity of
365 days or less, and, as a matter of non-fundamental
policy, will maintain a dollar-weighted average portfolio
maturity of 90 days or less. Each Portfolio may purchase
securities on a when-issued or delayed delivery basis.
For additional information regarding the Portfolios'
permitted investments and the ratings referred to above, see
"Description of Permitted Investments and Risk Factors" and
the Statement of Additional Information.
INVESTMENT LIMITATIONS _________________________________________________________
The investment objective and investment limitations are
fundamental policies of the Portfolios. Fundamental policies
cannot be changed with respect to a Portfolio without the
consent of the holders of a majority of the Trust's or that
Portfolio's outstanding shares.
6
<PAGE>
It is a fundamental policy of each Portfolio to use its
best efforts to maintain a constant net asset value of $1.00
per share. In addition, it is a fundamental policy of each
of the Government Securities and Prime Obligation Portfolios
to invest its assets solely in the securities listed as
appropriate investments for that Portfolio.
Each Portfolio may not:
1. Purchase securities of any issuer (except securities
issued or guaranteed by the U.S. Government, its agencies
or instrumentalities and any securities guaranteed
thereby) if as a result more than 5% of the total assets
of the Portfolio (based on fair market value at the time
of investment) would be invested in the securities of
such issuer; provided, however, that the Treasury
Securities, Money Market and Institutional Cash
Portfolios may invest up to 25% of their total assets
without regard to this restriction as permitted by Rule
2a-7.
2. Purchase any securities which would cause more than 25%
of the total assets of the Portfolio to be invested in
the securities of one or more issuers conducting their
principal business activities in the same industry,
provided that this limitation does not apply to
investments in (a) domestic banks and (b) obligations
issued or guaranteed by the U.S. Government or its
agencies and instrumentalities.
3. Borrow money except for temporary or emergency purposes
and then only in an amount not exceeding 10% of the value
of the total assets of that Portfolio. This borrowing
provision is included solely to facilitate the orderly
sale of portfolio securities to accommodate substantial
redemption requests if they should occur and is not for
investment purposes. All borrowings will be repaid before
making additional investments for that Portfolio and any
interest paid on such borrowings will reduce the income
of that Portfolio.
The foregoing percentage limitations will apply at the time
of the purchase of a security. Additional investment
limitations are set forth in the Statement of Additional
Information.
THE MANAGER AND SHAREHOLDER SERVICING AGENT ____________________________________
SEI Financial Management Corporation (the "Manager" and the
"Transfer Agent"), 680 East Swedesford Road, Wayne,
Pennsylvania 19087-1658, a wholly-owned subsidiary of SEI
Corporation ("SEI"), provides the Trust with overall
management services, regulatory reporting, all necessary
office space, equipment, personnel and facilities, and acts
as transfer agent, dividend disbursing agent, and
shareholder servicing agent.
The Manager is entitled to a fee which is calculated
daily and paid monthly at an annual rate of .42% of the
average daily net assets of each Portfolio, except the
Institutional Cash Portfolio, for which the Manager is
entitled to a fee of .36% of the Portfolio's average daily
net assets. The Manager has contractually agreed to waive
all or a
7
<PAGE>
portion of its fee with respect to each Portfolio, except
the Institutional Cash Portfolio, in order to limit the
total operating expenses of the Class A shares of such
Portfolios to not more than .44% of its average daily net
assets. For the Institutional Cash Portfolio only, this
waiver is voluntary and may be terminated at any time in the
Manager's sole discretion.
For the fiscal year ended June 30, 1995, the Treasury
Securities Government Securities, Prime Obligation and
Institutional Cash Portfolios paid management fees, after
waivers, of .33%, .33%, .33% and .36%, respectively, of
their average daily net assets. As of June 30, 1995, the
Money Market Portfolio had not commenced operations.
THE ADVISER ____________________________________________________________________
Wellington Management Company ("WMC" or the "Adviser"), 75
State Street, Boston, Massachusetts 02109, serves as the
investment adviser to each Portfolio. The Adviser, under an
investment advisory agreement with the Trust, invests the
assets of the Portfolios and continuously reviews,
supervises and administers each Portfolio's investment
program, subject to the supervision of, and policies
established by, the Trustees of the Trust.
As of September 30, 1995, the Adviser had investment
management authority with respect to approximately $102.4
billion of assets, including the assets of the Trust, SEI
Daily Income Trust and a portfolio of Insurance Investment
Products Trust, each of which is an open-end management
investment company administered by the Manager. WMC is a
professional investment counseling firm which provides
investment services to investment companies, employee
benefit plans, endowments, foundations, and other
institutions and individuals. The Adviser's predecessor
organizations have provided investment advisory services to
investment companies since 1933, and to investment
counseling clients since 1960. WMC is a Massachusetts
general partnership, of which the following persons are
managing partners: Robert W. Doran, Duncan M. McFarland and
John B. Neff.
John C. Keogh, Senior Vice President of the Adviser,
serves as portfolio manager to the Portfolios. He has been
an investment professional with the Adviser since 1983, and
has served as portfolio manager to the Treasury Securities
Portfolio since July, 1994. Prior to that date, he assisted
the portfolio manager in the management of the Portfolio.
Mr. Keogh has served as portfolio manager of the
Institutional Cash Portfolio since the Portfolio's inception
in 1986.
The Adviser is entitled to a fee which is calculated
daily and paid monthly at an annual rate of .075% of the
combined average daily net assets of the Trust's Portfolios
up to $500 million, and .02% of such average daily net
assets in excess of $500 million. Such fees are allocated
daily among the Portfolios of the Trust on the basis of
their relative net assets. For the fiscal year ended June
30, 1995, the Treasury Securities, Government Securities,
Prime Obligation, and Institutional Cash Portfolios paid
advisory fees, after fee waivers, of .03%, .03%, .03%, and
.03%, respectively, of their relative net assets.
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<PAGE>
DISTRIBUTION ___________________________________________________________________
SEI Financial Services Company (the "Distributor"), a
wholly-owned subsidiary of SEI, serves as each Portfolio's
distributor pursuant to a distribution agreement (the
"Distribution Agreement") with the Trust. Each Class of the
Trust has adopted a distribution plan (the "Class A Plan"
and "Class D Plan," and, collectively, the "Plans") pursuant
to Rule 12b-1 under the Investment Company Act of 1940 (the
"1940 Act").
The Class A Plan provides for reimbursement for expenses
incurred by the Distributor, provided those expenses are
permissible as to both type and amount under a budget
adopted by the Board of Trustees, including those who are
not interested persons and have no financial interest in the
Plan or any related agreement ("Qualified Trustees").
Pursuant to state law, the Distributor has voluntarily
agreed to limit the distribution-related expenses of the
Class A shares of each Portfolio to .25%. Currently, the
budget (shown here as a percentage of average daily net
assets) for each Portfolio is set at an annual rate of .04%.
Distribution-related expenses reimbursable to the
Distributor under the budget include those related to the
costs of the printing of reports, prospectuses, notices and
similar materials for persons other than current
shareholders, federal and state securities law registration
and the cost of complying with such laws in the distribution
of the Trust's shares, advertising expenses and promotional
and sales expenses including expenses for travel,
communication and compensation and benefits for sales
personnel. Distribution expenses not attributable to a
specific Portfolio are allocated among each of the
Portfolios of the Trust on the basis of their average net
assets. The Trust is not obligated to reimburse the
Distributor for any expenditures in excess of the approved
budget.
It is possible that an institution may offer different
classes of shares to its customers and thus receive
different compensation with respect to different classes.
These financial institutions may also charge separate fees
to their customers.
The Trust may execute brokerage or other agency
transactions through the Distributor for which the
Distributor may receive compensation.
The Distributor may, from time to time in its sole
discretion, institute one or more promotional incentive
programs, which will be paid for by the Distributor from the
sales charge it receives or from any other source available
to it. Under any such program, the Distributor will provide
promotional incentives, in the form of cash or other
compensation, including merchandise, airline vouchers, trips
and vacation packages, to all dealers selling shares of the
Portfolios. Such promotional incentives will be offered
uniformly to all shares of the Portfolios, and also will be
offered uniformly to all dealers, predicated upon the amount
of shares of the Portfolios sold by such dealer.
9
<PAGE>
PURCHASE AND REDEMPTION OF SHARES ______________________________________________
Financial institutions may acquire Class A shares of the
Portfolios for their own account, or as a record owner on
behalf of fiduciary, agency or custody accounts, by placing
orders with the Transfer Agent. Institutions that use
certain SEI proprietary systems may place orders
electronically through those systems. State securities laws
may require banks and financial institutions purchasing
shares for their customers to register as dealers pursuant
to state laws. Financial institutions may impose an earlier
cut-off time for receipt of purchase orders directed through
them to allow time for processing and transmittal of these
orders to the Transfer Agent for effectiveness on the same
day. Financial institutions which purchase shares for the
accounts of their customers may impose separate charges on
these customers for account services. Shares of the
Portfolios are offered only to residents of states in which
the shares are eligible for purchase.
Shares of each Portfolio may be purchased or redeemed on
days on which the New York Stock Exchange is open for
business ("Business Days"). However, money market fund
shares cannot be purchased by Federal Reserve wire on
Federal holidays restricting wire transfers.
Shareholders who desire to purchase shares must place
their orders with the Transfer Agent prior to 2:00 p.m.,
Eastern time (12:00 p.m., Eastern time for the Institutional
Cash Portfolio), on any Business Day for the order to be
accepted on that Business Day. Cash investments must be
transmitted or delivered in federal funds to the wire agent
by the close of business on the same day the order is
placed. The Trust reserves the right to reject a purchase
order when the Distributor determines that it is not in the
best interest of the Trust or shareholders to accept such
purchase order.
The Trust will send shareholders a statement after each
purchase or redemption transaction. The purchase price of
shares is the net asset value next determined after a
purchase order is received and accepted by the Trust. The
net asset value per share of each Portfolio is determined by
dividing the total market value of the Portfolio's
investments and other assets, less any liabilities, by the
total outstanding shares of that Portfolio. Net asset value
per share is determined daily as of 2:00 p.m., Eastern time
(12:00 p.m., Eastern time for the Institutional Cash
Portfolio), on each Business Day.
Shareholders who desire to redeem shares of a Portfolio
must place their redemption orders with the Transfer Agent
prior to 2:00 p.m., Eastern time (12:00 p.m., Eastern time
for the Institutional Cash Portfolio), on any Business Day.
The redemption price is the net asset value per share of the
Portfolio next determined after receipt by the Transfer
Agent of the redemption order. Payment on redemptions will
be made as promptly as possible and, in any event, within
seven days after the redemption order is received.
Purchase and redemption orders may be placed by
telephone. Neither the Trust nor the Trust's Transfer Agent
will be responsible for any loss, liability, cost or expense
for
10
<PAGE>
acting upon wire instructions or upon telephone instructions
that it reasonably believes to be genuine. The Trust and the
Trust's Transfer Agent will each employ reasonable
procedures to confirm that instructions communicated by
telephone are genuine, including requiring a form of
personal identification prior to acting upon instructions
received by telephone and recording telephone instructions.
If market conditions are extraordinarily active, or other
extraordinary circumstances exist, shareholders may
experience difficulties placing redemption orders by
telephone, and may wish to consider placing orders by other
means.
PERFORMANCE ____________________________________________________________________
From time to time, the Portfolios may advertise "current
yield" and "effective compound yield." These figures will
fluctuate, as they are based on historical earnings and are
not intended to indicate future performance. The "current
yield" of the Portfolios refers to the income generated by
an investment over a seven-day period which is then
"annualized." That is, the amount of income generated by an
investment during that week is assumed to be generated each
week over a 52-week period and is shown as a percentage of
the investment. The "effective yield" is calculated
similarly but, when annualized, the income earned by an
investment is assumed to be reinvested. The "effective
yield" will be slightly higher than the "current yield"
because of the compounding effect of this assumed
reinvestment.
A Portfolio may periodically compare its performance to
that of: (i) other mutual funds tracked by mutual fund
rating services (such as Lipper Analytical), financial and
business publications and periodicals; (ii) broad groups of
comparable mutual funds; (iii) unmanaged indices which may
assume investment of dividends but generally do not reflect
deductions for administrative and management costs; or (iv)
other investment alternatives.
For each Portfolio, the performance of the Class A shares
will normally be higher than the performance of the Class D
shares of that Portfolio because of additional distribution
and transfer agent expenses charged to Class D shares.
TAXES __________________________________________________________________________
The following summary of federal income tax consequences is
based on current tax laws and regulations, which may be
changed by legislative, judicial or administrative action.
No attempt has been made to present a detailed explanation
of the federal, state, or local income tax treatment of the
Portfolios or their shareholders. In addition, state and
local tax consequences of an investment in a Portfolio may
differ from the federal income tax consequences described
below. Accordingly, shareholders are urged to consult their
tax advisers regarding specific questions as to federal,
state and local income taxes. Additional information
concerning taxes is set forth in the Statement of Additional
Information.
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<PAGE>
Tax Status of Each Portfolio is treated as a separate entity for federal
the Portfolios tax purposes and is not combined with the Trust's other
Portfolios. Each Portfolio intends to qualify for the
special tax treatment afforded regulated investment
companies under Subchapter M the Internal Revenue Code of
1986, as amended, so as to be relieved of federal income tax
on net investment company taxable income and net capital
gains (the excess of net long-term capital gain over net
short-term capital losses) distributed to shareholders.
Tax Status of Each Portfolio distributes substantially all of its net
Distributions investment income (including net short-term capital gains)
to shareholders. Dividends from a Portfolio's net investment
income are taxable to its shareholders as ordinary income
(whether received in cash or in additional shares).
Distributions of net capital gains are taxable as long-term
capital gains, regardless of how long shareholders have held
their shares and regardless of whether the distributions are
received in cash or in additional shares. Dividends and
distributions of capital gains paid by each Portfolio do not
qualify for the dividends received deduction for corporate
shareholders. Each portfolio will provide annual reports to
shareholders of the federal income tax status of all
distributions.
Dividends declared by a Portfolio in October, November or
December of any year and payable to shareholders of record
on a date in such a month will be deemed to have been paid
by the Portfolio and received by the shareholders on
December 31 of the year declared if paid by the Portfolio at
any time during the following January.
Each Portfolio intends to make sufficient distributions
prior to the end of each calendar year to avoid liability
for the federal excise tax applicable to regulated
investment companies.
With respect to investments in U.S. Treasury STRIPS,
which are sold at original issue discount and thus do not
make periodic cash interest payments, each Portfolio will be
required to include as part of its current income, the
imputed interest on such obligations even though the
Portfolio has not received any interest payments on such
obligations during that period. Because each Portfolio
distributes all of its net investment income to its
shareholders, a Portfolio may have to sell Portfolio
securities in order to distribute such imputed income, which
may occur at a time when the Adviser would not have chosen
to sell such securities and, which may result in a taxable
gain or loss.
Investment income received by the Portfolios on direct
U.S. Government obligations is exempt from tax at the state
level when received directly by a Portfolio, and may be
exempt, depending on the state, when received by a
shareholder as income dividends from any Portfolio provided
certain state-specific conditions are satisfied. Interest
received on repurchase agreements collateralized by U.S.
Government obligations normally is not exempt from state
taxation. Each Portfolio will inform shareholders annually
of the percentage of income and distributions derived from
direct U.S. Government obligations. Shareholders should
consult their tax advisers to determine whether any portion
of the income dividends received from a Portfolio is
considered tax exempt in their particular states.
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Each sale, exchange, or redemption of any Portfolio's
shares is a taxable transaction to the shareholder.
GENERAL INFORMATION ____________________________________________________________
The Trust SEI Liquid Asset Trust (the "Trust") was organized as a
Massachusetts business trust under a Declaration of Trust
dated July 20, 1981. The Declaration of Trust permits the
Trust to offer separate Portfolios of shares and different
classes of each Portfolio. All consideration received by the
Trust for shares of any portfolio and all assets of such
portfolio belong to that portfolio or class and are subject
to liabilities related thereto.
The Trust pays its expenses, including fees of its
service providers, audit and legal expenses, expenses of
preparing prospectuses, proxy solicitation material and
reports to shareholders, costs of custodial services and
registering the shares under federal and state securities
laws, pricing, insurance expenses, litigation and other
extraordinary expenses, brokerage costs, interest charges,
taxes and organization expenses.
Trustees of the The management and affairs of the Trust are supervised by
Trust the Trustees under the laws of the Commonwealth of
Massachusetts. The Trustees have approved contracts under
which, as described above, certain companies provide
essential management services to the Trust.
Voting Rights Each share held entitles the shareholder of record to one
vote. The shareholders of each Portfolio or class of the
Trust will vote separately on matters relating solely to
that Portfolio or class. As a Massachusetts business trust,
the Trust is not required to hold annual meetings of
shareholders, but approval will be sought for certain
changes in the operation of the Trust and for the election
of Trustees under certain circumstances. In addition, a
Trustee may be removed by the remaining Trustees or by
shareholders at a special meeting called upon written
request of shareholders owning at least 10% of the
outstanding shares of the Trust. In the event that such a
meeting is requested, the Trust will provide appropriate
assistance and information to the shareholders requesting
the meeting.
Reporting The Trust issues unaudited financial statements semi-
annually and audited financial statements annually. The
Trust furnishes proxy statements and other reports to
shareholders of record.
Shareholder Shareholder inquiries should be directed to the Manager, SEI
Inquiries Financial Management Corporation, 680 East Swedesford Road,
Wayne, Pennsylvania 19087-1658.
Dividends The dividends of Class A shares will normally be higher than
on Class D shares of each Portfolio because of the
additional distribution and transfer agent expenses charged
to Class D shares.
Substantially all of the net investment income (exclusive
of capital gains) of each Portfolio is periodically declared
and paid as a dividend. Dividends are paid by the Portfolio
in federal funds or in additional shares at the discretion
of the shareholder on the first
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<PAGE>
Business Day of each month. Currently, capital gains (the
excess of net long-term capital gain over net short-term
capital loss) realized, if any, are distributed at least
annually.
Counsel and
Independent Morgan, Lewis & Bockius LLP serves as counsel to the Trust.
Accountants Price Waterhouse LLP serves as the independent accountants
to the Trust.
Custodian and
Wire Agent CoreStates Bank, N.A., Broad and Chestnut Streets, P.O. Box
7618, Philadelphia, Pennsylvania 19101 (the "Custodian"),
serves as custodian of the Trust's assets and as wire agent
of the Trust. The Custodian holds cash, securities and other
assets of the Trust as required by the 1940 Act.
DESCRIPTION OF PERMITTED INVESTMENTS AND RISK FACTORS __________________________
The following is a description of certain of the permitted
investments for the Portfolios, and the associated risk
factors:
Bank Notes
Bank notes are notes used to represent debt obligations
issued by banks in large denominations.
Bankers'
Acceptance A bankers' acceptance is a bill of exchange or time drafts
drawn on and accepted by a commercial bank. It is used by
corporations to finance the shipment and storage of goods
and to furnish dollar exchange. Maturities are generally six
months or less.
Certificates of
Deposit Certificates of deposit are negotiable interest-bearing
instruments with a specific maturity. They are issued by
banks and savings and loan institutions in exchange for the
deposit of funds, and normally can be traded in the
secondary market prior to maturity. Certificates of deposit
have penalties for early withdrawal.
Commercial
Paper Commercial paper is the term used to designate unsecured
short-term promissory notes issued by municipalities,
corporations and other entities. Maturities on these issues
vary from one to 270 days. Section 4(2) commercial paper is
issued in reliance on an exemption from registration under
Section 4(2) of the Securities Act of 1933 (the "1933 Act"),
and is generally sold to institutional investors who
purchase for investment. Any resale of such commercial paper
must be in an exempt transaction, usually to an
institutional investor through the issuer or investment
dealers who make a market in such commercial paper.
Demand
Instruments Demand instruments are instruments which may involve a
conditional or unconditional demand feature which permits
the holder to demand payment of the principal amount of the
instrument. They may include variable amount master demand
notes.
Foreign
Securities The Money Market Portfolio may invest in U.S. dollar
denominated obligations or securities of U.S. and London
branches of foreign banks. Investments in such instruments
involve risks that are different from investments in
securities of U.S. banks. These risks may include future
unfavorable political and economic developments, possible
withholding taxes,
14
<PAGE>
seizure of foreign deposits, currency controls, interest
limitations or other governmental restrictions which might
affect payment of principal or interest. Additionally, there
may be less public information available about foreign banks
and their branches. Foreign branches of foreign banks are
not regulated by U.S. banking authorities and generally are
not bound by accounting, auditing and financial reporting
standards comparable to U.S. banks. However, the Adviser
attempts to minimize these risks by investing only in those
instruments which satisfy the high quality and maturity
restrictions applicable to a Portfolio.
Illiquid Illiquid securities are securities which cannot be sold or
Securities disposed of within seven business days at approximately the
value at which they are being carried on a Portfolio's
books. Illiquid securities may include demand instruments
with demand notice periods exceeding seven days for which
there is no secondary market, and repurchase agreements with
maturities over seven days in length.
Repurchase Repurchase agreements are agreements by which a Portfolio
Agreements obtains a security and simultaneously commits to return the
security to the seller at an agreed upon price on an agreed
upon date. The custodian will hold the security as
collateral for the repurchase agreement. A Portfolio bears a
risk of loss in the event the other party defaults on its
obligations and the Portfolio is delayed or prevented from
exercising its right to dispose of the collateral or if the
Portfolio realizes a loss on the sale of the collateral. A
Portfolio will enter into repurchase agreements only with
financial institutions deemed to present minimal risk of
bankruptcy during the term of the agreement based on
established guidelines. Repurchase agreements are considered
loans under the 1940 Act.
Restricted Restricted Securities are securities that may not be sold
Securities freely to the public absent registration under the 1933 Act,
or an exemption from registration.
Time Deposits Time deposits are non-negotiable receipts issued by a bank
in exchange for the deposit of funds. Similar to a
certificate of deposit, a time deposit earns a specified
rate of interest over a definite period of time; however, it
cannot be traded in the secondary market.
U.S. Government Certain federal agencies, such as the Government National
Agency Mortgage Association ("GNMA"), have been established as
Obligations instrumentalities of the U.S. Government to supervise and
finance certain types of activities. Issues of these
agencies, while not direct obligations of the U.S.
Government, are either backed by the full faith and credit
of the United States (such as GNMA securities) or supported
by the issuing agency's right to borrow from the Treasury.
The issues of other agencies are supported only by the
credit of the instrumentality (such as Federal National
Mortgage Association securities). Any guarantee by the U.S.
Government, its agencies or instrumentalities of all
securities in which a Portfolio invests guarantees only the
payment of principal and interest on the guaranteed security
and does not guarantee the yield or value of the security or
the yield or value of shares of that Portfolio.
U.S. Treasury U.S. Treasury obligations consist of bills, notes and bonds
Obligations issued by the U.S. Treasury and separately traded interest
and principal component parts of such obligations that are
15
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transferable through the federal book-entry system known as
Separately Traded Registered Interest and Principal
Securities ("STRIPS").
STRIPS are sold as zero coupon securities, which means
that they are sold at a substantial discount and redeemed at
face value at their maturity date without interim payments
of interest or principal. This discount is accreted over the
life of the security, and such accretion will constitute the
income earned on the security for both accounting and tax
purposes. Because of these features, such securities may be
subject to greater interest rate volatility than interest-
paying investments. See also "Taxes."
Variable and Certain of the obligations purchased by a Portfolio may
Floating Rate carry variable or floating rates of interest and may involve
Instruments a conditional or unconditional demand feature. Such
obligations may include variable amount master demand notes.
Such instruments bear interest at rates which are not fixed,
but which vary with changes in specified market rates or
indices. The interest rates on these securities may be reset
daily, weekly, quarterly or at some other interval, and may
have a floor or ceiling on interest rate changes. There is a
risk that the current interest rate on such obligations may
not accurately reflect existing market interest rates. A
demand instrument with a demand notice period exceeding
seven days may be considered illiquid if there is no
secondary market for such security.
When-Issued and When-issued or delayed delivery transactions involve the
Delayed purchase of an instrument with payment and delivery taking
Delivery place in the future. Delivery of and payment for these
Securities securities may occur a month or more after the date of the
purchase commitment. A Portfolio will maintain with the
custodian a separate account with liquid, high grade debt
securities or cash in an amount at least equal to these
commitments. The interest rate realized on these securities
is fixed as of the purchase date, and no interest accrues to
a Portfolio before settlement. These securities are subject
to market fluctuation due to changes in market interest
rates, and it is possible that the market value at the time
of settlement could be higher or lower than the purchase
price if the general level of interest rates has changed.
Although a Portfolio generally purchases securities on a
when-issued or forward commitment basis with the intention
of actually acquiring securities, a Portfolio may dispose of
a when-issued security or forward commitment prior to
settlement if the Adviser deems it appropriate to do so.
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TABLE OF CONTENTS
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<TABLE>
<S> <C>
Annual Operating Expenses............................................... 2
Financial Highlights.................................................... 3
The Trust............................................................... 4
Investment Objectives and Policies...................................... 4
General Investment Policies............................................. 6
Investment Limitations.................................................. 6
The Manager and Shareholder Servicing Agent............................. 7
The Adviser............................................................. 8
Distribution............................................................ 9
Purchase and Redemption of Shares....................................... 10
Performance............................................................. 11
Taxes................................................................... 11
General Information..................................................... 13
Description of Permitted Investments and Risk Factors................... 14
</TABLE>
<PAGE>
PROSPECTUS
OCTOBER 30, 1995
- --------------------------------------------------------------------------------
TREASURY SECURITIES PORTFOLIO
- --------------------------------------------------------------------------------
Please read this prospectus carefully before investing, and keep it on file for
future reference. It contains information that can help you decide if the
Portfolio's investment goals match your own.
A Statement of Additional Information dated October 30, 1995, has been filed
with the Securities and Exchange Commission and is available upon request and
without charge by writing the Distributor, SEI Financial Services Company, 680
East Swedesford Road, Wayne, Pennsylvania 19087-1658, or by calling 1-800-437-
6016. The Statement of Additional Information is incorporated by reference into
this Prospectus.
SEI Liquid Asset Trust (the "Trust") is an open-end management investment
company certain classes of which offer shareholders a convenient means of
investing their funds in one or more professionally managed diversified
portfolios of securities. The Treasury Securities Portfolio offers two classes
of shares, Class A shares and Class D shares. Class D shares differ from Class
A shares primarily in the allocation of certain distribution expenses and
transfer agent fees. Class D shares are available through SEI Financial
Services Company (the Trust's distributor), and through participating broker-
dealers, financial institutions and other organizations. This Prospectus offers
Class D shares of the Trust's Treasury Securities Portfolio (the "Portfolio").
AN INVESTMENT IN THE PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT THE PORTFOLIO WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
- --------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
THE TRUST'S SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK. THE SHARES ARE NOT FEDERALLY INSURED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD
OR ANY OTHER GOVERNMENT AGENCY. INVESTMENT IN THE SHARES INVOLVES
RISK, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL AMOUNT INVESTED.
- --------------------------------------------------------------------------------
<PAGE>
..........................
TABLE OF
CONTENTS
<TABLE>
<S> <C>
Fund Highlights.. 2
Portfolio
Expenses........ 4
Financial
Highlights...... 5
Your Account and
Doing Business
with Us......... 6
Investment
Objective and
Policies........ 9
General
Investment
Policies........ 9
Investment
Limitations..... 10
The Manager and
Shareholder
Servicing Agent. 11
The Adviser...... 11
Distribution..... 12
Performance...... 13
Taxes............ 14
Additional
Information
About Doing
Business with
Us.............. 15
General
Information..... 18
Description of
Permitted
Investments and
Risk Factors.... 19
</TABLE>
..........................
HOW TO READ THIS PROSPECTUS ____________________________________________________
This Prospectus gives you information that you should know about the Portfolio
before investing. Brief descriptions are also provided throughout the
Prospectus to better explain certain key points. To find these helpful guides,
look for this symbol. [SYMBOL APPEARS HERE]
FUND HIGHLIGHTS ________________________________________________________________
The following summary provides basic information about the Class D shares of
the Trust's Treasury Securities Portfolio. This summary is qualified in its
entirety by reference to the more detailed information provided elsewhere in
this Prospectus and in the Statement of Additional Information.
INVESTMENT The Treasury Securities Portfolio seeks to preserve principal
OBJECTIVE AND value and maintain a high degree of liquidity while providing
POLICIES current income. See "Investment Objective and Policies" and
"Description of Permitted Investments and Risk Factors."
UNDERSTANDING There can be no assurance that the Portfolio will
RISK achieve its investment objective. See "Investment Objectives
and Policies" and "Description of Permitted Investments and
Risk Factors."
MANAGEMENT Wellington Management Company (the "Adviser") serves as the
PROFILE investment adviser to the Portfolio. The Adviser is a
professional investment counseling firm which has been
providing investment advisory services to mutual funds
since 1933. SEI Financial Management Corporation serves
as the manager and shareholder servicing agent of the
Trust (the "Manager"). DST Systems, Inc. ("DST") serves
as transfer agent (the "Transfer Agent") and dividend
disbursing agent for the Class D shares of the Trust.
SEI Financial Services Company serves as distributor
("Distributor") of the Trust's shares. See "The Manager and
Shareholder Servicing Agent," "The Adviser" and
"Distribution."
2
<PAGE>
................................................................................
[SYMBOL APPEARS HERE] INVESTMENT
PHILOSOPHY
Believing that no single investment adviser can deliver outstanding performance
in every investment category, only those advisers who have distinguished them-
selves within their areas of specialization are selected to advise our mutual
funds.
................................................................................
YOUR ACCOUNT You may open an account with just $1,000 and make additional
AND DOING investments with as little as $100. Redemptions of the
BUSINESS WITH Portfolio's shares are made at net asset value per share. See
US "Purchase of Shares" and "Redemption of Shares."
DIVIDENDS Substantially all of the net investment income (exclusive
of capital gains) of the Portfolio is distributed in
the form of dividends that will be declared daily and
paid monthly on the first Business Day of each month.
Any realized net capital gain is distributed at least
annually. Distributions are paid in additional shares
unless you elect to take the payment in cash. See
"Dividends."
INFORMATION/ For more information about Class D shares, call SEI Financial
SERVICE Services Company at 1-800-437-6016.
CONTACTS
3
<PAGE>
PORTFOLIO EXPENSES _____________________________________________________________
The purpose of the following table is to help you understand the various cost
and expenses that you, as a shareholder, will bear directly or indirectly in
connection with an investment in Class D shares.
SHAREHOLDER TRANSACTION EXPENSES (as a percentage of offering price)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TREASURY
SECURITIES
PORTFOLIO
----------
<S> <C>
Maximum Sales Charge Imposed On Purchases None
Maximum Sales Charge Imposed on Reinvested Dividends None
Redemption Fees/1/ None
- ----------------------------------------------------------------
</TABLE>
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TREASURY
SECURITIES
PORTFOLIO
----------
<S> <C>
Management/Advisory fees (after fee waiver)(/2/) .36%
12b-1 fees(/3/) .24%
Other Expenses (after fee waiver) .19%
- ------------------------------------------------------------
Total Operating Expenses (after fee waiver) .79%
- ------------------------------------------------------------
</TABLE>
1 A charge, currently $10.00, is imposed on wires of redemption proceeds of the
Portfolio's Class D shares.
2 The Manager has agreed contractually to waive a portion of its fee in order
to limit total operating expenses for Class D shares of the Portfolio to not
more than .84% of its average daily net assets. Absent these contractual
provisions, management/advisory fees, 12b-1 fees and total operating expenses
as a percentage of net assets, respectively, would have been .45%, .29% and
.93% for the Treasury Securities Portfolio. Additional information may be
found under "The Manager and Shareholder Servicing Agent," "The Adviser" and
"Distribution."
3 The 12b-1 fee shown reflects the Portfolio's current 12b-1 budget for
reimbursement of expenses. The maximum 12b-1 fee payable by Class D shares
for the Portfolio is .55%.
EXAMPLE
- --------------------------------------------------------------------------------
An investor in the Class D shares
of the Portfolio would pay the fol-
lowing expenses on a $1,000 invest-
ment assuming (1) 5% annual return
and (2) redemption at the end of
each time period:
<TABLE>
<CAPTION>
1 YR. 3 YRS. 5 YRS. 10 YRS.
----- ------ ------ -------
<S> <C> <C> <C> <C>
TREASURY SECURITIES PORTFOLIO $8 $25 $44 $98
- ----------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN. The purpose of the
expense table is to assist the investor in understanding the various costs and
expenses that may be directly or indirectly borne by investors in Class D
shares of the Portfolio. A person who purchases shares through an account with
a financial institution may be charged separate fees by that institution. The
information set forth in the foregoing table and example relates only to the
Class D shares. The Portfolio also offers Class A shares, which are subject to
the same expenses, except there are no transfer agent costs, and there are
different distribution costs. Additional information may be found under "The
Manager and Shareholder Servicing Agent," "The Adviser" and "Distribution."
Long-term shareholders may pay more than the economic equivalent of the maximum
front-end sales charge otherwise permitted by the Rules of Fair Practice of the
National Association of Securities Dealers, Inc. (the "NASD").
4
<PAGE>
FINANCIAL HIGHLIGHTS ___________________________________________________________
The following financial highlights for a share outstanding throughout each
year, insofar as they relate to each of the years in the period ended June 30,
1995, have been audited by Price Waterhouse LLP, independent public
accountants, whose report thereon was unqualified. This information should be
read in conjunction with the Trust's financial statements and notes thereto
which are included in the Statement of Additional Information under the heading
"Financial Information." Additional performance information is set forth in the
Trust's 1995 Annual Report to Shareholders, which is available upon request and
without charge by calling 1-800-437-6016.
For a Class D Share Outstanding Throughout each Period
<TABLE>
<CAPTION>
Net Asset Distributions Distributions Ratio of
Value Net Realized and from Net from Net Asset Net Asset Expenses
Beginning Investment Unrealized Investment Realized Capital Value End Total End of to Average
of Period Income Gains on Securities Income Gains of Period Return Period (000) Net Assets
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Treasury Securities
- -----------------------------------------------------------------------------------------------------------------------------------
1995 1.00 0.05 -- (0.05) -- 1.00 4.69 9,798 0.79
1994(1) 1.00 0.01 -- (0.01) -- 1.00 0.50** 23 0.79*
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Ratio of
Net
Ratio of Ratio of Investment
Net Expenses Income
Investment to Average to Average
Income Net Assets Net Assets
to Average (Excluding (Excluding
Net Assets Waivers) Waivers)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Treasury Securities
- --------------------------------------------------------------------------------------------------------------------------
1995 5.15 0.89 5.05
1994(1) 3.23* 0.98* 3.04*
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Treasury Securities Class D commenced operations on May 4, 1994.
* Annualized
** Not Annualized
Amounts designated as "--" are either $0 or have been rounded to $0.
5
<PAGE>
...............................................................................
[SYMBOL APPEARS HERE] WHAT IS AN
INTERMEDIARY?
Any entity, such as a bank, broker-dealer, other financial institution,
association or organization which has entered into an arrangement
with the Distributor to sell Class D shares to its customers.
................................................................................
YOUR ACCOUNT AND DOING BUSINESS WITH US
Class D shares of the Portfolio are sold on a continuous basis and may be
purchased directly from the Trust's Distributor, SEI Financial Services
Company. Shares may also be purchased through financial institutions, broker-
dealers, or other organizations which have established a dealer agreement or
other arrangement with SEI Financial Services Company ("Intermediaries"). For
more information about the following topics, see "Additional Information About
Doing Business with Us."
- --------------------------------------------------------------------------------
HOW TO BUY, Class D shares of the Portfolio may be purchased through
SELL AND Intermediaries which provide various levels of shareholder
EXCHANGE services to their customers. Contact your Intermediary for
SHARES THROUGH information about the services available to you and for
INTERMEDIARIES specific instructions on how to buy, sell and exchange
shares. To allow for processing and transmittal of orders to
the Transfer Agent on the same day, Intermediaries may impose
earlier cut-off times for receipt of purchase orders. Certain
Intermediaries may charge customer account fees. Information
concerning shareholder services and any charges will be
provided to the customer by the Intermediary. Certain of
these Intermediaries may be required to register as broker-
dealers under state law.
The shares you purchase through an Intermediary may be
held "of record" by that Intermediary. If you want to
transfer the registration of shares beneficially owned by
you, but held "of record" by an Intermediary, you should call
the Intermediary to request this change.
HOW TO BUY Application forms can be obtained by calling 1-800-437-6016.
SHARES FROM Class D shares of the Portfolio are offered only to residents
THE of states in which the shares are eligible for purchase.
DISTRIBUTOR
Opening an ccount
By Check You may buy Class D shares by mailing a completed application
and a check (or other negotiable bank instrument or money
order) payable to "Class D (Treasury Securities Portfolio)".
If you send a check that does not clear, the purchase will be
canceled and you could be liable for any losses or fees
incurred.
By Fed Wire To buy shares by Fed Wire call toll-free at 1-800-437-6016.
Automatic You may systematically buy Class D shares through deductions
Investment from your checking or savings accounts, provided these
Plan ("AIP") accounts are maintained through banks which are part of the
Automated Clearing House ("ACH") system. You may purchase
shares on a fixed schedule (semi-monthly or monthly) with
amounts as low as $25, or as high as $100,000. Upon notice,
the amount you commit to the AIP may be changed or canceled
at any time.
6
<PAGE>
...............................................................................
[SYMBOL APPEARS HERE] HOW DOES AN
EXCHANGE TAKE
PLACE?
When making an exchange, you authorize the sale of your shares of one or more
Portfolios in order to purchase the shares of another Portfolio. In other
words, you are executing a sell order and then a buy order. This sale of your
shares is a taxable event which could result in a taxable gain or loss.
................................................................................
The AIP is subject to account minimum initial purchase
amounts and minimum balance maintenance requirements.
EXCHANGING
SHARES
When Can You Once payment for your shares has been received and accepted
Exchange (i.e., an account has been established), you may exchange
----
Shares? some or all of your shares for Class D shares of SEI Tax
Exempt Trust, SEI Daily Income Trust, SEI International Trust
and SEI Institutional Managed Trust ("SEI Funds"). Exchanges
are made at net asset value plus any applicable sales charge.
When Do Sales SEI Funds' portfolios that are not money market portfolios
Charges Apply currently impose a sales charge on Class D shares. If you
to an exchange into one of these "non-money market" portfolios, you
Exchange? will have to pay a sales charge on any portion of your
exchanged Class D shares for which you have not previously
paid a sales charge.
If you previously paid a sales charge on your Class D
shares, no additional sales charge will be assessed when you
exchange those Class D shares for other Class D shares.
If you buy Class D shares of a "non-money market" fund and
you receive a sales charge waiver, you will be deemed to have
paid the sales charge for purposes of this exchange privilege.
In calculating any sales charge payable on your exchange, the
Trust will assume that the first shares you exchange are those
on which you have already paid a sales charge. Sales charge
waivers may also be available under certain circumstances
described in the SEI Funds' prospectuses.
The Trust reserves the right to change the terms and
conditions of the exchange privilege discussed herein, or to
terminate the exchange privilege, upon 60 days' notice. The
Trust also reserves the right to deny an exchange request
made within 60 days of the purchase of a "non-money market"
portfolio.
Requesting an To request an exchange, you must provide proper instructions
Exchange of in writing to the Transfer Agent. Telephone exchanges will
Shares also be accepted if you previously elected this option on
your account application.
In the case of shares held "of record" by an Intermediary
but beneficially owned by you, you should contact the
Intermediary who will contact the Transfer Agent and effect
the exchange on your behalf.
7
<PAGE>
................................................................................
[SYMBOL APPEARS HERE] WHAT IS A
SIGNATURE
GUARANTEE?
A signature guarantee verifies the authenticity of your signature and may be
obtained from any of the following: banks, brokers, dealers, certain credit
unions, securities exchange or association, clearing agency or savings
association. A notary public cannot provide a signature guarantee.
...............................................................................
HOW TO SELL To sell your shares, a written request for redemption in good
SHARES THROUGH order must be received by the Transfer Agent. Valid written
THE redemption requests will be effective on receipt. All
DISTRIBUTOR shareholders of record must sign the redemption request. The
Transfer Agent may require that the signatures on written
By Mail requests be guaranteed.
For information about the proper form of redemption
requests, call 1-800-437-6016. You may also have the proceeds
mailed to an address of record or mailed (or sent by ACH) to
a commercial bank account previously designated on the
Account Application or specified by written instruction to
the Transfer Agent. There is no charge for having redemption
requests mailed to a designated bank account.
By Telephone You may sell your shares by telephone if you previously elected
that option on the Account Application. You may have the
proceeds mailed to the address of record, wired or sent by ACH
to a commercial bank account previously designated on the
Account Application. Under most circumstances, payments will be
transmitted on the next Business Day following receipt of a
valid telephone request for redemption. Wire redemption
requests may be made by calling 1-800-437-6016. A wire
redemption charge (presently $10.00) will be deducted from the
amount of the redemption.
Systematic You may establish a systematic withdrawal plan for an account
Withdrawal with a $10,000 minimum balance. Under the plan, redemptions
Plan ("SWP") can be automatically processed from accounts (monthly,
quarterly, semi-annually or annually) by check or by ACH with a
minimum redemption amount of $50.
Check-Writing Check-Writing Service is offered free of charge to Class D
shareholders in the Portfolio. You may redeem shares by
writing checks on your account for $500 or more. Once you
have signed and returned a signature card, you will receive a
supply of checks. A check may be made payable to any person,
and your account will continue to earn dividends until the
check clears.
Because of the difficulty of determining in advance the
exact value of your account, you may not use a check to close
your account. The checks are free, but your account will be
charged a fee for stopping payment of a check upon your
request or if the check cannot be honored because of
insufficient funds or other valid reasons.
8
<PAGE>
...............................................................................
[SYMBOL APPEARS HERE] WHAT ARE
INVESTMENT
OBJECTIVES AND
POLICIES?
The Portfolio's investment objective is a statement of what it seeks to
achieve. It is important to make sure that the investment objective matches
your own financial needs and circumstances. The investment policies section
spells out the types of securities in which the Portfolio invests.
................................................................................
INVESTMENT OBJECTIVE AND POLICIES _________________________________________
TREASURY The investment objective of the Treasury Securities
SECURITIES Portfolio is to preserve principal value and maintain
PORTFOLIO a high degree of liquidity while providing current income.
The Treasury Securities Portfolio invests exclusively in
U.S. Treasury obligations and repurchase agreements involving
such obligations. The repurchase agreement dealers selected for
the Treasury Securities Portfolio must meet certain
creditworthiness criteria established by Standard & Poor's
Corporation ("S&P").
There can be no assurance that the Portfolio will
achieve its investment objective.
GENERAL INVESTMENT POLICIES ____________________________________________________
In purchasing obligations, the Portfolio complies with the
requirements of Rule 2a-7 under the 1940 Act, as that Rule
may be amended from time to time. These requirements
currently provide that the Portfolio must limit its
investments to securities with remaining maturities of 397
days or less, and must maintain a dollar-weighted average
maturity of 90 days or less. In addition, the Portfolio may
only invest in securities (other than U.S. Government
Securities) rated in one of the two highest categories for
short-term securities by at least two nationally recognized
statistical rating organizations ("NRSROs") (or by one NRSRO
if only one NRSRO has rated the security), or, if unrated,
determined by the Adviser (in accordance with procedures
adopted by the Trust's Board of Trustees) to be of equivalent
quality to rated securities in which the Portfolio may
invest. Purchases of unrated securities and securities rated
by only one NRSRO will be ratified by the Trust's Board of
Trustees.
Securities rated in the highest rating category (e.g., A-1
by S&P) by at least two NRSROs (or, if unrated, determined by
the Adviser to be of comparable quality) are "first tier"
securities. Securities rated in the second highest rating
category (e.g., A-2 by S&P) by at least one NRSRO (or, if
unrated, determined by the Adviser to be of comparable
quality) are considered to be "second tier" securities. The
Portfolio will invest, in the aggregate, no more than 5% of
its assets in second tier securities, and any investment in
any one second tier security limited to the greater of 1% of
the Portfolio's total assets or $1 million.
The Portfolio may purchase securities on a when-issued or
delayed delivery basis.
9
<PAGE>
For additional information regarding the Portfolio's
permitted investments, see "Description of Permitted
Investments and Risk Factors" and the Statement of
Additional Information.
INVESTMENT LIMITATIONS _________________________________________________________
The investment objective and investment limitations are
fundamental policies of the Portfolio. Fundamental policies
cannot be changed with respect to the Portfolio without the
consent of the holders of a majority of the Trust's or the
Portfolio's outstanding shares. It is a fundamental policy
of the Portfolio to use its best efforts to maintain a
constant net asset value of $1.00 per share.
The Portfolio may not:
1. Purchase securities of any issuer (except securities
issued or guaranteed by the U.S. Government, its agencies
or instrumentalities and any securities guaranteed
thereby) if as a result more than 5% of total assets of
the Portfolio (based on fair market value at the time of
investment) would be invested in the securities of such
issuer; provided, however, that the Portfolio may invest
up to 25% of its total assets without regard to this
restriction as permitted by Rule 2a-7.
2. Purchase any securities which would cause more than 25%
of the total assets of the Portfolio based on fair market
value at the time of such purchase, to be invested in the
securities of one or more issuers conducting their
principal business activities in the same industry,
provided that this limitation does not apply to
investments in (a) domestic banks and (b) obligations
issued or guaranteed by the U.S. Government or its
agencies and instrumentalities.
3. Borrow money except for temporary or emergency purposes
and then only in an amount not exceeding 10% of the value
of the total assets of the Portfolio. This borrowing
provision is included solely to facilitate the orderly
sale of portfolio securities to accommodate substantial
redemption requests if they should occur and is not for
investment purposes. All borrowings will be repaid before
making additional investments for the Portfolio and any
interest paid on such borrowings will reduce the income
of the Portfolio.
The foregoing percentage limitations will apply at the time
of the purchase of a security. Additional investment
limitations are set forth in the Statement of Additional
Information.
10
<PAGE>
...........................
INVESTMENT
ADVISER
[SYMBOL APPEARS HERE]
A Portfolio's in-
vestment adviser
manages the in-
vestment activi-
ties and is re-
sponsible for the
performance of
the Portfolio.
The adviser con-
ducts investment
research, exe-
cutes investment
strategies based
on an assessment
of economic and
market condi-
tions, and deter-
mines which secu-
rities to buy,
hold or sell.
................................................................................
THE MANAGER AND SHAREHOLDER SERVICING AGENT ____________________________________
SEI Financial Management Corporation (the "Manager"), 680
East Swedesford Road, Wayne, Pennsylvania 19087-1658, a
wholly-owned subsidiary of SEI Corporation ("SEI"), provides
the Trust with overall management services, regulatory
reporting, all necessary office space, equipment, personnel
and facilities and for acting as shareholder servicing
agent.
The Manager is entitled to a fee, which is calculated
daily and paid monthly at an annual rate of .42% of the
average daily net assets of the Treasury Securities
Portfolio. The Manager has contractually agreed to waive a
portion of its fee in order to limit total operating
expenses on an annualized basis to not more than .84% of the
average daily net assets of the Class D shares of the
Portfolio on an annualized basis. For the fiscal year ended
June 30, 1995, the Portfolio paid management fees, after fee
waivers, of .33% of the Portfolio's average daily net
assets.
The Trust and DST Systems, Inc., 210 W. 10th Street,
Kansas City, Missouri, 64105, have entered into a separate
transfer agent agreement with respect to the Class D shares
of the Portfolio. Under this agreement, DST acts as the
transfer agent and dividend disbursing agent (the "Transfer
Agent") for the Class D shares of the Trust.
THE ADVISER ____________________________________________________________________
Wellington Management Company ("WMC" or the "Adviser") 75
State Street, Boston, Massachusetts 02109, serves as the
investment adviser to the Portfolio. The Adviser,
under an investment advisory
agreement with the Trust,
invests the assets of the
Portfolio and continuously
reviews, supervises and
administers the Portfolio's
investment program, subject to
the supervision of, and
policies set by, the Trustees
of the Trust.
As of September 30, 1995,
the Adviser had investment
management authority with
respect to approximately
$102.4 billion of assets,
including the assets of the
Trust, SEI Daily Income Trust
and a portfolio of Insurance
Investment Products Trust,
each of which is an open-end
money market investment
company administered
by the Manager. WMC is a
professional investment
counseling firm which provides
investment services to
investment companies, employee
benefit plans, endowments,
foundations, and other institutions
and individuals. The Adviser's
predecessor organizations have
provided investment
advisory services to investment
companies since 1933 and to
investment counseling clients since
1960. WMC is
11
<PAGE>
a Massachusetts general partnership, of which the following
persons are managing partners: Robert W. Doran, Duncan M.
