<PAGE>
As filed with the Securities and Exchange Commission on March __, 1995
File No. 2-77048
File No. 811-3451
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933 [ ]
POST-EFFECTIVE AMENDMENT NO. 33
[X]
and
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 [ ]
AMENDMENT NO. 32
[X]
SEI Daily Income 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)
Copy to:
Richard W. Grant, Esquire
Morgan, Lewis & Bockius
2000 One Logan Square
Philadelphia, Pennsylvania 19103
It is proposed that this filing become effective (check appropriate box)
[ ] immediately upon filing pursuant to paragraph (b)
[ ] on (date) pursuant to Paragraph (b)
[X] 60 days after filing pursuant to Paragraph (a)
[ ] on (date) pursuant to Paragraph (a) of Rule 485
--------------------------------------------------------------------------------
Registrant filed a Notice pursuant to Rule 24f-2 under the Investment Company
Act of 1940, as amended, on March 27, 1995 for its fiscal year ended January
31, 1995.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
SEI DAILY INCOME
CROSS REFERENCE SHEET
PART A - Money Market Portfolios (Money Market Portfolio, Prime Obligation
Portfolio, Government Portfolio, Government II Portfolio, Treasury Portfolio,
Treasury II Portfolio and Federal Securities Portfolio)
<TABLE>
<CAPTION>
N-1A Item No. Location
------------- --------
<S> <C> <C>
Item 1. Cover page....................................... Cover Page
Item 2. Synopsis......................................... Annual Operating Expenses
Item 3. Condensed Financial Information.................. Financial Highlights
Item 4. General Description of Registrant................ The Trust; Investment Objective
and Policies
Item 5. Management of the Fund........................... Trustees of the Trust; The
Manager and Shareholder
Servicing Agent; The Adviser
Item 5A. Management's Discussion of Fund Performance...... *
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........................ *
</TABLE>
PART A - Fixed Income Portfolios (Corporate Daily Income Portfolio, Government
Securities Daily Income Portfolio, Short-Term Mortgage Portfolio, Short Duration
Mortgage Portfolio, Short-Term Government Portfolio, Intermediate-Term
Government Portfolio and GNMA Portfolio)
<TABLE>
<CAPTION>
N-1A Item No. Location
------------- --------
<S> <C> <C>
Item 1. Cover page....................................... Cover Page
Item 2. Synopsis......................................... Annual Operating Expenses
Item 3. Condensed Financial Information.................. Financial Highlights
Item 4. General Description of Registrant................ The Trust; Investment Objective
and Policies
Item 5. Management of the Fund........................... Trustees of the Trust; The
Manager and Shareholder
Servicing Agent; The Adviser
Item 5A. Management's Discussion of Fund Performance...... **
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........................ *
</TABLE>
<PAGE>
PART A - Class D Shares (Short-Term Government Portfolio, Intermediate-Term
Government Portfolio and GNMA Portfolio)
<TABLE>
<CAPTION>
N-1A Item No. Location
------------- --------
<S> <C> <C>
Item 1. Cover page....................................... Cover Page
Item 2. Synopsis......................................... Annual Operating Expenses
Item 3. Condensed Financial Information.................. Financial Highlights
Item 4. General Description of Registrant................ The Trust; Investment Objective
and Policies
Item 5. Management of the Fund........................... Trustees of the Trust; The
Manager; The Adviser and the
Custodian
Item 5A. Management's Discussion of Fund Performance...... **
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........................ *
</TABLE>
PART B - All Portfolios
<TABLE>
<CAPTION>
N-1A Item No Location
------------ --------
<S> <C> <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 Statements
</TABLE>
<PAGE>
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.
------------------
* Not Applicable
** To be included in the Annual Report for the fiscal year ending January 31,
1995.
<PAGE>
SEI DAILY INCOME TRUST
MAY 31, 1995
--------------------------------------------------------------------------------
MONEY MARKET PORTFOLIO
PRIME OBLIGATION PORTFOLIO
GOVERNMENT PORTFOLIO
GOVERNMENT II PORTFOLIO
TREASURY PORTFOLIO
TREASURY II PORTFOLIO
FEDERAL SECURITIES PORTFOLIO
--------------------------------------------------------------------------------
Please read this Prospectus carefully before investing, and keep it on file for
future reference.
A Statement of Additional Information dated May 31, 1995 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 Daily Income 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 professionally managed
diversified portfolios of securities. Some portfolios offer separate classes of
units of beneficial interest ("shares") that differ from each other primarily
in the allocation of certain distribution expenses. This Prospectus offers
shares of the seven money market fund portfolios (the "Portfolios," and each of
these, a "Portfolio") listed above. Except in the case of the Federal
Securities Portfolio, which offers only one class of shares, each of the
Portfolios offers Class A, Class B and Class C shares.