McFarland and John B. Neff.
John C. Keogh, Senior Vice President of the Adviser,
serves as portfolio manager to the Portfolio. He has been an
investment professional with the Adviser since 1983, and has
served as portfolio manager to the Treasury Securities
Portfolio since July 1994. Prior to that date, he assisted
the portfolio manager in the management of the Portfolio.
The Adviser is entitled to a fee which is calculated
daily and paid monthly, at an annual rate of .075% of the
combined average daily net assets of the Trust's Portfolio
up to $500 million, and .02% of such assets in excess of
$500 million. Such fees are allocated daily among the
Portfolios of the Trust on the basis of their relative net
assets. For the fiscal year ended June 30, 1995, the
Treasury Securities Portfolio paid advisory fees, after fee
waivers, of .03% of its relative net assets.
DISTRIBUTION ___________________________________________________________________
SEI Financial Services Company (the "Distributor"), a
wholly-owned subsidiary of SEI, serves as each Portfolio's
distributor pursuant to a distribution agreement (the
"Distribution Agreement") with the Trust. Each Class of the
Trust has adopted a distribution plan (the "Class A Plan"
and "Class D Plan," and, collectively, the "Plans") pursuant
to Rule 12b-1 under the Investment Company Act of 1940 (the
"1940 Act").
The Class D Plan provides for reimbursement for expenses
incurred by the Distributor, in an amount not to exceed .30%
of the average daily net assets of each Portfolio on an
annualized basis, and provided those expenses are
permissible as to both type and amount under a budget
adopted by the Board of Trustees, including those who are
not interested persons and have no financial interest in the
Plan or any related agreement ("Qualified Trustees").
Currently, the budget (shown here as a percentage of average
daily net assets) for each Portfolio is set at an annual
rate of .04%.
Distribution-related expenses reimbursable to the
Distributor under the budget include those related to the
costs of the printing of reports, prospectuses, notices and
similar materials for persons other than current
shareholders, advertising expenses and promotional and sales
expenses including expenses for travel, communication and
compensation and benefits for sales personnel. Distribution
expenses not attributable to a specific portfolio of the
Trust are allocated among each of the portfolios of the
Trust based on the basis of their relative average net
assets. The Trust is not obligated to reimburse the
Distributor for any expenditures in excess of the approved
budget.
The Class D Plan, in addition to providing for the
reimbursement payments described above, provides for
payments to the Distributor at an annual rate of .25% of
each Portfolio's average daily net assets attributable to
Class D shares. This additional payment may be used to
compensate financial institutions that provide distribution-
related services to their customers. These payments are
characterized as "compensation," and are not directly tied
to expenses incurred by the Distributor; the payments the
Distributor
12
<PAGE>
receives during any year may therefore be higher or lower
than its actual expenses. These additional payments
compensate the Distributor for its services in connection
with distribution assistance or the provision of shareholder
services, and some or all of it may be used to pay financial
institutions and intermediaries such as banks, savings and
loan associations, insurance companies, and investment
counselors, broker-dealers (including the Distributor's
affiliates and subsidiaries) for services or reimbursement
of expenses incurred in connection with distribution
assistance or the provision of shareholder services. If the
Distributor's expenses are less than its fees under the
Class D Plan, the Trust will still pay the full fee and the
Distributor will realize a profit, but the Trust will not be
obligated to pay in excess of the full fee, even if the
Distributor's actual expenses are higher. Currently, the
Distributor is taking this additional compensation payment
under the Class D Plan at a rate of .20% of the Portfolio's
average daily net assets, on an annualized basis,
attributable to Class D shares.
It is possible that an institution may offer different
classes of shares to its customers and thus receive
different compensation with respect to different classes.
These financial institutions may also charge separate fees
to their customers.
The Trust may execute brokerage or other agency
transactions through the Distributor for which the
Distributor may receive compensation.
The Distributor may, from time to time in its sole
discretion, institute one or more promotional incentive
programs, which will be paid for by the Distributor from the
sales charge it receives or from any other source available
to it. Under any such program, the Distributor will provide
promotional incentives, in the form of cash or other
compensation, including merchandise, airline vouchers, trips
and vacation packages, to all dealers selling shares of the
Portfolios. Such promotional incentives will be offered
uniformly to all shares of the Portfolios, and also will be
offered uniformly to all dealers, predicated upon the amount
of shares of the Portfolios sold by such dealer.
PERFORMANCE ____________________________________________________________________
From time to time, the Portfolio may advertise "current
yield" and "effective compound yield." These figures will
fluctuate, as they are based on historical earnings and are
not intended to indicate future performance. The "current
yield" of the Portfolio refers to the income generated by an
investment over a seven-day period which is then
"annualized." That is, the amount of income generated by an
investment during that week is assumed to be generated each
week over a 52-week period and is shown as a percentage of
the investment. The "effective yield" is calculated
similarly but, when annualized, the income earned by an
investment is assumed to be reinvested. The "effective
yield" will be slightly higher than the "current yield"
because of the compounding effect of this assumed
reinvestment.
13
<PAGE>
................................................................................
[SYMBOL APPEARS HERE] TAXES
You must pay taxes on your Portfolio's earnings, whether you take your
payments in cash or additional shares.
................................................................................
................................................................................
[SYMBOL APPEARS HERE] DISTRIBUTIONS
The Portfolio distributes income dividends and capital gains. Income dividends
represent the earnings from the Portfolio's investments; capital gains dis-
tributions occur when investments in the Portfolio are sold for more than the
original purchase price.
...............................................................................
................................................................................
The Portfolio may periodically compare its performance to
that of: (i) other mutual funds tracked by mutual fund rating
services (such as Lipper Analytical), financial and business
publications and periodicals; (ii) broad groups of comparable
mutual funds; (iii) unmanaged indices which may assume
investment of dividends but generally do not reflect
deductions for administrative and management costs; or (iv)
other investment alternatives.
For the Portfolio, the performance of the Class A shares
will normally be higher than the performance of the Class D
shares of the Portfolio because of additional distribution
and transfer agent expenses charged to Class D shares.
TAXES __________________________________________________________________________
The following summary of federal income tax consequences is
based on current tax laws and regulations, which may be
changed by legislative, judicial or administrative action. No
attempt has been made to present a detailed explanation of
the federal, state, or local income tax treatment of the
Portfolio or its shareholders. In addition, state and local
tax consequences of an investment in the Portfolio may differ
from the federal income tax consequences described below.
Accordingly, Shareholders are urged to consult their tax
advisers regarding specific questions as to federal, state
and local income taxes. Additional information concerning
taxes is set forth in the Statement of Additional
Information.
Tax Status of The Portfolio is treated as a separate entity for federal
the Portfolio: tax purposes and is not combined with the Trust's other
Portfolios. The Portfolio intends to continue to qualify for
the special tax treatment afforded regulated investment
companies under subchapter M of the Internal Revenue Code of
1986, as amended, so as to be relieved of federal income tax on
net investment company taxable income and net capital gains
(the excess of net long-term capital gain over net short-term
capital losses) distributed to shareholders.
Tax Status of The Portfolio will distribute substantially all of its net
Distributions: investment income (including net short-term capital gains)
and net capital gain to shareholders. Dividends from net
investment company taxable income are taxable to shareholders
as ordinary income, whether received in cash or in additional
shares, to the extent of the Portfolio's earning and profits.
Distributions of net capital gains are taxable to shareholders
as long-term capital gains regardless of how long shareholders
have held their shares and regardless of whether
the distributions are received in cash or in additional
shares. Dividends and
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<PAGE>
distributions of capital gains paid by the Portfolio do not
qualify for the dividends received deduction for corporate
shareholders. The Portfolio will make annual reports to
shareholders on the federal income tax status of all
distributions.
Dividends declared by the Portfolio in October, November
or December of any year and payable to shareholders of
record on a date in such a month will be deemed to have been
paid by the Portfolio and received by the shareholders on
December 31 of the year declared if paid by the Portfolio at
any time during the following January.
The Portfolio intends to make sufficient distributions
prior to the end of each calendar year, to avoid liability
for the federal excise tax applicable to regulated
investment companies.
With respect to investments in U.S. Treasury STRIPS,
which are sold at original issue discount and thus do not
make periodic cash interest payments, the Portfolio will be
required to include as part of its current income the
imputed interest on such obligations even though the
Portfolio has not received any interest payments on such
obligations during that period. Because the Portfolio
distributes all of its net investment income to its
shareholders, the Portfolio may have to sell portfolio
securities to distribute such imputed income, which may
occur at a time when the Adviser would not have chosen to
sell such securities and, which may result in a taxable gain
or loss.
Investment income received by the Portfolio on direct
U.S. Government obligations is exempt from tax at the state
level when received directly by the Portfolio and may be
exempt, depending on the state, when received by a
shareholder as income dividends from the Portfolio provided
certain state-specific conditions are satisfied. Interest
received on repurchase agreements collateralized by U.S.
Government obligations normally is not exempt from state
taxation. The Portfolio will inform shareholders annually of
the percentage of income and distributions derived from
direct U.S. Government obligations. Shareholders should
consult their tax advisers to determine whether any portion
of the income dividends received from the Portfolio is
considered tax exempt in their particular states.
Each sale, exchange, or redemption of the Portfolio's
shares is a taxable transaction to the shareholder.
ADDITIONAL INFORMATION ABOUT DOING BUSINESS WITH US ____________________________
Business Days
You may buy, sell or exchange shares on days on which the
New York Stock Exchange is open for business ("Business
Days"). However, shares of the Portfolio cannot be purchased
by Federal Reserve wire on Federal holidays restricting wire
transfers. All purchase, exchange and redemption requests
received in "good order" will be effective as of the
Business Day received by the Transfer Agent as long as the
Transfer Agent receives the
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<PAGE>
...............................................................................
[SYMBOL APPEARS HERE] BUY, EXCHANGE AND
SELL REQUESTS ARE IN
"GOOD ORDER" WHEN:
. The account number and portfolio name are shown
. The amount of the transaction is specified in dollars or shares
. Signatures of all owners appear exactly as they are registered on the
account
. Any required signature guarantees (if applicable) are included
. Other supporting legal documents (as necessary) are present
................................................................................
order and, in the case of a purchase request, payment before 2:00 p.m., Eastern
time. Otherwise the purchase will be effective when payment is received. Broker-
dealers may have separate arrangements with the Trust regarding the sale of
Class D shares.
If an exchange request is for shares of a portfolio whose net asset value
is calculated as of a time earlier than 2:00 p.m., Eastern time, the exchange
request will not be effective until the next Business Day. Anyone who wishes to
make an exchange must have received a current prospectus of the portfolio into
which the exchange is being made before the exchange will be effected.
Minimum The minimum initial investment in the Portfolio's Class D
Investments shares is $1,000; however, the minimum investment may be
waived at the Distributor's discretion. All subsequent
purchases must be at least $100 ($25 for payroll deductions
authorized pursuant to pre-approved payroll deduction plans).
The Trust reserves the right to reject a purchase order when
the Distributor determines that it is not in the best
interest of the Trust or its shareholders to accept such
order.
Maintaining a Due to the relatively high cost of handling small
Minimum investments, the Portfolio reserves the right to redeem, at
Account net asset value, the shares of any shareholder if, because of
Balance redemptions of shares by or on behalf of the shareholder, the
account of such shareholder in the Portfolio has a value of
less than $1,000, the minimum initial purchase amount.
Accordingly, an investor purchasing shares of the Portfolio
in only the minimum investment amount may be subject to such
involuntary redemption if he or she thereafter redeems any of
these shares. Before the Portfolio exercises its right to
redeem such shares and to send the proceeds to the
shareholder, the shareholder will be given notice that the
value of the shares in his or her account is less than the
minimum amount and will be allowed 60 days to make an
additional investment in that Portfolio in an amount that
will increase the value of the account to at least $1,000.
See "Purchase and Redemption of Shares" in the Statement of
Additional Information for examples of when the right of
redemption may be suspended.
At various times, the Portfolio may receive a request to
redeem shares for which it has not yet received good payment.
In such circumstances, redemption proceeds will be forwarded
upon collection of payment for the shares; collection of
payment may take 10 or more days. The Portfolio intends to
pay cash for all shares redeemed, but under abnormal
conditions that make payment in cash unwise, payment may be
made wholly or partly in portfolio securities with a market
value equal to the redemption price. In such cases, an
investor may incur brokerage costs in converting such
securities to cash.
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<PAGE>
Net Asset Value An order to buy shares will be executed at a per share price
equal to the net asset value next determined after the
receipt of the purchase order by the Transfer Agent (the
"offering price"). No certificates representing shares will
be issued. An order to sell shares will be executed at the
net asset value per share next determined after receipt and
effectiveness of a request for redemption in good order. Net
asset value per share is determined daily as of 2:00 p.m.,
Eastern time on any Business Day. Payment to shareholders
for shares redeemed will be made within 7 days after receipt
by the Transfer Agent of the redemption order.
How the Net The net asset value per share of the Portfolio is determined
Asset Value is by dividing the total market value of its investments and
Determined other assets, less any liabilities, by the total number of
outstanding shares of that Portfolio. Although the
methodology and procedures for determining net asset value
per share are identical for both classes of the Portfolio,
the net asset value per share of one class may differ from
that of another class because of the different distribution
fees charged to each class and the incremental transfer
agent fees charged to Class D shares.
Signature The Transfer Agent may require that the signatures on the
Guarantees written request be guaranteed. You should be able to obtain
a signature guarantee from a bank, broker, dealer, certain
credit unions, securities exchange or association, clearing
agency or savings association. Notaries public cannot
guarantee signatures. The signature guarantee requirement
will be waived if all of the following conditions apply: (1)
the redemption is for not more than $5,000 worth of shares,
(2) the redemption check is payable to the shareholder(s) of
record, and (3) the redemption check is mailed to the
shareholder(s) at his or her address of record. The Trust
and the Transfer Agent reserve the right to amend these
requirements without notice.
Telephone/Wire Redemption orders may be placed by telephone. Neither the
Instructions Trust nor the Transfer Agent will be responsible for any
loss, liability, cost or expense for acting upon wire
instructions or upon telephone instructions that it
reasonably believes to be genuine. The Trust and the
Transfer Agent will each employ reasonable procedures to
confirm that instructions communicated by telephone are
genuine, including requiring a form of personal
identification prior to acting upon instructions received by
telephone and recording telephone instructions. If market
conditions are extraordinarily active, or other
extraordinary circumstances exist, and you experience
difficulties placing redemption orders by telephone and may
wish to consider placing orders by other means.
Systematic Please note that if withdrawals exceed income dividends,
Withdrawal Plan your invested principal in the account will be depleted.
("SWP") Thus, depending upon the frequency and amounts of the
withdrawal payments and/or any fluctuations in the net asset
value per share, your original investment could be exhausted
entirely. To participate in the SWP, you must have your
dividends automatically reinvested. You may change or cancel
the SWP at any time, upon written notice to the Transfer
Agent.
17
<PAGE>
How to Close An account may be closed by providing written notice to the
your Account Transfer Agent. You may also close your account by telephone
if you have previously elected telephone options on your
account application.
GENERAL INFORMATION ____________________________________________________________
The Trust SEI Liquid Asset Trust (the "Trust") was organized as a
Massachusetts business trust under a Declaration of Trust
dated July 20, 1981. The Declaration of Trust permits the
Trust to offer separate portfolios of shares and different
classes of each portfolio. Shareholders may purchase shares
in Portfolios through two separate classes: Class A and
Class D, which provide for variation in distribution and
transfer agent costs, voting rights, dividends, and the
imposition of a sales charge on the Class D shares. This
Prospectus offers the Class D shares of the Trust's Treasury
Securities Portfolio. In addition to the Portfolio, the
Trust consists of the following portfolios: Government
Securities Portfolio, Institutional Cash Portfolio, Prime
Obligation Portfolio, and Money Market Portfolio. Additional
information pertaining to the Trust may be obtained by
writing to SEI Financial Management Corporation, 680 East
Swedesford Road, Wayne, Pennsylvania 19087-1658, or by
calling 1-800-437-6016. All consideration received by the
Trust for shares of any Portfolio or class and all assets of
such Portfolio or class belong to that Portfolio or class
and are subject to liabilities related thereto.
The Trust pays its expenses, including fees of its
service providers, audit and legal expenses, expenses of
preparing prospectuses, proxy solicitation material and
reports to shareholders, costs of custodial services and
registering the shares under federal and state securities
laws, pricing, insurance expenses, litigation and other
extraordinary expenses, brokerage costs, interest charges,
taxes and organization expenses.
Trustees of the The management and affairs of the Trust are supervised by
Trust the Trustees under the laws of the Commonwealth of
Massachusetts. The Trustees have approved contracts under
which, as described above, certain companies provide
essential management services to the Trust.
Voting Rights Each share held entitles the shareholder of record to one
vote. The shareholders of each portfolio or class of the
Trust will vote separately on matters relating solely to
that Portfolio or class. As a Massachusetts business trust,
the Trust is not required to hold annual meetings of
shareholders but approval will be sought for certain changes
in the operation of the Trust and for the election of
Trustees under certain circumstances. In addition, a Trustee
may be removed by the remaining Trustees or by shareholders
at a special meeting called upon written request of
shareholders owning at least 10% of the outstanding shares
of the Trust. In the event that such a meeting is requested,
the Trust will provide appropriate assistance and
information to the shareholders requesting the meeting.
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<PAGE>
Reporting
The Trust issues unaudited financial statements semi-
annually and audited financial statements annually. The
Trust furnishes proxy statements and other reports to
shareholders of record.
Shareholder
Inquiries Shareholder inquiries should be directed to DST Systems,
Inc., P.O. Box 419240, Kansas City, MO 64141-6240.
Dividends
The dividends of Class D shares will normally be lower than
on Class A shares of the Portfolio because of the additional
distribution and transfer agent expenses charged to Class D
shares. Substantially all of the net investment income
(exclusive of capital gains) of the Portfolio is distributed
in the form of dividends that will be declared daily and
paid monthly on the first Business Day of each month.
Currently, capital gains (the excess of net long-term
capital gain over net short-term capital loss) realized, if
any, are distributed at least annually.
Shareholders in the Portfolio automatically receive all
income dividends and capital gain distributions in
additional shares at the net asset value next determined
following the record date, unless the shareholder has
elected to take such payment in cash. Shareholders may
change their election by providing written notice to the
Manager at least 15 days prior to the distribution.
Dividends and distributions of the Portfolio are paid by
the Portfolio on a per-share basis. The value of each share
will be reduced by the amount of any such payment. If shares
are purchased shortly before the record date for a dividend
or the distribution of capital gains, a shareholder will pay
the full price for the shares and receive some portion of
the price back as a taxable dividend or distribution.
Counsel and Morgan, Lewis & Bockius LLP serves as counsel to the Trust.
Independent Price Waterhouse LLP serves as the independent accountants
Accountants to the Trust.
Custodian and CoreStates Bank, N.A., Broad and Chestnut Streets, P.O. Box
Wire Agent 7618, Philadelphia, Pennsylvania 19101 (the "Custodian"),
serves as custodian of the Trust's assets and as wire agent
of the Trust. The Custodian holds cash, securities and other
assets of the Trust as required by the 1940 Act.
DESCRIPTION OF PERMITTED INVESTMENTS AND RISK FACTORS __________________________
The following is a description of certain of the permitted
investments for the Portfolio, and the associated risk
factors:
Repurchase Repurchase agreements are agreements by which a Portfolio
Agreements obtains a security and simultaneously commits to return the
security to the seller at an agreed upon price on an agreed
upon date. The custodian will hold the security as
collateral for the repurchase agreement. The Portfolio bears
a risk of loss in the event the other party defaults on its
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<PAGE>
obligations and the Portfolio is delayed or prevented from
exercising its right to dispose of the collateral or if the
Portfolio realizes a loss on the sale of the collateral. The
Portfolio will enter into repurchase agreements only with
financial institutions deemed to present minimal risk of
bankruptcy during the term of the agreement based on
established guidelines. Repurchase agreements are considered
loans under the 1940 Act.
U.S. Treasury U.S. Treasury Obligations consist of bills, notes and bonds
Obligations issued by the U.S. Treasury and separately traded interest
and principal component parts of such obligations that are
transferable through the federal book-entry system known as
Separately Traded Registered Interest and Principal
Securities ("STRIPS").
STRIPS are sold as zero coupon securities which means that
they are sold at a substantial discount and redeemed at face
value at their maturity date without interim cash payments
of interest or principal. This discount is accreted over the
life of the security, and such accretion will constitute the
income earned on the security for both accounting and tax
purposes. Because of these features, such securities may be
subject to greater interest rate volatility than interest
paying permitted investments. See also "Taxes."
When-Issued and When-issued or delayed delivery transactions involve the
Delayed purchase of an instrument with payment and delivery taking
Delivery place in the future. Delivery of and payment for these
Securities securities may occur a month or more after the date of the
purchase commitment. The Portfolio will maintain with the
custodian a separate account, with liquid, high grade debt
securities or cash in an amount at least equal to these
commitments. The interest rate realized on these securities
is fixed as of the purchase date and no interest accrues to
the Portfolio before settlement. These securities are
subject to market fluctuation due to changes in market
interest rates, and it is possible that the market value at
the time of settlement could be higher or lower than the
purchase price if the general level of interest rates has
changed. Although the Portfolio generally purchases
securities on a when-issued or forward commitment basis with
the intention of actually acquiring securities, the
Portfolio may dispose of a when-issued security or forward
commitment prior to settlement if the Adviser deems it
appropriate to do so.
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<PAGE>
SEI Liquid Asset Trust
Manager and Shareholder Servicing Agent:
SEI Financial Management Corporation
Distributor:
SEI Financial Services Company
Investment Adviser:
Wellington Management Company
This Statement of Additional Information is not a Prospectus. It is intended to
provide additional information regarding the activities and operations of SEI
Liquid Asset Trust (the "Trust") and should be read in conjunction with the
Trust's Class A and Class D Prospectuses, each of which is dated October 30,
1995. Prospectuses may be obtained upon request and without charge by writing
the Trust's distributor, SEI Financial Services Company, 680 East Swedesford
Road, Wayne, Pennsylvania 19087-1658, or by calling 1-800-342-5734.
TABLE OF CONTENTS
<TABLE>
<S> <C>
The Trust......................................................... S-2
Description of Permitted Investments.............................. S-2
Commercial Paper Ratings.......................................... S-2
The Manager and Shareholder Servicing Agent....................... S-7
The Adviser....................................................... S-8
Distribution...................................................... S-9
Trustees and Officers of the Trust................................ S-10
Fundamental Investment Limitations................................ S-13
Performance....................................................... S-16
Determination of Net Asset Value.................................. S-17
Purchase and Redemption of Shares................................. S-18
Shareholder Services (Class D Shares)............................. S-19
Taxes............................................................. S-20
Portfolio Transactions............................................ S-22
Description of Shares............................................. S-23
Limitation of Trustees' Liability................................ S-23
Shareholder Liability............................................ S-23
5% Shareholders.................................................. S-24
Experts.......................................................... S-26
Financial Information............................................ S-27
</TABLE>
October 30, 1995
SEI-F-044-06
<PAGE>
THE TRUST
SEI Liquid Asset Trust (the "Trust") is a diversified, open-end management
investment company established as a Massachusetts business trust pursuant to a
Declaration of Trust dated July 20, 1981. The Declaration of Trust permits the
Trust to offer separate series ("portfolios") of units of beneficial interest
("shares") and separate classes of portfolios. Except for differences between
Class A and Class D shares pertaining to distribution plans, voting rights,
dividends and transfer agent expenses, each share of each portfolio represents
an equal proportionate interest in that portfolio with each other share of that
portfolio.
This Statement of Additional Information relates to the shares of the following
Portfolios: Treasury Securities, Government Securities, Prime Obligation,
Institutional Cash and Money Market Portfolios (each a "Portfolio" and,
together, the "Portfolios"), and any classes of the Portfolios.
DESCRIPTION OF PERMITTED INVESTMENTS
COMMERCIAL PAPER -- The Prime Obligation and Money Market Portfolios may invest
in commercial paper. Commercial paper is the term used to designate unsecured,
short-term promissory notes issued by corporations and other entities.
COMMERCIAL PAPER RATINGS
The following descriptions of commercial paper ratings have been published by
Standard & Poor's Corporation ("S&P"), Moody's Investors Service, Inc.
("Moody's"), Fitch Investors Service, Inc. ("Fitch"), Duff & Phelps, Inc.
("Duff"), Thomson BankWatch ("Thomson") and IBCA Limited and IBCA, Inc.
(together, "IBCA").
Commercial paper rated A by S&P is regarded by S&P as having the greatest
capacity for timely payment. Issues rated A are further refined by use of the
numbers 1+, 1 and 2 to indicate the relative degree of safety. Issues rated
A-1+ are those with an "overwhelming degree" of credit protection. Those rated
A-1, the highest rating category, reflect a "very strong" degree of safety
regarding timely payment. Those rated A-2, the second highest rating category,
reflect a safety regarding timely payment, but not as high as A-1.
Moody's employs two designations, judged to be high grade commercial paper, to
indicate the relative repayment capacity of rated issuers as follows:
Prime-1 Superior Quality
Prime-2 Strong Quality
The rating Fitch-1 (Highest Grade) is the highest commercial paper rating
assigned by Fitch. Paper rated Fitch-1 is regarded as having the strongest
degree of assurance for timely payment. The rating Fitch-2 (Very Good Grade) is
the second highest commercial paper rating assigned by Fitch which reflects an
assurance of timely payment only slightly lower in degree than the strongest
issues.
The rating Duff-1 is the highest commercial paper rating assigned by Duff.
Paper rated Duff-1 is regarded as having very high certainty of timely payment
with excellent liquidity factors which are supported by ample asset protection.
Risk factors are minor. Paper rated Duff-2, the second highest rating category,
is regarded as having good certainty of timely payment, good access to capital
markets and sound liquidity factors and company fundamentals. Risk factors are
small.
The rating TBW-1 is the highest commercial paper rating assigned by Thomson.
Paper rated TBW-1 indicates a very high likelihood that principal and interest
will be paid on a timely basis. The rating TBW-2 is the second-highest rating
assigned category by Thomson. The relative degree of safety regarding timely
repayment of principal and interest is strong. However, the relative degree of
safety is not as high as for issues rated TBW-1.
S-3
<PAGE>
The designation A1, the highest rating category established by IBCA, indicates
that the obligation is supported by a very strong capacity for timely repayment.
Those obligations rated A1+ are supported by the highest capacity for timely
repayment. Obligations rated A2, the second highest rating category, are
supported by a strong capacity for timely repayment, although such capacity may
be susceptible to adverse changes in business, economic or financial conditions.
DESCRIPTION OF MUNICIPAL AND CORPORATE BOND RATINGS -- Bonds rated AAA have the
highest rating S&P assigns to a debt obligation. Such a rating indicates an
extremely strong capacity to pay principal and interest. Bonds rate AA also
qualify as high-quality debt obligations. Capacity to pay principal and
interest is very strong, and in the majority of instances, they differ from AAA
issues only in small degree.
Bonds which are rated Aaa by Moody's are judged to be the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt edge." Interest payments are protected by a large, or an exceptionally
stable, margin and principal is secure. While the various protective elements
are likely to change, such changes as can be visualized are most unlikely to
impair the fundamentally strong position of such issues. Bonds rated Aa are
judged by Moody's to be of high quality by all standards. Together with bonds
rated Aaa, they comprise what are generally known as high-grade bonds. They are
rated lower than the best bonds because margins of protection may not be as
large as in Aaa securities or fluctuation of protective elements may be of
greater amplitude or there may be other elements present which make the long-
term risks appear somewhat larger than in Aaa securities.
Bonds rated AAA are judged by Fitch to be strictly high grade, broadly
marketable, suitable for investment by trustees and fiduciary institutions
liable to but slight market fluctuation other than through changes in the money
rate. The prime feature of an AAA bond is a showing of earnings
several times or many times interest requirements, with such stability of
applicable earnings that safety is beyond reasonable question whatever changes
occur in conditions. Bonds rated AA are judged by Fitch to be of safety
virtually beyond question and are readily salable, whose merits are not unlike
those of the AAA class, but whose margin of safety is less strikingly broad.
The issue may be the obligation of a small company, strongly secured but
influenced as to rating by the lesser financial power of the enterprise and more
local type market.
Bonds rated Duff-1 are judged by Duff to be of the highest credit quality with
negligible risk factors; only slightly more than U.S. Treasury debt. Bonds
rated Duff-2, are judged by Duff to be of high credit quality with strong
protection factors. Risk is modest but may vary slightly from time to time
because of economic conditions.
Bonds which are rated AAA are judged by Thomson to be of the highest category.
The ability to repay principal and interest on a timely basis is very high.
Bonds rated AA are judged by Thomson to be of a superior ability to repay
principal and interest on a timely basis, with limited incremental risk compared
to issues rated in the highest category.
Obligations rated AAA by IBCA have the lowest expectation of investment risk.
Capacity for timely repayment of principal and interest is substantial, such
that adverse changes in business, economic or financial conditions are unlikely
to increase investment risk significantly. Obligations for which there is a
very low expectation of investment risk are rated AA by IBCA. Capacity for
timely repayment of principal and interest is substantial. Adverse changes in
business, economic or financial conditions may increase investment risk albeit
not very significantly.
FOREIGN SECURITIES -- The Money Market Portfolio may invest U.S. dollar
denominated obligations of foreign branches of U.S. commercial banks and of U.S.
and London branches of foreign banks. These instruments may subject the
Portfolio to investment risks that differ in some respects from those related to
investments in obligations of U.S. domestic issuers. Such risks include future
adverse political and economic developments, the possible imposition of
withholding taxes on interest or other income, possible seizure,
nationalization, or expropriation of foreign deposits, the possible
establishment of exchange controls or taxation at the source, greater
fluctuations in value due to changes in exchange rates, or the adoption of other
foreign governmental restrictions which might adversely affect the payment of
principal and interest on such obligations. Such investments may also entail
higher custodial fees and sales commissions than domestic investments. Foreign
issuers of securities or obligations are often subject to accounting treatment
and engage in business practices different from those respecting domestic
issuers of similar securities or obligations. Foreign
S-4
<PAGE>
branches of U.S. banks and foreign banks may be subject to less stringent
reserve requirements than those applicable to domestic branches of U.S. banks.
GNMA SECURITIES -- The Prime Obligation, Money Market and Government Securities
Portfolios may invest in securities issued by the Government National Mortgage
Association ("GNMA"), a wholly-owned U.S. Government Securities corporation
which guarantees the timely payment of principal and interest. However, any
premiums paid to purchase these instruments are not subject to GNMA guarantees.
The market value and interest yield of these instruments can vary due to market
interest rate fluctuations and early prepayments of underlying mortgages.
These securities represent ownership in a pool of Federally insured mortgage
loans. GNMA certificates consist of underlying mortgages with a maximum
maturity of 30 years. However, due to scheduled and unscheduled principal
payments, GNMA certificates have a shorter average maturity and, therefore, less
principal volatility than a comparable 30-year mortgage-backed bond. Since
prepayment rates vary widely, it is not possible to accurately predict the
average maturity of a particular GNMA pool. The scheduled monthly interest and
principal payments relating to mortgages in the pool will be "passed through" to
investors. GNMA securities differ from conventional bonds in that principal is
paid back to the certificate holders over the life of the loan rather than at
maturity. As a result, the Portfolios will receive monthly scheduled payments of
principal and interest. In addition, the Portfolios may receive unscheduled
principal payments representing prepayments on the underlying mortgages. Any
prepayments will be reinvested at the then prevailing interest rate.
Although GNMA certificates may offer yields higher than those available from
other types of U.S. Government Securities, GNMA certificates may be less
effective than other types of securities as a means of "locking in" attractive
long-term rates because of the prepayment feature. Due to this prepayment
feature, GNMA certificates tend not to increase in value as much as most other
debt securities when interest rates decline.
REPURCHASE AGREEMENTS -- The Treasury Securities, Government Securities, Prime
Obligation, and Money Market Portfolios may enter into repurchase agreements,
which are agreements under which securities are acquired from a securities
dealer or bank subject to resale on an agreed upon date and at an agreed upon
price which includes principal and interest. The Portfolio involved bears a risk
of loss in the event that the other party to a repurchase agreement defaults on
its obligations and the Portfolio is delayed or prevented from exercising its
rights to dispose of the securities held as collateral. Wellington Management
Company ("WMC" or the "Adviser") enters into repurchase agreements only with
financial institutions which it deems to present minimal risk of bankruptcy
during the term of the agreement based on guidelines established by and
periodically reviewed by the Board of Trustees. These guidelines currently
permit the Portfolios to enter into repurchase agreements only with approved
banks and primary securities dealers, as recognized by the Federal Reserve Bank
of New York, which have minimum net capital of $100 million, or with a member
bank of the Federal Reserve System. Repurchase agreements are considered to be
loans collateralized by the underlying security. Repurchase agreements entered
into by the Portfolios will provide that the underlying security at all times
shall have a value at least equal to 102% of the price stated in the agreement.
This underlying security will be marked to market daily. The Adviser monitors
compliance with this requirement. Under all repurchase agreements entered into
by the Portfolios, CoreStates Bank, N.A. (the "Custodian") or its agent must
take possession of the underlying collateral. However, if the seller defaults,
the Portfolios could realize a loss on the sale of the underlying security to
the extent the proceeds of the sale are less than the resale price. In
addition, even though the Bankruptcy Code provides protection for most
repurchase agreements, if the seller should be involved in bankruptcy or
insolvency proceedings, the Portfolios may incur delay and costs in selling the
security and may suffer a loss of principal and interest if the Portfolios are
treated as an unsecured creditor.
U.S. GOVERNMENT AGENCY OBLIGATIONS -- The Government Securities, Prime
Obligation, and Money Market Portfolios may invest in agencies of the United
States Government which consist of obligations issued by, among others, the
Export Import Bank of the United States, Farmers Home Administration, Federal
Farm Credit Bank, Federal Housing Administration, Government National Mortgage
Association, Maritime Administration, Small Business Administration, and The
Tennessee Valley Authority. The Government Securities, Prime Obligation, and
Money Market Portfolios may purchase securities guaranteed by the Government
National Mortgage Association, which represent participation in Veterans
Administration and Federal Housing Administration backed mortgage pools.
Obligations of
S-5
<PAGE>
instrumentalities of the United States Government include securities issued by,
among others, Federal Home Loan Banks, Federal Home Loan Mortgage Corporation,
Federal Intermediate Credit Banks, Federal Land Banks, Federal National Mortgage
Association and the United States Postal Service. Some of these securities are
supported by the full faith and credit of the United States Treasury (e.g.,
Government National Mortgage Association), others are supported by the right of
the issuer to borrow from the Treasury, and still others are supported only by
the credit of the instrumentality (e.g., Federal National Mortgage Association).
Guarantees of principal by agencies or instrumentalities of the U.S. Government
may be a guarantee of payment at the maturity of the obligation so that in the
event of a default prior to maturity there might not be a market and thus no
means of realizing the value of the obligation prior to maturity. The Portfolios
do not intend to purchase securities issued by the World Bank, the Inter-
American Development Bank or the Asian Development Bank.
VARIABLE OR FLOATING RATE INSTRUMENTS -- Each Portfolio may invest in variable
or floating rate instruments, which may involve a demand feature and may include
variable amount master demand notes which may or may not be backed by bank
letters of credit. Variable or floating rate instruments bear interest at a
rate which varies with changes in market rates. The holder of an instrument
with a demand feature may tender the instrument back to the issuer at par prior
to maturity. A variable amount master demand note is issued pursuant to a
written agreement between the issuer and the holder, its amount may be increased
by the holder or decreased by the holder or issuer, it is payable on demand, and
the rate of interest varies based upon an agreed formula. The quality of the
underlying credit must, in the opinion of the Adviser, be equivalent to the
quality ratings applicable to permitted investments for each Portfolio. The
Adviser will monitor on an ongoing basis the earning power, cash flow, and
liquidity ratios of the issuers of such instruments and will similarly monitor
the ability of an issuer of a demand instrument to pay principal and interest on
demand.
THE MANAGER AND SHAREHOLDER SERVICING AGENT
The Management Agreement, dated October 31, 1986, provides that SEI Financial
Management Corporation (the "Manager") shall not be liable for any error of
judgment or mistake of law or for any loss suffered by the Trust in connection
with the matters to which the Management Agreement relates, except a loss
resulting from willful misfeasance, bad faith or gross negligence on the part of
the Manager in the performance of its duties or from reckless disregard of its
duties and obligations thereunder.
The Management Agreement, unless terminated sooner as provided therein, shall
remain in effect for two years after the date of the Agreement and shall
continue in effect for successive periods of one year if such continuance is
specifically approved at least annually (i) by the Trustees of the Trust and
(ii) by the vote of a majority of the Trustees of the Trust who are not parties
to the Management Agreement or interested persons (as that term is defined in
the Investment Company Act of 1940, as amended (the "1940 Act")) of any such
party, cast in person at a Board of Trustees meeting called for the purpose of
voting on such approval. The Agreement may be terminated at any time and
without penalty by the Trustees of the Trust or by the Manager on not less than
30 days' nor more than 60 days' written notice to the other party thereto. Any
notice under the Management Agreement shall be given in writing, addressed and
delivered, or mailed postpaid, to the other party at the designated mailing
address of such party.
The Manager, a wholly-owned subsidiary of SEI Corporation ("SEI"), was organized
as a Delaware corporation in 1969, and has its principal business offices at 680
East Swedesford Road, Wayne, Pennsylvania 19087-1658. Alfred P. West, Jr.,
Henry H. Greer and Carmen V. Romeo constitute the Board of Directors of the
Manager. Mr. West serves as the Chairman of the Board of Directors, President
and Chief Executive Officer of SEI. Mr. Greer serves as Director, President and
Chief Operating Officer of SEI. SEI and its subsidiaries are leading providers
of funds evaluation services, trust accounting systems, and brokerage and
information services to financial institutions, institutional investors and
money managers. The Manager also serves as manager/administrator to these other
mutual funds: SEI Daily Income Trust; SEI Tax Exempt Trust; SEI Index Funds; SEI
Institutional Managed Trust; SEI International Trust; Stepstone Funds; The
Compass Capital Group; FFB Lexicon Funds; The Advisors' Inner Circle Fund; The
Pillar Funds; CUFUND; STI Classic Funds; CoreFunds, Inc.; First American Funds,
Inc.; First American Investment Funds, Inc.; Rembrandt Funds(R); The Arbor Fund;
1784 Funds; The PBHG Funds, Inc.; Marquis(SM) Funds;
S-6
<PAGE>
Morgan Grenfell Investment Trust; Inventor Funds; Insurance Investment Products
Trust; Bishop Street Funds; Conestoga Family of Funds; The Achievement Funds
Trust; CrestFunds, Inc.(C); and STI Classic Variable Trust.
The Manager has agreed contractually to waive its fee in order to limit
operating expenses of the Portfolios to not more than .44% of average net assets
of the Class A shares and .84% of average net assets of the Class D shares. As
to the Institutional Cash Portfolio only, this waiver is voluntary and may be
terminated at any time. Shareholders will be notified in advance if and when the
waiver is terminated. The Manager will not be required to bear expenses of any
Portfolio to an extent which would result in the Portfolio's inability to
qualify as a regulated investment company under provisions of the Internal
Revenue Code of 1986, as amended (the "Code"). The term "expenses" is defined in
such laws or regulations, and generally excludes brokerage commissions,
distribution expenses, taxes, interest, litigation and extraordinary expenses.
For the fiscal years ended June 30, 1993, 1994 and 1995, the Portfolios paid
fees to the Manager as follows:
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
Management Fees Paid Management Fees Waived
--------------------------------------------------------------------------------
1993 1994 1995 1993 1994 1995
<S> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------
Treasury Securities $9,581,000 $7,482,000 $4,160,873.22 $1,353,000 $1,252,000 $1,226,700.66
Portfolio
- ------------------------------------------------------------------------------------------------------
Prime Obligation $6,308,000 $4,330,000 $3,352,356.97 $ 890,000 $ 763,000 $ 884,036.50
Portfolio
- ------------------------------------------------------------------------------------------------------
Government $1,997,000 $1,505,000 $ 794,731.78 $ 278,000 $ 264,000 $ 221,071.85
Securities Portfolio
- ------------------------------------------------------------------------------------------------------
Institutional Cash $ 14,000 $ 10,000 $ 7,878.60 $ 0 $ 0 $ 0
Portfolio
- ------------------------------------------------------------------------------------------------------
Money Market * * * * * *
Portfolio
======================================================================================================
</TABLE>
* Not in operation during such period.
THE ADVISER
The Trust and Wellington Management Company ("WMC") have entered into an
investment advisory agreement (the "Advisory Agreement") dated October 30, 1985.
The Advisory Agreement provides that the Adviser shall not be protected against
any liability to the Trust or its shareholders by reason of willful misfeasance,
bad faith or gross negligence on its part in the performance of its duties or
from reckless disregard of its obligations or duties thereunder.
The continuance of the Advisory Agreement after the first two (2) years of the
Agreement must be specifically approved at least annually (i) by the vote of a
majority of the outstanding shares of that Portfolio or by the Trustees, and
(ii) by the vote of a majority of the Trustees who are not parties to the
Advisory Agreement or "interested persons" of any party thereto, cast in person
at a meeting called for the purpose of voting on such approval. The Advisory
Agreement will terminate automatically in the event of its assignment, and is
terminable at any time without penalty by the Trustees of the Trust or, with
respect to a Portfolio, by a majority of the outstanding shares of that
Portfolio, on not less than 30 days' nor more than 60 days' written notice to
the Adviser, or by the Adviser on 90 days' written notice to the Trust.
S-7
<PAGE>
WMC, Adviser to the Portfolios, is entitled to a fee for its investment advisory
services, which is calculated daily and paid monthly at the following annual
rates: .075% of the Trust's daily net assets up to $500 million, and .02% of
the Trust's daily net assets in excess of $500 million. The fee is allocated
among the Portfolios based upon their relative net assets.
For the fiscal years ended June 30, 1993, 1994 and 1995 the Portfolios paid WMC
advisory fees as follows:
<TABLE>
<CAPTION>
====================================================================
Advisory Fees Paid
--------------------------------
1993 1994 1995
<S> <C> <C> <C>
- --------------------------------------------------------------------
Treasury Securities Portfolio $603,000 $514,000 $395,983.29
- --------------------------------------------------------------------
Prime Obligation Portfolio $397,000 $299,000 $311,042.13
- --------------------------------------------------------------------
Government Securities Portfolio $126,000 $103,000 $ 74,686.68
- --------------------------------------------------------------------
Institutional Cash Portfolio $ 1,000 $ 0 $ 0
- --------------------------------------------------------------------
Money Market Portfolio * * *
====================================================================
</TABLE>
* Not in operation during such period.
DISTRIBUTION
The Trust has adopted a Distribution Agreement for the Portfolios dated November
29, 1982. The Trust has also adopted a Class A Distribution Plan (the "Class A
Plan") and a Class D Distribution Plan (the "Class D Plan" and, together with
the Class A Plan, the "Plans") for the Portfolios in accordance with Rule 12b-1
under the 1940 Act, which regulates the circumstances under which an investment
company may directly or indirectly bear expenses relating to the distribution of
its shares. In this regard, the Board of Trustees has determined that the Plans
and the Distribution Agreement are in the best interests of the Shareholders.
Continuance of the Plans must be approved annually by a majority of the Trustees
of the Trust, and by a majority of the trustees who are not "interested persons"
of the Trust as that term is defined in the 1940 Act, and who have no direct or
indirect financial interest in the operation of a Distribution Plan or in any
agreements related thereto ("Qualified Trustees"). The Plans require that
quarterly written reports of amounts spent under the Plans and the purposes of
such expenditures be furnished to and reviewed by the Trustees. The Plans may
not be amended to increase materially the amount which may be spent thereunder
without approval by a majority of the outstanding shares of the Portfolio
affected. All material amendments of the Plans will require approval by a
majority of the Trustees of the Trust and of the Qualified Trustees.
For the fiscal year ended June 30, 1995, the Portfolios incurred the following
distribution expenses:
<TABLE>
<CAPTION>
====================================================================================================================================
Portfolio/Class Total Basis Amount Paid Sales Advertising Prospectus Costs Other
($Amount) Points to 3rd Expenses ($ Amount) Printing & Associated
Parties by ($ Amount) Mailing Costs with
SFS for (New Registration
Distributor Shareholders Fees
Related Only ($ Amount)
Services ($ Amount)
($ Amount)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Class A
- ------------------------------------------------------------------------------------------------------------------------------------
Treasury $570,122.85 .04% $0 $570,122.85 $0 $0 $0 $0
Securities
- ------------------------------------------------------------------------------------------------------------------------------------
Government $106,233.11 .04% $0 $106,233.11 $0 $0 $0 $0
Securities
- ------------------------------------------------------------------------------------------------------------------------------------
Prime $435,935.89 .04% $0 $435.935.89 $0 $0 $0 $0
Obligation
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
S-8
<PAGE>
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Institutional $ 0 0% $0 $ 0 $0 $0 $0 $0
Cash
- ------------------------------------------------------------------------------------------------------------------------------------
Money Market * * * * * * * *
- ------------------------------------------------------------------------------------------------------------------------------------
Class D
- ------------------------------------------------------------------------------------------------------------------------------------
Treasury $ 10,981.35 .20% $0 $ 10,981.35 $0 $0 $0 $0
Securities
====================================================================================================================================
</TABLE>
* Not in operation during such period.
TRUSTEES AND OFFICERS OF THE TRUST
The Trustees and Executive Officers of the Trust and their principal occupations
for the last five years are set forth below. Each may have held other positions
with the named companies during that period. Unless otherwise noted, the
business address of each Trustee and Executive Officer is SEI Financial
Management Corporation, 680 East Swedesford Road, Wayne, Pennsylvania 19087-
1658. Certain officers of the Trust also serve as trustees and/or officers of
SEI Daily Income Trust, SEI Institutional Managed Trust, SEI Tax Exempt Trust,
SEI Index Funds, SEI International Trust, Stepstone Funds, The Compass Capital
Group, FFB Lexicon Funds, The Advisors' Inner Circle Fund, The Pillar Funds,
CUFUND, STI Classic Funds, CoreFunds, Inc., First American Funds, Inc., First
American Investment Funds, Inc., Rembrandt Funds(R), The Arbor Fund, 1784 Funds,
The PBHG Funds, Inc., Bishop Street Funds, Conestoga Family of Funds, Insurance
Investment Products Trust, Marquis/sm/ Funds, Morgan Grenfell Investment Trust,
The Achievement Funds Trust, CrestFunds, Inc., STI Classic Variable Trust, and
Inventor Funds, open-end management investment companies which are managed by
SEI Financial Management Corporation and/or distributed by SEI Financial
Services Company.
ROBERT A. NESHER - Chairman of the Board of Trustees* - Retired since 1994.
Executive Officer - Executive Vice President of SEI 1986-1994. Director and
Executive Vice President of the Manager and Executive Vice President of the
Distributor 1981-1994.
RICHARD F. BLANCHARD - Trustee** - P.O. Box 76, Canfield Road, Convent Station,
NJ 07961. Private Investor. Director of AEA Investors Inc. (acquisition and
investment firm) June 1981-86, Director of Baker Hughes Corp. (oil service
company) 1976-88. Director of Imperial Clevite Industries (transportation
equipment company) 1981-87. Executive Vice President of American Express
Company (financial services company), responsible for the investment function,
before June 1981.
WILLIAM M. DORAN - Trustee* - 2000 One Logan Square, Philadelphia, PA 19103.
Partner of Morgan, Lewis & Bockius LLP, counsel to the Trust, Manager and
Distributor, Director and Secretary of SEI and Secretary of the Manager and
Distributor.
F. WENDELL GOOCH - Trustee** - P.O. Box 190, Paoli, IN 47454. President, Orange
County Publishing Co., Inc., since October 1981. Publisher of the Paoli News
and the Paoli Republican and Editor of the Paoli Republican since January 1981,
President, H & W Distribution, Inc. since July 1984. Executive Vice President,
Trust Department, Harris Trust and Savings Bank and Chairman of the Board of
Directors of The Harris Trust Company of Arizona before January 1981.
FRANK E. MORRIS - Trustee** - 105 Walpole Street, Dover, MA 02030. Retired
since 1990. Peter Drucker Professor of Management, Boston College, 1989-1990.
President, Federal Reserve Bank of Boston, 1968-1988.
JAMES M. STOREY - Trustee** - Ten Post Office Square, Boston, MA 02109.
Partner, Dechert Price & Rhodes (law firm).
DAVID G. LEE - President, Chief Executive Officer - Senior Vice President of the
Manager and Distributor since 1993. Vice President of the Manager and
Distributor 1991-1993. President, GW Sierra Trust Funds before 1991.
S-9
<PAGE>
CARMEN V. ROMEO - Treasurer, Assistant Secretary - Director, Executive Vice
President, Chief Financial Officer and Treasurer of SEI since 1977. Director
and Treasurer of the Manager and Distributor since 1981.
SANDRA K. ORLOW - Vice President, Assistant Secretary - Vice President and
Assistant Secretary of the Manager and Distributor since 1988. Corporate Legal
Assistant, Omni Exploration (oil and gas investment) prior to 1983.
ROBERT B. CARROLL - Vice President, Assistant Secretary - Vice President,
Assistant Secretary of SEI Corporation, the Manager and Distributor since 1994.
United States Securities and Exchange Commission, Division of Investment
Management, 1990-1994. Associate, McGuire, Woods, Battle & Boothe (law firm)
prior to 1990.
TODD CIPPERMAN - Vice President, Assistant Secretary - Vice President, Assistant
Secretary of SEI, the Administrator and Distributor since May, 1995, Associate,
Dewey Ballantine (law firm) 1994-1995, Associate, Winston & Strawn (law firm)
1991-1995.
JOSEPH LYDON - Vice President, Assistant Secretary - Director of Business
Administration, SEI Corporation since April, 1995; Vice President of Fund Group,
Vice President of the Advisor -Dreman Value Management, LP, President of Dreman
Financial Services, Inc. from 1989 to 1995.
KATHRYN L. STANTON - Vice President, Assistant Secretary - Vice President,
Assistant Secretary of SEI Corporation, the Manager and Distributor since 1994;
Associate, Morgan, Lewis & Bockius LLP (law firm), 1989 to 1994.
KEVIN P. ROBINS - Vice President, Assistant Secretary - Senior Vice President
and General Counsel of SEI and the Distributor since 1994. Vice President and
Assistant Secretary of the Manager and Distributor 1992-1994. Associate,
Morgan, Lewis & Bockius LLP (law firm) prior to 1992.
JEFFREY A. COHEN - Controller, Assistant Secretary - SEI Corporation, 1991 to
present. Senior Accountant, Price Waterhouse, 1988 to 1991.
RICHARD W. GRANT - Secretary - 2000 One Logan Square, Philadelphia, PA 19103.
Partner, Morgan, Lewis & Bockius LLP, counsel to the Trust, Manager and
Distributor.
JOHN H. GRADY, JR. - Assistant Secretary - 1800 M Street, N.W., Washington,
D.C., 20036, Partner, since 1995 and Associate, 1993-1995, Morgan, Lewis &
Bockius LLP, counsel to the Trust, Manager and Distributor; Associate, Ropes &
Gray, 1988 to 1993.
- ----------------------------------------
*Messrs. Nesher and Doran are Trustees who may be deemed to be "interested
persons" of the Trust as the term is defined in the 1940 Act.
**Messrs. Blanchard, Gooch, Storey and Morris serve as members of the Audit
Committee of the Trust.
The Trustees and officers of the Trust own less than 1% of the outstanding
shares of the Trust. The Trust pays the fees for unaffiliated Trustees.
Compensation of officers and affiliated Trustees of the Trust is paid by the
Manager.
The following table sets forth information about the compensation paid to the
Trustees for the fiscal year ended June 30, 1995:
S-10
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Pension or
Aggregate Retirement Total Compensation From
Compensation Benefits Accrued Estimated Annual Registrant and Fund
From Registrant as Part of Fund Benefits Upon Complex Paid to Directors
Name of Person and Position for FYE 6/30/95 Expenses Retirement for FYE 6/30/95
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Robert A. Nesher, Trustee* N/A N/A N/A N/A
- ------------------------------------------------------------------------------------------------------------------------------------
Edward W. Binshadler, $ 37,500 N/A N/A $37,500 for services on 7
Trustee** boards
- ------------------------------------------------------------------------------------------------------------------------------------
Richard F. Blanchard, $ 82,500 N/A N/A $82,500 for services on 7
Trustee boards
- ------------------------------------------------------------------------------------------------------------------------------------
William M. Doran, Trustee* N/A N/A N/A N/A
- -----------------------------------------------------------------------------------------------------------------------------------
F. Wendell Gooch, Trustee $ 90,625 N/A N/A $90,625 for services on 7
boards
- ------------------------------------------------------------------------------------------------------------------------------------
Frank E. Morris, Trustee $112,000 N/A N/A $112,000 for services on 7
boards
- ------------------------------------------------------------------------------------------------------------------------------------
James M. Storey, Trustee $112,000 N/A N/A $112,000 for services on 7
boards
====================================================================================================================================
</TABLE>
*Messrs. Nesher and Doran are Trustees who may be deemed to be "interested
persons" of the Trust as the term is defined in the 1940 Act.
**Retired as of December, 1994.
FUNDAMENTAL INVESTMENT LIMITATIONS
The following investment limitations are fundamental policies of each Portfolio
which cannot be changed with respect to a Portfolio without the consent of the
holders of a majority of that Portfolio's outstanding shares. The term
"majority of outstanding shares" means the vote of (i) 67% or more of a
Portfolio's shares present at a meeting, if not more than 50% of the outstanding
shares of a Portfolio are present or represented by proxy, or (ii) more than 50%
of a Portfolio's outstanding shares, whichever is less.
No Portfolio may:
1. Borrow money except for temporary or emergency purposes and then only in an
amount not exceeding 10% of the value of the total assets of that
Portfolio. This borrowing provision is included solely to facilitate the
orderly sale of portfolio securities to accommodate substantial redemption
requests if they should occur and is not for investment purposes. All
borrowings by a Portfolio will be repaid before making
additional investments for that Portfolio and any interest on such
borrowings will reduce the income of that Portfolio.
2. Make loans, except that any Portfolio may purchase or hold debt instruments
in accordance with its investment objective and policies and may enter into
repurchase agreements, provided that repurchase agreements maturing in more
than seven days, restricted securities and other illiquid securities are
not to exceed, in the aggregate, 10% of the Portfolio's total assets.
3. Pledge, mortgage or hypothecate assets except to secure temporary
borrowings, as described in the Prospectus, in aggregate amounts not to
exceed 10% of the net assets of such Portfolio taken at fair market value
at the time such loan is incurred.
S-11
<PAGE>
4. Invest in companies for the purpose of exercising control.
5. Acquire more than 10% of the voting securities of any one issuer.
6. Purchase or sell real estate, real estate limited partnership interests,
commodities or commodities contracts including futures contracts. However,
subject to its permitted investments, any Portfolio may purchase
obligations issued by companies which invest in real estate, real estate
limited partnerships, commodities or commodities contracts.
7. Make short sales of securities, maintain a short position or purchase
securities on margin, except that a Portfolio may obtain short-term credits
as necessary for the clearance of security transactions.
8. Act as an underwriter of securities of other issuers except as it may be
deemed an underwriter in selling a portfolio security.
9. Purchase securities of other investment companies except as permitted by
the 1940 Act and the rules and regulations thereunder and, in any event,
may not purchase securities of other open-end investment companies. Under
these rules and regulations, the Portfolios are prohibited from acquiring
the securities of other investment companies if, as a result of such
acquisition, a Portfolio owns more than 3% of the total voting stock of an
investment company; securities issued by any one investment company
represent more than 5% of the total Portfolio assets; or securities (other
than treasury stock) issued by all investment companies represent more than
10% of the total assets of a Portfolio. These investment companies
typically incur fees that are separate from those fees incurred directly by
a Portfolio. A Portfolio's purchase of such investment companies results
in the layering of expenses such that shareholders would indirectly bear a
proportionate share of such investment companies' expenses, including
advisory fees.
10. Issue senior securities (as defined in the Investment Company Act of 1940)
except in connection with permitted borrowings as described in the
Prospectus and this Statement of Additional Information or as permitted by
rule, regulation or order of the Securities and Exchange Commission.
11. Purchase or retain securities of an issuer if, to the knowledge of the
Trust, an officer, trustee, partner or director of the Trust or any
investment adviser of the Trust owns beneficially more than 1/2 of 1% of
the shares or securities of such issuer and all such officers, trustees,
partners and directors owning more than 1/2 of 1% of such shares or
securities together own more than 5% of such shares or securities.
12. Purchase securities of any company which has (with predecessors) a record
of less than three years' continuing operations, except (i) obligations
issued or guaranteed by the U.S. Government, its agencies or
instrumentalities, or (ii) municipal securities which are rated by at least
two nationally recognized municipal bond rating services, if, as a result,
more than 5% of the total assets (taken at fair market value) of the
Portfolio would be invested in such securities.
13. Purchase warrants, puts, calls, straddles, spreads or combinations thereof.
14. Invest in interests in oil, gas or other mineral exploration or development
programs.
15. Purchase restricted securities (securities which must be registered under
the Securities Act of 1933 before they may be offered or sold to the
public) or other illiquid securities except as described in the Prospectus
and this Statement of Additional Information.
Except with respect to the limitation on investing in illiquid securities, the
foregoing percentages will apply at the time of the purchase of a security and
shall not be considered violated unless an excess or deficiency occurs or exists
immediately after and as a result of a purchase of such security.
S-12
<PAGE>
NON-FUNDAMENTAL INVESTMENT LIMITATIONS
1. The Government Securities and Prime Obligations Portfolios may not purchase
obligations with remaining maturities of more than 365 days and must
maintain an average dollar-weighted portfolio maturity of more than 90
days.
ADDITIONAL RESTRICTIONS
The following are non-fundamental investment limitations that are currently
required by one or more states in which the Trust sells shares of the
Portfolios. These limitations are in addition to, and in some cases more
restrictive than, the fundamental and non-fundamental investment limitations
listed above. A limitation may be changed or eliminated without shareholder
approval if the relevant state changes or eliminates its policy regarding such
investment restriction. As long as a Portfolio's shares are registered for sale
in such states, it may not:
1. Invest more than 10% of its total assets in illiquid securities, including
securities which are not readily marketable or are restricted.
2. Invest more than 15% of its assets in restricted securities. For purposes
of this limitation, securities exempted from registration under the 1933
Act, including Section 4(2) commercial paper, are considered to be
restricted securities.
PERFORMANCE
From time to time, each Portfolio may advertise its yield. These figures will be
based on historical earnings and are not intended to indicate future
performance.
The current yield of each Portfolio is calculated daily based upon the seven
days ending on the date of calculation ("base period"). The yield is computed
by determining the net change (exclusive of capital changes) in the value of a
hypothetical pre-existing shareholder account having a balance of one share at
the beginning of the period, subtracting a hypothetical charge reflecting
deductions from shareholder accounts and dividing such net change by the value
of the account at the beginning of the same period to obtain the base period
return and multiplying the result by (365/7). Realized and unrealized gains and
losses are not included in the calculation of the yield.
The Portfolios compute their effective compound yield by determining the net
changes, exclusive of capital changes, in the value of a hypothetical pre-
existing account having a balance of one share at the beginning of the period,
subtracting a hypothetical charge reflecting deductions from shareholder
accounts, and dividing the difference by the value of the account at the
beginning of the base period to obtain the base period return, and then
compounding the base period return by adding 1, raising the sum to a power equal
to 365 divided by 7, and subtracting 1 from the result, according to the
following formula: Effective Yield = {(Base Period Return + 1)/365/7/ - 1}.
The current and the effective yields reflect the reinvestment of net income
earned daily on portfolio assets.
Actual yields will depend on such variables as asset quality, average asset
maturity, the type of instruments a Portfolio invests in, changes in interest
rates on money market instruments, changes in the expenses of the Portfolios and
other factors.
Yields are one basis upon which investors may compare the Portfolios with other
money market funds; however, yields of other money market mutual funds and other
investment vehicles may not be comparable because of the factors set forth above
and differences in the methods used in valuing portfolio instruments.
For the seven-day period ended June 30, 1995 the Portfolios' yield and effective
yield were as follows:
S-13
<PAGE>
<TABLE>
<CAPTION>
================================================================================
7-Day Effective
Portfolio/Class Class 7-day Yield Yield
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Treasury Securities Class A 5.62 5.78
------------------------------------------------
Class D 5.27 5.40
- --------------------------------------------------------------------------------
Government Securities Class A 5.53 5.68
- --------------------------------------------------------------------------------
Prime Obligation Class A 5.66 5.82
- --------------------------------------------------------------------------------
Institutional Cash Class A N/A N/A
- --------------------------------------------------------------------------------
Money Market Class A N/A N/A
================================================================================
</TABLE>
DETERMINATION OF NET ASSET VALUE
Securities of the Portfolios will be valued by the amortized cost method, which
involves valuing a security at its cost on the date of purchase and thereafter
(absent unusual circumstances) assuming a constant amortization to maturity of
any discount or premium, regardless of the impact of fluctuations in general
market rates of interest on the value of the instrument. While this method
provides certainty in valuation, it may result in periods during which value, as
determined by this method is higher or lower than the price a Portfolio would
receive if it sold the instrument. During periods of declining interest rates,
the daily yield of a Portfolio may tend to be higher than a like computation
made by a company with identical investments utilizing a method of valuation
based upon market prices and estimates of market prices for all of its portfolio
securities. Thus, if the use of amortized cost by the Trust resulted in a lower
aggregate portfolio value on a particular day, a prospective investor in a
Portfolio would be able to obtain a somewhat higher yield than would result from
investment in a company utilizing solely market values, and existing
shareholders in the Portfolio would experience a lower yield. The converse
would apply in a period of rising interest rates.
The Trust's use of amortized cost valuation and the maintenance of the net asset
value of each Portfolio at $1.00 are permitted by Rule 2a-7, under the 1940 Act,
provided that certain conditions are met. Under Rule 2a-7, a money market
portfolio must maintain a dollar-weighted average maturity in the Portfolio of
90 days or less and not purchase any instrument having a remaining maturity of
more than 397 days. In addition, money market funds may acquire only U.S.
dollar denominated obligations that present minimal credit risks and that are
"eligible securities," which means they are (i) rated, at the time of
investment, by at least two nationally recognized statistical rating
organizations (one if it is the only organization rating such obligation) in the
highest short-term rating category or, if unrated, determined to be of
comparable quality (a "first tier security"), or (ii) rated according to the
foregoing criteria in the second highest short-term rating category or, if
unrated, determined to be of comparable quality ("second tier security"). The
Adviser will determine that an obligation presents minimal credit
risks or that unrated instruments are of comparable quality in accordance with
guidelines established by the Trustees. The Trustees must approve or ratify the
purchase of any unrated securities or securities rated by only one rating
organization. In addition, investments in second tier securities are subject to
the further constraints that (i) no more than 5% of a Portfolio's assets may be
invested in such securities in the aggregate, and (ii) any investment in such
securities of one issuer is limited to the greater of 1% of the Portfolio's
total assets or $1 million. The regulations also require the Trustees to
establish procedures which are reasonably designed to stabilize the net asset
value per unit at $1.00 for each Portfolio. However, there is no assurance that
the Trust will be able to meet this objective. The Trust's procedures include
the determination of the extent of deviation, if any, of each Portfolio's
current net asset value per unit calculated using available market quotations
from each Portfolio's amortized cost price per unit at such intervals as the
Trustees deem appropriate and reasonable in light of market conditions and
periodic reviews of the amount of the deviation and the methods used to
calculate such deviation. In the event that such deviation exceeds 1/2 of 1%,
the Trustees are required to consider promptly what action, if any, should be
initiated, and, if the Trustees believe that the extent of any deviation may
result in material dilution or other unfair results to shareholders, the
Trustees are required to take such corrective action as they deem appropriate to
eliminate or reduce such dilution or unfair results to the extent reasonably
practicable. In addition, if any Portfolio incurs a significant
S-14
<PAGE>
loss or liability, the Trustees have the authority to reduce pro rata the number
of shares of that Portfolio in each shareholder's account and to offset each
shareholder's pro rata portion of such loss or liability from the shareholder's
accrued but unpaid dividends or from future dividends.
PURCHASE AND REDEMPTION OF SHARES
Purchases and redemptions of shares of the Funds may be made on any day the New
York Stock Exchange is open for business. Currently, the following holidays are
observed by the Trust: New Year's Day, Presidents' Day, Good Friday, Memorial
Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day.
The Trust reserves the right to suspend the right of redemption and/or to
postpone the date of payment upon redemption for any period during which trading
on the New York Stock Exchange is restricted, or during the existence of an
emergency (as determined by the SEC by rule or regulation) as a result of which
disposal or evaluation of the portfolio securities is not reasonably
practicable, or for such other periods as the SEC may be order permit. The
Trust also reserves the right to suspend sales of shares of the Portfolio for
any period during which the New York Stock Exchange, the Manager, the Adviser,
the Distributor and/or the Custodian are not open for business.
State Securities laws regarding sub-administrators may differ from the
interpretations of federal law expressed herein and banks and financial
institutions acting in that capacity may be required to register as dealers
pursuant to state law.
SHAREHOLDER SERVICES (Class D Shares)
Stop-Payment Requests: Investors may request a stop payment on checks by
providing the Trust with a written authorization to do so. Oral requests will
be accepted provided that the Trust promptly receives a written authorization.
Such requests will remain in effect for six months unless renewed or canceled.
The Trust will use its best efforts to effect stop-payment instructions, but
does not promise or guarantee that such instructions will be effective.
Shareholders requesting stop payment will be charged a $20 service fee per check
which will be deducted from their accounts.
Right of Accumulation: A shareholder qualifies for cumulative quantity
discounts when his new investment, together with the current market value of all
holdings of that shareholder in certain eligible portfolios reaches a discount
level. See "Purchase and Redemption of Shares" in the Prospectuses for the
sales charge on quantity purchases.
Letter Of Intent: The reduced sales shares are also applicable to the aggregate
amount of purchases made by any such purchaser previously enumerated within a
13-month period pursuant to a written Letter of Intent provided by the
Distributor, and not legally binding on the signer or a Portfolio which provides
for the holder in escrow by the Manager of 5% of the total amount intended to be
purchased until such purchase is completed within the 13-month period. A Letter
of Intent may be dated to include shares purchased up to 90 days prior to the
date of the Letter of Intent is signed. The 13-month period begins on the date
of the earliest purchase. If the intended investment is not completed, the
Manager will surrender an appropriate number of the escrowed shares for
redemption in order to realize the difference between the sales charge imposed
under the Letter of Intent and the sales charge that would have otherwise been
imposed.
Distribution Investment Option: Distributions of dividends and capital gains
made by the Portfolios may be automatically invested in shares of one of the
Portfolios if shares of the Portfolio are available for sale. Such investments
will be subject to initial investment minimums, as well as additional purchase
minimums. A shareholder considering the Distribution Investment Option should
obtain and read the prospectus of the Portfolios and/or classes in which such
automatic investments are to be made and consider the differences in investment
objectives and policies before making any investment.
Reinstatement Privilege: A shareholder who has redeemed shares of any of the
Portfolios has a one-time right to reinvest the redemption proceeds in shares of
the Portfolio at their net asset value as of the time of reinvestment. Such a
reinvestment must be made within 30 days of the redemption and is limited to the
amount of the redemption proceeds. Although redemptions and repurchases of
shares are taxable events, a reinvestment within such 30-day period in the same
S-15
<PAGE>
fund is considered a "wash sale" and results in the inability to recognize
currently all or a portion of a loss realized on the original redemption for
federal income tax purposes. The investor must notify the Transfer Agent at the
time the trade is placed that the transaction is a reinvestment.
Exchange Privilege: Some or all of the shares of the Portfolio for which payment
has been received (i.e., an established account) may be exchanged, at their net
----
asset value, plus any applicable sales charge, for Class D shares of the Trust,
SEI Tax Exempt Trust, SEI Daily Income Trust, SEI International Trust and SEI
Institutional Managed Trust or at their net asset value for Class D shares of
other portfolios of such trusts that do not have sales charges. Exchanges will
be made only after proper instructions in writing or by telephone (an "Exchange
Request") are received for an established account by the Distributor.
A shareholder may exchange a Portfolio's Class D shares, for which good payment
has been received, in his account at any time, regardless of how long he has
held his shares.
Each Exchange Request must be in proper form (i.e., if in writing, signed by the
----
record owner(s) exactly as the shares are registered; if by telephone, proper
account identification is given by the dealer or shareholder of record), and
each exchange must involve either shares having an aggregate value of at least
$1,000 or all the shares in the account. Each exchange involves the redemption
of the shares of a Portfolio to be exchanged and the purchase of the shares of
the other Portfolio. Any gain or loss on the redemption of the shares exchanged
is reportable on the shareholder's Federal income tax return, unless such shares
were held in a tax-deferred retirement plan or other tax-exempt account. If the
Exchange Request is received by the Distributor in writing or by telephone on
any Business Day, as defined in the Prospectuses of the Trust, prior to the
close of the New York Stock Exchange, the exchange will be effective on that
day if all the restrictions set forth above have been complied with at that
time. However, payment of the redemption proceeds by the Portfolios, and thus
the purchase of shares of the other Portfolios, may be delayed for up to seven
days if the Portfolios determine that such delay would be in the best interest
of all of its shareholders. Investment dealers which have satisfied criteria
established by the Portfolios may also communicate a shareholder's Exchange
Request to the Portfolios subject to the restrictions set forth above. No more
than five exchange requests may be made in any one telephone Exchange Request.
TAXES
The following is only a summary of certain tax considerations generally
affecting a Portfolio and its shareholders, and is not intended as a substitute
for careful tax planning. Shareholders are urged to consult their tax advisors
with specific reference to their own tax situations, including their state and
local tax liabilities.
Federal Income Taxes
The following discussion of federal income tax consequences is based on the
Internal Revenue Code of 1986, as amended (the "Code"), and the regulations
issued thereunder as in effect on the date of this Statement of Additional
Information. New legislation, as well as administrative changes or court
decisions, may significantly change the conclusions expressed herein, and may
have a retroactive effect with respect to the transactions contemplated herein.
Each Portfolio intends to qualify as a regulated investment company ("RIC") as
defined under Subchapter M of the Code. By following such a policy, each of the
Portfolios expects to eliminate or reduce to a nominal amount the federal income
taxes to which such Portfolio may be subject.
In order to qualify for treatment as a RIC, a Portfolio must distribute annually
to its shareholders at least the sum of 90% of its net interest income
excludable from gross income plus 90% of its investment company taxable income
(generally, net investment income plus net short-term capital gain) (the
"Distribution Requirement") and also must meet several additional requirements.
Among these requirements are the following: (i) at least 90% of a Portfolio's
gross income each taxable year must be derived from dividends, interest,
payments with respect to securities loans, and gains from the sale or other
disposition of stock or securities, or other income derived with respect to its
business of investing in such stock
S-16
<PAGE>
or securities; (ii) less than 30% of a Portfolio's gross income each taxable
year must be derived from the sale or other disposition of stocks, securities or
certain other investments held for less than three months; (iii) at the close of
each quarter of a Portfolio's taxable year, at least 50% of the value of its
total assets must be represented by cash and cash items, U.S. government
securities, securities of other RIC's, and other securities, with such other
securities limited, in respect of any one issuer, to an amount that does not
exceed 5% of the value of a Portfolio's assets and that does not represent more
than 10% of the outstanding voting securities of such issuer; and (iv) at the
close of each quarter of a Portfolio's taxable year, not more than 25% of the
value of its assets may be invested in securities (other than U.S. government
securities or the securities of other RIC's) of any one issuer or of two or more
issuers which are engaged in the same, similar or related trades or businesses
if the Portfolio owns at least 20% of the voting power of such issuers.
Notwithstanding the Distribution Requirement described above, which only
requires a Portfolio to distribute at least 90% of its annual investment company
taxable income and does not require any minimum distribution of net capital gain
(the excess of net long-term capital gain over net short-term capital loss), a
Portfolio will be subject to a nondeductible 4% federal excise tax to the extent
it fails to distribute by the end of any calendar year at least 98% of its
ordinary income for that year and 98% of its capital gain net income (the excess
of short and long-term capital gains over short and long-term capital losses)
for the one-year period ending on October 31 of that year, plus certain other
amounts.
If capital gain distributions have been made with respect to shares that are
sold at a loss after being held for six months or less, the loss is treated as a
long-term capital loss to the extent of the previous capital gain distributions.
If a Portfolio fails to qualify as a RIC for any year, all of its taxable income
will be subject to tax at regular corporate rates without any deduction for
distributions to shareholders, and its distributions (including capital gains
distributions) will be taxable as ordinary income dividends to its shareholders,
subject to the dividends received deduction for corporate shareholders.
Otherwise, distributions to shareholders generally will not be eligible for the
dividends received deduction.
State Taxes
A Portfolio is not liable for any income or franchise tax in Massachusetts if it
qualifies as a RIC for federal income tax purposes. Depending upon state and
local law, distributions by the Portfolio to shareholders and the ownership of
shares may be subject to state and local taxes.
PORTFOLIO TRANSACTIONS
The Trust has no obligation to deal with any dealer or group of dealers in the
execution of transactions in portfolio securities. Subject to policies
established by the Trustees, the Adviser is responsible for placing orders to
execute Portfolio transactions. In placing orders, it is the Trust's policy to
seek to obtain the best net results taking into account such factors as price
(including the applicable dealer spread), size, type and difficulty of the
transaction involved, the firm's general execution and operational facilities,
and the firm's risk in positioning the securities involved. While the Adviser
generally seeks reasonably competitive spreads or commissions, the Trust will
not necessarily be paying the lowest spread or commission available. The Trust's
policy of investing in securities with short maturities will result in high
portfolio turnover. The Trust will not purchase portfolio securities from any
affiliated person acting as principal except in conformity with the regulations
of the Securities and Exchange Commission.
The Trust does not expect to use one particular dealer, but, subject to the
Trust's policy of seeking the best net results, dealers who provide supplemental
investment research to the Adviser may receive orders for transactions by the
Trust. Information so received will be in addition to and not in lieu of the
services required to be performed by the Adviser under the Advisory Agreements,
and the expenses of the Adviser will not necessarily be reduced as a result of
the receipt of such supplemental information.
S-17
<PAGE>
The money market securities in which certain of the Portfolios invest are traded
primarily in the over-the-counter market. Where possible, the Adviser will deal
directly with the dealers who make a market in the securities involved except in
those circumstances where better prices and execution are available elsewhere.
Such dealers usually are acting as principal for their own account. On
occasion, securities may be purchased directly from the issuer. Money market
securities generally are traded on a net basis and normally do not involve
either brokerage commissions or transfer taxes. The cost of executing portfolio
securities transactions of the Portfolio will primarily consist of dealer
spreads and underwriting commissions.
Since the Trust does not market its shares through intermediary brokers or
dealers, it is not the Trust's practice to allocate brokerage or principal
business on the basis of sales of its shares which may be made through such
firms. However, the Adviser may place portfolio orders with qualified broker-
dealers who recommend the Trust to clients, and may, when a number of brokers
and dealers can provide best price and execution on a particular transaction,
consider such recommendations by a broker or dealer in selecting among broker-
dealers.
For the Trust's fiscal years ended June 30, 1993, 1994 and 1995, no brokerage
fees were paid.
DESCRIPTION OF SHARES
The Declaration of Trust authorizes the issuance of an unlimited number of
shares of each Portfolio, each of which represents an equal proportionate
interest in that Portfolio. Each share of a Portfolio upon liquidation of that
Portfolio entitles a shareholder to a pro rata share in the net assets of that
Portfolio, after taking into account certain distribution expenses.
Shareholders have no preemptive rights. The Declaration of Trust provides that
the Trustees of the Trust may create additional portfolios of shares or classes
of portfolios. Any consideration received by the Trust for shares of any
additional Portfolio and assets in which such consideration is invested would
belong to that Portfolio and would be subject to the liabilities related
thereto. Share certificates representing the shares will not be issued.
LIMITATION OF TRUSTEES' LIABILITY
The Declaration of Trust provides that a Trustee shall be liable only for his
own willful defaults and, if reasonable care has been exercised in the selection
of officers, agents, employees or administrators, shall not be liable for any
neglect or wrongdoing of any such person. The Declaration of Trust also provides
that the Trust will indemnify its Trustees and officers against liabilities and
expenses incurred in connection with actual or threatened litigation in which
they may be involved because of their offices with the Trust unless it is
determined in the manner provided in the Declaration of Trust that they have not
acted in good faith in the reasonable belief that their actions were in the best
interests of the Trust. However, nothing in the Declaration of Trust shall
protect or indemnify a Trustee against any liability for his willful
misfeasance, bad faith, gross negligence or reckless disregard of his duties.
SHAREHOLDER LIABILITY
The Trust is an entity of the type commonly known as a "Massachusetts business
trust." Under Massachusetts law, shareholders of the Trust could, under certain
circumstances, be held personally liable for the obligations of the Trust.
However, the possibility of the shareholders' incurring financial loss appears
remote because the Trust's Declaration of Trust contains an express disclaimer
of shareholder liability for obligations of the Trust, and requires that notice
of such disclaimer be given in each agreement, obligation or instrument entered
into or executed by or on behalf of the Trust or the Trustees. The Declaration
of Trust provides for indemnification out of the Trust's property for any
shareholder held personally liable for the obligations of the Trust.
5% SHAREHOLDERS
As of October 5, 1995, the following persons were the only persons who were
record owners (or to the knowledge of the Trust, beneficial owners) of 5% or
more of the shares of the Portfolios. The Trust believes that most of the
shares referred to below were held by the persons indicated in accounts for
their fiduciary, agency, or custodial customers.
S-18
<PAGE>
Treasury Securities Portfolio Class A Shares:
<TABLE>
<CAPTION>
Name and Address Number of Shares Percent of Funds
- ---------------- ---------------- -----------------
<S> <C> <C>
First Hawaiian Bank 255,829,356.51 20.31%
Financial Management Group (FIDAC)
Attn: Dolores Mollring
P.O. Box 3200
Honolulu, HI 96847
Bank of America NT&SA 111,264,115.04 8.83%
Attn: Common Trust Funds Unit #8239
P.O. Box 3577, Terminal Annex
Los Angeles, CA 90051
North American Trust Company 77,585,312.17 6.16%
Attn: David Hilbish
225 Broadway, Suite 200
San Diego, CA 92101
The Fulton Company 163,648,232.62 12.99%
c/o Fulton Bank Trust Department
Attn: Dennis Patrick
One Penn Square
Lancaster, PA 17602
Treasury Securities Portfolio Class D Shares:
Sumitomo Bank Trustee, FBO 6,394.91 33.81%
Laurie Huey Cust FBO
Michelle Huey UGMA CA
874 Shore Breeze Drive
Sacramento, CA 95831
Sumitomo Bank Trustee, FBO 6,394.91 33.81%
Laurie Huey Cust FBO
Megan Huey UGMA CA
874 Shore Breeze Drive
Sacramento, CA 95831
Robert H. Gibson & 3,000.00 15.86%
Diane E Gibson Jtten
P.O. Box 207
209 County Road 443
Grand Lake, CO 80447
Sukhavati Temple 1,013.05 5.35%
74 Old Main Street
South Yarmouth, MA 02664
Joseph F. King 1,061.11 5.61%
P.O. Box 2336
Ramona, CA 92065
</TABLE>
S-19
<PAGE>
<TABLE>
<CAPTION>
Name and Address Number of Shares Percent of Funds
- ---------------- ---------------- -----------------
<S> <C> <C>
Paul Shih & 1,044.98 5.52%
Wen-Chen Shih Jtten
17381 Coronado Lane
Huntington Beach, CA 92647
Government Securities Portfolio:
United Jersey Bank 33,253,184.21 16.47%
Attn: Joseph Guittari
P.O. Box 547
Hackensack, NJ 07602
Vose & Co. 64,790,981.07 32.08%
c/o Fleet/Norstar Services
One East Avenue
Funds Central NY/RO/3090
Rochester, NY 14638-0001
</TABLE>
S-20
<PAGE>
<TABLE>
<CAPTION>
Name and Address Number of Shares Percent of Funds
- ---------------- ---------------- -----------------
<S> <C> <C>
CoreStates Bank, N.A. 20,933,007.46 10.37%
Attn: James Quinlan
Penn Mutual Insurance Building
Philadelphia, PA 19106
Prime Obligation Portfolio:
BHC Securities Inc. 49,978.881.73 5.70%
Attn: Cash Sweeps Department
2005 Market Street
One Commerce Square, 11th Floor
Philadelphia, PA 19103
Eagle Trust Company 52,684,107.18 6.01%
Attn: Jacqueline Esposito
680 East Swedesford Road
Wayne, PA 19087
Republic & Co. 86,530,300.00 9.86%
c/o Imperial Trust Company
Attn: Shirley Matthews
201 N. Figueroa Street, #610
Los Angeles, CA 90012
CoreStates Bank, N.A. 103,807,482.77 11.83%
Attn: James Quinlan
Penn Mutual Insurance Building
Philadelphia, PA 19106
Smith & Co. 123,244,202.31 14.05%
c/o First Security Bank of Utah, N.A.
Attn: Money Market/Mutual Fund Desk
P.O. Box 25297
Salt Lake City, UT 84125
</TABLE>
EXPERTS
The financial statements in this Statement of Additional Information and the
financial highlights included in the Prospectuses have been audited by Price
Waterhouse LLP, independent public accountants, as indicated in their report,
with respect thereto, and are included herein in reliance upon the authority of
said firm as experts in giving said report.
FINANCIAL STATEMENTS
Following are the audited financial statements of the Trust for the fiscal year
ended June 30, 1995, and the Report of Independent Accountants of Price
Waterhouse LLP dated August 11, 1995, relating to the financial statements and
financial highlights of the Trust.
S-21
<PAGE>
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
SEI Liquid Asset Trust--June 30, 1995
TREASURY SECURITIES PORTFOLIO
<TABLE>
- ------------------------------------------------------------------------------
<CAPTION>
Description Par (000) Value (000)
- ------------------------------------------------------------------------------
<S> <C> <C>
U.S. TREASURY OBLIGATIONS -- 55.4%
U.S. Treasury Bills
6.380%, 08/10/95 $ 230,000 $ 228,441
6.126%, 09/14/95 97,000 95,814
6.133%, 09/14/95 90,000 88,899
6.068%, 10/26/95 42,000 41,207
5.598%, 12/21/95 203,000 197,757
5.600%, 12/21/95 50,000 48,707
----------
Total U.S. Treasury Obligations
(Cost $700,825,036) 700,825
----------
REPURCHASE AGREEMENTS -- 45.1%
Donaldson, Lufkin & Jenrette
Securities (A)
6.15%, dated 06/30/95, matures 07/03/95, repurchase
price $170,087,125 (collateralized by U.S. Treasury
Bills par value $19,464,000, matures 09/28/95: U.S.
Treasury Notes total par value $73,960,000, 5.625%-
6.875%, 02/28/97-01/15/00: U.S Treasury Bond par value
52,900,000, 11.75%,matures 11/15/14: total market
value $173,400,428) 170,000 170,000
Lehman Brothers (A)
6.20%, dated 06/30/95, matures 07/03/95, repurchase
price $2,448,264 (collateralized by U.S. Treasury Note
par value $2,446,000, 6.50%, matures 04/30/97: market
value $2,496,871) 2,447 2,447
Nomura Securities International (A)(B)
5.95%, dated 06/23/95, matures 07/24/95, repurchase
price $114,584,092 (collateralized by U.S. Treasury
Bills par value $14,470,000, matures 05/30/96: U.S.
Treasury Notes total par value $92,015,000, 5.75%-
6.875%, 04/30/97-08/15/04: U.S. Treasury Bond par
value $5,026,000, 12.00%, matures 08/15/13: total
market value $116,280,217) 114,000 114,000
</TABLE>
<TABLE>
- -------------------------------------------------------------------------------
<CAPTION>
Value
Description Par (000) (000)
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Swiss Bank Corporation (A)
6.17%, dated 06/30/95, matures 07/03/95, repurchase
price $283,673,780 (collateralized by U.S. Treasury
Bills total par value $39,335,000, 07/13/95-
06/27/96: U.S. Treasury Notes total par value
$281,797,000, 3.875%-8.50%, 08/15/95-05/15/05: U.S.
Treasury Bonds total par value $385,000, 7.625%-
12.00%, 08/15/13-02/15/25: total market value
$319,966,232) $ 283,528 $ 283,528
----------
Total Repurchase Agreements
(Cost $569,975,000) 569,975
----------
Total Investments -- 100.5%
(Cost $1,270,800,036) 1,270,800
----------
OTHER ASSETS AND LIABILITIES -- (0.5%)
Other Asset and Liabilities, Net (6,114)
----------
NET ASSETS:
Portfolio shares of Class A (unlimited
authorization -- no par value) based on
1,254,737,326 outstanding shares of beneficial
interest 1,254,737
Portfolio shares of Class D (unlimited
authorization -- no par value) based on 9,796,527
outstanding shares of beneficial interest 9,797
Accumulated net realized gain on investments 152
----------
Total Net Assets -- 100.0% $1,264,686
==========
Net Asset Value, Offering and Redemption Price Per
Share -- Class A $ 1.00
==========
Net Asset Value, Offering and Redemption Price Per
Share --Class D $ 1.00
==========
</TABLE>
(A) Tri-party repurchase agreement
(B) Term repurchase agreement
The accompanying notes are an integral part of the financial statements.
1
<PAGE>
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
SEI Liquid Asset Trust--June 30, 1995
GOVERNMENT SECURITIES PORTFOLIO
<TABLE>
- -------------------------------------------------------------------------------
<CAPTION>
Description Par (000) Value (000)
- -------------------------------------------------------------------------------
<S> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 95.7%
Federal Farm Credit Bank
6.230%, 09/29/95 $ 3,150 $ 3,103
Federal Home Loan Bank
6.311%, 08/01/95 10,000 9,948
6.340%, 08/18/95 10,000 9,919
6.183%, 09/06/95 6,000 5,933
Federal Home Loan Mortgage
6.105%, 08/01/95 10,000 9,949
5.942%, 09/05/95 9,550 9,448
5.929%, 09/25/95 1,000 986
5.775%, 11/01/95 1,120 1,099
5.969%, 11/27/95 5,000 4,881
Federal National Mortgage
5.690%, 07/05/95 (A) 22,000 22,000
6.101%, 08/04/95 20,000 19,888
6.306%, 08/07/95 9,320 9,262
6.083%, 08/14/95 35,650 35,392
6.350%, 08/28/95 9,000 8,912
6.281%, 09/29/95 10,000 9,850
6.116%, 10/03/95 350 345
6.371%, 10/03/95 1,030 1,014
5.876%, 10/04/95 1,005 990
Student Loan Marketing
5.700%, 07/05/95 (A) 15,400 15,400
5.860%, 07/05/95 (A) 8,000 8,035
5.885%, 07/05/95 (A) 5,800 5,817
--------
Total U.S. Government Agency Obligations
(Cost $192,171,309) 192,171
--------
REPURCHASE AGREEMENT -- 4.7%
Lehman Brothers (B)
6.2%,dated 06/30/95, matures 07/03/95, repurchase price
$9,428,869 (collateralized by U.S. Treasury Note par
value $9,420,000, 6.50%, matures 04/30/97: market value
$9,615,915) 9,424 9,424
--------
Total Repurchase Agreement
(Cost $9,424,000) 9,424
--------
Total Investments -- 100.4%
(Cost $201,595,309) 201,595
--------
OTHER ASSETS AND LIABILITIES -- (0.4%)
Other Assets and Liabilities, Net (827)
--------
</TABLE>
<TABLE>
- -------------------------------------------------------------------------------
<CAPTION>
Description Par (000) Value (000)
- -------------------------------------------------------------------------------
<S> <C> <C>
NET ASSETS:
Portfolio Shares (unlimited authorization -- no par
value) based on 200,789,702 outstanding shares of
beneficial interest $ 200,790
Accumulated net realized loss on investments (21)
Distributions in excess of net investment income (1)
---------
Total Net Assets -- 100.0% $ 200,768
=========
Net Asset Value, Offering and Redemption Price per Share $ 1.00
=========
(A) Variable rate instrument. The rate reflected on the Statement of Net Assets
is the rate in effect on June 30, 1995.
(B) Tri-party repurchase agreement.
The accompanying notes are an integral part of the financial statements.
PRIME OBLIGATION PORTFOLIO
U.S. GOVERNMENT AGENCY
OBLIGATIONS -- 16.9%
Federal Home Loan Bank
6.238%, 07/10/95 $ 7,000 $ 6,989
6.315%, 08/23/95 14,385 14,257
Federal Home Loan Mortgage
5.958%, 09/08/95 3,940 3,896
Federal National Mortgage
5.690%, 07/05/95 (A) 30,000 30,000
6.225%, 07/17/95 10,000 9,973
6.706%, 07/26/95 30,000 29,867
5.945%, 11/13/95 10,000 9,786
Student Loan Marketing
5.700%, 07/05/95 (A) 24,000 24,000
5.710%, 07/05/95 (A) 7,000 7,001
5.720%, 07/05/95 (A) 15,000 15,004
5.720%, 07/05/95 (A) 8,000 8,000
---------
Total U.S. Government Agency Obligations
(Cost $158,773,184) 158,773
---------
COMMERCIAL PAPER -- 69.7%
American Express Credit
6.030%, 07/17/95 10,000 9,973
6.100%, 07/21/95 10,000 9,966
5.900%, 10/19/95 6,000 5,892
American General
6.000%, 07/26/95 10,000 9,958
American General Finance
5.940%, 07/31/95 10,000 9,951
5.700%, 09/15/95 10,000 9,880
</TABLE>
2
<PAGE>
- --------------------------------------------------------------------------------
PRIME OBLIGATION PORTFOLIO
<TABLE>
- --------------------------------------------------------------
<CAPTION>
Description Par (000) Value (000)
- --------------------------------------------------------------
<S> <C> <C>
American Home Products (B)
5.970%, 08/09/95 $ 9,000 $ 8,942
Associates Corporation of North America
5.950%, 07/27/95 10,000 9,957
5.950%, 08/07/95 15,000 14,908
Bear Stearns Companies
5.950%, 07/10/95 10,000 9,985
5.980%, 07/11/95 8,000 7,987
5.840%, 08/04/95 15,000 14,917
Beneficial Corporation
6.000%, 07/06/95 15,000 14,988
5.940%, 08/09/95 10,000 9,936
5.900%, 09/21/95 10,000 9,866
Central & South West Corporation
6.010%, 08/04/95 10,000 9,943
5.870%, 09/22/95 15,000 14,797
Ciesco LP
5.970%, 07/13/95 10,000 9,980
5.930%, 08/11/95 20,000 19,865
CIT Group Holdings
6.100%, 07/05/95 10,000 9,993
6.100%, 07/24/95 10,000 9,961
5.680%, 12/06/95 10,000 9,751
Corporate Asset Funding
5.970%, 08/02/95 10,000 9,947
CSW Credit
5.950%, 08/15/95 5,000 4,963
Dean Witter Discover
6.000%, 07/26/95 8,000 7,967
Delaware Funding
5.960%, 07/18/95 4,966 4,952
5.950%, 08/08/95 10,000 9,937
5.970%, 08/14/95 15,000 14,890
Ford Motor Credit
6.000%, 07/20/95 15,000 14,953
5.950%, 09/05/95 15,000 14,836
5.740%, 09/29/95 8,000 7,885
General Electric Capital
5.920%, 09/05/95 15,000 14,836
5.700%, 09/20/95 15,000 14,808
5.700%, 11/02/95 5,000 4,902
IBM Credit
6.040%, 07/12/95 15,000 14,972
International Lease Finance
6.000%, 07/12/95 10,000 9,982
5.950%, 07/17/95 6,300 6,283
5.720%, 10/27/95 10,000 9,812
John Deere Capital
5.940%, 08/01/95 20,000 19,898
5.680%, 11/21/95 10,000 9,774
</TABLE>
<TABLE>
- -----------------------------------------------------------------
<CAPTION>
Description Par (000) Value (000)
- -----------------------------------------------------------------
<S> <C> <C>
McKenna Triangle
6.010%, 07/12/95 $ 4,300 $ 4,292
Merrill Lynch
5.950%, 07/17/95 20,000 19,947
Norwest Corporation
6.000%, 07/24/95 10,000 9,962
Norwest Financial
6.000%, 08/01/95 10,000 9,948
Philip Morris Companies
5.960%, 08/03/95 14,000 13,923
6.000%, 08/07/95 10,000 9,938
Prudential Funding
5.970%, 07/13/95 10,000 9,980
5.940%, 07/27/95 15,000 14,936
Puerto Rico Development Bank
6.020%, 07/19/95 8,000 7,976
6.010%, 07/20/95 20,000 19,937
Riverwood Funding
5.950%, 07/26/95 10,000 9,959
Sears Roebuck Acceptance
6.100%, 07/11/95 12,000 11,980
6.030%, 07/24/95 10,000 9,961
Toshiba America
5.950%, 09/08/95 5,000 4,943
5.870%, 11/13/95 22,150 21,662
Transamerica Finance
6.100%, 07/10/95 16,000 15,976
6.000%, 07/27/95 10,000 9,957
Whirlpool Corporation
6.020%, 08/01/95 5,000 4,974
Zeneca Wilmington Incorporation
6.000%, 07/05/95 9,000 8,994
--------
Total Commercial Paper
(Cost $656,238,515) 656,238
--------
CERTIFICATES OF DEPOSIT -- 3.0%
First Alabama Bank
6.120%, 07/21/95 11,000 11,000
First National Bank of Boston
6.020%, 07/18/95 10,000 10,000
West One Bank
6.000%, 10/02/95 7,000 7,000
--------
Total Certificates of Deposit
(Cost $28,000,000) 28,000
--------
FLOATING RATE INSTRUMENTS -- 8.8%
Allstate (A)
6.163%, 08/01/95 10,000 10,000
Corestates Capital (A)
6.090%, 01/05/96 10,000 10,000
People's Security Funding Agreement (A)(B)
6.360%, 08/01/95 33,000 33,000
</TABLE>
3
<PAGE>
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
SEI Liquid Asset Trust--June 30, 1995
PRIME OBLIGATION PORTFOLIO
<TABLE>
- ------------------------------------------------------------------------------
<CAPTION>
Description Par (000) Value (000)
- ------------------------------------------------------------------------------
<S> <C> <C>
SMM Trust 1994-B (A)(B)
6.238%, 08/11/95 $ 10,000 $ 10,000
SMM Trust 1995-I (A)(B)
6.082%, 05/29/96 20,000 19,995
--------
Total Floating Rate Instrument
(Cost $82,994,703) 82,995
--------
REPURCHASE AGREEMENT -- 2.0%
Lehman Brothers (C)
6.20%, dated 06/30/95, mature 07/03/95, repurchase
price $18,694,654 (collateralized by U.S. Treasury
Note par value $3,684,000, 6.50%, matures 04/30/97:
U.S. Treasury Bills, par value $15,733,000, matures
12/28/95: total market value $19,069,632) 18,685 18,685
--------
Total Repurchase Agreement
(Cost $18,685,000) 18,685
--------
Total Investments -- 100.4%
(Cost $944,691,402) 944,691
--------
</TABLE>
<TABLE>
- -------------------------------------------------------------------------------
<CAPTION>
Description Value (000)
- -------------------------------------------------------------------------------
<S> <C> <C>
OTHER ASSETS AND LIABILITIES -- ( 0.4%)
Other Assets and Liabilities, Net $ (3,828)
--------
NET ASSETS:
Portfolio shares (unlimited authorization--no par value) based
on 940,882,322 outstanding shares of beneficial interest 940,882
Accumulated net realized loss on investments (19)
--------
Total Net Assets -- 100.0% $940,863
========
Net Asset Value, Offering and Redemption Price Per Share $ 1.00
========
</TABLE>
(A) Variable rate instrument. The rate reflected on the Statement of Net Assets
is the rate in effect on June 30,1995.
(B) Private Placement
(C) Tri-party repurchase agreement
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
SEI Liquid Asset Trust--June 30, 1995
<TABLE>
<CAPTION>
------------- ------------
INSTITUTIONAL
CASH MONEY MARKET
PORTFOLIO PORTFOLIO
------------- ------------
<S> <C> <C>
ASSETS:
Cash $ 100 $ 100
----- -----
Total assets 100 100
----- -----
NET ASSETS:
Portfolio shares (unlimited authorization--no par
value) based on 100 outstanding shares of
beneficial interest 100 100
----- -----
Total net assets $ 100 $ 100
===== =====
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION
PRICE PER SHARE CLASS A $1.00 $1.00
===== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
STATEMENT OF OPERATIONS (000)
- --------------------------------------------------------------------------------
SEI Liquid Asset Trust--June 30, 1995
<TABLE>
<CAPTION>
---------- ---------- ---------- -------------
TREASURY GOVERNMENT PRIME INSTITUTIONAL
SECURITIES SECURITIES OBLIGATION CASH
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
---------- ---------- ---------- -------------
<S> <C> <C> <C> <C>
Interest Income $68,880 $13,256 $57,035 $101
------- ------- ------- ----
EXPENSES:
Management fee 5,388 1,016 4,236 8
Less management fees waived (1,227) (221) (884) --
Investment advisory fee 396 75 311 --
Custodian/wire agent fees 164 28 113 --
Professional fees 51 10 33 --
Trustee fees 23 4 18 --
Registration & filing fees 176 28 122 --
Distribution fees 581 106 436 --
Insurance 31 6 24 --
Other fees 67 12 29 --
------- ------- ------- ----
Total expenses 5,650 1,064 4,438 8
------- ------- ------- ----
NET INVESTMENT INCOME 63,230 12,192 52,597 93
------- ------- ------- ----
Net realized gain from security
transactions 240 39 55 --
------- ------- ------- ----
NET INCREASE IN NET ASSETS FROM
OPERATIONS $63,470 $12,231 $52,652 $ 93
======= ======= ======= ====
</TABLE>
Amounts designated as "--" are either $0 or have been rounded to $0.
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (000)
- --------------------------------------------------------------------------------
SEI Liquid Asset Trust--for the fiscal years ended June 30
<TABLE>
<CAPTION>
------------------------- ------------------------
TREASURY GOVERNMENT
SECURITIES SECURITIES
------------------------- ------------------------
1995 1994 1995 1994
------------------------- ------------------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income $ 63,230 $ 51,915 $ 12,192 $ 10,615
Net realized gain from
security transactions 240 181 39 78
----------- ------------ ----------- -----------
Net increase in net
assets resulting from
operations 63,470 52,096 12,231 10,693
----------- ------------ ----------- -----------
DIVIDENDS DISTRIBUTED
FROM:
Net investment income:
Class A (62,948) (51,915) (12,193) (10,615)
Class D (282) -- -- --
Net realized gains:
Class A -- (91) -- --
Class D -- -- -- --
----------- ------------ ----------- -----------
Total dividends
distributed (63,230) (52,006) (12,193) (10,615)
----------- ------------ ----------- -----------
CAPITAL SHARE
TRANSACTIONS (ALL AT
$1.00 PER SHARE):
Class A:
Proceeds from shares
issued 9,652,814 11,652,775 1,544,000 2,184,077
Shares issued in lieu of
cash distributions 823 1,963 579 545
Cost of shares
repurchased (9,900,410) (12,373,107) (1,599,403) (2,436,978)
----------- ------------ ----------- -----------
Decrease in net assets
derived from Class A
transactions (246,773) (718,369) (54,824) (252,356)
----------- ------------ ----------- -----------
Class D
Proceeds from shares
issued 25,743 39 -- --
Shares issued in lieu of
cash distributions 2 -- -- --
Cost of shares
repurchased (15,971) (16) -- --
----------- ------------ ----------- -----------
Increase in net assets
derived from Class D
transactions 9,774 23 -- --
----------- ------------ ----------- -----------
Decrease in net assets
derived from capital
share transactions (236,999) (718,346) (54,824) (252,356)
----------- ------------ ----------- -----------
Net decrease in net
assets (236,759) (718,256) (54,786) (252,278)
----------- ------------ ----------- -----------
NET ASSETS:
Beginning of Period 1,501,445 2,219,701 255,554 507,832
----------- ------------ ----------- -----------
End of Period $ 1,264,686 $ 1,501,445 $ 200,768 $ 255,554
=========== ============ =========== ===========
</TABLE>
Amounts designated as "--" are either $0 or have been rounded to $0.
The accompanying notes are an integral part of the financial statements.
7
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (000)
- --------------------------------------------------------------------------------
SEI Liquid Asset Trust--for the fiscal years ended June 30
<TABLE>
<CAPTION>
------------------------ --------------------
PRIME INSTITUTIONAL
OBLIGATION CASH
------------------------ --------------------
1995 1994 1995 1994
------------------------ --------------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income $ 52,597 $ 31,230 $ 93 $ 58
Net realized gain (loss) from
security transactions 55 (34) -- --
----------- ----------- --------- ---------
Net increase in net assets
resulting from operations 52,652 31,196 93 58
----------- ----------- --------- ---------
DIVIDENDS DISTRIBUTED FROM:
Net investment income:
Class A (52,597) (31,230) (93) (58)
Class D -- -- -- --
Net realized gains:
Class A -- -- -- --
Class D -- -- -- --
----------- ----------- --------- ---------
Total dividends distributed (52,597) (31,230) (93) (58)
----------- ----------- --------- ---------
CAPITAL SHARE TRANSACTIONS
(ALL AT $1.00 PER SHARE):
Class A:
Proceeds from shares issued 9,162,056 8,520,028 163,880 261,773
Shares issued in lieu of cash
distributions 11,333 7,599 -- --
Cost of shares repurchased (9,151,091) (8,782,192) (163,880) (261,773)
----------- ----------- --------- ---------
Increase (decrease) in net
assets derived from Class A
transactions 22,298 (254,565) -- --
----------- ----------- --------- ---------
Class D
Proceeds from shares issued -- -- -- --
Shares issued in lieu of cash
distributions -- -- -- --
Cost of shares repurchased -- -- -- --
----------- ----------- --------- ---------
Increase (decrease) in net
assets derived from Class D
transactions -- -- -- --
----------- ----------- --------- ---------
Increase (decrease) in net
assets derived from capital
share transactions 22,298 (254,565) -- --
----------- ----------- --------- ---------
Net increase (decrease) in
net assets 22,353 (254,599) -- --
----------- ----------- --------- ---------
NET ASSETS:
Beginning of Period 918,510 1,173,109 -- --
----------- ----------- --------- ---------
End of Period $ 940,863 $ 918,510 -- --
=========== =========== ========= =========
</TABLE>
Amounts designated as "--" are either $0 or have been rounded to $0.
The accompanying notes are an integral part of the financial statements.
8
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
SEI Liquid Asset Trust--for the fiscal years ended June 30
For a Share Outstanding Throughout each Period
<TABLE>
<CAPTION>
Net Asset Distributions Distributions Ratio of
Value Net Realized and from Net from Net Asset Net Assets Expenses
Beginning Investment Unrealized Investment Realized Capital Value End Total End of to Average
of Period Income Gains on Securities Income Gains of Period Return Period (000) Net Assets
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TREASURY SECURITIES
-------------------
CLASS A
1995 $1.00 $ 0.05 -- $ (0.05) -- $1.00 5.05% 1,254,888 0.44%
1994 1.00 0.03 -- (0.03) -- 1.00 3.00 1,501,510 0.44
1993 1.00 0.03 -- (0.03) -- 1.00 3.03 2,219,701 0.44
1992 1.00 0.05 -- (0.05) -- 1.00 4.69 2,304,153 0.44
1991 1.00 0.07 -- (0.07) -- 1.00 7.04 2,248,497 0.44
1990 1.00 0.08 -- (0.08) -- 1.00 8.41 2,076,845 0.44
1989 1.00 0.08 -- (0.08) -- 1.00 8.51 2,318,763 0.44
1988 1.00 0.06 -- (0.06) -- 1.00 6.56 2,671,802 0.44
1987 1.00 0.06 -- (0.06) -- 1.00 5.91 2,580,118 0.44
1986 1.00 0.07 -- (0.07) -- 1.00 7.40 2,041,343 0.44
CLASS D
1995 1.00 0.05 -- (0.05) -- 1.00 4.69 9,798 0.79
1994(1) 1.00 0.01 -- (0.01) -- 1.00 0.50** 23 0.79*
GOVERNMENT SECURITIES
---------------------
CLASS A
1995 $1.00 $ 0.05 -- $ (0.05) -- $1.00 5.18% 200,768 0.44%
1994 1.00 0.03 -- (0.03) -- 1.00 3.04 255,554 0.44
1993 1.00 0.03 -- (0.03) -- 1.00 3.05 507,832 0.44
1992 1.00 0.05 -- (0.05) -- 1.00 4.72 399,938 0.44
1991 1.00 0.07 -- (0.07) -- 1.00 7.08 520,187 0.44
1990 1.00 0.08 -- (0.08) -- 1.00 8.48 368,318 0.44
1989 1.00 0.08 -- (0.08) -- 1.00 8.69 467,056 0.44
1988 1.00 0.07 -- (0.07) -- 1.00 6.83 523,274 0.44
1987 1.00 0.06 -- (0.06) -- 1.00 5.99 479,968 0.44
1986 1.00 0.07 -- (0.07) -- 1.00 7.52 222,215 0.44
PRIME OBLIGATION
----------------
CLASS A
1995 $1.00 $ 0.05 -- $ (0.05) $1.00 5.20% 940,863 0.44%
1994 1.00 0.03 -- (0.03) -- 1.00 3.08 918,509 0.44
1993 1.00 0.03 -- (0.03) -- 1.00 3.07 1,173,109 0.44
1992 1.00 0.05 -- (0.05) -- 1.00 4.73 1,515,554 0.44
1991 1.00 0.07 -- (0.07) -- 1.00 7.36 1,729,845 0.44
1990 1.00 0.08 -- (0.08) -- 1.00 8.57 1,804,367 0.44
1989 1.00 0.09 -- (0.09) -- 1.00 8.85 2,160,859 0.44
1988 1.00 0.07 -- (0.07) -- 1.00 7.12 2,224,159 0.44
1987 1.00 0.06 -- (0.06) -- 1.00 6.08 1,851,072 0.44
1986 1.00 0.07 -- (0.07) -- 1.00 7.58 1,469,066 0.44
INSTITUTIONAL CASH*
-------------------
CLASS A
1995 $1.00 $0.0003 -- $ (0.0003) -- $1.00 4.94% -- 0.44%
1994 1.00 0.0003 -- (0.0003) -- 1.00 2.60 -- 0.44
1993 1.00 0.0003 -- (0.0003) -- 1.00 2.83 -- 0.44
1992 1.00 0.0002 -- (0.0002) -- 1.00 3.47 -- 0.44
1991 1.00 0.0003 0.0001 (0.0003) (0.0001) 1.00 7.12 -- 0.42
1990 1.00 0.0008 0.0003 (0.0008) (0.0003) 1.00 10.22 -- 0.44
1989 1.00 0.0007 0.0002 (0.0007) (0.0002) 1.00 8.49 -- 0.44
1988 1.00 0.0006 0.0001 (0.0006) (0.0001) 1.00 4.02 -- 0.44
1987(2) 1.00 0.0003 -- (0.0003) -- 1.00 5.48 -- 0.44
<CAPTION>
Ratio of
Net
Ratio of Ratio of Investment
Net Expenses Income
Investment to Average to Average
Income Net Assets Net Assets
to Average (Excluding (Excluding
Net Assets Waivers) Waivers)
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
TREASURY SECURITIES
-------------------
CLASS A
1995 4.93% 0.54% 4.83%
1994 2.91 0.51 2.84
1993 2.99 0.50 2.93
1992 4.60 0.50 4.50
1991 6.80 0.47 6.80
1990 8.10 0.45 8.10
1989 8.20 0.44 8.20
1988 6.40 0.44 6.40
1987 5.70 0.45 5.70
1986 7.20 0.44 7.20
CLASS D
1995 5.15 0.89 5.05
1994(1) 3.23* 0.98* 3.04*
GOVERNMENT SECURITIES
---------------------
CLASS A
1995 5.04% 0.53% 4.95%
1994 2.96 0.51 2.89
1993 3.00 0.50 2.94
1992 4.60 0.50 4.60
1991 6.80 0.48 6.70
1990 8.10 0.45 8.10
1989 8.30 0.46 8.30
1988 6.70 0.44 6.70
1987 5.80 0.46 5.80
1986 7.30 0.44 7.30
PRIME OBLIGATION
----------------
CLASS A
1995 5.21% 0.53% 5.12%
1994 3.03 0.51 2.96
1993 3.04 0.50 2.98
1992 4.70 0.49 4.60
1991 7.10 0.47 7.10
1990 8.30 0.45 8.30
1989 8.50 0.44 8.50
1988 6.90 0.44 6.90
1987 5.90 0.45 5.90
1986 7.30 0.44 7.30
INSTITUTIONAL CASH*
-------------------
CLASS A
1995 5.19% 0.44% 5.19%
1994 2.63 0.44 2.63
1993 2.66 0.44 2.66
1992 3.50 0.44 3.50
1991 5.90 0.42 5.90
1990 7.80 0.44 7.80
1989 6.80 0.44 6.80
1988 5.20 0.44 5.20
1987(2) 5.30 0.44 5.30
</TABLE>
(1) Treasury Securities Class D commenced operations on May 4, 1994.
(2) Institutional Cash Fund commenced operations on December 31, 1986.
* Annualized
** Not Annualized
Amounts designated as "--" are either $0 or have been rounded to $0.
The accompanying notes are an integral part of the financial statements.
9
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------
SEI Liquid Asset Trust--June 30, 1995
1. ORGANIZATION
SEI Liquid Asset Trust (the "Trust") was organized as a Massachusetts business
trust under a Declaration of Trust dated July 20, 1981.
The Trust is registered under the Investment Company Act of 1940, as amended,
as a diversified, open-end management investment company with five portfolios:
the Treasury Securities Portfolio, the Government Securities Portfolio, the
Prime Obligation Portfolio, the Institutional Cash Portfolio and the Money Mar-
ket Portfolio (the "Portfolios"). The Trust is registered to offer Class A
shares of the portfolios and Class D (formerly the ProVantage Funds) shares of
the Treasury Securities Portfolio and the Prime Obligation Portfolio. The as-
sets of each Portfolio are segregated and a shareholder's interest is limited
to the Portfolio in which shares are held. As of June 30, 1995 the Money Market
Portfolio had not commenced operations.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Trust.
Security Valuation--Investment securities are stated at amortized cost, which
approximates market value. Under this valuation method, purchase discounts and
premiums are accreted and amortized ratably to maturity and are included in in-
terest income.
Federal Income Taxes--It is each Portfolio's intention to continue to qualify
as a regulated investment company and distribute all of its taxable income. Ac-
cordingly, no provision for Federal income taxes is required.
Repurchase Agreements--Securities pledged as collateral for Repurchase Agree-
ments are held by the Portfolio's custodian bank until maturity of the Repur-
chase Agreement. Provisions of the Agreement and procedures adopted by the Man-
ager of the Trust ensure that the market value of the collateral, including ac-
crued interest thereon, is sufficient in the event of default by the
counterparty.
The Trust also invests in tri-party repurchase agreements. Securities held as
collateral for tri-party repurchase agreements are maintained in a segregated
account by the broker's custodian bank until maturity of the repurchase agree-
ment. Provisions of the agreements ensure that the market value of the collat-
eral, including accrued interest thereon, is sufficient in the event of de-
fault.
If the counterparty defaults and the value of the collateral declines or if
the counterparty enters an insolvency proceeding, realization of the collateral
by the Trust may be delayed or limited.
Discount and Premium Amortization--All amortization is calculated using the
effective interest method over the holding period of the security. Amortization
of premiums and discounts is currently included in interest income.
Expenses--Expenses of the Trust which are not directly associated to a spe-
cific Portfolio are allocated on the basis of relative net asset value of the
affected Portfolios.
Classes--Expenses of a class of shares of beneficial interest are borne by
that class. Income, expenses and realized gains/losses are allocated to the re-
spective classes on the basis of relative daily net assets.
Other--Security transactions are accounted for on the date the securities are
purchased or sold. Costs used in determining realized gains and losses on the
sale of investment securities are those of the specific securities sold. Dis-
tributions from net investment income are declared on a daily basis and are
payable on the first business day of the following month. Any net realized cap-
ital gains of the Portfolios are distributed to the shareholders of the af-
fected Portfolios annually.
3. MANAGEMENT, INVESTMENT ADVISORY AND DISTRIBUTION AGREEMENTS
SEI Financial Management Corporation (the "Manager") provided management, ad-
ministrative and shareholder services to the Trust for an annual fee, which is
calculated daily and paid monthly, of .42% of the average daily net assets of
each Portfolio with the exception of the Institutional Cash Portfolio for which
the fee is calculated at an annual rate of .36%. The Manager has agreed to bear
certain expenses of the Trust so that the total expenses do not exceed .44% of
average daily net assets annually. For the fiscal year ended June 30, 1995 the
manage-
10
<PAGE>
- --------------------------------------------------------------------------------
ment fee was $10,636,000 of which $2,332,000 was waived by the Manager in ac-
cordance with the expense limitation discussed above.
In addition, the Trust and the Manager have entered into a separate Transfer
Agent Agreement with respect to Class D shares under which DST Systems, Inc. is
entitled to a fee of .15% of the average daily net assets of Class D plus out-
of-pocket costs.
Wellington Management Company serves as the Investment Adviser of the Trust.
For its services, the Investment Adviser receives an annual fee equal to .075%
of the Trust's average daily net asset value up to $500 million and .02% of
such net asset value in excess of $500 million. At June 30, 1995, the Invest-
ment Adviser was a holder of beneficial interest in the Trust. The fees of the
Investment Adviser are paid monthly.
SEI Financial Services Company ("SFS") acts as the distributor of the shares
of the Trust under a Distribution Agreement and Distribution Plans which pro-
vide for the Trust to reimburse SFS for its distribution expenses. Reimburse-
ment for expenses incurred by SFS may not exceed .30% of a Portfolio's average
daily net assets. Distribution expenses include, among other items, the compen-
sation and benefits of sales personnel incurred by SFS in connection with the
promotion and sale of shares. Distribution expenses not attributable to a spe-
cific Portfolio are allocated among the Portfolios on the basis of their rela-
tive average daily net assets.
In addition, the Treasury Securities Portfolio and the Prime Obligation Port-
folio have registered an additional class of shares, Class D shares, for which
a separate distribution plan has been adopted. The Class D Distribution Plan
(the "Class D" Plan) provides for additional payments to the distributor of
.25% of each of the Class D shares average daily net assets. As of the fiscal
year end, SFS is taking a fee under the Class D Plan of only .20% of each of
the Class D average daily net assets.
4. TRANSACTIONS WITH AFFILIATES
Certain officers and/or Trustees of the Trust are also officers and/or Direc-
tors of the Manager or SFS. Compensation of officers and affiliated Trustees of
the Trust is paid by the Manager and/or SFS.
CoreStates N.A., which is a Trust shareholder, acts as Custodian and Wire
Agent for the Trust.
5. CAPITAL LOSS CARRYOVERS
At June 30, 1995, the Portfolios had a capital loss carryover, to the extent
provided in regulations, for Federal income tax purposes as follows:
<TABLE>
<S> <C>
Government Securities Portfolio: $16,295 expiring in 2001
Prime Obligation
Portfolio: $67,346 expiring in 2000
5,140 expiring in 2003
</TABLE>
11
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Board of Trustees and Shareholders of
SEI Liquid Asset Trust:
In our opinion, the accompanying statement of net assets and statement of
assets and liabilities, and the related statements of operations and of changes
in net assets and the financial highlights present fairly, in all material
respects, the financial position of the Treasury Securities Portfolio, the
Government Securities Portfolio, the Prime Obligation Portfolio, the
Institutional Cash Portfolio and the Money Market Portfolio (constituting SEI
Liquid Asset Trust, hereafter referred to as the "Trust") at June 30, 1995, the
results of each of their operations, the changes in each of their net assets
and the financial highlights for each of the respective periods presented, in
conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Trust's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation of
securities at June 30, 1995, by correspondence with the custodian, provide a
reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
Philadelphia, Pennsylvania
August 11, 1995
<PAGE>
PART C. OTHER INFORMATION
Post-Effective Amendment No. 19
-------------------------------
Item 24. Financial Statements and Exhibits:
(a) Financial Statements.
The Registrant's Financial Statements for the year ended June 30, 1995
including Price Waterhouse's report thereon, are included in the Statement of
Additional Information filed herewith. Financial Statements included
are:
1. Statement of Net Assets as of June 30, 1995
2. Statement of Assets and Liabilities for the year ending June 30,
1995
3. Statement of Operations for the year ended June 30, 1995
4. Statement of Changes in Net Assets for the years ended June 30,
1994 and 1995
5. Financial Highlights for the respective periods presented
6. Notes to Financial Statements
7. Report of Independent Accountants
(b) Additional Exhibits.
(1) Registrant's Agreement and Declaration of Trust.*
(2) Registrant's By-laws.*
(3) Not applicable.
(4) Not applicable.
(5)(a) Investment Advisory Contract dated October 30, 1985 between
TrustFunds Liquid Asset Trust and Wellington Management
Company.*
(5)(b) Management Agreement dated as of October 31, 1986 by and between
TrustFunds Liquid Asset Trust and SEI Financial Management
Corporation.*
(6) Distribution Agreement dated November 29, 1982 between
TrustFunds Liquid Asset Trust and SEI Financial Services
Company.*
(7) Not applicable.
(8)(a) Custodian Agreement dated September 1, 1981 by and between
TrustFunds Liquid Asset Trust and The Philadelphia National
Bank.*
(8)(b) Custodian Agreement dated October 25, 1984 between TrustFunds
Liquid Asset Trust and First Interstate Bank of Oregon.*
(9) Not applicable.
(10) Opinion and Consent of Counsel./2/
(11) Consent of Independent Accountants.*
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15)(a) Registrant's 12b-1 Distribution Plan as amended March 30,
1984.*
(15)(b) Registrant's 12b-1 Distribution Plan with respect to the
ProVantage Funds Class.*
(16) Performance Quotation Computation./1/
(18) Rule 18f-3 Plan.*
(24) Powers of Attorney.*
(27) Financial Data Schedules.*
C-1
<PAGE>
- ---------------
* Filed herewith.
1 Incorporated by reference to Post-Effective Amendment No. 15 to
Registrant's Registration Statement on Form N-1A filed with the SEC on
October 28, 1992.
2 Incorporated by reference to Post-Effective Amendment No. 16 to
Registrant's Registration Statement on Form N-1A filed with the SEC on
April 30, 1993.
Item 25. Persons Controlled by or under Common Control with Registrant:
See the Prospectus and the Statement of Additional Information filed
herewith regarding the Trust's control relationships. The Manager is a
subsidiary of SEI Corporation which also controls the distributor of the
Registrant, SEI Financial Services Company, and other corporations engaged in
providing various financial and record keeping services, primarily to bank
trust departments, pension plan sponsors, and investment managers.
Item 26. Number of Holders of Securities:
<TABLE>
<CAPTION>
As of October 5, 1995
Number of
Title of Class Record Holders
-------------- --------------
<S> <C>
Units of beneficial interest, without par value-
Treasury Portfolio
Class A........................................ 82
Class D........................................ 6
Government Portfolio.............................. 38
Prime Obligation Portfolio........................ 104
Institutional Cash Portfolio...................... 0
Money Market Portfolio............................ 0
</TABLE>
Item 27. Indemnification:
Article VIII of the Agreement and Declaration of Trust filed as Exhibit 1
to the Registration Statement is filed herewith. Insofar as indemnification
for liabilities arising under the
C-2
<PAGE>
Securities Act of 1933 may be permitted to trustees, directors, officers and
controlling persons of the Registrant by the Registrant pursuant to the
Declaration of Trust or otherwise, the Registrant is aware that in the opinion
of the Securities and Exchange Commission, such indemnification is against
public policy as expressed in the Act and, therefore, is unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by trustees,
directors, officers or controlling persons of the Registrant in connection
with the successful defense of any act, suit or proceeding) is asserted by
such trustees, directors, officers or controlling persons in connection with
the shares being registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be governed by
the final adjudication of such issues.
Item 28. Business and Other Connections of Investment Adviser:
The list required by this Item 28 of officers and partners of Wellington
Management Company, together with information as to any other business,
profession, vocation or employment of a substantial nature engaged in by such
officers and partners during the past two years, is incorporated by reference
to Schedules A and D of Form ADV, filed by Wellington Management Company
pursuant to the Investment Advisers Act of 1940 (SEC File No. 801-15908).
Item 29. Principal Underwriters:
(a) Furnish the name of each investment company (other than the Registrant)
for which each principal underwriter currently distributing the securities
of the Registrant also acts as a principal underwriter, distributor or
investment adviser.
Registrant's distributor, SEI Financial Services Company ("SFS"), acts as
distributor for:
<TABLE>
<S> <C>
SEI Daily Income Trust................. July 15, 1982
SEI Tax Exempt Trust................... December 3, 1982
SEI Index Funds........................ July 10, 1985
SEI Institutional Managed Trust........ January 22, 1987
SEI International Trust................ August 30, 1988
Stepstone Funds........................ January 30, 1991
The Compass Capital Group.............. March 8, 1991
FFB Lexicon Funds...................... October 18, 1991
The Advisors' Inner Circle Fund........ November 14, 1991
The Pillar Funds....................... February 28, 1992
CUFUND................................. May 1, 1992
STI Classic Funds...................... May 29, 1992
CoreFunds, Inc......................... October 30, 1992
First American Funds, Inc.............. November 1, 1992
First American Investment Funds, Inc... November 1, 1992
The Arbor Fund......................... January 28, 1993
1784 Funds............................. June 1, 1993
The PBHG Funds, Inc.................... July 16, 1993
Marquis/SM/ Funds...................... August 17, 1993
Morgan Grenfell Investment Trust....... January 3, 1994
Inventor Funds, Inc.................... August 1, 1994
</TABLE>
C-3
<PAGE>
<TABLE>
<S> <C>
The Achievement Funds Trust............ December 27, 1994
Insurance Investment Products Trust.... December 30, 1994
Bishop Street Funds.................... January 27, 1995
CrestFunds, Inc........................ March 1, 1995
Conestoga Family of Funds.............. May 1, 1995
STI Classic Variable Trust............. August 18, 1995
</TABLE>
SFS provides numerous financial services to investment managers, pension
plan sponsors, and bank trust departments. These services include
portfolio evaluation, performance measurement and consulting services
("Funds Evaluation") and automated execution, clearing and settlement of
securities transactions ("MarketLink").
(b) Furnish the Information required by the following table with respect to
each director, officer or partner of each principal underwriter named in the
answer to Item 21 of Part B. Unless otherwise noted, the business address of
each director or officer is 680 East Swedesford Road, Wayne, Pennsylvania
19087.
<TABLE>
<CAPTION>
Position and Office Positions and Offices
Name with Underwriter with Registrant
- ---- ------------------- ---------------------
<S> <C> <C>
Alfred P. West, Jr. Director, Chairman & Chief --
Executive Officer
Henry H. Greer Director, President & Chief --
Operating Officer
Carmen V. Romeo Director, Executive Vice
President & Treasurer Treasurer & Assistant
Secretary
Gilbert L. Beebower Executive Vice President --
Richard B. Lieb Executive Vice President --
Charles A. Marsh Executive Vice President- --
Capital Resources Division
Leo J. Dolan, Jr. Senior Vice President --
Carl A. Guarino Senior Vice President --
Jerome Hickey Senior Vice President --
David G. Lee Senior Vice President President & Chief
Executive Officer
William Madden Senior Vice President --
A. Keith McDowell Senior Vice President --
Dennis J. McGonigle Senior Vice President --
Hartland J. McKeown Senior Vice President --
James V. Morris Senior Vice President --
Steven Onofrio Senior Vice President --
Kevin P. Robins Senior Vice President, Vice President &
General Counsel & Assistant Secretary
Secretary
Robert Wagner Senior Vice President --
Patrick K. Walsh Senior Vice President --
Kenneth Zimmer Senior Vice President --
Robert Crudup Managing Director --
Vic Galef Managing Director --
Kim Kirk Managing Director --
</TABLE>
C-4
<PAGE>
<TABLE>
<CAPTION>
Position and Office Positions and Offices
Name with Underwriter with Registrant
---- ------------------- ---------------------
<S> <C> <C>
John Krzeminski Managing Director --
Carolyn McLaurin Managing Director --
Barbara Moore Managing Director --
Donald Pepin Managing Director --
Mark Samuels Managing Director --
Wayne M. Withrow Managing Director --
Mick Duncan Team Leader Assistant Secretary
Vicki Malloy Team Leader Assistant Secretary
Robert Aller Vice President --
C. Tony Baker Vice President --
Steve Bendinelli Vice President --
Cris Brookmyer Vice President & Controller --
Gordon W. Carpenter Vice President --
Robert B. Carroll Vice President & Assistant Vice President &
Secretary Assistant Secretary
Todd Cipperman Vice President & Assistant Vice President &
Secretary Assistant Secretary
Ed Daly Vice President --
Jeff Drennen Vice President --
Lucinda Duncalfe Vice President --
Kathy Heilig Vice President --
Larry Hutchison Vice President --
Michael Kantor Vice President --
Samuel King Vice President --
Donald H. Korytowski Vice President --
Robert S. Ludwig Vice President Assistant Secretary
Jack May Vice President --
Sandra K. Orlow Vice President & Assistant Vice President &
Secretary Assistant Secretary
Larry Pokora Vice President --
Kim Rainey Vice President --
Paul Sachs Vice President --
Steve Smith Vice President --
Daniel Spaventa Vice President --
Kathryn L. Stanton Vice President & Assistant Vice President &
Secretary Assistant Secretary
William Zawaski Vice President --
James Dougherty Director of Brokerage
Services --
</TABLE>
Item 30. Location of Accounts and Records:
Books or other documents required to be maintained by Section 31(a) of the
Investment Company Act of 1940, and the rules promulgated thereunder, are
maintained as follows:
(a) With respect to Rules 31a-1(a); 31a-1(b)(1); (2)(a) and (b); (3); (6);
(8); (12); and 31a-1(d), the required books and records are maintained
at the offices of Registrant's Custodian:
C-5
<PAGE>
CoreStates Bank, N.A.
Broad and Chestnut Streets
P.O. Box 7618
Philadelphia, Pennsylvania 19101
(b)/(c) With respect to Rules 31a-1(a); 31a-1(b)(1), (4); (2)(C) and (D);
(4); (5); (6); (8); (9); (10); (11); and 31a-1(f), the required books and
records are maintained at the offices of Registrant's Manager:
SEI Financial Management Corporation
680 E. Swedesford Road
Wayne, Pennsylvania 19087
(d) With respect to Rules 31a-1(b)(5), (6), (9) and (10) and 31a-1(f), the
required books and records are maintained at the principal offices of
the Registrant's Adviser:
Wellington Management Company
75 State Street
Boston, Massachusetts 02109
Item 31. Management Services: None.
Item 32. Undertakings:
Registrant hereby undertakes that whenever shareholders meeting the
requirements of Section 16(c) of the Investment Company Act of 1940 inform the
Board of Trustees of their desire to communicate with shareholders of the
Fund, the Trustees will inform such shareholders as to the approximate number
of shareholders of record and the approximate costs of mailing or afford said
shareholders access to a list of shareholders.
Registrant hereby undertakes to call a meeting of shareholders for the
purpose of voting upon the question of removal of a Trustee(s) when requested
in writing to do so by the holders of at least 10% of Registrant's outstanding
shares and in connection with such meetings to assist in communications with
other shareholders as required by the provisions of Section 16(c) of the
Investment Company Act of 1940.
Registrant hereby undertakes to furnish each prospective person to
whom a prospectus for any series of the Registrant is delivered with a copy of
the Registrant's latest annual report to shareholders for such series, when
such annual report is issued containing information called for by Item 5A of
Form N-1A, upon request and without charge.
C-6
<PAGE>
NOTICE
A copy of the Agreement and Declaration of Trust of SEI Liquid Asset Trust
is on file with the Secretary of State of The Commonwealth of Massachusetts
and notice is hereby given that this Registration Statement has been executed
on behalf of the Trust by an officer of the Trust as an officer and by its
Trustees as trustees and not individually and the obligations of or arising
out of this Registration Statement are not binding upon any of the Trustees,
officers, or Unitholders individually but are binding only upon the assets and
property of the Trust.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, as amended, the Registrant certifies that it meets all of
the requirements for effectiveness of this Registration Statement pursuant to
Rule 485(b) under the Securities Act of 1933 and has duly caused this
Amendment to Registration Statement No. 2-73428 to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of Wayne, Commonwealth
of Pennsylvania on the 30th day of October, 1995.
SEI LIQUID ASSET TRUST
By: /s/ David G. Lee
--------------------------
David G. Lee
President
ATTEST:
/s/ Jeffrey A. Cohen
-------------------------------------
Jeffrey A. Cohen
Controller
Pursuant to the requirements of the Securities Act of 1933, this Amendment to
the Registration Statement has been signed below by the following persons in
the capacity on the dates indicated.
<TABLE>
<S> <C> <C>
*
- --------------------------- Trustee October 30, 1995
Richard F. Blanchard
*
- --------------------------- Trustee October 30, 1995
William M. Doran
*
- --------------------------- Trustee October 30, 1995
F. Wendell Gooch
*
- --------------------------- Trustee October 30, 1995
Frank E. Morris
*
- --------------------------- Trustee October 30, 1995
James M. Storey
*
- --------------------------- Trustee October 30, 1995
Robert A. Nesher
/s/ Jeffrey A. Cohen
- --------------------------- Controller and October 30, 1995
Jeffrey A. Cohen Assistant Secretary
/s/ Carmen V. Romeo
- --------------------------- Treasurer and October 30, 1995
Carmen V. Romeo Assistant Secretary
* By: /s/ David G. Lee
----------------------
David G. Lee
Attorney-in-Fact
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Exhibit
Number Exhibit Page Number
<C> <S> <C>
EX-99.B1 Registrant's Agreement and Declaration of Trust.*
EX-99.B2 Registrant's By-laws.*
EX-99.B3 Not applicable.
EX-99.B4 Not applicable.
EX-99.B5(a) Investment Advisory Contract dated October 30, 1985
between TrustFunds Liquid Asset Trust and Wellington
Management Company.*
EX-99.B5(b) Management Agreement dated as of October 31, 1986 by and
between TrustFunds Liquid Asset Trust and SEI Financial
Management Corporation.*
EX-99.B6 Distribution Agreement dated November 29, 1982 between
TrustFunds Liquid Asset Trust and SEI Financial Services
Company.*
EX-99.B7 Not applicable.
EX-99.B8(a) Custodian Agreement dated September 1, 1981 by and between
TrustFunds Liquid Asset Trust and The Philadelphia National
Bank.*
EX-99.B8(b) Custodian Agreement dated October 25, 1984 between
TrustFunds Liquid Asset Trust and First Interstate Bank of
Oregon.*
EX-99.B9 Not applicable.
EX-99.B10 Opinion and Consent of Counsel./2/
EX-99.B11 Consent of Independent Accountants.*
EX-99.B12 Not applicable.
EX-99.B13 Not applicable.
EX-99.B14 Not applicable.
EX-99.B15(a) Registrant's 12b-1 Distribution Plan as amended March 30,
1984.*
EX-99.B15(b) Registrant's 12b-1 Distribution Plan with respect
to the ProVantage Funds Class.*
EX-99.B16 Performance Quotation Computation./1/
EX-99.B18 Rule 18f-3 Plan.*
EX-99.B24 Powers of Attorney.*
EX-27-1 Financial Data Schedule for Treasury Securities Portfolio
Class A.*
EX-27-2 Financial Data Schedule for Government Securities Portfolio.*
EX-27-3 Financial Data Schedule for Prime Obligation Portfolio.*
EX-27-4 Financial Data Schedule for Money Market Portfolio.*
EX-27-5 Financial Data Schedule for Treasury Securities Portfolio
Class D.*
EX-27-6 Financial Data Schedule for Institutional Cash Portfolio.*
- ---------------
</TABLE>
* Filed herewith.
1 Incorporated by reference to Post-Effective Amendment No. 15 to
Registrant's Registration Statement on Form N-1A filed with the SEC on
October 28, 1992.
2 Incorporated by reference to Post-Effective Amendment No. 16 to
Registrant's Registration Statement on Form N-1A filed with the SEC on
April 30, 1993.
<PAGE>
As amended
2/5/84
9/17/85
TRUSTFUNDS LIQUID ASSET TRUST
---------------------------
AGREEMENT AND DECLARATION OF TRUST
---------------------------
AGREEMENT AND DECLARATION OF TRUST made at Boston, Massachusetts, this 20th
day of July, 1981, by the Trustees hereunder, and by the holders of shares of
beneficial interest to be issued hereunder as hereinafter provided.
WITNESSETH that
WHEREAS, this Trust has been formed to carry on the business of an
investment company; and
WHEREAS, the Trustees have agreed to manage all property coming into their
hands as trustees of a Massachusetts voluntary association with transferable
shares in accordance with the provisions hereinafter set forth.
NOW, THEREFORE, the Trustees hereby declare that they will hold all cash,
securities and other assets, which they may from time to time acquire in any
manner as Trustees hereunder IN TRUST to manage and dispose of the same upon the
following terms and conditions for the pro rata benefit of the holders from time
to time of Shares in this Trust as hereinafter set forth.
ARTICLE I
Name and Definitions
--------------------
Name
- ----
Section 1. This Trust shall be known as the "TrustFunds Liquid Asset Trust"
---------
and the Trustees shall conduct the business of the Trust under that name or any
other name as they may from time to time determine.
<PAGE>
Definitions
- -----------
Section 2. Whenever used herein, unless otherwise required by the context
---------
or specifically provided:
(a) The "Trust" refers to the Massachusetts voluntary association
established by this Agreement and Declaration of Trust, as amended from time to
time;
(b) "Trustees" refers to the Trustees of the Trust named herein or elected
in accordance with Article IV and then in office;
(c) "Shares" mean the equal proportionate transferable units of interest
into which the beneficial interest in the Trust shall be divided from time to
time or, if more than one series of Shares is authorized by the Trustees, the
equal proportionate transferable units into which each series of Shares shall be
divided from time to time;
(d) "Shareholder" means a record owner of Shares;
(e) The "1940 Act" refers to the Investment Company Act of 1940 and the
Rules and Regulations thereunder, all as amended from time to time;
(f) The terms "Affiliated Person", "Assignment", "Commission", "Interested
Person", "Principal Underwriter" and "Majority Shareholder Vote: (the 67% or 50%
requirement of the third sentence of Section 2(a)(42) of the 1940 Act, whichever
may be applicable) shall have the meanings given them in the 1940 Act;
(g) "Declaration of Trust" shall mean this Agreement and Declaration
as amended or restated from time to time; and
(h) "By-Laws" shall mean the By-Laws of the Trust as amended from time
to time.
ARTICLE II
----------
Purpose
-------
The purpose of the Trust is to provide investors a managed investment
portfolio consisting primarily of securities, including debt instruments or
obligations.
- 2 -
<PAGE>
ARTICLE III
Shares
------
Division of Beneficial Interest
- -------------------------------
Section 1. The Shares of the Trust shall be issued in one or more series
---------
as the Trustees may, without shareholder approval, authorize. Each series shall
be preferred over all other series in respect of the assets allocated to that
series. The beneficial interest in each series shall at all times be divided
into Shares, without par value, each of which shall represent an equal
proportionate interest in the series with each other Share of the same series,
none having priority or preference over another. The number of Shares authorized
shall be unlimited, and the Shares so authorized may be represented in part by
fractional shares. The Trustees may from time to time divide or combine the
Shares of any series into a greater or lesser number without thereby changing
the proportionate beneficial interests in the series.
Ownership of Shares
- --------------------
Section 2. The ownership of Shares shall be recorded on the books of
---------
the Trust or its transfer or similar agent. No certificates certifying the
ownership of Shares shall be issued except as the Trustees may otherwise
determine from time to time. The Trustees may make such rules as they consider
appropriate for the issuance of Share certificates, the transfer of Shares and
similar matters. The record books of the Trust as kept by the Trust or any
transfer or similar agent of the Trust, as the case may be, shall be conclusive
as to who are the Shareholders of each series and as to the number of Shares of
each series held from time to time by each Shareholder.
Investments in the Trust; Assets of the Series
- ----------------------------------------------
Section 3. The Trustees may accept investments in the Trust from such
---------
persons and on such terms and, subject to any requirements of law, for such
consideration, which may consist of cash or tangible or intangible property or a
combination thereof, as they may from time to time authorize.
All consideration received by the Trust for the issue or sale of Shares of
each series, together with all income, earnings, profits, and proceeds thereof,
including any proceeds derived from the sale, exchange or liquidation thereof,
and any funds or payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall irrevocably belong to the series of Shares
with respect to which the same were received by the Trust for all purposes,
subject only to the rights of creditors, and shall be so handled upon the books
of account of the Trust and are herein referred to as "assets of" such series.
- 3 -
<PAGE>
No Preemptive Rights
- --------------------
Section 4. Shareholders shall have no preemptive or other right to
---------
receive, purchase or subscribe for any additional Shares or other securities
issued by the Trust.
Status of Shares and Limitation of Personal Liability
- -----------------------------------------------------
Section 5. Shares shall be deemed to be personal property giving only the
---------
rights provided in this instrument. Every shareholder by virtue of having become
a Shareholder shall be held to have expressly assented and agreed to the terms
of the Declaration of Trust and to have become a party thereto. The death of a
Shareholder during the continuance of the Trust shall not operate to terminate
the same nor entitle the representative of any deceased Shareholder to an
accounting or to take any action in court or elsewhere against the Trust or
the Trustees, but only to the rights of said decedent under this Trust.
Ownership of Shares shall not entitle the Shareholder to any title in or to the
whole or any part of the Trust property or right to call for a partition or
division of the same or for an accounting, nor shall the ownership of Shares
constitute the Shareholders partners. Neither the Trust nor the Trustees, nor
any officer, employee or agent of the Trust shall have any power to bind
personally any Shareholder, nor except as specifically provided herein to call
upon any Shareholder for the payment of any sum of money or assessment
whatsoever other than such as the Shareholder may at any time personally agree
to pay.
ARTICLE IV
The Trustees
------------
Election
- --------
Section 1. The number of Trustees shall be fixed by the Trustees, except
---------
that there shall be not less than three nor more than fifteen Trustees. Any
vacancies occurring in the Board of Trustees may be filled by the Trustees if,
immediately after filling any such vacancy, at least two-thirds of the Trustees
then holding office would have been elected to such office by the Shareholders.
In the event that at any time less than a majority of the Trustees then holding
office were elected to such office by the Shareholders, the Trustees promptly
shall call a meeting of Shareholders for the purpose of electing Trustees. Each
Trustee elected by the Shareholders or by the Trustees shall serve until the
next meeting of Shareholders and until the election and qualification of his or
her successor, or until he or she sooner dies, resigns or is removed. At any
meeting called for such purpose, a Trustee may be removed with or without cause
- 4 -
<PAGE>
by vote of the Shareholders holding a majority of the Shares entitled to vote.
By vote of a majority of the Trustees then in office, the Trustees may remove a
Trustee for cause. Any Trustee may, but need not be, a Shareholder.
Effect of Death, Resignation, ect. of a Trustee
- -----------------------------------------------
Section 2. The death, declination, resignation, retirement, removal, or
---------
incapacity of the Trustees, or any one of them, shall not operate to annul the
Trust or to revoke any existing agency created pursuant to the terms of this
Declaration of Trust.
Powers
- ------
Section 3. Subject to the provisions of this Declaration of Trust, the
---------
business of the Trust shall be managed by the Trustees, and they shall have all
powers necessary or convenient to carry out that responsibility. Without
limiting the foregoing, the Trustees may adopt By-Laws not inconsistent with
this Declaration of Trust providing for the conduct of the business of the Trust
and may amend and repeal them to the extent that such By-Laws do not reserve
that right to the Shareholders; they may fill vacancies in their number,
including vacancies resulting from increases in their number, and may elect and
remove such officers and appoint and terminate such agents as they consider
appropriate; they may appoint from their own number, and terminate, any one or
more committees consisting of two or more Trustees, including an executive
committee which may, when the Trustees are not in session, exercise some or all
of the powers and authority of the Trustees as the Trustees may determine; they
may appoint an advisory board, the members of which shall not be Trustees and
need not be Shareholders; they may employ one or more custodians of the assets
of the Trust and may authorize such custodians to employ subcustodians and to
deposit all or any part of such assets in a system or systems for the central
handling of securities, retain a transfer agent or a Shareholder services agent,
or both, provide for the distribution of Shares by the Trust, through one or
more principal underwriters or otherwise, set record dates for the determination
of Shareholders with respect to various matters, and in general delegate such
authority as they consider desirable to any officer of the Trust, to any
committee of the Trustees and to any agent or employee of the Trust or to any
such custodian or underwriter.
Without limiting the foregoing, the Trustees shall have power and
authority:
- 5 -
<PAGE>
(a) To invest and reinvest cash, and to hold cash uninvested;
(b) To sell, exchange, lend, pledge, mortgage, hypothecate, write
options on and lease any or all of the assets of the Trust;
(c) To vote or give assent, or exercise any rights of ownership, with
respect to stock or other securities of property; and to execute and
deliver proxies or powers of attorney to such person or persons as the
Trustees shall deem proper, granting to such person or persons such power
and discretion with relation to securities or property as the Trustees
shall deem proper;
(d) To exercise powers and rights of subscription or otherwise which
in any manner arise out of ownership of securities;
(e) To hold any security or property in a form not indicating any
trust, whether in bearer, unregistered or other negotiable form, or in the
name of the Trustees or of the Trust or in the name of a custodian,
subcustodian or other depositary or a nominee or nominees or otherwise;
(f) To consent to or participate in any plan for the reorganization,
consolidation or merger of any corporation or issuer, any security or
property of which is or was held in the Trust; to consent to any contract,
lease, mortgage, purchase or sale of property by such corporation or
issuer, and to pay calls or subscriptions with respect to any security held
in the Trust;
(g) To join with other security holders in acting through a
committee, depositary, voting trustee or otherwise, and in that connection
to deposit any security with, or transfer any security to, any such
committee, depositary or trustee, and to delegate to them such power and
authority with relation to any security (whether or not so deposited or
transferred) as the Trustees shall deem proper, and to agree to pay, and to
pay, such portion of the expenses and compensation of such committee,
depositary or trustee as the Trustees shall deem proper;
(h) To compromise, arbitrate or otherwise adjust claims in favor of
or against the Trust or any matter in controversy, including but not
limited to claims for taxes;
(i) To enter into joint ventures, general or limited partnerships and
any other combinations or associations;
(j) To borrow funds;
- 6 -
<PAGE>
(k) To endorse or guarantee the payment of any notes or other
obligations of any person; to make contracts of guaranty or suretyship, or
otherwise assume liability for payment thereof; and to mortgage and pledge
the Trust property or any part thereof to secure any of or all such
obligations;
(l) To purchase and pay for entirely out of Trust property such
insurance as they may deem necessary or appropriate for the conduct of the
business, including, without limitation, insurance policies insuring the
assets of the Trust and payment of distributions and principal on its
portfolio investments, and insurance policies insuring the Shareholders,
Trustees, officers, employees, agents, investment advisers or managers,
principal underwriters, or independent contractors of the Trust
individually against all claims and liabilities of every nature arising by
reason of holding, being or having held any such office or position, or by
reason of any action alleged to have been taken or omitted by any such
person as Shareholder, Trustee, officer, employee, agent, investment
adviser or manager, principal underwriter, or independent contractor,
including any action taken or omitted that may be determined to constitute
negligence, whether or not the Trust would have the power to indemnify such
person against such liability; and
(m) To pay pensions for faithful service, as deemed appropriate by
the Trustees, and to adopt, establish and carry out pension, profit-
sharing, share bonus, share purchase, savings, thrift and other retirement,
incentive and benefit plans, trusts and provisions, including the
purchasing of life insurance and annuity contracts as a means of providing
such retirement and other benefits, for any or all of the Trustees,
officers, employees and agents of the Trust.
The Trustees shall not in any way be bound or limited by any present or
future law or custom in regard to investments by trustees. Except as otherwise
provided herein or from time to time in the By-Laws, any action to be taken by
the Trustees may be taken by a majority of the Trustees present at a meeting of
Trustees (a quorum being present), within or without Massachusetts, including
any meeting held by means of a conference telephone or other communications
equipment by means of which all persons participating in the meeting can hear
each other at the same time and participation by such means shall constitute
presence in person at a meeting, or by written consents of a majority of the
Trustees then in office.
- 7 -
<PAGE>
Payment of Expenses by Trust
- ----------------------------
Section 4. The Trustees are authorized to pay or to cause to be paid out of
---------
the principal or income of the Trust, or partly out of principal and partly out
of income, as they deem fair, all expenses, fees, charges, taxes and liabilities
incurred or arising in connection with the Trust, or in connection with the
management thereof, including, but not limited to, the Trustees' compensation
and such expenses and charges for the services of the Trust's officers,
employees, investment adviser or manager, principal underwriter, auditor,
counsel, custodian, transfer agent, Shareholder servicing agent, and such other
agents or independent contractors and such other expenses and charges as the
Trustees may deem necessary or proper to incur.
Section 5. The Trustees shall have the power, as frequently as they may
---------
determine, to cause each Shareholder to pay directly, in advance or arrears, for
charges of the Trust's custodian or transfer or shareholder service or similar
agent, an amount fixed from time to time by the Trustees, by setting off such
charges due from such Shareholder from declared but unpaid dividends owed such
Shareholder and/or reducing the number of Shares in the account of such
Shareholder by that number of full and/or fractional Shares which represents the
outstanding amount of such charges due from such Shareholder.
Ownership of Assets of the Trust
- --------------------------------
Section 6. Title to all of the assets of the Trust shall at all times be
---------
considered as vested in the Trustees.
Advisory, Management and Distribution
- -------------------------------------
Section 7. Subject to a favorable Majority Shareholder Vote, the Trustees
---------
may, at any time and from time to time, contract for exclusive or nonexclusive
advisory and/or management services with SEI Financial Management Corporation
(the "Manager"), a Delaware corporation, and/or any other corporation, trust,
association or other organization, every such contract to comply with such
requirements and restrictions as may be set forth in the By-Laws; and any such
contract may contain such other terms interpretive of or in addition to said
requirements and restrictions as the Trustees may determine, including, without
limitation, authority to determine from time to time what investments shall be
purchased, held, sold or exchanged and what portion, if any, of the assets of
the Trust shall be held uninvested and to make changes in the Trust's
investments. The Trustees may also, at any time and from time to time, contract
with SEI Financial Services Company (the "Distributor"), a Pennsylvania
Corporation and/or any other corporation, trust, association or other
organization, appointing it exclusive or nonexclusive
- 8 -
<PAGE>
distributor or principal underwriter for the Shares every such contract to
comply with such requirements and restrictions as may be set forth in the
By-Laws; and any such contract may contain such other terms interpretive of or
in addition to said requirements and restrictions as the Trustees may determine.
The fact that:
(i) any of the Shareholders, Trustees or officers of the Trust is a
shareholder, director, officer, partner, trustee, employee, manager,
advisor, principal underwriter, or distributor or agent of or for any
corporation, trust, association, or other organization, or of or for any
parent or affiliate of any organization, with which an advisory or
management contract, or principal underwriter's or distributor's contract,
or transfer, Shareholder services or other agency contract may have been or
may hereafter be made, or that any such organization, or any parent or
affiliate thereof, is a Shareholder or has an interest in the Trust, or
that
(ii) any corporation, trust, association or other organization with
which an advisory or management contract or principal underwriter's or
distributor's contract, or transfer, Shareholder services or other agency
contract may have been or may hereafter be made also has an advisory or
management contract, or principal underwriter's or distributor's contract,
or transfer, Shareholder services or other agency contract with one or more
other corporations, trusts, associations, or other organizations, or has
other businesses or interests
shall not affect the validity of any such contract or disqualify any
Shareholder, Trustee or officer of the Trust from voting upon or executing the
same or create any liability or accountability to the Trust or its Shareholders.
ARTICLE V
Shareholder's Voting Powers and Meetings
----------------------------------------
Voting Powers
- -------------
Section 1. The Shareholders shall have power to vote only (i) for the
---------
election or removal of Trustees as provided in Article IV, Section 1, (ii) with
respect to any investment advisor or manager as provided in Article IV,
Section 7, (iii) with respect to any termination of the Trust to the extent and
as provided in Article IX, Section 4, (iv) with respect to any amendment of this
Declaration of Trust to the extent and as provided in Article IX, Section 7, (v)
to the same extent as the stockholders of a Massachusetts business corporation
as to
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<PAGE>
whether or not a court action proceeding or claim should or should not be
brought or maintained derivatively or as a class action on behalf of the Trust
or the Shareholders, and (vi) with respect to such additional matters relating
to the Trust as may be required by law, this Declaration of Trust, the By-laws
or any registration of the Trust with the Commission (or any successor agency
or any state, or as the Trustees may consider necessary or desirable.
Each whole Share shall be entitled to one vote as to any matter on which it
is entitled to vote and each fractional Share shall be entitled to a
proportionate fractional vote. On any matter submitted to a vote of Shareholders
all Shares of the Trust then entitled to vote, irrespective of series, shall be
voted in the aggregate and not by series, except (1) when required by the 1940
Act, Shares shall be voted by individual series, in which event, unless
otherwise required by the 1940 Act, a vote of Shareholders of all shares of the
Trust, irrespective of series, shall not be required; and (2) when the Trustees
have determined that the matter affects only the interests of one or more
series, then only Shareholders of the such series shall be entitled to vote
thereon. There shall be no cumulative voting in the election of Trustees. Shares
may be voted in person or by proxy.
A proxy with respect to Shares held in the name of two or more persons
shall be valid if executed by any one of them unless at or prior to the exercise
of the proxy the Trust receives a specific written notice to the contrary from
any one of them. A proxy purporting to be executed by or on behalf of a
Shareholder shall be deemed valid unless challenged at or prior to its exercise
and the burden of proving invalidity shall rest on the challenger.
Until Shares are issued, the Trustees may exercise all rights of
Shareholders and may take any action required by-law, this Declaration of Trust
or the By-Laws to be taken by Shareholders.
Voting Power and Meetings
- -------------------------
Section 2. Meetings of Shareholders of the Trust or of any series may be
---------
called by the Trustees, or such other person or persons as may be specific in
the By-Laws, and held from time to time for the purpose of taking action upon
any matter requiring the vote or the authority of the Shareholders of the Trust
or any series as herein provided or upon any other matter deemed by the Trustees
to be necessary or desirable. Meetings of Shareholders of the Trust or of any
series shall be called by the Trustees or such other person or persons as may be
specified in the By-Laws upon written application by Shareholders holding at
least 10% of the outstanding Shares of the Trust, if Shareholders
- 10 -
<PAGE>
of all series are required hereunder to vote in the aggregate and not by
individual series at such meeting, or of any series, if Shareholders of such
series are entitled hereunder to vote by individual series at such meeting,
requesting that a meeting be called for a purpose requiring action by the
Shareholders as provided herein or in the By-Laws. The Shareholders shall be
entitled to at least seven days' written notice of any meeting of the
Shareholders.
Quorum and Required Vote
- ------------------------
Section 3. A majority of the Shares entitled to vote shall be a quorum for
---------
the transaction of business at a Shareholders' meeting, except that where any
provision of law or of this Declaration of Trust permits or requires that
holders of any series shall vote as a series, then a majority of the aggregate
number of Shares of that series entitled to vote shall be necessary to
constitute a quorum for the transaction of business by that series. Any lesser
number, however, shall be sufficient for adjournments. Any adjourned session or
sessions may be held within a reasonable time after the date set for the
original meeting without the necessity of further notice.
Except when a larger vote is required by any provisions of this Declaration
of Trust or the By-Laws, a majority of the Shares voted on any matter shall
decide such matter and a plurality shall elect a Trustee, provided that where
any provision of law or of this Declaration of Trust permits or requires that
the holders of any series shall vote as a series, then a majority of the Shares
of that series voted on the matter shall decide that matter insofar as that
series is concerned.
Action by Written Consent
- -------------------------
Section 4. Any action taken by Shareholders may be taken without a meeting
---------
if a majority of Shareholders entitled to vote on the matter (or such larger
vote as shall be required by any provision of this Declaration of Trust or the
By-Laws) consent to the action in writing and such written consents are filed
with the records of the meetings of Shareholders. Such consent shall be treated
for all purposes as a vote taken at a meeting of Shareholders.
Additional Provisions
- ---------------------
Section 5. The By-Laws may include further provisions for Shareholders'
---------
votes and meetings and related matters.
- 11 -
<PAGE>
ARTICLE VI
Distributions, Redemptions and Repurchases,
and Determination of Net Asset Value
-------------------------------------------
Distributions
- -------------
Section 1. The Trustees may, but need not, each year distribute to the
---------
Shareholders of each series such income and gains, accrued or realized, as
the Trustees may determine, after providing for actual and accrued expenses and
liabilities (including such reserves as the Trustees may establish) determined
in accordance with good accounting practices. The Trustees shall have full
discretion to determine which items shall be treated as income and which items
as capital and their determination shall be binding upon the Shareholders.
Distributions of each year's income of each series, if any be made, may be made
in one or more payments, which shall be in Shares, in cash or otherwise and on a
date or dates determined by the Trustees. At any time and from time to time in
their discretion, the Trustees may distribute to the Shareholders of any one or
more series as of a record date or dates determined by the Trustees, in Shares,
in cash or otherwise, all or part of any gains, realized on the sale or
disposition of property of the Trust or otherwise, or all or part of any other
principal of the Trust. Each distribution pursuant to this Section 1 shall be
made ratably according to the number of Shares of the series held by the several
Shareholders on the applicable record date thereof, provided that no
distributions need be made on Shares purchased pursuant to orders received, or
for which payment is made, after such time or times as the Trustees may
determine. Any such distribution paid in Shares will be paid at the net asset
value thereof as determined in accordance with this Declaration of Trust.
Redemptions and Repurchases
- ---------------------------
Section 2. Any holder of Shares of the Trust may by presentation of a
---------
written request, together with his certificates, if any, for such Shares, in
proper form for transfer, at the office of the Trust or the Manager or at a
principal office of a transfer or shareholder service agent appointed by the
Trust, redeem his Shares for the net asset value thereof determined and computed
in accordance with the provisions of this Section 2 and the provisions of
Section 5 of Article VI of this Declaration of Trust.
Upon receipt by the Trust, the Manager or its transfer or shareholder
service agent of such written request for redemption of Shares, such Shares
shall be redeemed at the net asset value per share of the particular series next
- 12 -
<PAGE>
determined after such Shares are tendered in proper form for transfer to the
Trust or determined as of such other time fixed by the Trustees as may be
permitted or required by the 1940 Act, provided that no such tender shall be
required in the case of Shares for which a certificate or certificates have not
been issued, and in such case such Shares shall be redeemed at the net asset
value per share of the particular series next determined after such demand has
been received or determined at such other time fixed by the Trustees as may be
permitted or required by the 1940 Act.
The obligation of the Trust to redeem its Shares of each series as set
forth in this Section 2 shall be subject to the conditions that during any time
of emergency, as hereinafter defined, such obligation may be suspended by the
Trust by or under authority of the Trustees for such period or periods during
such time of emergency as shall be determined by or under authority of the
Trustees. If there is such a suspension, any Shareholder may withdraw any demand
for redemption and any tender of Shares which has been received by the Trust
during any such period and any tender of Shares the applicable net asset value
of which would but for such suspension be calculated as of a time during such
period. Upon such withdrawal, the Trust shall return to the Shareholder the
certificates therefor, if any. For the purposes of any such suspension "time of
emergency" shall mean, either with respect of all Shares or any series of
Shares, any period during which:
a. the New York Stock Exchange is closed other than for customary
weekend and holiday closing; or
b. the Trustees or authorized officers of the Trust shall have
determined, in compliance with any applicable rules and regulations of the
Securities and Exchange Commission, either that trading on the New York
Stock Exchange is restricted, or that an emergency exists as a result of
which (i) disposal by the Trust of securities owned by it is not reasonably
practicable or (ii) it is not reasonably practicable for the Trust fairly
to determine the current value of its net assets; or
c. The suspension or postponement of such obligations is permitted
by order of the Securities and Exchange Commission.
The Trust may also purchase, repurchase or redeem Shares in accordance with
such other methods, upon such other terms and subject to such other conditions
as the Trustees may from time to time authorize at a price not exceeding the net
asset value of such Shares in effect when the purchase or repurchase or any
contract to purchase or repurchase is made.
- 13 -
<PAGE>
Payment in Kind
- ---------------
Section 3. Subject to any generally applicable limitation imposed by the
---------
Trustees, any payment on redemption, purchase or repurchase by the Trust of
Shares may, if authorized by the Trustees, be made wholly or partly in kind,
instead of in cash. Such payment in kind shall be made by distributing
securities or other property, constituting, in the opinion of the Trustees, a
fair representation of the various types of securities and other property then
held by the series of Shares being redeemed purchased or repurchased (but not
necessarily involving a portion of each of the series' holdings) and taken at
their value used in determining the net asset value of the Shares in respect of
which payment is made.
Additional Provisions Relating to Redemptions and Repurchases
- -------------------------------------------------------------
Section 4. The completion of redemption, purchase or repurchase of Shares
---------
shall constitute a full discharge of the Trust and the Trustees with respect to
such Shares and the Trustees may require that any certificate or certificates
issued by the Trust to evidence the ownership of such Shares shall be
surrendered to the Trustees for cancellation or notation.
Determination of Net Asset Value
- --------------------------------
Section 5. The term "net asset value" of the Shares of each series shall
---------
mean: (i) the value of all the assets of such series; (ii) less total
liabilities of such series; (iii) divided by the number of Shares of such series
outstanding, in each case at the time of each determination. The "number of
Shares of such series outstanding" for the purposes of such computation shall be
exclusive of any Shares of such series to be redeemed, purchased or repurchased
by the Trust and not then redeemed, purchased or repurchased as to which the
price has been determined, but shall include Shares of such series presented for
redemption, purchase or repurchase by the Trust and not then redemmed, purchased
repurchased as to which the price has not been determined and Shares of such
series the sale of which has been confirmed. Any fractions involved in the
computation of net asset value per share shall be adjusted to the nearer cent
unless the Trustees shall determine to adjust such fraction of a cent.
The Trustees, or any officer, or officers or agent of the Trust designated
for the purpose by the Trustees shall determine the net asset value of the
Shares of each series, and the Trustees shall fix the time as of which the net
asset value of the Shares of each series shall be determined and shall fix the
periods during which any such net asset value shall be effective as to sales,
redemptions and repurchases of, and other transactions in, the Shares of such
series, except as such times and periods of any such transaction may be fixed by
other provisions of this Declaration of Trust or by the By-Laws.
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<PAGE>
In valuing the portfolio investments of any series for determination of net
asset value per share of such series, securities for which market quotations are
readily available shall be valued at prices which, in the opinion of the
Trustees or any officer, or officers or agent of the Trust designated for the
purpose by the Trustees, most nearly represent the market value of such
securities which may, but need not, be the most recent bid price obtained from
one or more of the market makers for such securities; other securities and
assets be valued at fair value as determined by or pursuant to the direction of
the Trustees. Notwithstanding the foregoing short-term debt obligations,
commercial paper, and repurchase agreements may be, but need not be, valued on
the basis of quoted yields for securities of comparable maturity, quality and
type, or on the basis of amortized cost. In the determination of net asset value
of any series, dividends receivable and accounts receivable for investments sold
and for Shares sold shall be stated at the amounts to be received therefor; and
income receivable accrued daily on bonds and notes owned shall be stated at the
amount to be received. Any other assets shall be stated at fair value as
determined by the Trustees or such officer, officers or agent pursuant to the
Trustees' authority, except that no value shall be assigned to good will,
furniture, lists, reports, statistics or other noncurrent assets other than real
estate. Liabilities of any series for accounts payable, for investments
purchased and for Shares tendered for redemption, purchase or repurchase by the
Trust and not then redeemed, purchased or repurchased as to which the price has
been determined shall be stated at the amounts payable therefor. In determining
net asset value of any series, the person or persons making such determination
on behalf of the Trust may include in liabilities such reserves, estimated
accrued expenses and contingencies as such person or persons may in its, his or
their best judgment deem fair and reasonable under the circumstances. Any income
dividends and gains distributions payable by the Trust shall be deducted as of
such time or times on the record date therefor as the Trustees shall determine.
The manner of determining the net assets of any series or of determining
the net asset value of the Shares of any series may from time to time be altered
as necessary or desirable in the judgment of the Trustees to conform to any
other method prescribed or permitted by any applicable law or regulation or
generally accepted accounting practice.
Determinations in accordance with Section 5 made in good faith shall be
binding on all parties concerned.
Maintenance of Constant Net Asset Value
- ---------------------------------------
Section 6. The Trust will use its best efforts to maintain the net asset
---------
value per share of each series at $1.00. In the event that the Trust, or any
series, incurs a
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<PAGE>
loss or liability, which the Trustees, in their sole discretion, determine to be
significant with respect to the maintenance by the Trust of a constant net asset
value of $1.00 per share for each series, the Trustees shall have the power (i)
to reduce the number of shares of the Trust, or the series, as the case may be,
by that number of full and fractional shares which represent the amount of such
loss or liability, by reducing the number of shares in the account of each
Shareholder of the Trust or the series, as the case may be, on a pro rata basis;
(ii) to offset the pro rata share of such loss or liability from the accrued
dividend account of each Shareholder of the Trust or the series, as the case may
be, and/or (iii) to cause to be recorded on the books of the Trust or the
series, as the case may be, an asset account in the amount of any such loss or
liability, which account may be reduced by the amount of dividends declared
thereafter upon the shares of the Trust or the series, as the case may be,
outstanding on the day any such loss or liability is incurred, until such asset
account is reduced to zero.
ARTICLE VII
Compensation and Limitation
of Liability of Trustees
---------------------------
Compensation
- ------------
Section 1. The Trustees as such shall be entitled to reasonable
---------
compensation from the Trust; they may fix the amount of their compensation.
Nothing herein shall in any way prevent the employment of any Trustee for
advisory, management, legal, accounting, investment banking or other services
and payment for the same by the Trust.
Limitation of Liability
- -----------------------
Section 2. The Trustees shall not be responsible or liable in any event for
---------
any neglect or wrongdoing of any officer, agent, employee, investment advisor or
manager, principal underwriter or custodian, nor shall any Trustee be
responsible for the act or omission of any other Trustee, but nothing herein
contained shall protect any Trustee against any liability to which he or she
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his or
her office.
Every note, bond, contract, instrument, certificate, Share or undertaking
and every other act or thing whatsoever executed or done by or on behalf of the
Trust or the Trustees or any of them in connection with the Trust shall be
conclusively deemed to have been executed or done only in or with respect to
their or his or her capacity as Trustees or Trustee, and such Trustees or
Trustee shall not be personally liable thereon.
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<PAGE>
ARTICLE VIII
Indemnification
---------------
Subject to the exceptions and limitations contained in this Article, every
person who is or has been, a Trustee or officer of the Trust shall be
indemnified by the Trust to the fullest extent permitted by law against
liability and against all expenses reasonably incurred or paid by him in
connection with any claim, action, suit or proceeding in which he becomes
involved as a party or otherwise by virtue of his being or having been a Trustee
or officer and against amounts paid or incurred by him in settlement thereof.
No indemnification shall be provided hereunder to a Trustee or officer:
(a) against any liability to the Trust or its stockholders by reason of a
final adjudication by the court or other body before which the
proceeding was brought that he engaged in willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved
in the conduct of his office;
(b) with respect to any matter as to which he shall have been finally
adjudicated not to have acted in good faith in the reasonable belief
that his action was in the best interests of the Trust;
(c) in the event of a settlement or other disposition, not involving a
final adjudication as provided in paragraph (a) or (b), resulting in a
payment by a Trustee or officer, unless there has been either a
determination that such director or officer did not engage in willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office by the court or other
body approving the settlement or other disposition or a reasonable
determination, based on a review of readily available facts (as
opposed to a full trial-type inquiry) that he did not engage in such
conduct:
(i) by a vote of a majority of the Disinterested Trustees acting on
the matter (provided that a majority of the Disinterested
Trustees then in office act on the matter); or
(ii) by written opinion of independent legal counsel.
- 17 -
<PAGE>
The rights of indemnification hereinafter provided may be insured against
by policies maintained by the Trust, shall be severable, shall not affect any
other rights to which any Trustee or officer may now or hereafter be entitled,
shall continue as to a person who has ceased to be such Trustee or officer and
shall inure to the benefit of the heirs, executors and administrators of such a
person. Nothing contained herein shall affect any rights to indemnification to
which Trust personnel other than Trustees and officers may be entitled by
contract or otherwise under law.
Expenses of preparation and presentation of a defense to any claim, action,
suit or proceeding of the character described in the last paragraph of this
Article shall be advanced by the Trust prior to final disposition thereof upon
receipt of an undertaking by or on behalf of the recipient to repay such amount
if it is ultimately determined that he is not entitled to indemnification under
this Article, provided that either:
(a) such undertaking is secured by a surety bond or some other
appropriate security or the Trust shall be insured against losses arising
out of any such advances; or
(b) a majority of the Disinterested Trustees acting on the matter
(provided that a majority of the Disinterested Trustees then in office act
on the matter) or independent legal counsel in a written opinion shall
determine, based upon a review of the readily available facts (as opposed
to a full trial-type inquiry), that there is reason to believe that the
recipient ultimately will be found entitled to indemnification.
As used in this Article, a "Disinterested Trustee" is one (i) who is not an
"interested person" of the Trust (as defined by the Investment Company Act of
1940) (including anyone who has been exempted from being an "interested person"
by any rule, regulation or order of the Securities and Exchange Commission), and
(ii) against whom none of such actions, suits or other proceedings or another
action, suit or other proceeding on the same or similar grounds is then or has
been pending.
As used in this Article, the words "claim", "action", "suit" or
"proceeding" shall apply to all claims, actions, suits or proceedings (civil,
criminal or other, including appeals), actual or threatened; and the words
"liability" and "expenses" shall include without limitation, attorneys' fees,
costs, judgments, amounts paid in settlement, fines, penalties and other
liabilities.
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<PAGE>
"In case of any Shareholder or former Shareholder shall be held to be
personally liable solely by reason of his or her being or having been a
Shareholder and not because of his or her acts or omissions or for some other
reason, the Shareholder or former Shareholder (or his or her heirs, executors,
administrators or other legal representatives or in the case of a corporation or
other entity, its corporate or other general successor) shall be entitled out
of the assets of the Trust to be held harmless from and indemnified against all
loss and expense arising from such liability."
ARTICLE IX
Miscellaneous
-------------
Trustees, Shareholders, etc. Not Personally Liable; Notice
- ----------------------------------------------------------
Section 1. All persons extending credit to, contracting with or having any
---------
claim against the Trust shall look only to the assets of the Trust for payment
under such credit, contract or claim; and neither the Shareholders not the
Trustees, nor any of the Trust's officers, employees or agents, whether past,
present or future, shall be personally liable therefor. Nothing in this
Declaration of Trust shall protect any Trustee against any liability to which
such Trustee would otherwise be subject by reason of willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of the office of the Trustees.
Every note, bond, contract, instrument, certificate or undertaking made or
issued by the Trustees or by any officers or officer shall give notice that this
Declaration of Trust is on file with the Secretary of The Commonwealth of
Massachusetts and shall recite that the same was executed or made by or on
behalf of the Trust or by them as Trustees or Trustee or as officers or officer
and not individually and that the obligations of such instrument are not binding
upon any of them or the Shareholders individually but are binding only upon the
assets and property of the Trust, and may contain such further recital as he or
she or they may deem appropriate, but the omission thereof shall not operate to
bind any Trustees or Trustee or officers or officer or Shareholders or
Shareholder individually.
Trustee's Good Faith Action, Expert Advice, No Bond or Surety
- -------------------------------------------------------------
Section 2. The exercise by the Trustees of their powers and discretions
---------
hereunder shall be binding upon everyone interested. A Trustee shall be liable
for his or her own willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of the office
- 19 -
<PAGE>
of Trustee, and for nothing else, and shall not be liable for errors of
judgment or mistakes of fact or law. The Trustees may take advice of counsel or
other experts with respect to the meaning and operation of this Declaration of
Trust, and shall be under no liability for any act or omission in accordance
with such advice or for failing to follow such advice. The Trustees shall not be
required to give any bond as such, nor any surety if a bond is required.
Liability of Third Persons Dealing with Trustees
- ------------------------------------------------
Section 3. No person dealing with the Trustees shall be bound to make any
---------
inquiry concerning the validity of any transaction made or to be made by the
Trustees or to see to the application of any payments made or property
transferred to the Trust or upon its order.
Duration and Termination of Trust
- ---------------------------------
Section 4. Unless terminated as provided herein, the Trust shall continue
---------
without limitation of time. The Trust may be terminated at any time by vote of
Shareholders holding at least a majority of the Shares entitled to vote or by
the Trustees by written notice to the Shareholders. Any series of Shares may be
terminated at any time by vote of Shareholders holding at least a majority of
the Shares of such series entitled to vote or by the Trustees by written notice
to the Shareholders of such series.
Upon termination of the Trust or of any one or more series of Shares, after
paying or otherwise providing for all charges, taxes, expenses and liabilities,
whether due or accrued or anticipated, of the particular series as may be
determined by the Trustees, the Trust shall in accordance with such procedures
as the Trustees consider appropriate reduce the remaining assets to
distributable form in cash or shares or other securities, or any combination
thereof, and distribute the proceeds to the Shareholders of the series involved,
ratably according to the number of Shares of such series held by the several
Shareholders of such series on the date of termination.
Filing of Copies, References, Headings
- --------------------------------------
Section 5. The original or a copy of this instrument and of each amendment
---------
hereto shall be kept at the office of the Trust where it may be inspected by any
Shareholder. A copy of this instrument and of each amendment hereto shall be
filed by the Trust with the Secretary of The Commonwealth of Massachusetts and
with the Boston City Clerk, as well as any other governmental office where such
filing may from time to time be required. Anyone dealing with the Trust may
- 20 -
<PAGE>
rely on a certificate by an officer of the Trust as to whether or not any such
amendments have been made and as to any matters in connection with the Trust
hereunder; and, with the same effect as if it were the original, may rely on a
copy certified by an officer of the Trust to be a copy of this instrument or of
any such amendments. In this instrument and in any such amendment, references to
this instrument, and all expressions like "herein", "hereof", and "hereunder",
shall be deemed to refer to this instrument as amended from time to time.
Headings are placed herein for convenience of reference only and shall not be
taken as a part hereof or control or affect the meaning, construction or effect
of this instrument. This instrument may be executed in any number of
counterparts each of which shall be deemed an original.
Applicable Law
- --------------
Section 6. This Declaration of Trust is made in The Commonwealth of
---------
Massachusetts, and it is created under and is to be governed by and construed
and administered according to the laws of said Commonwealth. The Trust shall be
of the type commonly called a Massachusetts business trust, and without limiting
the provisions hereof, the Trust may exercise all powers which are ordinarily
exercised by such a trust.
Amendments
- ----------
Section 7. This Declaration of Trust may be amended at any time by an
---------
instrument in writing signed by a majority of the then Trustees when authorized
so to do by vote of Shareholders holding a majority of the Shares entitled to
vote, except that an amendment which shall affect the holders of one or more
series of Shares but not the holders of all outstanding series shall be
authorized by vote of the Shareholders holding a majority of the Shares entitled
to vote of each series affected and no vote of Shareholders of a series not
affected shall be required. Amendments having the purpose of changing the name
of the Trust or of supplying any omission, curing any ambiguity or curing,
correcting or supplimenting any defective or inconsistent provision contained
herein shall not require authorization by Shareholder vote.
IN WITNESS WHEREOF, the undersigned have hereunto set their hands and seals
in the City of Boston, Massachusetts for themselves and their assigns, as of the
day and year first above written.
____________________________
____________________________
____________________________
- 21 -
<PAGE>
THE COMMONWEALTH OF MASSACHUSETTS
Suffolk, ss. Boston
Then personally appeared the above-named Alfred P. West, Jr., William M.
Doran, Richard F. Blanchard and F. Wendell Gooch, and acknowledged the foregoing
instrument to be their free act and deed, before me,
___________________________
Notary Public
My commission expires:
(Notary's Seal)
<PAGE>
TRUSTFUNDS LIQUID ASSET TRUST
WRITTEN INSTRUMENT AMENDING THE AGREEMENT
AND DECLARATION OF TRUST
The undersigned, being at least a majority of the Trustees of TrustFunds
Liquid Asset Trust, a business trust organized under the laws of the
Commonwealth of Massachusetts pursuant to an Agreement and Declaration of Trust
dated July 20, 1981 (the "Declaration of Trust"), and being authorized by the
Unitholders of said Trust to effect this amendment, do hereby amend pursuant
to Article IX, Section 7 of the Declaration of Trust, effective upon the signing
of this instrument, the Declaration of Trust as follows:
Article III, Section 1, Article IV, Section 7, and Article V, Section 1 are
hereby amended in their entirety to read as follows:
ARTICLE III
Shares
Division of Beneficial Interest
Section 1. The Shares of the Trust shall be issued in one or more series
as the Trustees may, without shareholder approval, authorize. Each series shall
be preferred over all other series in respect of the assets allocated to that
series. The beneficial interest in each series shall at all times be divided
into Shares, without par value, each of which shall represent an equal
proportionate interest in the series with each other Share of the same series,
none having priority or preference over another. The number of Shares authorized
shall be unlimited, and the Shares so authorized may be represented in part by
fractional shares. The Trustees may from time to time divide or combine the
Shares of any series or class into a greater or lesser number without thereby
changing the proportionate beneficial interests in the series or class.
ARTICLE IV
The Trustees
Advisory, Management and Distribution
Section 7. The Trustees may, at any time and from time to time, contract
for exclusive or nonexclusive advisory and/or
<PAGE>
management services with SEI Financial Management Corporation (the "Manager"), a
Delaware corporation, and/or any other corporation, trust, association or other
organization, every such contract to comply with such requirements and
restrictions as may be set forth in the By-Laws; and any such contract may
contain such other terms interpretive of or in addition to said requirements and
restrictions as the Trustees may determine, including, without limitation,
authority to determine from time to time what investments shall be purchased,
held, sold, or exchanged and what portion, if any, of the assets of the Trust
shall be held uninvested and to make changes in the Trust's investments. The
Trustees may also, at any time and from time to time, contract with any other
corporation, trust, association or other organization, appointing it exclusive
or nonexclusive distributor or principal underwriter for the Shares, every such
contract to comply with such requirements and restrictions as may be set forth
in the By-Laws; and any such contract may contain such other terms interpretive
of or in addition to said requirements and restrictions as the Trustees may
determine.
The fact that:
(i) any of the Shareholders, Trustees or officers of the Trust is a
shareholder, director, officer, partner, trustee, employee, manager,
advisor, principal underwriter, or distributor or agent of or for any
corporation, trust, association, or other organization, or of or for any
parent or affiliate of any organization, with which an advisory or
management or principal underwriter's or distributor's contract, or
transfer, Shareholder services or other agency contract may have been or
may hereafter be made, or that any such organization, or any parent or
affiliate thereof, is a Shareholder or has an interest in the Trust, or
that
(ii) any corporation, trust, association or other organization with
which an advisory or management or principal underwriter's or distributor's
contract, or transfer, Shareholder services or other agency contract may
have been or may hereafter be made also has an advisory or management
contract, or principal underwriter's or distributor's contract, or
transfer, Shareholder services or other agency contract with one or more
other corporations, trusts, associations, or other organizations, or has
other businesses or interests.
shall not affect the validity of any such contract or disqualify any
Shareholder, trustee or officer of the Trust from voting upon or executing the
same or create any liability or accountability to the Trust or its Shareholders.
- 2 -
<PAGE>
ARTICLE V
Shareholders' Voting Powers and Meetings
Voting Powers
Section 1. The Shareholders shall have power to vote only (i) for the
election or removal of Trustees as provided in Article IV, Section 1, (ii) with
respect to the approval of any investment advisory contract as provided in
Article IV, Section 7, (iii) with respect to any termination of the Trust to the
extent and as provided in Article IX, Section 4, (iv) with respect to any
amendment of this Declaration of Trust to the extent and as provided in Article
IX, Section 7, (v) to the same extent as the stockholders of a Massachusetts
business corporation as to whether or not a court action, proceeding or claim
should or should not be brought or maintained derivatively or as a class action
on behalf of the Trust or the Shareholders, and (vi) with respect to such
additional matters relating to the Trust as may be required by law, this
Declaration of Trust, the By-Laws or any registration of the Trust with the
Commission (or any successor agency) or any state, or as the Trustees may
consider necessary or desirable.
Each whole Share shall be entitled to one vote as to any matter on which it
is entitled to vote and each fractional Share shall be entitled to a
proportionate fractional vote. On any matter submitted to a vote of Shareholders
all Shares of the Trust then entitled to vote, irrespective of series, shall be
voted in the aggregate and not by series, except (i) when required by the 1940
Act, Shares shall be voted by individual series, in which event, unless
otherwise required by the 1940 Act, a vote of Shareholders of all shares of the
Trust, irrespective of series, shall not be required; and (2) when the Trustees
have determined that the matter affects only the interests of one or more
series, than only Shareholders of such series shall be entitled to vote thereon.
There shall be no cumulative voting in the election of Trustees. Shares may be
voted in person or by proxy.
A proxy with respect to Shares held in the name of two or more persons
shall be valid if executed by any one of them unless at or prior to the exercise
of the proxy the Trust receives a specific written notice to the contrary from
any of them. A proxy purporting to be executed by or on behalf of a Shareholder
shall be deemed valid unless challenged at or prior to its exercise and the
burden of proving invalidity shall rest on the challenger.
Until Shares are issued, the Trustees may exercise all rights of
Shareholders and may take any action required by law, this Declaration of Trust
or the By-Laws to be taken by Shareholders.
- 3 -
<PAGE>
This instrument may be executed in several counterparts, each of which
shall be deemed an original, but all taken together shall constitute one
instrument.
IN WITNESS WHEREOF AND UNDER PENALTIES OF PERJURY, the undersigned swear
that the foregoing is their free act and deed and they have set their respective
hands hereunder as of this 10th day of December, 1986.
/s/ Alfred P. West, Jr.
- ------------------------------
Alfred P. West, Jr.
/s/ Edward W. Binshadler
- ------------------------------
Edward W. Binshadler
/s/ Richard F. Blanchard
- ------------------------------
Richard F. Blanchard
/s/ William M. Doran
- ------------------------------
William M. Doran
/s/ F. Wendell Gooch
- ------------------------------
F. Wendell Gooch
<PAGE>
TRUSTFUNDS LIQUID ASSET TRUST
WRITTEN INSTRUMENT AMENDING THE DECLARATION OF TRUST
The undersigned, being all of the Trustees of TrustFunds Liquid Asset
Trust, a business trust organized under the laws of The Commonwealth of
Massachusetts pursuant to a Declaration of Trust dated July 20, 1981, do hereby
amend, effective upon the filing of this instrument in the office of the
Secretary of State of The Commonwealth of Massachusetts, the Declaration of
Trust by deleting the word "TrustFunds" wherever it appears therein and
inserting in place thereof the words "SEI".
This instrument may be executed in several counterparts, each of which
shall be deemed an original, but all taken together shall constitute one
instrument.
IN WITNESS WHEREOF, the undersigned have signed these presents on the dates
indicated.
/s/ Alfred P. West, Jr. December 23, 1988
- ------------------------------
Alfred P. West, Jr.
/s/ William M. Doran December 23, 1988
- ------------------------------
William M. Doran
December 23, 1988
- ------------------------------
Edward W. Binshadler
December 23, 1988
- ------------------------------
Richard F. Blanchard
December 23, 1988
- ------------------------------
F. Wendell Gooch
<PAGE>
As amended
2/5/82
10/15/82
9/17/85
BY-LAWS
-------
OF
--
TRUSTFUNDS LIQUID ASSET TRUST
-----------------------------
Section 1. Agreement and Declaration of
Trust and Principal Office
----------------------------------------
1.1 Agreement and Declaration of Trust. These By-Laws shall be subject to the
----------------------------------
Agreement and Declaration of Trust, as from time to time in effect (the
"Declaration of Trust"), of TRUSTFUNDS LIQUID ASSET TRUST, the Massachusetts
business trust established by the Declaration of Trust (the "Trust").
1.2 Principal Office of the Trust. The principal office of the Trust shall be
-----------------------------
located in Boston, Massachusetts.
Section 2. Shareholders
-----------------------
2.1 Meetings. A meeting of the shareholders of the Trust or by any one or more
--------
series of shares may be called at any time by the Trustees, by the president or,
if the Trustees and the president shall fail to call any meeting of shareholders
for a period of 30 days after written application of one or more shareholders
who hold at least 10% of all outstanding shares of the Trust, if shareholders of
all series are required under the Declaration of Trust to vote in the aggregate
and not by individual series at such meeting, or of any series, if shareholders
of such series are entitled under the Declaration of Trust to vote by individual
series at such meeting, then such shareholders may call such meeting. If the
meeting is a meeting of the shareholders of one or more series of shares, but
not a meeting of all shareholders of the Trust, then only the shareholders of
such one or more series shall be entitled to notice of and to vote at the
meeting. Each call of a meeting shall state the place,date, hour and purposes of
the meeting.
2.2 Place of Meetings. All meetings of the shareholders shall be held at the
-----------------
principal office of the Trust, or to the extent permitted by the Declaration of
Trust, at such other place within the United States as shall be designated by
the Trustees or the president of the Trust.
<PAGE>
2.3 Notice of Meetings. A written notice of each meeting of shareholders,
------------------
stating the place, date and hour and the purposes of the meeting, shall be given
at least seven days before the meeting to each shareholder entitled to vote
thereat by leaving such notice with him or at his residence or usual place of
business or by mailing it, postage prepaid, and addressed to such shareholder at
his address as it appears in the records of the Trust. Such notice shall be
given by the secretary or an assistant secretary or by an officer designated by
the Trustees. No notice of any meeting of shareholders need be given to a
shareholder if a written waiver of notice, executed before or after the meeting
by such shareholder or his attorney thereunto duly authorized, is filed with the
records of the meeting.
2.4 Ballots. No ballot shall be required for any election unless requested by a
-------
shareholder present or represented at the meeting and entitled to vote in the
election.
2.5 Proxies. Shareholders entitled to vote may vote either in person or by proxy
-------
in writing dated not more than six months before the meeting named therein,
which proxies shall be filed with the secretary or other person responsible to
record the proceedings of the meeting before being voted. Unless otherwise
specifically limited by their terms, such proxies shall entitle the holders
thereof to vote at any adjournment of such meeting but shall not be valid after
the final adjournment of such meeting.
Section 3. Trustees
-------------------
3.1 Committees and Advisory Board. The Trustees may appoint from their number an
-----------------------------
executive committee and other committees. Except as the Trustees may otherwise
determine, any such committee may make rules for conduct of its business. The
Trustees may appoint an advisory board to consist of not less than two nor more
than five members. The members of the advisory board shall be compensated in
such manner as the Trustees may determine and shall confer with and advise the
Trustees regarding the investments and other affairs of the Trust. Each member
of the advisory board shall hold office until the first meeting of the Trustees
following the next meeting of the shareholders and until his successor is
elected and qualified, or until he sooner dies, resigns, is removed, or becomes
disqualified or until the advisory board is sooner abolished by the Trustees.
3.2 Regular Meetings. Regular meetings of the Trustees may be held without call
----------------
or notice at such places and at such times as the Trustees may from time to time
determine, provided that notice of the first regular meeting following any such
determination shall be given to absent Trustees.
- 2 -
<PAGE>
3.3 Special Meetings. Special meetings of the Trustees may be held at any time
----------------
and at any place designated in the call of the meeting when called by the
Chairman of the Board, the president or the treasurer or by two or more
Trustees, sufficient notice thereof being given to each Trustee by the secretary
or an assistant secretary or by the officer or one of the Trustees calling the
meeting.
3.4 Notice. It shall be sufficient notice to a Trustee to send notice by mail at
------
least forty-eight hours or by telegram at least twenty-four hours before the
meeting addressed to the Trustee at his or her usual or last known business or
residence address or to give notice to him or her in person or by telephone at
least twenty-four hours before the meeting. Notice of a meeting need not be
given to any Trustee if a written waiver of notice, executed by him or her
before or after the meeting, is filed with the records of the meeting, or to any
Trustee who attends the meeting without protesting prior thereto or at its
commencement the lack of notice to him or her. Neither notice of a meeting nor a
waiver of a notice need specify the purposes of the meeting.
3.5 Quorum. At any meeting of the Trustees one-third of the Trustees than in
------
office shall constitute a quorum; provided, however, a quorum shall not be less
than two. Any meeting may be adjourned from time to time by a majority of the
votes cast upon the question, whether or not a quorum is present, and the
meeting may be held as adjourned without further notice.
Section 4. Officers and Agents
------------------------------
4.1 Enumeration; Qualification. The officers of the Trust shall be a president,
--------------------------
a treasurer, a secretary and such other officers, if any, as the Trustees from
time to time may in their discretion elect or appoint. The Trust may also have
such agents, if any, as the Trustees from time to time may in their discretion
appoint. Any officer may be but none need be a Trustee or shareholder. Any two
or more offices may be held by the same person.
4.2 Powers. Subject to the other provisions of these By-Laws, each officer shall
------
have, in addition to the duties and powers herein and in the Declaration of
Trust set forth, such duties and powers as are commonly incident to his or her
office as if the Trust were organized as a Massachusetts business corporation
and such other duties and powers as the Trustees may from time to time
designate.
4.3 Election. The president, the treasurer and the secretary shall be elected
--------
annually by the Trustees. Other officers, if any, may be elected or appointed by
the Trustees at said meeting or at any other time.
- 3 -
<PAGE>
4.4 Tenure. The president, the treasurer and the secretary shall hold office
------
until their respective successors are chosen and qualified, or in each case
until he or she sooner dies, resigns, is removed or becomes disqualified. Each
other officer shall hold office at the pleasure of the Trustees. Each agent
shall retain his or her authority at the pleasure of the Trustees.
4.5 President and Vice Presidents. The president shall be the chief executive
-----------------------------
officer of the Trust. The president shall, subject to the control of the
Trustees, have general charge and supervision of the business of the Trust. Any
vice president shall have such duties and powers as shall be designated from
time to time by the Trustees.
4.6 Chairman of the Board. If a Chairman of the Board of Trustees is elected,
---------------------
he shall have the duties and powers specified in these bylaws and, except as the
Trustees shall otherwise determine, preside at all meetings of the stockholders
and of the Trustees at which he or she is present and have such other duties and
powers as may be determined by the Trustees.
4.7. Treasurer and Controller. The treasurer shall be the chief financial
------------------------
officer of the Trust and subject to any arrangement made by the Trustees with a
bank or trust company or other organization as custodian or transfer or
shareholder services agent, shall be in charge of its valuable papers and shall
have such other duties and powers as may be designated from time to time by the
Trustees or by the president. If at any time there shall be no controller, the
treasurer shall also be the chief accounting officer of the Trust and shall have
the duties and power prescribed herein for the controller. Any assistant
treasurer shall have such duties and powers as shall be designated from time to
time by the Trustees.
The controller, if any be elected, shall be the chief accounting officer of the
Trust and shall be in charge of its books of account and accounting records. The
Controller shall be responsible for preparation of financial statements of the
Trust and shall have such other duties and powers as may be designated from time
to time by the Trustees or the President.
4.8 Secretary and Assistant Secretaries. The secretary shall record all
-----------------------------------
proceedings of the shareholders and the Trustees in books to be kept therefor,
which books shall be kept at the principal office of the Trust. In the absence
of the secretary from any meeting of shareholders of Trustees, an assistant
secretary, or if there be none or he or she is absent, a temporary clerk chosen
at the meeting shall record the proceedings thereof in the aforesaid books.
- 4 -
<PAGE>
Section 5. Resignations and Removals
------------------------------------
Any Trustee, officer or advisory board member may resign at any time by
delivering his or her resignation in writing to the Chairman of the Board, the
president, the treasurer or the secretary or to a meeting of the Trustees. The
Trustees may remove any officer elected by them with or without cause by the
vote of a majority of the Trustees then in office. Except to the extent
expressly provided in a written agreement with the Trust, no Trustee, officers,
or advisory board member resigning, and no officer or advisory board member
removed shall have any right to any compensation for any period following his or
her resignation or removal, or any right to damages on account of such removal.
Section 6. Vacancies
--------------------
A vacancy in any office may be filled at any time. Each successor shall hold
office for the unexpired term, and in the case of the president, the treasurer
and the secretary, until his or her successor is chosen and qualified, or in
each case until he or she sooner dies, resigns, is removed or becomes
disqualified.
Section 7. Shares of Beneficial Interest
----------------------------------------
7.1 Share Certificates. No certificate certifying the ownership of shares shall
------------------
be issued except as the Trustees may otherwise authorize. In the event that the
Trustees authorize the issuance of share certificates, subject to the provisions
of Section 7.3, each shareholder shall be entitled to a certificate stating the
number of shares owned by him or her, in such form as shall be prescribed from
time to time by the Trustees. Such certificate shall be signed by the president
or a vice president and by the treasurer or an assistant treasurer. Such
signatures may be facsimiles if the certificate is signed by a transfer or
shareholder services agent or by a registar, other than a Trustee, officer or
employee of the Trust. In case any officer who has signed or whose facsimile
signature has been placed on such certificate shall have ceased to be such
officer before such certificate is issued, it may be issued by the Trust with
the same effect as if he or she were such officer at the time of its issue.
- 5 -
<PAGE>
In lieu of issuing certificates for shares, the Trustees or the transfer or
shareholder services agent may either issue receipts therefor or may keep
accounts upon the books of the Trust for the record holders of such shares, who
shall in either case be deemed, for all purposes hereunder, to be the holders of
certificates for such shares as if they had accepted such certificates and shall
be held to have expressly assented and agreed to the terms hereof.
7.2 Loss of Certificates. In the case of the alleged loss or destruction or the
--------------------
mutilation of a share certificate, a duplicate certificate may be issued in
place thereof, upon such terms as the Trustees may prescribe.
7.3 Discontinuance of Issuance of Certificates. The Trustees may at any time
------------------------------------------
discontinue the issuance of share certificates and may, by written notice to
each shareholder, require the surrender of share certificates to the Trust for
cancellation. Such surrender and cancellation shall not affect the ownership of
shares in the Trust.
Section 8. Record Date
----------------------
The Trustees may fix in advance a time, which shall not be more than 60 days
before the date of any meeting of shareholders or the date for the payment of
any dividend or making of any other distribution to shareholders, as the record
date for determining the shareholders having the right to notice and to vote at
such meeting and any adjournment thereof or the right to receive such dividend
or distribution, and in such case only shareholders of record on such record
date shall have such right, notwithstanding any transfer of shares on the books
of the Trust after the record date.
Section 9. Seal
---------------
The seal of the Trust shall, subject to alteration by the Trustees, consist of a
flat-faced circular die with the word "Massachusetts" together with the name of
the Trust and the year of its organization, cut or engraved thereon; but, unless
otherwise required by the Trustees, the seal shall not be necessary to be placed
on, and its absence shall not impair the validity of, any document, instrument
or other paper executed and delivered by or on behalf of the Trust.
- 6 -
<PAGE>
Section 10. Execution of Papers
-------------------------------
Except as the Trustees may generally or in particular cases authorize the
execution thereof in some other manner, all deeds, leases, transfers, contracts,
bonds, notes, checks, drafts and other obligations made, accepted or endorsed by
the Trust shall be signed, and any transfers of securities standing in the name
of the Trust shall be executed, by the president or by one of the vice
presidents or by the treasurer or by whomsoever else shall be designated for
that purpose by the vote of the Trustees and need not bear the seal of the
Trust.
Section 11. Fiscal Year
-----------------------
Except as from time to time otherwise provided by the Trustees, the fiscal year
of the Trust shall end on September 30 in each year.
Section 12. Provisions Relating to the
Conduct of the Trust's Business
-------------------------------------------
12.1 Dealings with Affiliates. The Trust shall not purchase or retain securities
------------------------
issued by any issuer if one or more of the holders of the securities of such
issuer or one or more of the officers or directors of such issuer is an officer
or Trustee of the Trust or officer or director of any organization, association
or corporation with which the Trust has an investment advisor's contract
("investment advisor"), if to the knowledge of the Trust one or more of such
officers or Trustees of the Trust or such officers or directors of such
investment advisors owns beneficially more than one-half of one percent of the
shares or securities of such issuer and such officers, Trustees and directors
owning more than one-half of one percent of such shares or securities together
own beneficially more than five percent of such outstanding shares or
securities. Each Trustee and officer of the Trust shall give notice to the
secretary of the identity of all issuers whose securities are held by the Trust
of which such officer or Trustee owns as much as one-half of one percent of the
outstanding securities, and the Trust shall not be charged with the knowledge of
such holdings in the absence of receiving such notice if the Trust has requested
such information not less often than quarterly.
Subject to the provisions of the preceding paragraph, no officer, Trustee or
agent of the Trust and no officer, director or agent of any investment advisor
shall deal for or on behalf of the Trust with himself as principal or agent, or
with any partnership, association or corporation
-7-
<PAGE>
in which he has a material financial interest; provided that the foregoing
provisions shall not prevent (a) officers and Trustees of the Trust from buying,
holding or selling shares in the Trust, or from being partners, officers or
directors of or financially interested in any investment advisor to the Trust or
in any corporation, firm or association which may at any time have a
distributor's or principal underwriter's contract with the Trust; (b) purchases
or sales of securities or other property if such transaction is permitted by or
is exempt or exempted from the provisions of the Investment Company Act of 1940
for any Rule or Regulation thereunder and if such transaction does not involve
any commission or profit to any security dealer who is, or one or more of whose
partners, shareholders, officers or directors is an officer or Trustee of the
Trust or an officer or director of the investment advisor, manager or principal
underwriter of the Trust; (c) employment of legal counsel, registrar, transfer
agent, shareholder services, dividend disbursing agent or custodian who is, or
has a partner, stockholder, officer or director who is, an officer or Trustees
of the Trust; (d) sharing statistical, research and management expenses,
including office hire and services, with any other company in which an officer
or Trustee of the Trust is an officer or director or financially interested.
12.2 Dealing in Securities of the Trust. The Trust, the investment advisor, any
----------------------------------
corporation, firm or association which may at any time have an exclusive
distributor's or principal underwriter's contract with the Trust (the
"distributor") and the officers and Trustees of the Trust and officers and
directors of every investment advisor and distributor, shall not take long or
short positions in the securities of the Trust, except that:
(a) the distributor may place orders with the Trust for its shares
equivalent to orders received by the distributor;
(b) shares of the Trust may be purchased at not less than net asset value
for investment by the investment advisor and by officers and directors of
the distributor, investment advisor, or the Trust and by any trust,
pension, profit-sharing or other benefit plan for such persons, no such
purchase to be in contravention of any applicable state or federal
requirement.
12.3 Limitation on Certain Loans. The Trust shall not make loans to any officer,
---------------------------
Trustee or employee of the Trust or any investment Advisor or distributor or
their respective officers, directors or partners or employees.
- 8 -
<PAGE>
12.4 Custodian. All Securities and cash owned by the Trust shall be maintained
---------
in the custody of one or more banks or trust companies having (according to its
last published report) not less than two million dollars ($2,000,000) aggregate
capital, surplus and undivided profits (any such bank or trust company is
hereinafter referred to as the "custodian"); provided, however, the custodian
may deliver securities as collateral on borrowings effected by the Trust,
provided, that such delivery shall be conditioned upon receipt of the borrowed
funds by the custodian except where additional collateral is being pledged on an
outstanding loan and the custodian may deliver securities lent by the Trust
against receipt of initial collateral specified by the Trust. Subject to such
rules, regulations and orders, if any, as the Securities and Exchange Commission
may adopt, the Trust may, or may permit any custodian to, deposit all or any
part of the securities owned by the Trust in a system for the central handling
of securities operated by the Federal Reserve Banks, or established by a
national securities exchange or national securities association registered with
said Commission under the Securities Exchange Act of 1934, or such other person
as may be permitted by said Commission, pursuant to which system all securities
of any particular class or series of any issue deposited with the system are
treated as fungible and may be transferred or pledged by bookkeeping entry,
without physical delivery of such securities.
The Trust shall upon the resignation or inability to serve of its custodian or
upon change of the custodian:
(a) in the case of such resignation or inability to serve use its best
efforts to obtain a successor custodian;
(b) require that the cash and securities owned by this corporation be
delivered directly to the successor custodian; and
(c) in the event that no successor custodian can be found, submit to the
shareholders, before permitting delivery of the cash and securities owned
by this Trust otherwise than to a successor custodian, the question
whether or not this Trust shall be liquidated or shall function without a
custodian.
12.5 Limitations on Investment. The Trust shall not:
-------------------------
(a) Invest in securities other than those described in the Trust's then
current prospectus as appropriate for the series of shares for which such
securities are being purchased, except that the Trust may make temporary
- 9 -
<PAGE>
investments for any series of shares in notes issued by or on behalf of
municipal or corporate issuers, obligations of the United States
Government and its agencies or instrumentalities, and any such items
subject to short-term repurchase agreements.
(b) Purchase securities of any issuer (except the United States
Government, its agencies and instrumentalities and any security guaranteed
thereby) if as a result more than 5% of the total assets of any series of
shares (based on their current value at the time of investment) would be
invested in the securities of such issuer.
(c) Invest in companies for the purpose of exercising control.
(d) Purchase any securities which would cause more than 25% of the total
assets of any series of shares, based on current value at the time of such
purchase, to be invested in the securities of one or more issuers
conducting their principal business activities in the same industry,
provided that this limitation does not apply to investments in (i) banks,
and (ii) obligations issued or guaranteed by the United States Government,
its agencies and instrumentalities. Neither business credit, personal
credit and industrial credit finance companies as a group nor utility
companies as a group are considered a single industry for purposes of this
limitation.
(e) "Purchase or sell real estate, commodities or commodities contracts.
However, subject to the permitted investments of any series of shares, the
Trust may purchase obligations issued by companies which invest in real
estate, commodities or commodities contracts."
(f) Purchase securities on margin, make short sales of securities or
maintain a short position, except that the Trust may obtain short-term
credits as necessary for the clearance of security transactions.
(g) Borrow money in any series of shares except for temporary or emergency
purposes of that series, and then only in an amount not exceeding 10% of
the value of the total assets of that series of shares. The Trust will
repay all borrowings in a particular series of shares before making
additional investments for that series.
- 10 -
<PAGE>
(h) Make loans, except that any series of shares may purchase or hold debt
instruments in accordance with its investment objective and policies, and
may enter into repurchase agreements; provided that repurchase agreements
maturing in more than seven days are not to exceed 10% of the total assets
of any series of shares.
(i) Pledge, mortgage or hypothecate the assets of any series of shares
except to secure temporary borrowings permitted by (g) above in aggregate
amounts not to exceed 10% of the total assets of that series at the time of
the incurrence of such loan, taken at market value.
(j) Act as an underwriter of securities of other issuers, except as it may
be deemed an underwriter in selling shares of any series.
(k) Purchase securities of other investment companies except as permitted
by the Investment Company Act of 1940 and the rules and regulations
thereunder, and in any event may not purchase securities of other open-end
investment companies.
(l) Issue senior securities (as defined in the Investment Company Act of
1940), except as permitted by (g) above or by rule, regulation or order of
the Securities and Exchange Commission.
(m) Purchase or retain securities of an issuer if, to the knowledge of the
Trust, an officer, trustee, partner or director of the Trust or of any
investment advisor of the Trust owns beneficially more than 1/2 of 1% of
the shares or securities of such issuer and all such officers, trustees,
partners and directors owning more than 1/2 of 1% of such shares or
securities together own more than 5% of such shares or securities.
(n) Purchase securities of any company which has (with predecessors) a
record of less than three years' continuing operations, if as a result more
than 5% of the total assets of any series of shares (taken at current
value) would be invested in such securities.
(o) Purchase puts, calls, straddles, spreads or combinations thereof.
(p) Invest in interests in oil, gas or other mineral exploration or
development programs.
-11-
<PAGE>
(q) Invest in securities or other instruments (except for repurchase
agreements) with legal or contractual restrictions on resale or for which
no readily available market exists.
12.6 Reports to Shareholders; Distributions from Realized Gains. The Trust shall
----------------------------------------------------------
send to each shareholder of record at least annually a statement of the
condition of the Trust and of the results of its operation, containing all
information required by applicable laws or regulations.
Section 13. Amendments
----------------------
These By-Laws may be amended or repealed, in whole or in part, by a majority of
the Trustees than in office at any meeting of the Trustees, or by one or more
writings signed by the majority.
<PAGE>
INVESTMENT ADVISORY AGREEMENT
-----------------------------
AGREEMENT made this 30th day of October, 1985 by and between TrustFunds Liquid
Asset Trust, a Massachusetts business trust (the "Trust"), a Wellington
Management Company/Thorndike, Doran, Paine & Lewis, a Massachusetts partnership
(the "Adviser").
WHEREAS, the Trust is an open-end, diversified management investment company
registered under the Investment Company Act of 1940, as amended, consisting of
several series of shares, each having its own investment policies; and
WHEREAS, the Trust has retained SEI Financial Management Corporation (the
"Manager") 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 management
services to the Trust with respect to its Treasury Portfolio, Agency Portfolio,
Commercial Portfolio and Prime Obligation Portfolio and such other portfolios as
the Trust and the Adviser may agree on (the "Portfolios") and the Adviser is
will to render such services;
NOW, THEREFORE, in consideration of mutual covenants herein contained, the
parties hereto agree as follows:
1. Duties of Adviser. The Trust employs the Adviser to manage the
investment and reinvestment of the assets, and to continuously review,
supervise, and administer the investment program of the Portfolios, to
determine in its discretion the securities to be purchased or sold, to
provide the Manager and the Trust with records concerning the Adviser's
activities which the Trust is required to maintain, and to render regular
reports to the Manager and to the Trust's officers and Trustees concerning
the Adviser's discharge of the foregoing responsibilities. The Adviser
shall discharge the foregoing responsibilities subject to the control of
the officers and the 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 Portfolio set
forth in the Trust's prospectus from time to time, and applicable laws and
regulations. 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 required by it to perform the
services on the terms and for the compensation provided herein.
<PAGE>
2. Portfolio Transactions. The Adviser is authorized to select the brokers
or dealers that will execute the purchases and sales of portfolio
securities for the Portfolios and is directed to use its best efforts to
obtain the best net results as described in the Trust's prospectus from
time to time. The Adviser will promptly communicate to the Manager and to
the officers and the Trustees of the Trust such information relating to
portfolio transactions as they may reasonably request.
3. Compensation of the Advisor. 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 at the end of each month, a fee calculated by applying a
daily rate, based on the following annual percentage rates, to the Assets
(hereinafter defined):
.075% on the first $500 million of Assets;
.02% on the Assets in excess of $500 million.
The terms "Assets" shall mean the daily net assets of the Portfolios
managed by the Adviser. The fee, as determined above, shall be based on
average Assets for the month involved (less any assets of such Portfolios
held in non-interest bearing special deposits with a Federal Reserve Bank).
4. Other Services. At the request of the Trust or the Manager, the Adviser
in its discretion may make available to the Trust, office facilities,
equipment, personnel, and other services. Such office facilities,
equipment, personnel, and services shall be provided for or rendered by the
Adviser and billed to the Trust or the Manager at the Adviser's costs.
5. 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.
6. 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.
7. 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 which are prepared
<PAGE>
or maintained by the Adviser on behalf of the Trust are the property of the
Trust and will be surrendered promptly to the Trust on request.
8. Liability of Adviser. No provision of this Agreement shall be deemed to
protect the Adviser against any liability to the Trust or its shareholders
to which it might otherwise be subject by reason of any willful
misfeasance, bad faith, or gross negligence in the performance of its
duties or the reckless disregard of its obligations under this Agreement.
9. 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.
10. Duration and Termination. This Agreement, unless sooner terminated as
provided herein, shall continue as to each Portfolio until October 30,
1987, 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 Portfolio; provided, however, that if the shareholders
of any Portfolio 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 Investment Company Act of 1940 and rules thereunder. The
foregoing requirement that continuance of this Agreement be "specifically
approved at least annually" shall be construed in a manner consistent with
the Investment Company Act of 1940 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 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. Any notice under this Agreement shall be given in writing,
addressed and delivered, or mailed postpaid, to the other party at any
office of such party.
<PAGE>
As used in this Section 10, 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 Investment Company Act of 1940
and the rules and regulations thereunder; subject to such exemptions as
may be granted by the Securities and Exchange Commission under said Act.
11. 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.
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
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.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
as of the day and year first written above.
WELLINGTON MANAGEMENT COMPANY/ TRUSTFUNDS LIQUID ASSET TRUST
THORNDIKE, DORAN, PAINE & LEWIS
By /s/ Signature appears here By /s/ Signature appears here
----------------------------- ----------------------------
Managing Partner President
<PAGE>
MANAGEMENT AGREEMENT
THIS AGREEMENT is made as of this 31st day of October, 1986 by and between
TrustFunds Liquid Asset Trust (the "Trust"), a Massachusetts business trust, and
SEI Financial Management Corporation (the "Manager"), a Delaware corporation.
WHEREAS the Trust is a diversified open-end investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS the Manager is willing to provide, or oversee the performance of
others who will provide management, administrative, transfer agent and
unitholder servicing services to the Trust's Treasury Portfolio, Agency
Portfolio, Commercial Portfolio, Prime Obligation Portfolio, Institutional Cash
Portfolio, and such other portfolios as the Trust and the Manager may agree on
(collectively, "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 Manager hereby agree as follows:
ARTICLE 1. Retention of the Manager. The Trust hereby retains the
------------------------
Manager to act as the Manager and Unitholder Servicing Agent of the Portfolios
and to furnish the Portfolios with the management, administrative, transfer
agent and unitholder servicing services as set forth below. The Manager hereby
accepts such employment to perform the duties set forth below. The Manager
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. All of the Manager's duties shall be subject always to the
objectives, policies and restrictions contained in the Trust's current
registration statement under the 1940 Act, to the Trust's Declaration of Trust
and By-Laws, to the provisions of the 1940 Act, and to any other guidelines that
may be established by the Trust's Trustees. The Manager 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.
ARTICLE 2. Evaluation Services. The Manager shall oversee and monitor
-------------------
the performance of the Portfolios' investment adviser and shall furnish to the
Trust such information, evaluations, analyses and opinions regarding said
performance as the Trustees may, from time to time, reasonably request;
provided, however, that the Manager shall have no authority to make and shall
not make investment decisions for the Portfolios nor furnish any advice with
respect to the desireability of making such investment decisions.
<PAGE>
ARTICLE 3. Transfer Agent Services. The Manager will act as Transfer
-----------------------
Agent for the Portfolios and, as such, will record in an account (the "Account")
the total number of units of beneficial interest ("Units") of each Portfolio
issued and outstanding from time to time and will maintain Unit transfer records
in which it will note the names and registered addresses of Unitholders, and the
number of Units from time to time owned by each of them. Each Unitholder will be
assigned one or more account numbers. The Manager is authorized to set up
accounts and record transactions in the accounts on the basis of instructions
received from Unitholders when accompanied by remittance in appropriate amount
as provided in the Trust's then current prospectus. The Trust will not issue
certificates representing its Units. Whenever Units are purchased or issued, the
Manager shall credit the Account with the Units issued, and credit the proper
number of Units to the appropriate Unitholder. Likewise, whenever the Manager
has occasion to redeem Units owned by a Unitholder, the Trust authorizes the
Manager to process the transaction by making appropriate entries in its Unit
transfer records and debiting the Account.
Upon receipt by the Trust's Wire Agent (currently the United States
National Bank of Oregon) on behalf of the Manager of funds through the Federal
Reserve wire system or conversion into Federal funds of funds transmitted by
other means, for the purchase of Units in accordance with the Trust's current
prospectus, the Manager shall notify the Trust of such deposits on a daily
basis. The Manager shall credit the Unitholder's account with the number of
units purchased according to the price of the Units in effect for such purchases
determined in the manner set forth in the Trust's then current prospectus. The
Manager shall process each order for the redemption of Units from or on behalf
of a Unitholder, 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 Manager. If the Manager or the Trust determines that a request for
redemption does not comply with the requirements for redemption, the Manager
shall promptly so notify the Unitholder, 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
banks and the New York Stock Exchange are open for business ("Business Day"),
the Manager shall notify the Custodian of the amount of cash or other assets
required to meet payments made pursuant to the provisions of this paragraph, and
the Trust shall instruct the Custodian to make available from time to time
sufficient funds or other assets therefor. The authority of the Manager to
perform its responsibilities under this paragraph 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.
- 2 -
<PAGE>
In registering transfers, the Manager may rely upon the 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 Manager, 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
Units of beneficial interest, and (iii) the number of units authorized for
issuance and that upon issuance they will be validly issued; and
(c) the Trust's Secretary's or Assistant Secretary's certificate as to the
authorized outstanding Units 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 Manager 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 Manager, together
with copies of all relevant resolutions, instruments or other documents,
specimen signatures, certificates, opinions or the like as the Manger may deem
necessary or appropriate.
ARTICLE 4. Dividend Disbursing Agent. The Manager shall act as Dividend
-------------------------
Disbursing Agent for the Trust 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 Unitholders. The
Trust agrees that it shall promptly inform the Manager of the declaration of any
dividend or distribution of its Units, 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 Unitholder is entitled to receive additional Units
by virtue of any such distribution or dividend, appropriate credits will be made
to the Unitholder's account.
ARTICLE 5. Other Administrative Services. in addition to the services
-----------------------------
described above, the Manager 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
- 3 -
<PAGE>
fiduciaries, insurers, banks and persons in any other capacity deemed to be
necessary or desirable for the Portfolios' operation. The Manager shall provide
the Trust with regulatory reporting and related bookkeeping services, all
necessary office space, equipment, personnel compensation and facilities
(including facilities for Unitholders' and Trustees' meetings) for handling the
affairs of the Portfolios and such other services as the Manager shall, from
time to time, determine to be necessary to perform its obligations under this
Agreement. The Manager 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 shall determine desirable; and shall provide the Portfolios'
Unitholders with the reports described in the Trust's current prospectus. Also,
the Manager will perform other services for the Trust as agreed to from time to
time, including, but not limited to, preparation and mailing of appropriate
federal income tax forms; mailing the annual reports of the Trust; preparing
an annual list of Unitholders; furnishing the Trust with such reports regarding
the sale and redemption of Units as may be required in order to comply with
federal and state securities law; and mailing notices of Unitholders' meetings,
proxies and proxy statements, for all of which the Trust will pay the Manager's
out-of-pocket expenses.
ARTICLE 6. Allocation of Charges and Expenses.
----------------------------------
(A) The Manager. The Manager shall furnish at its own expense the
-----------
executive, supervisory and clerical personnel necessary to perform its
obligations under this Agreement. The Manager 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 Manager or of any affiliated corporation; provided,
however, that unless otherwise specifically provided, the Manager shall not be
obligated to pay the compensation of any employee of the Manager 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 Unitholders, all expenses incurred
in connection with the issuing and redeeming Trust Units, the costs of custodial
services, the cost of initial and ongoing registration of the Trust's Units
under federal and state securities laws, fees and out-of-pocket expenses of
Trustees who are not affiliated persons of the Manager 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, and distribution expenses in accordance with the Trust's
Distribution Plan.
- 4 -
<PAGE>
ARTICLE 7. Compensation of the Manager
---------------------------
(A) Management Fee. For the services to be rendered, the facilities
--------------
furnished and the expenses assumed by the Manager pursuant to this Agreement,
the Trust shall pay to the Manager 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 Manager monthly (subject to any expenses to be borne by the Manager
under Article 7(B) herein). If this Agreement becomes effective subsequent to
the first day of a month or terminates before the last day of a month, the
Manager'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 Manager's compensation for the
preceding month shall be made promptly after completion of the
computations by paragraph (B) of this Article 7.
(B) Excess Expenses. If the expenses of any Portfolio for any fiscal year
---------------
(including fees and other amounts payable to the Manager, but excluding
interest, taxes, brokerage costs, litigation and other extraordinary costs) as
calculated every Business Day would exceed (i) the annual rate for any Portfolio
as specified in the attached Schedules or (ii) the expense limitations imposed
on investment companies by any applicable stature or regulatory authority of any
jurisdiction in which Units are qualified for offer and sale, the Manager shall
bear such excess cost of such portfolio. However, the Manager will not bear
expenses of the Trust or any Portfolio thereof to an extent 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 Manager
pursuant to this Article 7(B) shall be settled on a monthly basis (subject to
fiscal year end reconciliation) by a reduction in the fee payable to Manager for
such month pursuant to Article 7(A) above and, if such reduction shall be
insufficient to offset such expenses, by reimbursing the Trust. Any excess
expenses borne under Article 7(B)(i) (including any fees waived by the Manager)
or such excess expenses of the Trust borne by the Manager since May 25, 1984
pursuant to earlier agreements between the Manager and the Trust may be
recovered by the Manager from the Trust when such recovery would not cause the
applicable Portfolio's expenses to exceed the expense limitation set forth in
the attached Schedules.
(C) Compensation From Transactions. The Trust hereby authorizes any
------------------------------
entity or person associated with the Manager 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 11a2-2(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).
-5-
<PAGE>
(D) Survival of Compensation Rates. All rights of compensation under this
------------------------------
Agreement shall survive the termination of this Agreement.
ARTICLE 8. Limitation of Liability of the Manager. The duties of the
--------------------------------------
Manager shall be confined to those expressly set forth herein, and no implied
duties are assumed by or may be asserted against the Manager hereunder. The
Manager 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 8, the term "Manager" shall
include directors, officers and employees and other corporate agents of the
Manager as well as that corporation itself.) So long as the Manager acts in good
faith and with due diligence and without gross negligence, the Trust assumes
full responsibility and shall indemnify the Manager 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 management and transfer, dividend disbursing and unitholder servicing
agency relationship 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 Manager 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 Manager 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
affect the rights thereunder.
The Manager 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 Manager's
duties, and the Manager 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 Manager shall
be protected in acting upon any document which it reasonably believes to be
genuine and to have been signed by the proper person or persons.
- 6 -
<PAGE>
Nor shall the Manager be held to have notice of any change of authority of any
officer, employee or agent of the Trust until receipt of written notice thereof
from the Trust.
ARTICLE 9. Activities of the Manager. The services of the Manager
-------------------------
rendered to the Trust are not to be deemed to be exclusive. The Manager is free
to render such services to others and to have other businesses and interests. It
is understood that Trustees, officers, employees and Unitholders of the Trust
are or may be or become interested in the Manager, as directors, officers,
employees and shareholders or otherwise and that directors, officers, employees
and shareholders of the Manager and its counsel are or may be or become
similarly interested in the Trust, and that the Manager may be or become
interested in the Trust as a Unitholder or otherwise.
ARTICLE 10. Duration and Termination of this Agreement. This Agreement,
------------------------------------------
unless terminated sooner as provided herein, shall remain in effect for two
years after the date of the Agreement and shall continue in effect for
successive periods of one year if such continuance is specifically approved at
least annually (i) by 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. This Agreement may be
terminated at any time and without penalty by the Trustees of the Trust or by
the Manager on not less than 30 days nor more than 60 days written notice to the
other party hereto. Any notice under this Agreement shall be given in writing,
addressed and delivered, or mailed postpaid, to the other party at the
designated mailing address of such party.
This Agreement shall not be assignable by either party without the written
consent of the other party.
ARTICLE 11. 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, 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 Manager 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.
- 7 -
<PAGE>
ARTICLE 12. 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 Unitholders of the Trust individually, but binding only upon the
assets and property of the Trust.
ARTICLE 13. Certain Records. The Manager 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 Manager on behalf of the
Trust shall be prepared and maintained at the expense of the Manager, 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 Manager shall notify the Trust
and follow the Trust's instructions as to permitting or refusing such
inspection; provided that the Manager 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 Manager against such liability.
ARTICLE 14. 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 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 by one and the same
instrument.
- 8 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
TRUSTFUNDS LIQUID ASSET TRUST
By [SIGNATURE APPEARS HERE]
------------------------------------
President
SEI FINANCIAL MANAGEMENT CORPORATION
By [SIGNATURE APPEARS HERE]
------------------------------------
Executive Vice President
- 9 -
<PAGE>
Schedule A to Management Agreement
Between TrustFunds Liquid Asset Trust and
SEI Financial Management Corporation
Dated October 31, 1986
TrustFunds Liquid Asset Trust (the "Trust") and SEI Financial Management
Corporation ("Manager") hereby agree as follows with respect to Article 7 of the
Management Agreement between the Manager and the Trust date October 31, 1986
("Agreement").
1. The annual rate of compensation for the following Trust Portfolios
pursuant to Article 7(A) of the Agreement shall be as follows:
(a) Treasury Portfolio: .36% of the average daily net assets of the
------------------
Portfolio.
(b) Agency Portfolio: .36% of the average daily net assets of the
----------------
Portfolio.
(c) Commercial Portfolio: .36% of the average daily net assets of
--------------------
the Portfolio.
(d) Prime Obligation Portfolio: .36% of the average daily net assets
--------------------------
of the Portfolio.
(e) Institutional Cash Portfolio: .36% of the average daily net
----------------------------
assets of the Portfolio.
2. The annual rate of expenses for the following Trust Portfolios pursuant
to Article 7(B)(i) of the Agreement shall be as follows:
(a) Treasury Portfolio: .44% of the average daily net assets of the
------------------
Portfolio.
(b) Agency Portfolio: .44% of the average daily net assets of the
----------------
Portfolio.
(c) Commercial Portfolio: .44% of the average daily net assets of
--------------------
the Portfolio:
(d) Prime Obligation Portfolio: .44% of the average daily net assets
--------------------------
of the Portfolio:
(e) Institutional Cash Portfolio: .44% of the average daily net
----------------------------
assets of the Portfolio.
- 10 -
<PAGE>
DISTRIBUTION AGREEMENT
THIS AGREEMENT is made this 29th day of November, 1982, between TrustFunds
Liquid Asset Trust, a Massachusetts business trust ("Trust"), and SEI Financial
Services Company, a Pennsylvania corporation ("Distributor").
NOW THEREFORE, in consideration of the mutual covenants hereinafter
contained, the Trust and Distributor hereby agree as follows:
1. Sale of Units. The Trust grants to the Distributor the right to sell
-------------
units of the Trust, as agent and on behalf of the Trust, during the term of
this Agreement and subject to the registration requirements of the Securities
Act of 1933, as amended (the "Act"), and of the laws governing the sale of
securities in the various states ("Blue Sky laws").
2. Sale of Units by the Trust. The rights granted to the Distributor
--------------------------
shall be nonexclusive, and the Trust reserves the right to sell its units
directly to investors on applications received and processed by the Trust's
Transfer Agent.
3. Solicitation of Sales. In consideration of these rights granted to the
---------------------
Distributor, the Distributor agrees to use all reasonable efforts, consistent
with its other business, to obtain purchasers for shares of the Trust, provided,
however, that the Distributor shall not be
<PAGE>
prevented from entering into like arrangements with other issuers. The
provisions of this paragraph do not obligate the Distributor to register as a
broker or dealer under the Blue Sky laws of any jurisdiction which it determines
would be unreasonable to do so or to maintain its registration in any
jurisdiction in which it is now registered.
4. Authorized Representations. The Distributor is not authorized by the
--------------------------
Trust to give any information or to make any representations other than those
contained in the appropriate registration statements or prospectuses filed with
the Securities and Exchange Commission under the Act (as these registration
statements and prospectuses may be amended from time to time), or contained in
unitholder reports or other material that may be prepared by or on behalf of
the Trust for the Distributor's use. The Distributor may prepare and distribute
sales literature and other material as it may deem appropriate, provided it has
been cleared with the Trust.
5. Portfolio Securities. Portfolio securities of the Trust may not be
--------------------
bought or sold by or through the Distributor.
6. Registration of Shares. The Trust agrees that it will take all action
----------------------
necessary to register shares under the Act so that there will be available for
sale the number of units the Distributor may reasonably be expected to sell.
The Trust shall make available to the Distributor such
- 2 -
<PAGE>
number of copies of its currently effective prospectus as the Distributor may
reasonably request. The Trust shall furnish to the Distributor copies of all
information, financial statements and other papers which the Distributor may
reasonably request for use in connection with the distribution of units of the
Trust.
7. Expenses. The Trust shall pay all fees and expenses (a) in connection
--------
with the preparation, setting in type and filing of any registration statement
and prospectus under the 1933 Act and amendments for the issue of its units, (b)
of preparing, setting in type, printing and mailing any report or other
communication to unitholders of the Trust in their capacity as such, and (c) of
preparing, setting in type, printing and mailing prospectuses sent annually to
existing unitholders. To the extent provided in the Trust's annual budget under
its Distribution Plan, the Trust shall reimburse the Distributor for (i) the
cost of prospectuses, reports to unitholders, sales literature and other
materials for potential investors, (ii) costs of complying with state and
foreign securities laws pertaining to the distribution of units, (iii)
advertising, and (iv) expenses incurred in selling units. To the extent not so
provided, the Distributor shall pay expenses of (x) any supplemental sales
literature used by the Distributor in connection with such offering, and (y)
advertising in connection with such offering.
-3-
<PAGE>
8. Indemnification. The Trust agrees to indemnify and hold harmless the
---------------
Distributor and each of its directors and officers and each person, if any, who
controls the Distributor within the meaning of Section 15 of the Act against any
loss, liability, claim, damages or expense (including the reasonable cost of
investigating or defending any alleged loss, liability, claim, damages, or
expense and reasonable counsel fees incurred in connection therewith), arising
by reason of any person acquiring any shares, based upon the ground that the
registration statement, prospectus, unitholder reports or other information
filed or made public by the Trust (as from time to time amended), included an
untrue statement of a material fact or omitted to state a material fact required
to be stated or necessary in order to make the statements not misleading.
However, the Trust does not agree to indemnify the Distributor or hold it
harmless to the extent that the statement or omission was made in reliance upon,
and in conformity with, information furnished to the Trust by or on behalf of
the Distributor. In no case (i) is the indemnity of the Trust in favor of the
Distributor or any person indemnified to be deemed to protect the Distributor or
any person against any liability to the Trust or its unitholders to which the
Distributor or such person would otherwise by subject by reason of wilful
misfeasance, bad faith or gross negligence in the performance of its duties or
by reason of its reckless
-4-
<PAGE>
disregard of its obligations and duties under this Agreement, or (ii) is the
Trust to be liable under its indemnity agreement contained in this paragraph
with respect to any claim made against the Distributor or any person indemnified
unless the Distributor or any person shall have notified the Trust in writing of
the claim within a reasonable time after the summons or other first written
notification giving information of the nature of the claim shall have been
served upon the Distributor or any person (or after the Distributor or the
person shall have received notice of service on any designated agent). However,
failure to notify the Trust of any claim shall not relieve the Trust from any
liability which it may have to the Distributor or any person against whom such
action is brought otherwise than on account of its indemnity agreement contained
in this paragraph. The Trust shall be entitled to participate at its own expense
in the defense, or if it so elects, to assume the defense of any suit brought to
enforce any claims, but if the Trust elects to assume the defense, the defense
shall be conducted by counsel chosen by it and satisfactory to the Distributor
or person or persons, defendant or defendants in the suit. In the event the
Trust elects to assume the defense of any suit and retain counsel, the
Distributor, officers or directors or controlling person or persons, defendant
or defendants in the suit, shall bear the fees and expenses of any additional
counsel retained by
- 5 -
<PAGE>
them. If the Trust does not elect to assume the defense of any suit, it will
reimburse the Distributor, officers or directors or controlling person or
persons, defendant or defendants in the suit, for the reasonable fees and
expenses of any counsel retained by them. The Trust agrees to notify the
Distributor promptly of the commencement of any litigation or proceedings
against it or any of its officers or Trustees in connection with the issuance or
sale of any of the shares.
The Distributor also covenants and agrees that it will indemnify and hold
harmless the Trust and each of its Trustees and officers and each person, if
any, who controls the Trust within the meaning of Section 15 of the Act, against
any loss, liability, damages, claim or expense (including the reasonable cost of
investigating or defending any alleged loss, liability, damages, claim or
expense and reasonable counsel fees incurred in connection therewith) arising by
reason of any person acquiring any shares, based upon the Act or any other
statute or common law, alleging any wrongful act of the Distributor or any of
its employees or alleging that the registration statement, prospectus,
unitholder reports or other information filed or made public by the Trust (as
from time to time amended), included an untrue statement of a material fact or
omitted to state a material fact required to be stated or necessary in order to
make the statements not misleading, insofar as the statement
-6-
<PAGE>
or omission was made in reliance upon, and in conformity with information
furnished to the Trust by or on behalf of the Distributor. In no case (i) is the
indemnity of the Distributor in favor of the Trust or any person indemnified to
be deemed to protect the Trust or any person against any liability to which the
Trust or such person would otherwise be subject by reason of wilful misfeasance,
bad faith or gross negligence in the performance of its duties or by reason of
its reckless disregard of its obligations and duties under this Agreement, or
(ii) is the Distributor to be liable under its indemnity agreement contained in
this paragraph with respect to any claim made against the Trust or any person
indemnified unless the Trust or person, as the case may be, shall have notified
the Distributor in writing of the claim within a reasonable time after the
summons or other first written notification giving information of the nature of
the claim shall have been served upon the Trust or any person (or after the
Trust or such person shall have received notice of service on any designated
agent). However, failure to notify the Distributor of any claim shall not
relieve the Distributor from any liability which it may have to the Trust or
any person against whom the action is brought otherwise than on account of its
indemnity agreement contained in this paragraph. In the case of any notice to
the Distributor, it shall be entitled to participate, at its own expense, in the
defense or, if it so
- 7 -
<PAGE>
elects, to assume the defense of any suit brought to enforce the claim, but if
the Distributor elects to assume the defense, the defense shall be conducted by
counsel chosen by it and satisfactory to the Trust, to its officers and Trustees
and to any controlling person or persons, defendant or defendants in the suit.
In the event that the Distributor elects to assume the defense of any suit and
retain counsel, the Trust or controlling persons, defendant or defendants in the
suit, shall bear the fees and expenses of any additional counsel retained by
them. If the Distributor does not elect to assume the defense of any suit, it
will reimburse the Trust, officers and Trustees or controlling person or
persons, defendant or defendants in the suit, for the reasonable fees and
expenses of any counsel retained by them. The Distributor agrees to notify the
Trust promptly of the commencement of any litigation or proceedings against it
in connection with issue and sale of any of the units.
9. Effective Date. This Agreement shall be effective upon its execution
--------------
or upon such later date as shall be agreed upon by the President of the Trust
and the President of the Distributor, and unless terminated as provided, shall
continue in force for two (2) years from the date of its execution and
thereafter from year to year, provided continuance after the two (2) year period
is approved by (i) either the vote of a majority of the Trustees of the Trust
-8-
<PAGE>
or the vote of a majority of the outstanding voting securities of the Trust, and
(ii) the vote of a majority of those Trustees of the Trust who are not parties
to this Agreement or interested persons of any party, case in person at a
meeting called for the purpose of voting on the approval. This Agreement shall
automatically terminate, in the event of its assignment. As used in this
paragraph the terms "vote of a majority of the outstanding voting
securities," "assignment," and "interested person," shall have the respective
meanings specified in the Investment Company Act of 1940 as now in effect or as
hereafter amended. In addition to termination by failure to approve continuance
or by assignment, this Agreement may at any time be terminated by either party
upon not less than sixty days' prior written notice to the other party.
10. Notices. 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 28 State Street, Boston, Massachusetts, and if to the
Distributor, at 680 E. Swedesford Road, Wayne, Pennsylvania 19087.
11. Limitation of 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
- 9 -
<PAGE>
given that this Agreement 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 unitholders of the Trust
individually but binding only upon the assets and property of the Trust.
IN WITNESS, the Trust and Distributor have each duly executed this
Agreement, as of the day and year above written.
TRUSTFUNDS LIQUID ASSET TRUST
Attest: /s/ Signature Appears Here By /s/ Signature Appears Here
-------------------------- --------------------------
Secretary
SEI FINANCIAL SERVICES COMPANY
Attest: /s/ Signature Appears Here By /s/ Signature Appears Here
-------------------------- --------------------------
Secretary
- 10 -
<PAGE>
CUSTODIAN AGREEMENT
This Agreement, dated 1st day of September 1981 made by and between TrustFunds
Liquid Asset Trust (the Fund), a business trust operating as an open end
investment company, duly organized under the laws of the Commonwealth of
Massachusetts and The Philadelphia National Bank (PNB), a national bank;
WITNESSETH:
WHEREAS, the Fund desires to appoint The Philadelphia National Bank as custodian
of its Securities and cash, and The Philadelphia National Bank is willing to act
in such capacity upon the terms and conditions herein set forth; and
WHEREAS, The Philadelphia National Bank in its capacity as custodian hereunder
will also collect and apply the dividends and interest on said Securities in the
manner and to the extent herein set forth;
NOW, THEREFORE, in consideration of the premises and of the mutual covenants
herein contained, the parties hereto, intending to be legally bound, do hereby
agree as follows:
SECTION 1. The terms as defined in this Section wherever used in this
Agreement, or in any amendment or supplement hereto, shall have the meanings
herein specified unless the context otherwise requires.
CUSTODIAN: The term Custodian shall mean The Philadelphia National Bank in its
capacity as custodian under this Agreement.
PROPER INSTRUCTIONS: For purposes of this Agreement the Custodian shall be
deemed to have received Proper Instructions upon receipt of written, telephone
or telegraphic instructions from a person or persons reasonably believed by the
Custodian to be a person or persons authorized from time to time by the trustees
of the Fund or by the Board of Directors of an investment adviser for the Fund
to give the particular class of instructions. Telephone or telegraphic
instructions shall be confirmed in writing by such person or persons as said
Trustees or said Board of Directors shall have from time to time authorized to
give the particular class of instructions in question. The Custodian may act
upon telephone or telegraphic instructions without awaiting receipt of written
confirmation, and shall not be liable for Fund's or such investment adviser's
failure to confirm such instructions in writing.
SECURITIES: The term Securities shall mean bonds, debentures, notes,
certificates of deposit, evidences of indebtedness, and other securities and
investments from time to time owned by the Fund.
<PAGE>
SHAREHOLDERS: The term Shareholders shall mean the registered owners from time
to time of the Shares of the Fund in accordance with the registry records
maintained by the Fund or agents on its behalf.
SHARES: The term Shares of the Fund shall mean the shares of beneficial interest
of the Fund.
SECTION 2. The Fund shall from time to time file with the Custodian a certified
copy of each resolution of its Board of Trustees authorizing the person or
persons to give Proper Instructions (as defined in SECTION 1) and specifying the
class of instructions that may be given by each person to the Custodian under
this Agreement, together with certified signatures of such persons authorized to
sign, which shall constitute conclusive evidence of the authority of the
officers and signatories designated therein to act, and shall be considered in
full force and effect with the Custodian fully protected in acting in reliance
thereon until it receives written notice to the contrary; provided, however,
that if the certifying officer is authorized to give Proper Instructions, the
certification shall be also signed by a second officer of the Fund.
SECTION 3. The Fund hereby appoints the Custodian as custodian of the Securities
of the Fund and cash from time to time on deposit hereunder, to be held by the
Custodian and applied as provided in this Agreement. The Custodian hereby
accepts such appointment subject to the terms and conditions hereinafter
provided. Such Securities and cash shall, however, be segregated from the assets
of others and shall be and remain the sole property of the Fund and the
Custodian shall have only the bare custody thereof. The Securities held by the
Custodian shall, unless payable to bearer, be registered in the name of the
Custodian or in the name of its nominee. Securities, excepting bearer
securities, delivered from time to time to the Custodian upon purchase or
otherwise shall in all cases be in due form for transfer or already registered
as above provided.
SECTION 4. The Fund will initially deposit with the Custodian the Securities
owned by the Fund at the time this Agreement becomes effective. Thereafter the
Fund will cause to be deposited with the Custodian additional Securities as the
same are purchased or otherwise acquired from time to time.
The Fund will make an initial deposit of cash to be held and applied by the
Custodian hereunder. Thereafter the Fund will cause to be deposited with the
Custodian hereunder (i) the net proceeds of Securities sold from time to time
and (ii) the applicable net asset value of Shares sold from time to time whether
representing initial issue, other stock or reinvestments of dividends and/or
distributions payable to Shareholders.
<PAGE>
The Fund warrants that it shall keep all of its Securities, similar
investments, cash proceeds and other cash assets of the Fund in the custody of
the Custodian, except where permitted to otherwise keep, deposit, loan, pledge
or otherwise dispose of or maintain such assets in accordance with applicable
law.
SECTION 5. The Custodian will collect from time to time the dividends and
interest on the Securities held by it hereunder and will deposit the same in the
Fund's account. The Custodian is authorized to advance or pay out of said
account accrued interest on bonds purchased and dividends on securities sold and
like items. In the event that any dividends or interest payments are received by
the Fund, the Fund will endorse to the Custodian, or cause to be endorsed,
dividend and interest checks and will issue appropriate orders to the issuers of
the Securities to pay dividends and interest to the Custodian. Subject to proper
reserves for interest owing on Securities sold and like items, the Custodian
will disburse the money from time to time on deposit in the account to or upon
the order of the Fund as it may from time to time direct in accordance with this
Agreement.
SECTION 6. The Custodian is hereby authorized and directed to disburse cash from
time to time as follows:
(a) to pay the proper compensation and expenses of Custodian upon receipt
of Proper Instructions;
(b) to transfer to the Transfer Agent or other dividend disbursing agent
to pay dividends and/or distributions which may be authorized by the Fund upon
receipt of Proper Instructions;
(c) to pay, or provide the Fund with money to pay, if any, taxes upon
receipt of Proper Instructions;
(d) for the purpose of completing the purchase of Securities purchased by
the Fund, upon receipt of (i) Proper Instructions specifying the Securities and
stating the purchase price, and the name of the broker, investment banker or
other party to or upon whose order the purchase price is to be paid; and (ii)
upon receipt of such Securities by the Custodian or, in the case of a purchase
effected through a Securities System, in accordance with Section 8 hereof;
(e) for the purpose of redeeming or purchasing Shares upon receipt of
Proper Instructions stating the applicable redemption amounts payable, to the
Transfer Agent or other appropriate party;
<PAGE>
(f) for the purpose of paying over to the Transfer Agent or dividend
disbursing agent such amounts as may be stated in Proper Instructions,
representing proceeds of the sale of warrants, rights, stock dividends, profit
and increases in values of the Securities, as the Fund may determine to include
in dividends and/or distributions on the Shares;
(g) for the purpose of paying in whole or in part any loan of the Fund
upon receipt of Proper Instructions directing payment and stating the
Securities, if any, to be received against payment;
(h) to pay interest, investment advisory or supervisory fees,
administration, dividend and transfer agency fees and costs, compensation of
personnel, or operating expenses (including, without limitation thereto, fees
for legal purposes). Before making any such payment or disbursement, however,
the Custodian shall receive (and may conclusively rely upon) Proper Instructions
requesting such payment or disbursement and stating that it is for one or more
of the purposes hereinabove enumerated, provided that if the disbursement is for
any other purposes, the instructions shall be in writing and shall state that
the disbursement was authorized by resolution of the Board of Trustees of the
Fund (a copy of which resolution shall be attached) and is for a proper purpose.
SECTION 7. The Custodian is hereby authorized and directed to deliver
Securities from time to time as follows:
(a) for the purpose of completing sales of Securities sold by the Fund,
upon receipt of (i) the net proceeds of sale and (ii) Proper Instructions
specifying the Securities sold and stating the amount to be received and the
broker, investment banker or other party to or upon whose order the Securities
are to be delivered;
(b) for the purpose exchanging Securities for other Securities and/or cash
upon timely receipt of (i) Proper Instructions stating Securities to be
delivered and the Securities and/or cash to be received in exchange and the
manner in which the exchange is to be made, and (ii) against receipt of the
other Securities and/or cash as specified in the Proper Instructions;
(c) for the purpose of exchanging or converting Securities pursuant
to their terms or pursuant to any plan of conversion, consolidation,
recapitalization, reorganization, readjustment or otherwise, upon timely receipt
of (i) Proper Instructions authorizing such exchange or conversion and stating
the manner in which such exchange or conversion is to be made, and (ii) against
receipt of the Securities, certificates of deposit, interim receipts, and/or
cash to be received as specified in the Proper Instructions;
(d) for the purpose of presenting Securities for payment which have
matured or have been called for redemption upon receipt of appropriate Proper
Instructions and provided that the cash or other consideration is to be paid to
the Custodian;
<PAGE>
(e) for the purpose of delivery of Securities upon redemption of Shares in
kind, upon receipt of appropriate Proper Instructions; or
(f) for the purpose of depositing with the lender Securities to be held as
collateral of a loan to the Fund upon receipt of Proper Instructions directing
delivery to the lender and upon receipt of the proceeds of the loan.
SECTION 8. The Custodian may deposit and/or maintain Securities owned by the
Fund in a clearing agency registered with the Securities and Exchange Commission
under Section 17A of the Securities Exchange Act of 1934, which acts as a
securities depository, or in the book-entry system authorized by the U.S.
Department of the Treasury and certain Federal agencies, collectively referred
to herein as "Securities System" in accordance with applicable Federal Reserve
Board and Securities and Exchange Commission rules and regulations, if any, and
subject to the following provisions:
1) The Custodian may keep Securities of the Fund in a Securities System
provided that such Securities are represented in an account
("Account") of the Custodian in the Securities System which shall not
include any assets of the Custodian other than assets held as a
fiduciary, custodian, or otherwise for customers.
2) The records of the Custodian with respect to Securities of the Fund
which are maintained in a Securities System shall identify by book-
entry those Securities belonging to the Fund.
3) The Custodian shall pay for Securities purchased for the account of
the Fund upon (i) receipt of advice from the Securities System that
such Securities have been transferred to the Account, and (ii) the
making of an entry on the records of the Custodian to reflect such
payment and transfer for the account of the Fund. The Custodian shall
transfer Securities sold for the account of the Fund upon (i) receipt
of advice from the Securities System that payment for such Securities
has been transferred to the Account, and (ii) the making of an entry
on the records of the Custodian to reflect such transfer and payment
for the account of the Fund. Copies of all advices from the Securities
System of transfers of Securities for the account of the Fund shall
identify the Fund, be maintained for the Fund by the Custodian and be
provided to the Fund at its request. The Custodian shall furnish the
Fund confirmation of each transfer to or from the account of the Fund
in the form of a written advice or notice and shall furnish to the
Fund copies of daily transaction sheets reflecting each day's
transaction for the account of the Fund on the next business day.
<PAGE>
4) The Custodian shall provide the Fund with any report obtained by the
Custodian on the Securities System's internal accounting control and
procedures for safeguarding securities deposited in the Securities
System.
5) The Custodian shall have received an initial certificate of the
Secretary or an Assistant Secretary that the Trustees of the Fund have
approved the initial use of a particular Securities System and the
Custodian shall receive an annual certificate of the Secretary or an
Assistant Secretary that the Trustees have reviewed the use by the
Fund of such Securities System, as required in each case by Rule 17f-4
under the Investment Company Act of 1940, as amended.
6) Anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Fund for any loss or damage to the
Fund resulting from use of the Securities System by reason of any
negligence, misfeasance or misconduct of the Custodian or any of its
agents or of any of its or their employees or from any failure of the
Custodian or any such agent to enforce effectively such rights as it
may have against the Securities System; at the election of the Fund,
it shall be entitled to be subrogated to the rights of the Custodian
with respect to any claim against the Securities System or any other
person which the Custodian may have as a consequence of any such loss
or damage if and to the extent that the Fund has not been made whole
for any such loss or damage.
SECTION 9. The Custodian's compensation shall be as set forth in Schedule A
hereto attached, or as shall be set forth in amendments to such schedule
approved by the Fund and the Custodian.
SECTION 10. The Custodian shall forward to the Fund proxies, proxy statements,
annual reports, conversion notices, call notices, or other notices or written
materials sent to the registered owners of securities and actually received by
the Custodian (hereafter referred to as "notices and materials"), excluding only
certificates representing securities and dividend and interest payments.
Responsibility for taking action thereon is the sole responsibility of the Fund
and its investment advisor, and not the responsibility of the Custodian. Upon
actual receipt by the Custodian or warrants or rights issued in connection with
the assets of the Fund, the Custodian shall enter on its ledgers appropriate
notations indicating such receipt and shall forward notice thereof to the Fund,
but shall have no obligation whatsoever to take any action of any kind with
respect to such warrants or rights except upon receipt of Proper Instructions
authorizing the exercise or sale of such warrants or rights.
<PAGE>
SECTION 11. The Custodian assumes only the usual duties or obligations normally
performed by custodians of mutual funds. It specifically assumes no
responsibility for the management, investment or reinvestment of the Securities
from time to time owned by the Fund whether or not on deposit hereunder, it
being understood that the responsibility for the proper and timely management,
investment and reinvestment of said Securities shall be that of the Fund and its
investment advisors.
In connection with its functions under this Agreement, the Custodian shall:
(a) obtain a "due bill" for dividends, interest or other distributions of
the issuer, due the purchaser in connection with Securities delivered to the
Custodian;
(b) render to the Fund a daily report of all monies received or paid on
behalf of the Fund and such listings of Securities held by the Custodian for the
account of the Fund as may from time to time be requested by the Fund.
(c) execute ownership and other certificates and affidavits for all Federal
and State tax purposes in connection with the collection of bond and note
coupons;
(d) present for payment on the date of payment all coupons and other period
income items requiring presentation;
(e) monitor and record the collection of funds in accounts maintained by
the Custodian, in the name of the Fund on the same day as received;
(f) in accordance with the manager's directions as to allocation of the
securities to separate portfolios designated by the Fund, the Custodian shall
maintain records showing the respective securities comprising each such
portfolio.
(g) create, maintain and retain all records relating to its activities and
obligations under this Agreement in such manner as will meet the obligations of
the Fund with respect to said Custodian activities and obligations under
generally accepted accounting principles. All records maintained by the
Custodian in connection with the performance of its duties under this Agreement
will remain the property of the Fund and in the event of termination of this
Agreement will be relinquished to the Fund.
If the Custodian does not receive payment for items due under subsection (a),
(d), or (e) within a reasonable time after it has made proper demand for the
same, it shall so notify the Fund in writing, including copies of all demand
letters, any written responses thereto, and memoranda of all oral responses
thereto and to telephonic demands, and await Proper Instructions; the Custodian
shall not be obliged to take legal action for collection except by its consent
and unless and until reasonably indemnified to its satisfaction. The Custodian
shall also notify the Fund as soon as
<PAGE>
reasonably practicable whenever income due on Securities is not collected in due
course.
The Custodian shall not be liable for any taxes, assessments, or governmental
charges which may be levied or assessed upon the Securities held by it
hereunder, or upon the income therefrom or otherwise whatsoever. The Custodian
may pay any such tax, assessment or charge and reimburse itself out of the
monies of the Fund or out of the Securities held hereunder.
SECTION 12. No liability of any kind shall be attached to or incurred by the
Custodian by reason of its custody of the funds, assets, or shares held by it
from time to time under this Agreement, or otherwise by reason of its position
as custodian hereunder except only for its own negligence, bad faith, or willful
misconduct in the performance of its duties as specifically set forth in the
Agreement. Without limiting the generality of the foregoing sentence, the
Custodian:
(a) may rely upon the advice of counsel, who may be counsel for the Fund
or for the Custodian, and upon statements or accountants, brokers and other
persons believed by it in good faith to be expert in the matters upon which they
are consulted; and for any action taken or suffered in good faith based upon
such advice or statements the Custodian shall not be liable to anyone;
(b) shall not be liable for anything done or suffered to be done in good
faith in accordance with any request or advice of, or based upon information
furnished by, the Fund or its authorized officers or agents;
(c) is authorized to accept a certificate of the Secretary or Assistant
Secretary of the Fund, or Proper Instructions, to the effect that a resolution
in the form submitted has been duly adopted by its Board of Trustees or by the
Shareholders, as conclusive evidence that such resolution has been duly adopted
and is in full force and effect;
(d) may rely and shall be protected in acting upon any signature, written
(including telegraph or other mechanical) instructions, request, letter of
transmittal, certificate, opinion of counsel, statement, instrument, report,
notice, consent, order, or other paper or document reasonably believed by it to
be genuine and to have been signed, forwarded or presented by the purchaser,
Fund or other proper party or parties.
SECTION 13. The Fund, its successors and assigns hereby indemnify and hold
harmless the Custodian, its successors and assigns, of and from any and all
liability whatsoever arising out of or in connection with the Custodian's
status, acts, or omissions under this Agreement, except only for liability
arising out of the Custodian's own negligence, bad faith, or willful misconduct
in the performance of
<PAGE>
its duties specifically set forth in this Agreement. Without limiting the
generality of the foregoing, the Fund, its successors and assigns do hereby
fully indemnify and hold harmless the Custodian, it successors and assigns, from
any and all loss, liability, claims, demand, actions, suits and expenses of any
nature as the same may arise from the failure of the Fund to comply with any
law, rule, regulation or order of the United States, any State or any other
jurisdiction, governmental authority, body, or board relating to the sale,
registration, qualification of shares of any beneficial interest in the Fund, or
from the failure of the Fund to perform any duty or obligation under this
Agreement.
Upon written request of the Custodian, the Fund shall assume the entire defense
of any claim subject to the foregoing indemnity, or the joint defense with the
Custodian of such claim, as the Custodian shall request. The indemnities and
defense provisions of this SECTION 13 shall indefinitely survive termination of
this Agreement.
SECTION 14. The Custodian shall provide the Fund, at such times as the Fund may
reasonably require, with accountants' reports on the accounting system, internal
accounting control and procedures for safeguarding securities, including
securities deposited and/or maintained in a Securities System, relating to the
services provided by the Custodian under this Agreement; such reports, which
shall be of sufficient scope and in sufficient detail to provide reasonable
assurance that any material inadequacies would be disclosed, shall state in
detail material inadequacies disclosed by such examination, and, if there are no
such inadequacies, shall so state. Notwithstanding the foregoing the Custodian
shall not be required by the provisions of this Section 14 to have such a
report, which is not required for other purposes, prepared by independent public
accountants, unless the Fund agrees to reimburse the Custodian for the
reasonable charges of such independent public accountants for preparing such
report.
SECTION 15. This Agreement may be amended from time to time without notice to
or approval of the Shareholders by a supplemental agreement executed by the Fund
and the Custodian and amending and supplementing this Agreement in the manner
mutually agreed.
SECTION 16. Either the Fund or the Custodian may give one hundred twenty (120)
days written notice to the other of the termination of this Agreement, such
termination to take effect at the time specified in the notice. In case such
notice of termination is given either by the Fund or by the Custodian, the
Trustees of the Fund shall, by resolution duly adopted, promptly appoint a
Successor Custodian which Successor Custodian shall be a bank, trust company, or
a bank and trust company in good standing, with legal capacity to accept custody
of the securities of a mutual fund. Upon receipt of written notice from the Fund
of the appointment of such successor and upon receipt of Proper Instructions,
the Custodian shall deliver such
<PAGE>
Securities and cash as it may then be holding hereunder directly to and only to
the Successor Custodian. Unless or until a Successor Custodian has been
appointed as above provided, the Custodian then acting shall continue to act as
Custodian under this Agreement.
Every Successor Custodian appointed hereunder shall execute and deliver an
appropriate written acceptance of its appointment and shall thereupon become
vested with the rights, powers, obligations and custody of its predecessor
Custodian. The Custodian ceasing to act shall nevertheless, upon request of the
Fund and the Successor Custodian and upon payment of its charges and
disbursements, execute an instrument in form approved by its counsel
transferring to the Successor Custodian all the predecessor Custodian's rights,
duties, obligations and custody.
In case the Custodian shall consolidate with or merge into any other
corporation, the corporation remaining after or resulting from such
consolidation or merger shall ipso facto, without the execution of filing of any
papers or other documents, succeed to and be substituted for the Custodian with
like effect as though originally named as such.
SECTION 17. This Agreement shall take effect when assets of the Fund are first
delivered to the Custodian.
SECTION 18. 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.
SECTION 19. The Custodian may, at any time or times appoint (and may at any time
remove) and other bank or trust company which is itself qualified under the
Investment Company Act of 1940, as amended, to act as a custodian, as its agent
to carry out such of the provisions of this Agreement as the Custodian may from
time to time direct, provided, however, that the appointment of such agent shall
not relieve the Custodian of any of its responsibilities under this Agreement.
SECTION 20. A copy of the Declaration of Trust of the Fund 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 Fund 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 Fund individually but
binding only upon the assets and property of the Fund.
SECTION 21. The Custodian shall create and maintain all records relating to its
activities and obligations under this Agreement in such manner as will meet the
obligations of the Fund under the Investment Company Act of 1940, with
particular attention to Section
<PAGE>
31 thereof and Rules 31a-1 and 31a-2 thereunder, applicable Federal and state
tax laws and any other law or administrative rules or procedures which may be
applicable to the Fund.
Subject to security requirements of the Custodian applicable to its own
employees having access to similar records within the Custodian and such
regulations as to the conduct of such monitors as may be reasonably imposed by
the Custodian after prior consultation with an officer of the Fund the books and
records of the Custodian pertaining to its actions under this Agreement shall be
open to inspection and audit at any reasonable times by officers of, attorneys
for, and auditors employed by, the Fund.
SECTION 22. Nothing contained in this Agreement is intended to or shall require
the Custodian in any capacity hereunder to perform any functions or duties on
any holiday or other day of special observance on which the Custodian is closed.
Functions or duties normally scheduled to be performed on such days shall be
performed on, and as of, the next business day the Custodian is open.
SECTION 23. This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable by the Fund without the written
consent of the Custodian, or by the Custodian without the written consent of the
Fund, authorized or approved by a resolution of its Board of Trustees.
IN WITNESS WHEREOF, the Fund and the Custodian have caused this Agreement to be
signed by their respective officers as of the day and year first above written.
TrustFunds Liquid Asset Trust
By: /s/ Signature Appears Here
---------------------------------
President
THE PHILADELPHIA NATIONAL BANK
By: /s/ Signature Appears Here
---------------------------------
Vice President
<PAGE>
Schedule A
- ----------
The custodian fees will be taken against the portfolios in aggregate. These fees
shall consist of two parts: a net asset value fee and a variable transaction
fee.
Fixed Fee
- ---------
The net asset value fee will be charged monthly based on the average book value
of the aggregate portfolios during the month. There will be a minimum charge of
$50,000 per year, plus wire charges.
- -------
<TABLE>
<CAPTION>
Net Asset Value % Fee
--------------- -----
<S> <C>
On the first $1,000,000,000 .00013
Above $1,000,000,000 To be agreed on by the parties
</TABLE>
Transactional Fee
- -----------------
A transaction is defined as a purchase, a sale or a maturity.
. $12.00 - per transaction for Commercial Paper, Certificate of Deposit
Bankers Acceptances, Governmental Nat'l Mortgage Association (GNMA),
Euro Dollar Deposits, Nassau Time Deposits and repurchase agreements of
those investments.
. $10.00 - per transaction on all direct obligation of the U.S. Government
agencies of the U.S. Government (except GNMA) and repurchase agreements
these instruments - plus $2.00 per underlying asset.
These fees will be in effect for a period of not less than two years from the
date of the original document.
<PAGE>
SECONDARY CUSTODIAN AGREEMENT
This Agreement, dated 25th day of October, 1984 made by and between TrustFunds
Liquid Asset Trust (the "Fund"), a business trust operating as an open end
investment company, duly organized under the laws of The Commonwealth of
Massachusetts and First Interstate Bank of Oregon ("First Interstate");
WITNESSETH:
WHEREAS, the Fund desires to appoint First Interstate as custodian of a part of
its Securities and Cash at times when the Fund's primary custodian is not open
for business, and First Interstate is willing to act in such capacity upon the
terms and conditions herein set forth; and
WHEREAS; First Interstate in its capacity as Secondary Custodian hereunder will
also collect and apply the dividends and interest on said Securities in the
manner and to the extent herein set forth;
NOW, THEREFORE, in consideration of the premises and of the mutual convenants
herein contained, the parties hereto, intending to be legally bound, to hereby
agree as follows:
SECTION 1. The terms as defined in this Section wherever used in this
Agreement, or in any amendment or supplement hereto, shall have meanings herein
specified unless the context otherwise requires.
CUSTODIAN: The term Custodian shall mean The Philadelphia National Bank in its
capacity as custodian under an agreement with the Trust dated September 1, 1981,
or any successor thereto.
PROPER INSTRUCTIONS: For purposes of this Agreement the Secondary Custodian
shall be deemed to have received Proper Instructions upon receipt of written,
telephone or telegraphic instructions from a person or persons reasonably
believed by the Secondary Custodian to be a person or persons authorized from
time to time by the trustees of the Fund or by the Board of Directors of an
investment adviser for the Fund to give the particular class of instructions.
Telephone or telegraphic instructions shall be confirmed in writing by such
person or persons as said Trustees or said Board of Directors shall have from
time to time authorized to give the particular class of instructions in
question. The Secondary Custodian may act upon
<PAGE>
telephone or telegraphic instructions without awaiting receipt of written
confirmation, and shall not be liable for Fund's or such investment adviser's
failure to confirm such instructions in writing.
SECONDARY CUSTODIAN: The term Secondary Custodian shall mean First Interstate
----- ----------
Bank of Oregon in its capacity as Secondary Custodian under this Agreement.
- ---- -- ------
SECURITIES: The term Securities shall mean bonds, debentures, notes,
certificates of deposit, evidences of indebtedness, and other securities and
investments from time to time owned by the Fund.
SERVICE DATE: The day or days when services of the Secondary Custodian are
required.
SHAREHOLDERS: The term Shareholders shall mean the registered owners from time
to time of the Shares of the Fund in accordance with the registry records
maintained by the Fund or agents on its behalf.
SHARES: The term Shares of the Fund shall mean the shares of beneficial
interest of the Fund.
SECTION 2. The Fund shall from time to time file with the Secondary Custodian a
certified copy of each resolution of its Board of Trustees authorizing the
person or persons to give Proper Instructions (as defined in SECTION 1) and
specifying the class of instructions that may be given by each person to the
Secondary Custodian under this Agreement, together with certified signatures of
such persons authorized to sign, which shall constitute conclusive evidence of
the authority of the officers and signatories designated therein to act, and
shall be considered in full force and effect with the Secondary Custodian fully
protected in acting in reliance thereon until it receives written notice to the
contrary; provided, however, that if the certifying officer is authorized to
give Proper Instructions, the certification shall be also signed by a second
officer of the Fund.
SECTION 3. The Fund hereby appoints the Secondary Custodian as Secondary
Custodian of the Securities of the Fund and cash from time to time on deposit
hereunder, to be held by the Secondary Custodian and applied as provided in this
Agreement. The Secondary Custodian hereby accepts such appointment subject to
the terms and conditions hereinafter provided. Such Securities and cash shall,
however, be segregated from the assets of others and shall be and remain the
sole property of the Fund and the Secondary Custodian shall have only the bare
custody thereof.
-2-
<PAGE>
The Securities held by the Secondary Custodian shall, unless payable to bearer,
be registered in the name of the Custodian or in the name of its nominee.
Securities, excepting bearer securities, delivered from time to time to
the Secondary Custodian upon purchase or otherwise shall in all cases be in due
form for transfer or already registered as above provided.
SECTION 4: The Secondary Custodian shall be required to act in said capacity on
certain days when the Custodian is not open for transaction of business as
determined by the Fund. The Secondary Custodian shall maintain open accounts for
each portfolio of the Fund to be activated upon receipt of Proper Instructions.
The Fund will provide telephonic notice to the Secondary Custodian not less than
5 business days prior to the Service Day.
The Fund will make a deposit of cash one business day prior to the Service Day
to be held and applied by the Secondary Custodian hereunder. Thereafter the
Fund will cause to be deposited with the Secondary Custodian hereunder (i) the
net proceeds of Securities sold on the service day and (ii) the applicable net
asset value of Shares sold on the service day whether representing initial
issue, other stock or reinvestments of dividends and/or distributions payable to
Shareholders.
The Fund will withdraw such cash as is on deposit on the business day following
the Service Day.
SECTION 5. The Secondary Custodian will collect from time to time the dividends
and interest on the Securities held by it hereunder and will forward all
proceeds to the Custodian within one business day of receipt of same. The
Secondary Custodian is authorized to advance or pay out of said account accrued
interest on bonds purchased and dividends on securities sold and like items.
Subject to proper reserves for interest owing on Securities sold and like items,
the Secondary Custodian will disburse the money from time to time on deposit in
the account to or upon the order of the Fund as it may from time to time direct
in accordance with this Agreement.
SECTION 6. The Secondary Custodian is hereby authorized and directed to
disburse cash from time to time as follows:
(a) to pay the proper compensation and expenses of Secondary Custodian
upon receipt of Proper Instruction;
(b) to transfer to the Transfer Agent or other dividend disbursing agent
to pay dividends and/or distributions which may be authorized by the Fund upon
receipt of Proper Instructions;
-3-
<PAGE>
(c) to pay, or provide the Fund with money to pay, if any, taxes upon
receipt of Proper Instructions;
(d) for the purpose of completing the purchase of Securities purchased by
the Fund, upon receipt of (i) Proper Instructions specifying the Securities and
stating the purchase price, and the name of the broker, investment banker or
other party to or upon whose order the purchase price is to be paid; and (ii)
upon receipt of such Securities by the Secondary Custodian or, in the case of a
purchase effected through a Securities System, in accordance with Section 8
hereof;
(e) for the purpose of redeeming or purchasing Shares upon receipt of
Proper Instructions stating applicable redemption amounts payable, to the
Transfer Agent or other appropriate party;
(f) for the purpose of paying over to the Transfer agent or dividend
disbursing agent such amounts as may be stated in Proper Instructions,
representing proceeds of the sale of warrants, rights, stock dividends, profit
and increase in values of the Securities, as the Fund may determine to include
in dividends and/or distributions on the Shares;
(g) for the purpose of paying in whole or in part any loan of the Fund
upon receipt of Proper Instructions directing payment and stating the
Securities, if any, to be received against payment;
(h) to pay interest, investment advisory or supervisory fees,
administration, dividend and transfer agency fees and costs, compensation of
personnel, or operating expenses (including, without limitation thereto, fees
for legal purposes). Before making any such payment or disbursement, however,
the Secondary Custodian shall receive (and may conclusively rely upon) Proper
Instructions requesting such payment or disbursement and stating that it is for
one or more of the purposes hereinabove enumerated, provided that if the
disbursement is for any other purposes, the instructions shall be in writing and
shall state that the disbursement was authorized by resolution of the Board of
Trustees of the Fund (a copy of which resolution shall be attached) and is for a
proper purpose.
(i) for the purpose of transfer to the Custodian, upon receipt of Proper
Instructions.
SECTION 7. The Secondary Custodian is hereby authorized and directed to deliver
Securities from time to time as follows:
(a) for the purpose of completing sales of Securities sold by the Fund,
upon receipt of (i) the net proceeds of sale and
-4-
<PAGE>
(ii) Proper Instructions specifying the Securities sold and stating the amount
to be received and the broker, investment banker or other party to or upon whose
order the Securities are to be delivered;
(b) for the purpose of exchanging Securities for other Securities and/or
cash upon timely receipt of (i) Proper Instructions stating Securities to be
delivered and the Securities and/or cash to be received in exchange and the
manner in which the exchange is to be made, and (ii) against receipt of the
other Securities and/or cash as specified in the Proper Instructions;
(c) for the purpose of exchanging or converting Securities pursuant to
their terms or pursuant to any plan of conversion, consolidation,
recapitalization, reorganization, readjustment or otherwise, upon timely receipt
of (i) Proper Instructions authorizing such exchange or conversion and stating
the manner in which such exchange or conversion is to be made, and (ii) against
receipt of the Securities, certificates of deposit, interim receipts, and/or
cash to be received as specified in the Proper Instructions;
(d) for the purpose of presenting Securities for payment which have matured
or have been called for redemption upon receipt of appropriate Proper
Instructions and provided that the cash or other consideration is to paid to the
Secondary Custodian;
(e) for the purpose of delivering of Securities upon redemption of Shares
in kind, upon receipt of appropriate Proper Instructions; or
(f) for the purpose of depositing with the lender Securities to be held as
collateral of a loan to the Fund upon receipt of Proper Instructions directing
delivery to the lender and upon receipt of the proceeds of the loan.
SECTION 8. The Secondary Custodian may deposit and/or maintain Securities owned
by the Fund in a clearing agency registered with the Securities and Exchange
Commission under Section 17A of the Securities Exchange Act of 1934, which acts
as a securities depository, or in the book-entry system authorized by the U.S.
Department of the Treasury and certain Federal agencies, collectively referred
to herein as "Securities System" in accordance with applicable Federal Reserve
Board and Securities and Exchange Commission rules and regulations, if any, and
subject to the following provisions:
1) The Secondary Custodian may keep Securities of the Fund in a Securities
System provided that such Securities
-5-
<PAGE>
are represented in an account ("Account") of the Secondary Custodian in
the Securities System which shall not include any assets of the
Secondary Custodian other than assets held as a fiduciary, custodian,
or otherwise for customers.
2) The records of the Secondary Custodian with respect to Securities of
the Fund which are maintained in a Securities System shall identify by
book-entry those Securities belonging to the Fund.
3) The Secondary Custodian shall pay for Securities purchased for the
account of the Fund upon (i) receipt of advice from the Securities
System that such Securities have been transferred to the Account, and
(ii) the making of an entry on the records of the Secondary Custodian
to reflect such payment and transfer for the account of the Fund. The
Secondary Custodian shall transfer Securities sold for the account of
the Fund upon (i) receipt of advice from the Securities System that
payment for such Securities has been transferred to the Account, and
(ii) the making of an entry on the records of the Secondary Custodian
to reflect such transfer and payment for the account of the Fund.
Copies of all advices from the Securities System of transfers of
Securities for the account of the Fund shall identify the Fund, be
maintained for the Fund by the Secondary Custodian and be provided to
the Fund at its request. The Secondary Custodian shall furnish the Fund
confirmation of each transfer to or from the account of the Fund in the
form of a written advice or notice and shall furnish to the Fund copies
of daily transaction sheets reflecting each day's transaction for the
account of the Fund on the next business day.
4) The Secondary Custodian shall provide the Fund with any report obtained
by the Secondary Custodian on the Securities System's internal
accounting control and procedures for safeguarding securities deposited
in the Securities System.
5) The Secondary Custodian shall have received an initial certificate of
the Secretary or an Assistant Secretary that the Trustees of the Fund
have approved the initial use of a particular Securities System and the
Secondary Custodian shall receive an annual certificate of the
Secretary or an Assistant Secretary that the Trustees have reviewed the
use by the Fund of such Securities System, as required in each case by
Rule 17f-4 under the Investment Company Act of 1940, as amended.
-6-
<PAGE>
6) Anything to the contrary in this Agreement notwithstanding, the
Secondary Custodian shall be liable to the Fund for any loss or damage
to the fund resulting from use of the Securities System by reason of
any negligence, misfeasance or misconduct of the Secondary Custodian
or any of its agents or of any of its or their employees or from any
failure of the Secondary Custodian or any such agent to enforce
effectively such rights as it may have against the Securities System;
at the election of the Fund, it shall be entitled to be subrogated to
the rights of the Secondary Custodian with respect to any claim
against the Securities System or any other person which the Secondary
Custodian may have as a consequence of any such loss or damage if and
to the extent that the Fund has not been made whole for any such loss
or damage.
SECTION 9. The Secondary Custodian's compensation shall be as negotiated
between the Secondary Custodian and the Fund.
SECTION 10. The Secondary Custodian shall forward to the Fund proxies, proxy
statements, annual reports, conversion notices, call notices, or other notices
or written materials sent to the registered owners of securities and actually
received by the Secondary Custodian (hereafter referred to as "notices and
materials"), excluding only certificates representing securities and dividend
and interest payments. Responsibility for taking action thereon is the sole
responsibility of the Fund and its investment adviser, and not the
responsibility of the Secondary Custodian. Upon actual receipt by the Secondary
Custodian of warrants or rights issued in connection with the assets of the
Fund, the Secondary Custodian shall enter on its ledgers appropriate notations
indicating such receipt and shall forward notice thereof to the Fund, but shall
have no obligation whatsoever to take any action of any kind with respect to
such warrants or rights except upon receipt of Proper Instructions authorizing
the exercise or sale of such warrants or rights.
SECTION 11. The Secondary Custodian assumes only the usual duties or
obligations normally performed by custodians of mutual funds. It specifically
assumes no responsibility for the management, investment or reinvestment of the
Securities from time to time owned by the Fund whether or not on deposit
hereunder, it being understood that the responsibility for the proper and timely
management, investment and reinvestment of said Securities shall be that of the
Fund and its investment advisers.
-7-
<PAGE>
In connection with its functions under this Agreement, the Secondary Custodian
shall:
(a) obtain a "due bill" for dividends, interest or other distributions of
the issuer, due the purchaser in connection with Securities delivered to the
Secondary Custodian;
(b) render to the Fund a daily report of all monies received or paid on
behalf of the Fund and such listings of Securities held by the Secondary
Custodian for the account of the Fund as may from time to time be requested by
the Fund.
(c) execute ownership and other certificates and affidavits for all
Federal and State tax purposes in connection with the collection of bond and
note coupons;
(d) present for payment on the date of payment all coupons and other
periodic income items requiring presentation;
(e) monitor and record the collection of funds in accounts maintained by
the Secondary Custodian, in the name of the Fund on the same day as received;
(f) in accordance with the manager's directions as to allocation of the
securities to separate portfolios designated by the Fund, the Secondary
Custodian shall maintain records showing the respective securities comprising
each such portfolio.
(g) create, maintain and retain all records relating to its activities and
obligations under this Agreement in such manner as will meet the obligations of
the Fund with respect to said Secondary Custodian activities and obligations
under generally accepted accounting principles. All records maintained by the
Secondary Custodian in connection with the performance of its duties under this
Agreement will remain the property of the Fund and in the event of termination
of this Agreement will be relinquished to the Fund.
If the Secondary Custodian does not receive payment for items due under
subsection (a), (d), or (e) within a reasonable time after it has made proper
demands for the same, it shall so notify the Fund in writing, including copies
of all demand letters, any written responses thereto, and memoranda of all oral
responses thereto and to telephonic demands, and await Proper Instructions; the
Secondary Custodian shall not be obliged to take legal action for collection
except by its consent and unless and until reasonably indemnified to its
satisfaction. The Secondary Custodian shall also notify the Fund as soon as
reasonably practicable whenever income due on Securities is not collected in due
course.
-8-
<PAGE>
The Secondary Custodian shall not be liable for any taxes, assessments, or
governmental charges, which may be levied or assessed upon the Securities held
by it hereunder, or upon the income therefrom or otherwise whatsoever. The
Secondary Custodian may pay any such tax, assessment or charge and reimburse
itself out of the monies of the fund or out of the Securities held hereunder.
SECTION 12. No liability of any kind shall be attached to or incurred by the
Secondary Custodian by reason of its custody of the funds, assets, or shares
held by it from time to time under this Agreement, or otherwise by reason of its
position as secondary custodian hereunder except only for its own negligence,
bad faith, or willful misconduct in the performance of its duties as
specifically set forth in the Agreement. Without limiting the generality of the
foregoing sentence, the Secondary Custodian:
(a) may rely upon the advice of counsel, who may be counsel for the Fund
or for the Secondary Custodian, and upon statements of accountants, brokers and
other persons believed by it in good faith to be expert in the matters upon
which they are consulted; and for any action taken or suffered in good faith
based upon such advice or statements the Secondary Custodian shall not be liable
to anyone;
(b) shall not be liable for anything done or suffered to be done in good
faith in accordance with any request or advice of, or based upon information
furnished by, the Fund or its authorized officers or agents;
(c) is authorized to accept a certificate of the Secretary or Assistant
Secretary of the Fund, or Proper Instructions, to the effect that a resolution
in the form submitted has been duly adopted by its Board of Trustees or by the
Shareholders, as conclusive evidence that such resolution has been duly adopted
and is in full force and effect;
(d) may rely and shall be protected in acting upon any signature, written
(including telegraph or other mechanical) instructions, request, letter of
transmittal, certificate, opinion of counsel, statement, instrument, report,
notice, consent, order, or other paper or document reasonably believed by it to
be genuine and to have been signed, forwarded or presented by the purchaser,
Fund or other proper party or parties.
SECTION 13. The Fund, its successors and assigns hereby indemnify and hold
harmless the Secondary Custodian, its successors and assigns, of and from any
and all liability whatsoever arising out of or in connection with the Secondary
-9-
<PAGE>
Custodian's status, acts, or omissions under this Agreement except only for
liability arising out of the Secondary Custodian's own negligence, bad faith, or
willful misconduct in the performance of its duties specifically set forth in
this Agreement. Without limiting the generality of the foregoing, the Fund, its
successors and assigns do hereby fully indemnify and hold harmless the Secondary
Custodian, its successors and assigns, from any and all loss, liability, claims,
demand, actions, suits and expenses of any nature as the same may arise from the
failure of the Fund to comply with any law, rule, regulation or order of the
United States, any State of any other jurisdiction, governmental authority,
body, or board relating to the sale, registration, qualification of shares of
any beneficial interest in the Fund, or from the failure of the Fund to perform
any duty or obligation under this Agreement.
Upon written request of the Secondary Custodian, the Fund shall assume the
entire defense of any claim subject to the foregoing indemnity, or the joint
defense with the Secondary Custodian of such claim, as the Secondary Custodian
shall request. The indemnities and defense provisions of this SECTION 13 shall
indefinitely survive termination of this Agreement.
SECTION 14. The Secondary Custodian shall provide the Fund, at such times as the
Fund may reasonably require, with accountants' reports on the accounting system,
internal accounting control and procedures for safeguarding securities,
including securities deposited and/or maintained in a Securities System,
relating to the services provided by the Secondary Custodian under this
Agreement; such reports, which shall be of sufficient scope and in sufficient
detail to provide reasonable assurance that any material inadequacies would be
disclosed, shall state in detail material inadequacies disclosed by such
examination, and, if there are no such inadequacies, shall so state.
Notwithstanding the foregoing the Secondary Custodian shall not be required by
the provisions of this Section 14 to have such a report, which is not required
for other purposes, prepared by independent public accountants, unless the Fund
agrees to reimburse the Secondary Custodian for the reasonable charges of such
independent public accountants for preparing such report.
SECTION 15. This Agreement may be amended from time to time without notice to or
approval of the Shareholders by a supplemental agreement executed by the Fund
and the Secondary Custodian and amending and supplementing this Agreement in the
manner mutually agreed.
SECTION 16. Either the Fund or the Secondary Custodian may give one hundred
twenty (120) days written notice to the other of the
-10-
<PAGE>
termination of this Agreement, such termination to take effect at the time
specified in the notice.
In case the Secondary Custodian shall consolidate with or merge into any other
corporation, the corporation remaining after or resulting from such
consolidation or merger shall ipso facto, without the execution of filing of any
papers or other documents, succeed to and be substituted for the Secondary
Custodian with like effect as though originally named as such.
SECTION 17. This Agreement shall take effect when assets of the Fund are first
delivered to the Secondary Custodian.
SECTION 18. 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.
SECTION 19. The Secondary Custodian may, at any time or times appoint (and may
at any time remove) any other bank or trust company which is itself qualified
under the Investment Company Act of 1940, as amended, to act as a custodian, as
its agent to carry out such of the provisions of this Agreement as the Secondary
Custodian may from time to time direct, provided, however, that the appointment
of such agent shall not relieve the Secondary Custodian of any of its
responsibilities under this Agreement.
SECTION 20. A copy of the Declaration of Trust of the Fund 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 Fund 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 Fund individually but
binding only upon the assets and property of the Fund.
SECTION 21. The Secondary Custodian shall create and maintain all records
relating to its activities and obligations under this Agreement in such manner
as will meet the obligations of the Fund under the Investment Company Act of
1940, with particular attention to Section 31 thereof and Rules 31a-1 and 31a-2
thereunder, applicable Federal and State tax laws and any other law or
administrative rules or procedures which may be applicable to the Fund.
-11-
<PAGE>
Subject to security requirements of the Secondary Custodian applicable to its
own employees having access to similar records within the Secondary Custodian
and such regulations as to the conduct of such monitors as may be reasonably
imposed by the Secondary Custodian after prior consultation with an officer of
the Fund the books and records of the Secondary Custodian pertaining to its
actions under this Agreement shall be open to inspection and audit at any
reasonable times by officers of, attorneys for, and auditors employed by, the
Fund.
SECTION 22. This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable by the Fund without the written
consent of the Secondary Custodian, or by the Secondary Custodian without the
written consent of the Fund, authorized or approved by a resolution of its Board
of Trustees.
IN WITNESS WHEREOF, the Fund and the Secondary Custodian have caused this
Agreement to be signed by their respective officers as of the day and year first
above written.
TrustFunds Liquid Asset Trust
By: /s/ Signature Appears Here
-------------------------------
President
FIRST INTERSTATE BANK OF OREGON
By: /s/ Signature Appears Here
-------------------------------
-12-
<PAGE>
Consent of Independent Accountants
We hereby consent to the use in the Statement of Additional Information which
is incorporated by reference in this Post-Effective Amendment No. 19 to the
registration statement on Form N-1A (the "Registration Statement") of our report
dated August 11, 1995, relating to the June 30, 1995 financial statements and
financial highlights of the Treasury Securities, Government Securities, Prime
Obligation, Institutional Cash and the Money Market Portfolios of SEI Liquid
Asset Trust, which appears in each Statement of Additional Information, and to
the incorporation by reference of our report into the Prospectuses which are
incorporated by reference in this Registration Statement. We also consent to the
references to us under the headings "Financial Statements" and "Experts" in such
Statement of Additional Information and to the references to us under the
headings "Financial Highlights" and "Counsel and Independent Accountants" in
such Prospectuses.
PRICE WATERHOUSE LLP
Philadelphia, Pennsylvania
October 26, 1995
<PAGE>
DISTRIBUTION PLAN
(As amended March 30, 1984)
Section 1. TrustFunds Liquid Asset Trust (the "Trust") has adopted this
---------
Distribution Plan (the "Plan") pursuant to which it may directly or indirectly
bear expenses relating to the distribution of securities of which it is the
issuer, pursuant to Section 12(b) of the Investment Company Act of 1940 (the
"Act"), and the rules and regulations promulgated thereunder, as the same may
be, from time to time, issued or amended.
Section 2. A majority of the Qualified Trustees shall approve a budget for
---------
expenses which the Trust may incur pursuant to this Plan during the 12 month
period following the date on which this Plan shall first become effective and a
similar budget for each succeeding 12 month period (or portion thereof). A
majority of the Qualified Trustees may from time to time change such budgets to
increase or decrease the total amount authorized to be spent, to change the
allocation of amounts among expenditure items, to suspend expenditures or
otherwise. No expenditures under this Plan shall be made in excess of those
provided for in budgets approved by a majority of the Qualified Trustees from
time to time. All expenditures pursuant to such budgets shall be made only
pursuant to authorization by the President, any Vice President or the Treasurer
of the Trust for an expense permitted pursuant to this Plan and, unless
otherwise authorized by a majority of the Qualified Trustees, no such
expenditures shall be made if SEI Financial Services Company shall object
thereto in writing. Expenses incurred pursuant to this Plan shall constitute
expenses subject to the annual limitation on expenses (with certain exceptions)
provided in Article 3(b) of the Trust's Management Agreement with SEI Financial
Services Company dated November 29, 1983. Expenses incurred pursuant to this
Plan shall be allocated among the Portfolios on the basis of their relative net
asset values, unless otherwise determined by a majority of the Qualified
Trustees.
Section 3. Expenses permitted pursuant to this Plan shall include, and be
---------
limited, to the following:
A. The incremental printing cost incurred as the result of producing for
persons other than current unitholders of the Trust, reports,
prospectuses, notices and similar materials that are prepared by the
Trust for current unitholders, and of distributing the same to other
than current unitholders of the Trust.
B. The cost of registering the Trust's units under state and foreign laws
and other costs involved in complying with such laws in the
distribution of the Trust's units.
C. Advertising.
D. The costs of preparing, printing and distributing any literature not
covered in A and used in connection with the offering of the Trust's
units.
<PAGE>
E. Expenses incurred in connection with the promotion and sale of
the Trust's units (including, without limitation, travel and
communication expenses and expenses for compensation and benefits
of sales personnel.)
Section 4. This Plan shall not take effect until it has been approved by
---------
a vote of at least a majority of the outstanding voting securities of the Trust.
Section 5. This Plan shall not take effect until it has been approved,
---------
together with any related agreements, by votes of the majority (or whatever
greater percentage may, from time to time, be required by Section 12(b) of the
Act or the rules and regulations thereunder) of both (a) the Trustees of the
Trust and (b) the Qualified Trustees cast in person at a meeting called for the
purpose of voting on this Plan or such agreement.
Section 6. This Plan shall continue in effect for a period of more than
---------
one year after it takes effect only so long as such continuance is specifically
approved at least annually in the manner provided for approval of this Plan in
Section 5.
Section 7. Any person authorized to direct the disposition of monies paid
---------
or payable by the Trust pursuant to this Plan or any related agreement shall
provide to the Trustees of the Trust, and the Trustees shall review, at least
quarterly, a written report of the amounts so expended and the purposes for
which such expenditures were made.
Section 8. This Plan may be terminated at any time by vote of a majority
---------
of the Qualified Trustees, or by vote of a majority of the Trust's outstanding
voting securities.
Section 9. All agreements with any person relating to implementation of
---------
this Plan shall be in writing, and any agreement related to this Plan shall
provide:
A. That such agreement may be terminated at any time, without payment of
any penalty, by vote of a majority of the Qualified Trustees or by
vote of a majority of the Trust's outstanding voting securities, on
not more than 60 days' written notice to any other party to the
agreement; and
B. That such agreement shall terminate automatically in the event of its
assignment.
Section 10. This Plan may not be amended to increase materially the amount
----------
of distribution expenses permitted pursuant to Section 2 hereof without the
approval of a majority of the outstanding voting securities of the Trust, and
all material amendments to this Plan shall be approved in the manner provided
for approval of this Plan in Section 5.
Section 11. As used in this Plan, (A) the term "Qualified Trustees" shall
----------
mean those Trustees of the Trust who are not interested persons of the Trust,
and have no direct or indirect financial interest in the operation of this Plan
or any agreements related to it, and (B) the terms "assignment" and "interested
person" shall have the respective meanings specified in the Act
<PAGE>
and the rules and regulations thereunder, subject to such exemptions as may be
granted by the Securities and Exchange Commission.
<PAGE>
DISTRIBUTION PLAN
ProVantage Funds
WHEREAS, SEI Liquid Asset Trust (the "Trust") is engaged in business as an
open-end investment company registered under the Investment Company Act of 1940,
as amended ("1940 Act"); and
WHEREAS, the Trustees of the Trust have determined that there is a
reasonable likelihood that the following Distribution Plan will benefit the
Trust's ProVantage Funds Class and the owners of units of beneficial interest
("Shareholders") in the Trust's ProVantage Funds Class;
NOW, THEREFORE, the Trustees of the Trust hereby adopt this Distribution
Plan pursuant to Rule 12b-1 under the 1940 Act.
Section 1. The Trust has adopted this ProVantage Funds Distribution Plan
----------
("Plan") to enable the Trust to directly or indirectly bear expenses relating to
the distribution of ProVantage Funds securities of which the Trust is the
issuer.
Section 2. The Trust may incur expenses for the items stipulated in
----------
Section 3 of this Plan in an amount equal to .30% of the average daily net
assets of the ProVantage Funds of the Portfolios. All expenditures pursuant to
this Plan shall be made only pursuant to authorization by the President, any
Vice President or the Treasurer of the Trust. If there should be more than one
series of Trust shares, expenses incurred pursuant to this Plan shall be
allocated among the several series of the Trust on the basis of their relative
net asset values, unless otherwise determined by a majority of the Qualified
Trustees.
In addition, the Trust will pay the Distributor a fee on the ProVantage Funds of
the Portfolios up to the amount set forth on Exhibit A. The Distributor may use
this fee for (i) compensation for it services in connection with distribution
assistance or provision of shareholder services; or (ii) payments to financial
institutions and intermediaries such as banks, savings and loan associations,
insurance companies and investment counselors, broker-dealers and the
Distributor's affiliates and subsidiaries as compensation for services or
reimbursement of expenses incurred in connection with distribution assistance or
provision of shareholder services.
Section 3. Expenses permitted pursuant to this Plan shall include, and be
----------
limited to, the following:
(a) The incremental printing costs incurred in producing for and
distributing to
1
<PAGE>
persons other than current Shareholders of the Trust the reports, prospectuses,
notices and similar materials that are prepared by the Trust for current
Shareholders;
(b) advertising;
(c) the costs of preparing, printing and distributing any literature used
in connection with the offering of the Trust's Shares and not covered
by Section 3(a) of this Plan; and
(d) expenses incurred in connection with the promotion and sale of the
Trust's Shares including, without limitation, travel and communication
expenses and expenses for the compensation of and benefits for sales
personnel.
Section 4. This Plan shall not take effect until it has been approved (a)
----------
by a vote of at least a majority of the outstanding voting securities of the
Trust's ProVantage Funds Class; and (b) together with any related agreements, by
votes of the majority of both (i) the Trustees of the Trust and (ii) the
Qualified Trustees, cast in person at a Board of Trustees meeting called for the
purpose of voting on this Plan or such agreement.
Section 5. This Plan shall continue in effect for a period of more than
----------
one year after it takes effect only for so long as such continuance is
specifically approved at least annually in the manner provided in Part (b) of
Section 4 herein for the approval of this Plan.
Section 6. Any person authorized to direct the disposition of monies paid
----------
or payable by the Trust pursuant to this Plan or any related agreement shall
provide to the Trustees of the Trust, at least quarterly, a written report of
the amounts so expended and the purposes for which such expenditures were made.
Section 7. This Plan may be terminated at any time by the vote of a
----------
majority of the Qualified Trustees or by vote of a majority of the outstanding
voting securities of the Trust's ProVantage Funds Class.
Section 8. All agreements with any person relating to implementation of
----------
this Plan shall be in writing, and any agreement related to this Plan shall
provide (a) that such agreement may be terminated at any time, without payment
of any penalty, by the vote of a majority of the Qualified Trustees or by the
vote of Shareholders holding a majority of the Trust's outstanding voting
securities, on not more than 60 days written notice to any other party to the
agreement; and (b) that such agreement shall terminate automatically in the
event of its assignment.
Section 9. This Plan may not be amended to increase materially the amount
----------
of distribution expenses permitted pursuant to Section 2 hereof without the
approval of Shareholders holding a majority of the outstanding voting securities
of the Trust, and all
2
<PAGE>
material amendments to this Plan shall be approved in the manner provided in
Part (b) of Section 4 herein for the approval of this Plan.
Section 10. As used in this Plan, (a) the term "Qualified Trustees" shall
-----------
mean those Trustees of the Trust who are not interested persons of the Trust,
and have no direct or indirect financial interest in the operation of this Plan
or any agreements related to it, and (b) the terms "assignment" and "interested
person" 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.
Section 11. While this Plan is in effect, the selection and nomination of
-----------
those Trustees who are not interested persons of the Trust within the meaning of
Section 2(a)(19) of the 1940 Act shall be committed to the discretion of the
Trustees then in office who are not interested persons of the Trust.
Section 12. This Plan shall not obligate the Trust or any other party to
-----------
enter into an agreement with any particular person.
3
<PAGE>
EXHIBIT A
---------
<TABLE>
<S> <C>
Treasury Portfolio ..................................................... .25%
Prime Obligation Portfolio ............................................. .25%
</TABLE>
4
<PAGE>
SEI LIQUID ASSET TRUST
Rule 18f-3
Multiple Class Plan
March 22, 1993
SEI Liquid Asset Trust (the "Trust"), a registered investment company
that currently consists of five separately-managed portfolios and which may
consist of additional portfolios in the future to the extent listed on Schedule
A hereto, (each a "Portfolio" and, collectively, the "Portfolios"), have elected
to rely on Rule 18f-3 under the Investment Company Act of 1940, as amended (the
"1940 Act") in offering multiple classes of units of beneficial interest
("shares") in each Portfolio. The Plan sets forth the differences among
classes, including shareholder services, distribution arrangements, expense
allocations, and conversion or exchange options.
A. Attributes of Share Classes
The rights of each existing class of the Portfolios (i.e., Class A,
----
and Class D) shall be as set forth in the resolutions and related materials of
the Trust's Board adopted pursuant to the order dated September 9, 1993,
obtained by SEI Liquid Asset Trust, et al. (Inv. Co. Act Release No. IC-19698),
-- ---
and attached hereto as Exhibits A - C.
With respect to any class of shares of a Portfolio created after the
date hereof, each share of a Portfolio will represent an equal pro rata interest
--- ----
in the Portfolio and will have identical terms and conditions, except that: (i)
each new class will have a different class name (or other designation) that
identifies the class as separate from any other class; (ii) each class will
separately bear any distribution expenses ("distribution fees") in connection
with a plan adopted pursuant to Rule 12b-1 under the 1940 Act (a "Rule 12b-1
Plan"), and will separately bear any non-Rule 12b-1 Plan service payments
("service fees") that are made under any servicing agreement entered into with
respect to that class; (iii) each class may bear, consistent with rulings and
other published statements of position by the Internal Revenue Service, the
expenses of the Portfolio's operations which are directly attributable to such
class ("Class Expenses"); and (iv) shareholders of the class will have exclusive
voting rights regarding the Rule 12b-1 Plan and the servicing agreements
relating to such class, and will have separate voting rights on any matter
submitted to shareholders in which the interests of that class differ from the
interests of any other class.
<PAGE>
B. Expense Allocations
Expenses of each existing class and of each class created after the
date hereof shall be allocated as follows: (i) distribution and shareholder
servicing payments associated with any Rule 12b-1 Plan or servicing agreement
relating to each class of shares are (or will be) borne exclusively by that
class; (ii) any incremental transfer agency fees relating to a particular class
are (or will be) borne exclusively by that class; and (iii) Class Expenses
relating to a particular class are (or will be) borne exclusively by that class.
Until and unless changed by the Board, the methodology and procedures
for calculating the net asset value of the various classes of shares and the
proper allocation of income and expenses among the various classes of shares
shall be as set forth in the "Report" rendered by Coopers & Lybrand L.L.P.
C. Amendment of Plan; Periodic Review
This Plan must be amended to properly describe (through additional
exhibits hereto or otherwise) each new class of shares approved by the Board
after the date hereof.
The Board of the Corporation, including a majority of the independent
Directors, must periodically review this Plan for its continued appropriateness,
and must approve any material amendment of the Plan as it relates to any class
of any Portfolio covered by the Plan.
2
<PAGE>
Schedule A
----------
Prime Obligation Portfolio
Treasury Securities Portfolio
Government Securities Portfolio
Money Market Portfolio
Institutional Cash Portfolio
3
<PAGE>
From March 22, 1993 Minutes
SEI LIQUID ASSET TRUST
SEI CASH+PLUS TRUST
SEI INSTITUTIONAL MANAGED TRUST
SEI INTERNATIONAL TRUST
SEI TAX EXEMPT TRUST
WHEREAS, on December 24, 1990 the Securities and Exchange Commission granted an
order exempting mutual funds administered or distributed by SEI now or in the
future from Sections 18(f), 18(g), and 18(i) of the Investment Company Act of
1940 to permit such funds to sell five classes of shares with different
distribution arrangements; and
WHEREAS, said exemptive order requires that the Board of Trustees of each Trust,
including a majority of the non-interested Trustees, approve the offering of
different classes of shares only after a determination that multiple classes is
in the best interest of each Trust and its Shareholders;
WHEREAS, it is in the best interest of the shareholders of each Trust that a
retail class of shares be distributed;
NOW THEREFORE, be it
VOTED: That based upon information presented to this Board of Trustees, the
Trustees, including a majority of the non-interested Trustees, have
determined that a retail class system for distribution of shares of
each Trust is in the best interests of each Trust and its
shareholders.
FURTHER
VOTED: That the form of Distribution Plan for Retail Class be, and it hereby
is, adopted by each Trust in accordance with Rule 12b-1 under the
Investment Company Act of 1940.
FURTHER
VOTED: That the Board of Trustees must receive and review quarterly
statements detailing the amounts paid by each Trust under its Rule
12b-1 Plan for Retail Class shares and under related Servicing
Agreements.
FURTHER
VOTED: That the Adviser and the Distributor shall report to the Board of
Trustees any material conflicts of interest that develop between
classes of shares of each Trust.
FURTHER
VOTED: That the form of the Retail Transfer Agent Agreement be, and it hereby
is, adopted by each Trust.
4
<PAGE>
SEI LIQUID ASSET TRUST
OCTOBER 28, 1994
- --------------------------------------------------------------------------------
TREASURY SECURITIES PORTFOLIO
GOVERNMENT SECURITIES PORTFOLIO
PRIME OBLIGATION PORTFOLIO
INSTITUTIONAL CASH PORTFOLIO
MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
Please read this Prospectus carefully before investing, and keep it on file for
future reference.
A Statement of Additional Information dated October 28, 1994 has been filed
with the Securities and Exchange Commission and is available without charge
through the Distributor, SEI Financial Services Company, 680 East Swedesford
Road, Wayne, PA 19087 or by calling 1-800-342-5734. The Statement of Additional
Information is incorporated into this Prospectus by reference.
SEI Liquid Asset Trust (the "Trust") is a mutual fund that offers financial
institutions a convenient means of investing their own funds or funds for which
they act in a fiduciary, agency or custodial capacity in one or more
professionally managed diversified portfolios of securities. Some portfolios
offer separate classes of units of beneficial interest that differ from each
other primarily in the allocation of certain distribution expenses and minimum
investment amounts. This Prospectus offers Class A shares of the Trust's five
money market portfolios (the "Portfolios", and each of these, a "Portfolio")
listed above.
AN INVESTMENT IN A PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT A PORTFOLIO WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
- --------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE AC-
CURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
THE TRUST'S SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED
BY, ANY BANK. THE SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER GOVERNMENT AGENCY.
INVESTMENT IN THE SHARES INVOLVES RISK, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
- --------------------------------------------------------------------------------
5
<PAGE>
ANNUAL OPERATING EXPENSES (As a percentage of average net assets)/1/
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TREASURY GOVERNMENT PRIME INSTITUTIONAL MONEY
SECURITIES SECURITIES OBLIGATION CASH MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
---------- ---------- ---------- ------------- ---------
<S> <C> <C> <C> <C> <C>
Management/Advisory Fees
(after fee waivers)/2/ .38% .38% .38% .39% .38%
12b-1 Fees/3/ .03% .03% .03% 0% .03%
Other Expenses .03% .03% .03% .05% .03%
- ----------------------------------------------------------------------------------
Total Operating
Expenses/4/ .44% .44% .44% .44% .44%
- ----------------------------------------------------------------------------------
</TABLE>
1 The operating expenses for the Money Market Portfolio set forth in this table
are based on estimated expenses for the fiscal year ending June 30, 1995.
2 The Manager has agreed contractually to waive its fee in an amount that
limits operating expenses of the Portfolios to not more than .44% of average
net assets, except for the Institutional Cash Portfolio for which the waiver
is voluntary and may be terminated at any time in the Manager's sole
discretion. Absent the waiver of management fees, management/advisory fees
for the Treasury Securities, Government Securities, Prime Obligation,
Institutional Cash and Money Market Portfolios, would be .45%, .45%, .45%,
.39% and .45%, respectively, for the fiscal year ended June 30, 1994.
Additional information may be found under "The Manager and Shareholder
Servicing Agent", "The Adviser" and "Distribution".
3 The 12b-1 fees shown reflect each Portfolio's current 12b-1 budget for
reimbursement of expenses. The maximum 12b-1 fees payable by Class A shares
for each Portfolio are .30%.
4 Absent the fee waivers described above, total operating expenses for the
Treasury Securities, Government Securities, Prime Obligation, Institutional
Cash and Money Market Portfolios would be .51%, .51%, .51%, .44% and .51%,
respectively, for the fiscal year ended June 30, 1994. Additional information
may be found under "The Manager and Shareholder Servicing Agent."
EXAMPLE
<TABLE>
- -------------------------------------------------------------------------------
<CAPTION>
An investor in any Portfolio would pay the 1 YR. 3 YRS. 5 YRS. 10 YRS.
following expenses on a $1,000 investment assuming ----- ------ ------ -------
(1) 5% annual return and (2) redemption at the end
of each time period:
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$5.00 $14.00 $25.00 $55.00
- -------------------------------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
The purpose of this table is to assist the investor in understanding the
various costs and expenses that may be directly or indirectly borne by
investors in the Portfolios. A person who purchases shares through a financial
institution may be charged separate fees by that institution. The information
set forth in the foregoing table and example relates only to the Portfolios'
Class A shares. The Treasury Securities Portfolio and Prime Obligation
Portfolio also offer ProVantage Funds shares, which are subject to the same
expenses except that ProVantage Funds shares bear sales loads and different
distribution costs. Additional information may be found under "The Manager and
Shareholder Servicing Agent", "The Adviser" and "Distribution".
Long-term shareholders may eventually pay more than the economic equivalent of
the maximum front-end sales charges otherwise permitted by the Rules of Fair
Practice (the "Rules") of the National Association of Securities Dealers, Inc.
(the "NASD").
6
<PAGE>
THE TRUST ______________________________________________________________________
SEI Liquid Asset Trust (the "Trust") is a diversified, open-end management
investment company that offers units of beneficial interest ("shares") in
separate investment portfolios. This Prospectus offers Class A shares of the
Trust's Treasury Securities, Government Securities, Prime Obligation,
Institutional Cash and Money Market Portfolios (the "Portfolios" and each of
these, a "Portfolio"). Shares in the Treasury Securities Portfolio and Prime
Obligation Portfolio may also be purchased through each of these Portfolio's
ProVantage Funds Class. Additional information pertaining to the Trust may be
obtained by writing to SEI Financial Services Company, 680 East Swedesford
Road, Wayne, PA 19087-1658 or by calling 1-800-342-5734.
INVESTMENT
OBJECTIVES AND
POLICIES _______________________________________________________________________
TREASURY The Treasury Securities Portfolio seeks to preserve
SECURITIES principal value and maintain a high degree of liquidity
PORTFOLIO while providing current income.
Under normal conditions the Portfolio invests exclusively
in U.S. Treasury obligations and repurchase agreements
involving such obligations. The dealers selected for the
Treasury Securities Portfolio must meet criteria established
by Standard & Poor's Corporation ("S&P").
GOVERNMENT The Government Securities Portfolio seeks to preserve
SECURITIES principal value and maintain a high degree of liquidity
PORTFOLIO while providing current income.
Under normal conditions the Portfolio invests exclusively
in U.S. Treasury obligations, obligations issued or
guaranteed as to principal and interest by the agencies or
instrumentalities of the U.S. Government and repurchase
agreements involving such obligations.
PRIME The Prime Obligation Portfolio seeks to preserve principal
OBLIGATION value and maintain a high degree of liquidity while
PORTFOLIO providing current income.
Under normal conditions the Portfolio invests exclusively
in (i) commercial paper rated at least A-1 by S&P or Prime-1
by Moody's Investors Service, Inc. ("Moody's") at the time
of investment or, if not rated, determined by the Adviser to
be of comparable quality; (ii) obligations (including
certificates of deposit, time deposits, bankers' acceptances
and bank notes) of U.S. commercial banks that are members of
the Federal Reserve System or the Federal Deposit Insurance
Corporation or savings and loan institutions, which banks or
institutions have total assets of $500 million or more as
shown on their most recent public financial statements at
the time of investment, provided that such obligations are
rated in the top two short-term rating categories by two or
more NRSROs, or one NRSRO if only one NRSRO has rated the
security at the time of investment or, if not rated,
determined by the Adviser to be of comparable quality; (iii)
short-term corporate obligations rated AAA or AA by S&P or
Aaa or Aa by Moody's Investors Service, Inc. ("Moody's") at
the time of investment or, if not rated, determined by the
Adviser to
7
<PAGE>
3. Borrow money except for temporary or emergency purposes
and then only in an amount not exceeding 10% of the value
of the total assets of that Portfolio. This borrowing
provision is included solely to facilitate the orderly
sale of portfolio securities to accommodate substantial
redemption requests if they should occur and is not for
investment purposes. All borrowings will be repaid before
making additional investments for that Portfolio and any
interest paid on such borrowings will reduce the income
of that Portfolio.
The foregoing percentage limitations will apply at the time
of the purchase of a security. Additional investment
limitations are set forth in the Statement of Additional
Information.
THE MANAGER
AND SHAREHOLDER
SERVICING AGENT ________________________________________________________________
SEI Financial Management Corporation (the "Manager" and the
"Transfer Agent"), 680 East Swedesford Road, Wayne, PA
19087, a wholly-owned subsidiary of SEI Corporation ("SEI")
provides the Trust with overall management services,
regulatory reporting, all necessary office space, equipment,
personnel and facilities and for acting as transfer agent,
dividend disbursing agent, and shareholder servicing agent.
The Manager is entitled to a fee, calculated daily and
paid monthly at an annual rate of .42% of the average daily
net assets of each Portfolio, except the Institutional Cash
Portfolio for which the Manager is entitled to a fee of .36%
of that Portfolio's average daily net assets. The Manager
has contractually agreed to waive all or a portion of its
fee with respect to each Portfolio in order to limit total
operating expenses of the Class A shares of each of these
Portfolios to not more than .44% of its average daily net
assets. For the Institutional Cash Portfolio only, this
waiver is voluntary and may be terminated at any time in the
Manager's sole discretion.
For the fiscal year ended June 30, 1994, the Portfolios
paid the Manager fees (shown here as a percentage of average
daily net assets after fee waivers) as follows: Treasury
Securities Portfolio--.35%; Government Securities
Portfolio--.35%; Prime Obligation Portfolio--.35% and
Institutional Cash Portfolio--.36%. The Money Market
Portfolio had not commenced operations as of June 30, 1994.
THE ADVISER ____________________________________________________________________
Wellington Management Company (the "Adviser"), 75 State
Street, Boston, MA 02109, acts as each Portfolio's
investment adviser. The Adviser, under an investment
advisory agreement with the Trust, makes investment
decisions for the assets of the Portfolios and continuously
reviews, supervises and administers each Portfolio's
investment program, subject to the supervision of, and
policies established by, the Trustees of the Trust.
As of September 30, 1994, the Adviser had discretionary
management authority with respect to approximately $82.0
billion of assets, including the Trust and SEI Daily
8
<PAGE>
Income Trust, an open-end management investment company. WMC
is a professional investment counseling firm which provides
investment services to investment companies, employee
benefit plans, endowments, foundations, and other
institutions and individuals. The Adviser's predecessor
organizations have provided investment advisory services to
investment companies since 1933 and to investment counseling
clients since 1960. Wellington Trust Company, National
Association, a wholly-owned subsidiary of the Adviser,
utilizes SEI's trust accounting services. WMC is a
Massachusetts general partnership, of which the following
persons are managing partners: Robert W. Doran, Duncan M.
McFarland and John B. Neff.
The Adviser is entitled to a fee, which is calculated
daily and paid monthly, at an annual rate of .075% of the
combined average daily net assets of the money market
portfolios of the Trust up to $500 million, and .02% of such
average daily net assets in excess of $500 million. Such
fees are allocated daily among each of the Portfolios of the
Trust on the basis of their relative net assets. For the
fiscal year ended June 30, 1994, the Portfolios paid
advisory fees (shown here as a percentage of average daily
net assets after fee waivers) as follows: Treasury
Securities Portfolio--.03%; Government Securities
Portfolio--.03%; Prime Obligation Portfolio--.03% and
Institutional Cash Portfolio--.03%. The Money Market
Portfolio had not commenced operations as of June 30, 1994.
John C. Keogh, Senior Vice President of the Adviser,
serves as portfolio manager to the Portfolios. He has been
an investment professional with the Adviser since 1983, and
has served as portfolio manager to the Treasury Securities,
Government Securities and Prime Obligation Portfolios since
July 1994. Prior to that date, he assisted the portfolio
manager in the management of the Portfolios. Mr. Keogh has
served as portfolio manager of the Institutional Cash
Portfolio since the Portfolio's inception in 1986.
DISTRIBUTION ___________________________________________________________________
SEI Financial Services Company (the "Distributor"), 680 East
Swedesford Road, Wayne, PA 19087, a wholly-owned subsidiary
of SEI, acts as distributor. Each class of the Trust has a
separate distribution plan for its Class A shares (the
"Class A Plan") pursuant to Rule 12b-1 under the Investment
Company Act of 1940, as amended (the "1940 Act").
As provided in the distribution agreement and Plan the
Trust pays the Distributor at an annual rate of up to .30%
of the average daily net assets of each Portfolio, provided
those expenses are permissible as to both type and amount
under a budget. The budget must be approved and monitored by
the Trustees, including those who are not interested persons
and have no financial interest in the Plan or any related
agreement ("Qualified Trustees").
Distribution related expenses reimbursable to the
Distributor under the budget include those related to the
costs of advertising and sales materials, the costs of
federal and state securities law registration, advertising
expenses and promotional and sales expenses including
expenses for travel, communication and compensation and
benefits for
9
<PAGE>
shareholders annually of the percentage of income and
distributions derived from direct U.S. Government
obligations. Shareholders should consult their tax advisers
to determine whether any portion of the income dividends
received from a Portfolio is considered tax exempt in their
particular states.
With respect to investments in STRIPS, which are sold at
original issue discount and thus do not make periodic cash
interest payments, each Portfolio will be required to
include as part of its current income the imputed interest
on such obligations even though the Portfolio has not
received any interest payments on such obligations during
that period. Because each Portfolio distributes all of its
net investment income to its shareholders, a Portfolio may
have to sell portfolio securities to distribute such imputed
income, which may occur at a time when the Adviser would not
have chosen to sell such securities and which may result in
a taxable gain or loss.
Sales, exchange, or redemption of Portfolio shares is a
taxable transaction to the shareholder.
GENERAL
INFORMATION ____________________________________________________________
The Trust The Trust was organized as a Massachusetts business trust
under a Declaration of Trust dated July 20, 1981. The
Declaration of Trust permits the Trust to offer separate
portfolios of shares and different classes of each
portfolio. All consideration received by the Trust for
shares of any portfolio and all assets of such portfolio
belong to that portfolio and are subject to the liabilities
related thereto.
The Trust pays its expenses, including fees of its
service providers, audit and legal expenses, expenses of
preparing prospectuses, proxy solicitation material and
reports to shareholders, costs of custodial services and
registering the shares under federal and state securities
laws, pricing, insurance expenses, litigation and other
extraordinary expenses, brokerage costs, interest charges,
taxes and organization expenses.
Trustees of the The management and affairs of the Trust are supervised by
Trust the Trustees under the laws of the Commonwealth of
Massachusetts. The Trustees have approved contracts under
which, as described above, certain companies provide
essential management services to the Trust.
Voting Rights Each share held entitles the shareholder of record to one
vote. The shareholders of each Portfolio or class will vote
separately on matters relating solely to that Portfolio or
class. As a Massachusetts business trust, the Trust is not
required to hold annual meetings of shareholders but
approval will be sought for certain changes in the operation
of the Trust and for the election of Trustees under certain
circumstances. In addition, a Trustee may be removed by the
remaining Trustees or by shareholders at a special meeting
called upon written request of shareholders owning at least
10% of the outstanding shares of the Trust. In the event
that such a meeting is requested, the Trust will provide
appropriate assistance and information to the shareholders
requesting the meeting.
10
<PAGE>
PROSPECTUS
OCTOBER 28, 1994
- --------------------------------------------------------------------------------
TREASURY SECURITIES PORTFOLIO
PRIME OBLIGATION PORTFOLIO
- --------------------------------------------------------------------------------
Please read this prospectus carefully before investing, and keep it on file for
future reference. It contains information that can help you decide if a
Portfolio's investment goals match your own.
A Statement of Additional Information dated October 28, 1994 has been filed
with the Securities and Exchange Commission and is available without charge
through the Distributor, SEI Financial Services Company, 680 East Swedesford
Road, Wayne, PA 19087 or by calling 1-800-437-6016. The Statement of Additional
Information is incorporated into this Prospectus by reference.
SEI Liquid Asset Trust (the "Trust") is a mutual fund that offers shareholders
a convenient means of investing their funds in one or more professionally
managed diversified portfolios of securities. The Treasury Securities Portfolio
and Prime Obligation Portfolio each offer two classes of shares, Class A shares
and ProVantage Funds shares. ProVantage Funds shares differ from Class A shares
primarily in the imposition of sales charges and the allocation of certain
distribution expenses and transfer agent fees. ProVantage Funds shares are
available through SEI Financial Services Company (the Trust's distributor), and
through participating broker-dealers, financial institutions and other
organizations. This Prospectus offers ProVantage Funds shares of two of the
Trust's money market portfolios (the "Portfolios", and each of these, a
"Portfolio") listed above.
AN INVESTMENT IN A PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT A PORTFOLIO WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
- --------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
THE TRUST'S SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED
BY, ANY BANK. THE SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER GOVERNMENT AGENCY.
INVESTMENT IN THE SHARES INVOLVES RISK, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
- --------------------------------------------------------------------------------
11
<PAGE>
PORTFOLIO EXPENSES _____________________________________________________________
The purpose of the following table is to help you understand the various cost
and expenses that you, as a shareholder, will bear directly or indirectly in
connection with an investment in ProVantage Funds shares.
SHAREHOLDER TRANSACTION EXPENSES (as a percentage of offering price)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TREASURY PRIME
SECURITIES OBLIGATION
PORTFOLIO PORTFOLIO
---------- ----------
<S> <C> <C>
Maximum Sales Charge Imposed On Purchases None None
Maximum Sales Charge Imposed on Reinvested Dividends None None
Redemption Fees/1/ None None
- ---------------------------------------------------------------------------
</TABLE>
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)/2/
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TREASURY PRIME
SECURITIES OBLIGATION
PORTFOLIO PORTFOLIO
---------- ----------
<S> <C> <C>
Management/Advisory Fees (after fee waiver)/3/ .38% .38%
12b-1 Fees .23% .23%
Other Expenses (after fee waiver) .18% .18%
- ---------------------------------------------------------------------
Total Operating Expenses (after fee waiver) .79% .79%
- ---------------------------------------------------------------------
</TABLE>
1 A charge, currently $10.00, is imposed on wires of redemption proceeds of the
Portfolio's ProVantage Funds shares.
2 The operating expenses for the Prime Obligation Portfolio set forth in this
table reflect the expenses expected to be incurred by that Portfolio's
ProVantage Funds shares for the fiscal year ending June 30, 1995.
3 The Manager has contractually agreed to waive a portion of its fee in order
to limit total operating expenses for ProVantage Funds shares of each
Portfolio to not more than .84% of its average daily net assets. Absent these
contractual provisions, management/advisory, 12b-1 fees and total operating
expenses as a percentage of net assets, respectively, would have been .45%,
.28% and .86% for the Treasury Securities Portfolio, and .45%, .28% and .86%
for the Prime Obligation Portfolio. Additional information may be found under
"The Manager and Shareholder Servicing Agent", "The Adviser" and
"Distribution".
EXAMPLE
- --------------------------------------------------------------------------------
An investor in the ProVantage Fund
shares of the Portfolios would pay
the following expenses on a $1,000
investment assuming (1) imposition of
the maximum sales load (2) 5% annual
return and (3) redemption at the end
of each time period:
<TABLE>
<CAPTION>
1 YR. 3 YRS. 5 YRS. 10 YRS.
----- ------ ------ -------
<S> <C> <C> <C> <C>
TREASURY SECURITIES PORTFOLIO $8 $25 $44 $98
PRIME OBLIGATION PORTFOLIO $8 $25 $44 $98
- ----------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF FUTURE EXPENSES.
ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
The purpose of the expense table is to assist the investor in understanding the
various costs and expenses that may be directly or indirectly borne by
investors in ProVantage Funds shares of each Portfolio. A person who purchases
shares through an account with a financial institution may be charged separate
fees by that institution. The information set forth in the foregoing table and
example relates only to the ProVantage Funds shares. Each Portfolio also offers
Class A shares, which are subject to the same expenses, except there are no
sales charges, different distribution costs and no transfer agent costs.
Additional information may be found under "The Manager and Shareholder
Servicing Agent", "The Adviser" and "Distribution".
The rules of the Securities and Exchange Commission require that the maximum
sales charge be reflected in the above table. However, certain investors
qualify for reduced sales charges. See "Purchase of Shares".
Long-term shareholders may pay more than the economic equivalent of the maximum
front-end sales charge otherwise permitted by the Rules of Fair Practice of the
National Association of Securities Dealers, Inc. (the "NASD").
12
<PAGE>
Each Portfolio may not:
1. Purchase securities of any issuer (except securities
issued or guaranteed by the U.S. Government, its agencies
or instrumentalities) if as a result more than 5% of
total assets of the Portfolio would be invested in the
securities of such issuer. This limitation applies to 75%
of each Portfolio's total assets.
2. Purchase any securities which would cause more than 25%
of the total assets of the Portfolio, based on fair
market value at the time of such purchase, to be invested
in the securities of one or more issuers conducting their
principal business activities in the same industry,
provided that this limitation does not apply to
investments in (a) domestic banks and (b) obligations
issued or guaranteed by the U.S. Government or its
agencies and instrumentalities.
3. Borrow money except for temporary or emergency purposes
and then only in an amount not exceeding 10% of the value
of the total assets of that Portfolio. This borrowing
provision is included solely to facilitate the orderly
sale of portfolio securities to accommodate substantial
redemption requests if they should occur and is not for
investment purposes. All borrowings will be repaid before
making additional investments for that Portfolio and any
interest paid on such borrowings will reduce the income
of that Portfolio.
The foregoing percentage limitations will apply at the time
of the purchase of a security. Additional investment
limitations are set forth in the Statement of Additional
Information.
THE MANAGER
AND SHAREHOLDER
SERVICING AGENT ________________________________________________________________
SEI Financial Management Corporation (the "Manager"), 680
East Swedesford Road, Wayne, PA 19087, a wholly-owned
subsidiary of SEI Corporation ("SEI"), provides the Trust
with overall management services, regulatory reporting, all
necessary office space, equipment, personnel and facilities
and for acting as transfer agent, dividend disbursing agent,
and shareholder servicing agent.
The Manager is entitled to a fee, calculated daily and
paid monthly at an annual rate of .42% of the average daily
net assets of each of the Treasury Securities and Prime
Obligation Portfolios. The Manager has contractually agreed
to waive a portion of its fee in order to limit total
operating expenses on an annualized basis to not more than
.84% of the average daily net assets of the ProVantage Funds
shares of each Portfolio on an annualized basis. For the
fiscal year ended June 30, 1994, each Portfolio paid the
Manager fees (shown here as a percentage of average daily
net assets after fee waivers) of .35%.
In addition, the Trust and the Manager have entered into
a separate transfer agent agreement with respect to the
ProVantage Funds under which the Manager is entitled to a
fee of .15% of the average daily net assets of each
Portfolio offering ProVantage Funds shares plus out-of-
pocket costs.
13
<PAGE>
DISTRIBUTION ___________________________________________________________________
SEI Financial Services Company (the "Distributor"), 680 East
Swedesford Road, Wayne, PA 19087, a wholly-owned subsidiary
of SEI, acts as distributor. Each class of the Trust has a
separate distribution plan (individually, the "Class A Plan"
and "ProVantage Funds Plan"; collectively, the "Plans")
pursuant to Rule 12b-1 under the Investment Company Act of
1940, as amended (the "1940 Act").
As provided in the distribution agreement and Plan for
each class, the Trust pays the Distributor at an annual rate
of up to .30% of the average daily net assets of each
Portfolio, provided those expenses are permissible as to
both type and amount under a budget approved and monitored
quarterly by the Trustees, including those who are not
interested persons and have no financial interest in the
Plans or any related agreement ("Qualified Trustees").
Distribution related expenses reimbursable to the
Distributor under the budget include those related to the
costs of advertising and sales materials, the costs of
federal and state securities law registration, advertising
expenses and promotional and sales expenses including
expenses for travel, communication and compensation and
benefits for sales personnel. The Trust is not obligated to
reimburse the Distributor for any expenditures in excess of
the approved budget. Currently, the budget for each
Portfolio is set at an annual rate of .03% of its average
daily net assets. Distribution expenses not attributable to
a specific portfolio are allocated among each of the
portfolios of the Trust based on average net assets.
The ProVantage Funds Plan, in addition to providing for
the reimbursement payments described above, provides for
payments to the Distributor at an annual rate of .25% of
each Portfolio average daily net assets attributable to
ProVantage Funds shares. These additional payments are
characterized as "compensation", and are not directly tied
to expenses incurred by the Distributor; the payments the
Distributor receives during any year may therefore be higher
or lower than its actual expenses. These additional payments
may be used to compensate the Distributor for its services
in connection with distribution assistance or provision of
shareholder services, and some or all of it may be used to
pay financial institutions and intermediaries such as banks,
savings and loan associations, insurance companies, and
investment counselors, broker-dealers and the Distributor's
affiliates and subsidiaries for services or reimbursement of
expenses incurred in connection with distribution assistance
or provision of shareholder services. If the Distributor's
expenses are less than its fees under the ProVantage Funds
Plan, the Trust will still pay the full fee and the
Distributor will realize a profit, but the Trust will not be
obligated to pay in excess of the full fee, even if the
Distributor's actual expenses are higher. Currently, the
Distributor is taking this additional "compensation" payment
under the ProVantage Funds Plan at a rate of only .20% of
each Portfolio's average daily net assets, on an annualized
basis, attributable to ProVantage Funds shares.
14
<PAGE>
The Distributor may, from time to time in its sole
discretion, institute one or more promotional incentive
programs, which will be paid by the Distributor from the
sales charge it receives or from any other source available
to it. Under any such program, the Distributor will provide
promotional incentives, in the form of cash or other
compensation, including merchandise, airline vouchers, trips
and vacation packages, to all dealers selling shares of the
Portfolios. Such promotional incentives will be offered
uniformly to all dealers and predicated upon the amount of
shares of the Portfolios sold by the dealer.
The Trust may also execute brokerage or other agency
transactions through the Distributor for which the
Distributor may receive usual and customary compensation.
The Trust intends to operate the Plans in accordance with
their terms and with the NASD Rules concerning sales
charges.
PERFORMANCE ____________________________________________________________________
For any Portfolio, the performance of the ProVantage Funds
shares will normally be lower than the performance on the
Class A shares of that Portfolio because of additional
distribution and transfer agent expenses charged to
ProVantage Funds shares.
From time to time, each Portfolio may advertise its
"current yield" and "effective compound yield". These
figures are based on historical earnings and are not
intended to indicate future performance. No representation
can be made concerning actual future yields or returns. The
"current yield" of a Portfolio refers to the income
generated by an investment over a seven-day period which is
then "annualized". That is, the amount of income generated
by the investment during that week is assumed to be
generated each week over a 52-week period and is shown as a
percentage of the investment. The "effective yield" is
calculated similarly but, when annualized, the income earned
by an investment in the Portfolio is assumed to be
reinvested. The "effective yield" will be slightly higher
than the "current yield" because of the compounding effect
of this assumed reinvestment.
A Portfolio may periodically compare its performance to
that of other mutual funds tracked by mutual fund rating
services (such as Lipper Analytical), financial and business
publications and periodicals, broad groups of comparable
mutual funds, to unmanaged indices which may assume
investment of dividends but generally do not reflect
deductions for administrative and management costs or to
other investment alternatives. The Portfolios may also quote
financial and business publications and periodicals as they
relate to fund management, investment philosophy and
investment techniques.
15
<PAGE>
credit unions, securities exchange or association, clearing
agency or savings association. Notaries public cannot
guarantee signatures. The signature guarantee requirement
will be waived if all of the following conditions apply: (1)
the redemption is for not more than $5,000 worth of shares,
(2) the redemption check is payable to the shareholder(s) of
record, and (3) the redemption check is mailed to the
shareholder(s) at his or her address of record. The Trust
and the Transfer Agent reserve the right to amend these
requirements without notice.
Telephone/Wire Redemption orders may be placed by telephone. Neither the
Instructions Trust nor the Transfer Agent will be responsible for any
loss, liability, cost or expense for acting upon wire
instructions or upon telephone instructions that it
reasonably believes to be genuine. The Trust and the Trust's
Transfer Agent will each employ reasonable procedures to
confirm that instructions communicated by telephone are
genuine, including requiring a form of personal
identification prior to acting upon instructions received by
telephone and recording telephone instructions. If market
conditions are extraordinarily active, or other
extraordinary circumstances exist, and you experience
difficulties placing redemption orders by telephone, you may
wish to consider placing your order by other means.
Systematic Please note that if withdrawals exceed income dividends,
Withdrawal Plan your invested principal in the account will be depleted.
("SWP") Thus, depending upon the frequency and amounts of the
withdrawal payments and/or any fluctuations in the net asset
value per share, your original investment could be exhausted
entirely. To participate in the SWP, you must have your
dividends automatically reinvested. You may change or cancel
the SWP at any time, upon written notice to the Transfer
Agent.
How to Close An account may be closed by providing written notice to the
your Account Transfer Agent. You may also close your account by telephone
if you have previously elected telephone options on your
account application.
GENERAL
INFORMATION ____________________________________________________________________
The Trust SEI Liquid Asset Trust (the "Trust") was organized as a
Massachusetts business trust under a Declaration of Trust
dated July 20, 1981. The Declaration of Trust permits the
Trust to offer separate portfolios of shares and different
classes of each portfolio. Shareholders may purchase shares
in Portfolios through two separate classes: Class A and
ProVantage Funds, which provide for variation in
distribution and transfer agent costs, voting rights,
dividends, and the imposition of a sales charge on the
ProVantage Funds. This Prospectus offers the ProVantage
Funds shares of the Trust's Treasury Securities Portfolio
and Prime Obligation Portfolio (the "Portfolios"). In
addition to the Portfolios, the Trust consists of the
following portfolios: Government Securities Portfolio,
Institutional Cash Portfolio, and Money Market Portfolio.
Additional information pertaining to the Trust may be
obtained by writing to SEI Financial Management Corporation,
680 East Swedesford Road, Wayne, PA 19087 or by calling 1-
800-437-6016. All consideration
16
<PAGE>
received by the Trust for shares of any Portfolio or class
and all assets of such Portfolio or class belong to that
Portfolio or class and are subject to liabilities related
thereto.
The Trust pays its expenses, including fees of its
service providers, audit and legal expenses, expenses of
preparing prospectuses, proxy solicitation material and
reports to shareholders, costs of custodial services and
registering the shares under federal and state securities
laws, pricing, insurance expenses, litigation and other
extraordinary expenses, brokerage costs, interest charges,
taxes and organization expenses.
Trustees of the The management and affairs of the Trust are supervised by
Trust the Trustees under the laws of the Commonwealth of
Massachusetts. The Trustees have approved contracts under
which, as described above, certain companies provide
essential management services to the Trust.
Voting Rights Each share held entitles the shareholder of record to one
vote. Each portfolio or class of the Trust will vote
separately on matters relating solely to that Portfolio or
class. As a Massachusetts business trust, the Trust is not
required to hold annual meetings of shareholders but
approval will be sought for certain changes in the operation
of the Trust and for the election of Trustees under certain
circumstances. In addition, a Trustee may be removed by the
remaining Trustees or by shareholders at a special meeting
called upon written request of shareholders owning at least
10% of the outstanding shares of the Trust. In the event
that such a meeting is requested the Trust will provide
appropriate assistance and information to the shareholders
requesting the meeting.
Reporting The Trust issues unaudited financial information
semiannually and audited financial statements annually. The
Trust furnishes proxy statements and other reports to
shareholders of record.
Shareholder Shareholder inquiries should be directed to the Manager, SEI
Inquiries Financial Management Corporation, P.O. Box 451, Wayne, PA,
19087.
Dividends The dividends of ProVantage Funds shares will normally be
lower than on Class A shares of each Portfolio because of
the additional distribution and transfer agent expenses
charged to ProVantage Funds shares. Substantially all of the
net investment income (exclusive of capital gains) of each
Portfolio is distributed in the form of dividends that will
be declared daily and paid monthly on the first Business Day
of each month. Currently, capital gains, if any, are
distributed at least annually.
Shareholders in the Portfolios automatically receive all
income dividends and capital gain distributions in
additional shares at the net asset value next determined
following the record date, unless the shareholder has
elected to take such payment in cash. Shareholders may
change their election by providing written notice to the
Manager at least 15 days prior to the distribution.
Dividends and distributions of the Portfolios are paid by
the Portfolios on a per-share basis. The value of each share
will be reduced by the amount of any such payment. If shares
are purchased shortly before the record date for a dividend
or the distribution of capital gains, a shareholder will pay
the full price for the shares and receive some portion of
the price back as a taxable dividend or distribution.
17
<PAGE>
DISTRIBUTION PLAN
ProVantage Funds
WHEREAS, SEI Liquid Asset Trust (the "Trust") is engaged in business as an
open-end investment company registered under the Investment Company Act of 1940,
as amended ("1940 Act"); and
WHEREAS, the Trustees of the Trust have determined that there is a
reasonable likelihood that the following Distribution Plan will benefit the
Trust's ProVantage Funds Class and the owners of units of beneficial interest
("Shareholders") in the Trust's ProVantage Funds Class;
NOW, THEREFORE, the Trustees of the Trust hereby adopt this Distribution
Plan pursuant to Rule 12b-1 under the 1940 Act.
Section 1. The Trust has adopted this ProVantage Funds Distribution Plan
----------
("Plan") to enable the Trust to directly or indirectly bear expenses relating to
the distribution of ProVantage Funds securities of which the Trust is the
issuer.
Section 2. The Trust may incur expenses for the items stipulated in
----------
Section 3 of this Plan in an amount equal to .30% of the average daily net
assets of the ProVantage Funds of the Portfolios. All expenditures pursuant to
this Plan shall be made only pursuant to authorization by the President, any
Vice President or the Treasurer of the Trust. If there should be more than one
series of Trust shares, expenses incurred pursuant to this Plan shall be
allocated among the several series of the Trust on the basis of their relative
net asset values, unless otherwise determined by a majority of the Qualified
Trustees.
In addition, the Trust will pay the Distributor a fee on the ProVantage Funds of
the Portfolios up to the amount set forth on Exhibit A. The Distributor may use
this fee for (i) compensation for it services in connection with distribution
assistance or provision of shareholder services; or (ii) payments to financial
institutions and intermediaries such as banks, savings and loan associations,
insurance companies and investment counselors, broker-dealers and the
Distributor's affiliates and subsidiaries as compensation for services or
reimbursement of expenses incurred in connection with distribution assistance or
provision of shareholder services.
Section 3. Expenses permitted pursuant to this Plan shall include, and be
----------
limited to, the following:
(a) The incremental printing costs incurred in producing for and
distributing to
18
<PAGE>
persons other than current Shareholders of the Trust the reports, prospectuses,
notices and similar materials that are prepared by the Trust for current
Shareholders;
(b) advertising;
(c) the costs of preparing, printing and distributing any literature used
in connection with the offering of the Trust's Shares and not covered
by Section 3(a) of this Plan; and
(d) expenses incurred in connection with the promotion and sale of the
Trust's Shares including, without limitation, travel and communication
expenses and expenses for the compensation of and benefits for sales
personnel.
Section 4. This Plan shall not take effect until it has been approved (a)
----------
by a vote of at least a majority of the outstanding voting securities of the
Trust's ProVantage Funds Class; and (b) together with any related agreements, by
votes of the majority of both (i) the Trustees of the Trust and (ii) the
Qualified Trustees, cast in person at a Board of Trustees meeting called for the
purpose of voting on this Plan or such agreement.
Section 5. This Plan shall continue in effect for a period of more than
----------
one year after it takes effect only for so long as such continuance is
specifically approved at least annually in the manner provided in Part (b) of
Section 4 herein for the approval of this Plan.
Section 6. Any person authorized to direct the disposition of monies paid
----------
or payable by the Trust pursuant to this Plan or any related agreement shall
provide to the Trustees of the Trust, at least quarterly, a written report of
the amounts so expended and the purposes for which such expenditures were made.
Section 7. This Plan may be terminated at any time by the vote of a
----------
majority of the Qualified Trustees or by vote of a majority of the outstanding
voting securities of the Trust's ProVantage Funds Class.
Section 8. All agreements with any person relating to implementation of
----------
this Plan shall be in writing, and any agreement related to this Plan shall
provide (a) that such agreement may be terminated at any time, without payment
of any penalty, by the vote of a majority of the Qualified Trustees or by the
vote of Shareholders holding a majority of the Trust's outstanding voting
securities, on not more than 60 days written notice to any other party to the
agreement; and (b) that such agreement shall terminate automatically in the
event of its assignment.
Section 9. This Plan may not be amended to increase materially the amount
----------
of distribution expenses permitted pursuant to Section 2 hereof without the
approval of Shareholders holding a majority of the outstanding voting securities
of the Trust, and all
19
<PAGE>
material amendments to this Plan shall be approved in the manner provided in
Part (b) of Section 4 herein for the approval of this Plan.
Section 10. As used in this Plan, (a) the term "Qualified Trustees" shall
-----------
mean those Trustees of the Trust who are not interested persons of the Trust,
and have no direct or indirect financial interest in the operation of this Plan
or any agreements related to it, and (b) the terms "assignment" and "interested
person" 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.
Section 11. While this Plan is in effect, the selection and nomination of
-----------
those Trustees who are not interested persons of the Trust within the meaning of
Section 2(a)(19) of the 1940 Act shall be committed to the discretion of the
Trustees then in office who are not interested persons of the Trust.
Section 12. This Plan shall not obligate the Trust or any other party to
-----------
enter into an agreement with any particular person.
20
<PAGE>
EXHIBIT A
---------
<TABLE>
<S> <C>
Treasury Portfolio ..................................................... .25%
Prime Obligation Portfolio ............................................. .25%
</TABLE>
21
<PAGE>
Exhibit 24
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI CASH+PLUS TRUST
SEI INDEX FUNDS
SEI INSTITUTIONAL MANAGED TRUST
SEI INTERNATIONAL TRUST
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned trustee and/or
officer of the above referenced funds (the "Trusts"), each a business trust
organized under the laws of The Commonwealth of Massachusetts, hereby
constitutes and appoints David G. Lee, Kevin P. Robins and Carmen V. Romeo, and
each of them singly, his or her true and lawful attorney-in-fact and agent with
full power of substitution and resubstitution, to sign for him or her and in his
or her name, place and stead, and in the capacity indicated below, to sign any
or all amendments (including post-effective amendments) to each Trust's
Registration Statement on Form N-1A under the provisions of the Investment
Company Act of 1940 and the Securities Act of 1933, each such Act as amended,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, acting alone, full power
and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand and
seal as of the date set forth below.
/s/ Richard F. Blanchard Date: June 8, 1994
- ------------------------------
Richard F. Blanchard
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI CASH+PLUS TRUST
SEI INDEX FUNDS
SEI INSTITUTIONAL MANAGED TRUST
SEI INTERNATIONAL TRUST
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned trustee and/or
officer of the above referenced funds (the "Trusts"), each a business trust
organized under the laws of The Commonwealth of Massachusetts, hereby
constitutes and appoints David G. Lee, Kevin P. Robins and Carmen V. Romeo, and
each of them singly, his or her true and lawful attorney-in-fact and agent with
full power of substitution and resubstitution, to sign for him or her and in his
or her name, place and stead, and in the capacity indicated below, to sign any
or all amendments (including post-effective amendments) to each Trust's
Registration Statement on Form N-1A under the provisions of the Investment
Company Act of 1940 and the Securities Act of 1933, each such Act as amended,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, acting alone, full power
and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand and
seal as of the date set forth below.
/s/ William M. Doran Date: June 8, 1994
- ------------------------------
William M. Doran
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI CASH+PLUS TRUST
SEI INDEX FUNDS
SEI INSTITUTIONAL MANAGED TRUST
SEI INTERNATIONAL TRUST
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned trustee and/or
officer of the above referenced funds (the "Trusts"), each a business trust
organized under the laws of The Commonwealth of Massachusetts, hereby
constitutes and appoints David G. Lee, Kevin P. Robins and Carmen V. Romeo, and
each of them singly, his or her true and lawful attorney-in-fact and agent with
full power of substitution and resubstitution, to sign for him or her and in his
or her name, place and stead, and in the capacity indicated below, to sign any
or all amendments (including post-effective amendments) to each Trust's
Registration Statement on Form N-1A under the provisions of the Investment
Company Act of 1940 and the Securities Act of 1933, each such Act as amended,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, acting alone, full power
and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand and
seal as of the date set forth below.
/s/ F. Wendell Gooch Date: June 8, 1994
- ------------------------------
F. Wendell Gooch
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI CASH+PLUS TRUST
SEI INDEX FUNDS
SEI INSTITUTIONAL MANAGED TRUST
SEI INTERNATIONAL TRUST
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned trustee and/or
officer of the above referenced funds (the "Trusts"), each a business trust
organized under the laws of The Commonwealth of Massachusetts, hereby
constitutes and appoints David G. Lee, Kevin P. Robins and Carmen V. Romeo, and
each of them singly, his or her true and lawful attorney-in-fact and agent with
full power of substitution and resubstitution, to sign for him or her and in his
or her name, place and stead, and in the capacity indicated below, to sign any
or all amendments (including post-effective amendments) to each Trust's
Registration Statement on Form N-1A under the provisions of the Investment
Company Act of 1940 and the Securities Act of 1933, each such Act as amended,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, acting alone, full power
and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand and
seal as of the date set forth below.
/s/ Frank E. Morris Date: June 8, 1994
- ------------------------------
Frank E. Morris
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI CASH+PLUS TRUST
SEI INDEX FUNDS
SEI INSTITUTIONAL MANAGED TRUST
SEI INTERNATIONAL TRUST
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned trustee and/or
officer of the above referenced funds (the "Trusts"), each a business trust
organized under the laws of The Commonwealth of Massachusetts, hereby
constitutes and appoints David G. Lee, Kevin P. Robins and Carmen V. Romeo, and
each of them singly, his or her true and lawful attorney-in-fact and agent with
full power of substitution and resubstitution, to sign for him or her and in his
or her name, place and stead, and in the capacity indicated below, to sign any
or all amendments (including post-effective amendments) to each Trust's
Registration Statement on Form N-1A under the provisions of the Investment
Company Act of 1940 and the Securities Act of 1933, each such Act as amended,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, acting alone, full power
and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand and
seal as of the date set forth below.
/s/ James M. Storey Date: June 8, 1994
- ------------------------------
James M. Storey
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI CASH+PLUS TRUST
SEI INDEX FUNDS
SEI INSTITUTIONAL MANAGED TRUST
SEI INTERNATIONAL TRUST
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned trustee and/or
officer of the above referenced funds (the "Trusts"), each a business trust
organized under the laws of The Commonwealth of Massachusetts, hereby
constitutes and appoints David G. Lee, Kevin P. Robins and Carmen V. Romeo, and
each of them singly, his or her true and lawful attorney-in-fact and agent with
full power of substitution and resubstitution, to sign for him or her and in his
or her name, place and stead, and in the capacity indicated below, to sign any
or all amendments (including post-effective amendments) to each Trust's
Registration Statement on Form N-1A under the provisions of the Investment
Company Act of 1940 and the Securities Act of 1933, each such Act as amended,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, acting alone, full power
and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand and
seal as of the date set forth below.
/s/ Robert A. Nesher Date: June 8, 1994
- ------------------------------
Robert A. Nesher
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI CASH+PLUS TRUST
SEI INDEX FUNDS
SEI INSTITUTIONAL MANAGED TRUST
SEI INTERNATIONAL TRUST
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned trustee and/or
officer of the above referenced funds (the "Trusts"), each a business trust
organized under the laws of The Commonwealth of Massachusetts, hereby
constitutes and appoints David G. Lee, Kevin P. Robins and Carmen V. Romeo, and
each of them singly, his or her true and lawful attorney-in-fact and agent with
full power of substitution and resubstitution, to sign for him or her and in his
or her name, place and stead, and in the capacity indicated below, to sign any
or all amendments (including post-effective amendments) to each Trust's
Registration Statement on Form N-1A under the provisions of the Investment
Company Act of 1940 and the Securities Act of 1933, each such Act as amended,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, acting alone, full power
and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand and
seal as of the date set forth below.
/s/ Jeffrey A. Cohen Date: June 8, 1994
- ------------------------------
Jeffrey A. Cohen
Controller &
Assistant Secretary
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI CASH+PLUS TRUST
SEI INDEX FUNDS
SEI INSTITUTIONAL MANAGED TRUST
SEI INTERNATIONAL TRUST
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned trustee and/or
officer of the above referenced funds (the "Trusts"), each a business trust
organized under the laws of The Commonwealth of Massachusetts, hereby
constitutes and appoints David G. Lee and Kevin P. Robins, and each of them
singly, his or her true and lawful attorney-in-fact and agent with full power of
substitution and resubstitution, to sign for him or her and in his or her name,
place and stead, and in the capacity indicated below, to sign any or all
amendments (including post-effective amendments) to each Trust's Registration
Statement on Form N-1A under the provisions of the Investment Company Act of
1940 and the Securities Act of 1933, each such Act as amended, and to file the
same, with all exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorneys-in-
fact and agents, and each of them, acting alone, full power and authority to do
and perform each and every act and thing requisite or necessary to be done in
and about the premises, as fully to all intents and purposes as he or she might
or could do in person, hereby ratifying and confirming all that said attorneys-
in-fact and agents or any of them, or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand and
seal as of the date set forth below.
/s/ Carmen V. Romeo Date: June 14, 1994
- ------------------------------
Carmen V. Romeo
Treasurer
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI CASH+PLUS TRUST
SEI INDEX FUNDS
SEI INSTITUTIONAL MANAGED TRUST
SEI INTERNATIONAL TRUST
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned trustee and/or
officer of the above referenced funds (the "Trusts"), each a business trust
organized under the laws of The Commonwealth of Massachusetts, hereby
constitutes and appoints Kevin P. Robins and Carmen V. Romeo, and each of them
singly, his or her true and lawful attorney-in-fact and agent with full power of
substitution and resubstitution, to sign for him or her and in his or her name,
place and stead, and in the capacity indicated below, to sign any or all
amendments (including post-effective amendments) to each Trust's Registration
Statement on Form N-1A under the provisions of the Investment Company Act of
1940 and the Securities Act of 1933, each such Act as amended, and to file the
same, with all exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorneys-in-
fact and agents, and each of them, acting alone, full power and authority to do
and perform each and every act and thing requisite or necessary to be done in
and about the premises, as fully to all intents and purposes as he or she might
or could do in person, hereby ratifying and confirming all that said attorneys-
in-fact and agents or any of them, or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand and
seal as of the date set forth below.
/s/ David G. Lee Date: June 15, 1994
- ------------------------------
David G. Lee
President & Chief Executive
Officer
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000354603
<NAME> SEI LIQUID ASSET TRUST
<SERIES>
<NUMBER> 011
<NAME> TREASURY SECURITIES PORTFOLIO CLASS A
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1995
<PERIOD-START> JUL-01-1994
<PERIOD-END> JUN-30-1995
<INVESTMENTS-AT-COST> 1,270,800
<INVESTMENTS-AT-VALUE> 1,270,800
<RECEIVABLES> 229
<ASSETS-OTHER> 134
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,271,163
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6,477
<TOTAL-LIABILITIES> 6,477
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,264,534
<SHARES-COMMON-STOCK> 1,254,737
<SHARES-COMMON-PRIOR> 1,501,510
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 152
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,264,686
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 68,880
<OTHER-INCOME> 0
<EXPENSES-NET> 5,650
<NET-INVESTMENT-INCOME> 63,230
<REALIZED-GAINS-CURRENT> 240
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 63,470
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (62,948)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 9,652,814
<NUMBER-OF-SHARES-REDEEMED> 9,900,410
<SHARES-REINVESTED> 823
<NET-CHANGE-IN-ASSETS> (246,773)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (88)
<GROSS-ADVISORY-FEES> 396
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,285
<AVERAGE-NET-ASSETS> 1,282,762
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .05
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.05)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .44
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000354603
<NAME> SEI LIQUID ASSET TRUST
<SERIES>
<NUMBER> 02
<NAME> GOVERNMENT SECURITIES PORTFOLIO
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1995
<PERIOD-START> JUL-01-1994
<PERIOD-END> JUN-30-1995
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 201,595
<INVESTMENTS-AT-VALUE> 270
<RECEIVABLES> 270
<ASSETS-OTHER> 20
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 201,885
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,117
<TOTAL-LIABILITIES> 1,117
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 200,790
<SHARES-COMMON-STOCK> 200,790
<SHARES-COMMON-PRIOR> 255,614
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> (1)
<ACCUMULATED-NET-GAINS> (21)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 200,768
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 13,256
<OTHER-INCOME> 0
<EXPENSES-NET> 1,064
<NET-INVESTMENT-INCOME> 12,192
<REALIZED-GAINS-CURRENT> 39
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 12,231
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (12,193)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,544,000
<NUMBER-OF-SHARES-REDEEMED> (1,599,403)
<SHARES-REINVESTED> 579
<NET-CHANGE-IN-ASSETS> (54,786)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (60)
<GROSS-ADVISORY-FEES> 75
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,285
<AVERAGE-NET-ASSETS> 241,777
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .05
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.05)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .44
<AVG-DEBT-OUTSTANDING> 0
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<NAME> SEI LIQUID ASSET TRUST
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