AN INVESTMENT IN A PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT ANY 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 TRUST'S 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) CLASS A*
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MONEY PRIME FEDERAL
MARKET OBLIGATION GOVERNMENT GOVERNMENT II TREASURY TREASURY II SECURITIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ---------- ---------- ------------- --------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Management/Advisory Fees
(after fee waiver) (1) .12% .12% .12% .12% .12% .17% .58%
12b-1 Fees (after fee
waiver) (2) .05% .05% .04% .06% .05% .06% .00%
Other Expenses .03% .03% .04% .02% .03% .02% .02%
--------------------------------------------------------------------------------------------------------
Total Operating Expenses
(after fee waiver) (3) .20% .20% .20% .20% .20% .25% .60%
--------------------------------------------------------------------------------------------------------
</TABLE>
* The Federal Securities Portfolio offers only Class A shares.
(1) For the Money Market, Government and Federal Securities Portfolios the
Manager has waived, on a voluntary basis, a portion of its fee, and the
management/advisory fees shown reflect this voluntary waiver. The Manager
reserves the right to terminate its waiver at any time in its sole
discretion. Absent such fee waiver, management/advisory fees would be .37%
for the Money Market Portfolio, .27% for the Government Portfolio and .58%
for the Federal Securities Portfolio. For the Prime Obligation, Government
II, Treasury and Treasury II Portfolios, the Manager has contractually
agreed to waive its fee, and, if necessary, pay other operating expenses of
the Portfolios in an amount that operates to limit the total operating
expenses of the Class A shares. Absent these contractual provisions,
management/advisory fees would be .22% for the Prime Obligation Portfolio,
.22% for the Government II Portfolio, .27% for the Treasury Portfolio and
.27% for the Treasury II Portfolio.
(2) 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
of the Portfolios are 30%.
(3) Absent the voluntary fee waivers described above, total operating expenses
for the Class A shares of the Portfolios would be .45% for the Money Market
Portfolio, .30% for the Prime Obligation Portfolio, .35% for the Government
Portfolio, .30% for the Government II Portfolio, .35% for the Treasury
Portfolio, .35% for the Treasury II Portfolio and .60% for the Federal
Securities Portfolio.
EXAMPLE
<TABLE>
-------------------------------------------------------------------------------
<CAPTION>
1 YR. 3 YRS. 5 YRS. 10 YRS.
----- ------ ------ -------
<S> <C> <C> <C> <C>
An investor would pay the following expenses on a
$1,000 investment assuming (1) 5% annual return
and (2) redemption at the end of each time period:
Money Market Portfolio $2.00 $ 6.00 $11.00 $26.00
Prime Obligation Portfolio $2.00 $ 6.00 $11.00 $26.00
Government Portfolio $2.00 $ 6.00 $11.00 $26.00
Government II Portfolio $2.00 $ 6.00 $11.00 $26.00
Treasury Portfolio $2.00 $ 6.00 $11.00 $26.00
Treasury II Portfolio $3.00 $ 8.00 $14.00 $32.00
Federal Securities Portfolio $6.00 $19.00 $33.00 $75.00
-------------------------------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR 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 Class A shares.
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 Rules of Fair Practice (the "Rules") of the
National Association of Securities Dealers, Inc. ("NASD").
2
<PAGE>
ANNUAL OPERATING EXPENSES (as a percentage of average net assets) CLASS B
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MONEY PRIME
MARKET OBLIGATION GOVERNMENT GOVERNMENT II TREASURY TREASURY II
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ---------- ---------- ------------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Management/Advisory Fees
(after fee waiver) (1) .12% .12% .12% .12% .12% .17%
12b-1 Fees (2) .35% .35% .34% .36% .35% .36%
Other Expenses .03% .03% .04% .02% .03% .02%
---------------------------------------------------------------------------------------------
Total Operating Expenses
(after fee waiver) (3) .50% .50% .50% .50% .50% .55%
---------------------------------------------------------------------------------------------
</TABLE>
(1) For the Money Market and Government Portfolios the Manager has waived, on a
voluntary basis, a portion of its fee, and the management/advisory fees
shown reflect this voluntary waiver. The Manager reserves the right to
terminate its waiver at any time in its sole discretion. Absent such fee
waivers, management/advisory fees would be .37% for the Money Market
Portfolio and .27% for the Government Portfolio. For the Prime Obligation,
Government II, Treasury and Treasury II Portfolios, the Manager has
contractually agreed to waive its fee, and, if necessary, pay other
operating expenses of the Portfolios in an amount that operates to limit
the total operating expenses of the Class B shares. Absent these
contractual provisions, management/advisory fees would be .22% for the
Prime Obligation Portfolio, .22% for the Government II Portfolio, .27% for
the Treasury Portfolio and .27% for the Treasury II Portfolio.
(2) 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 B shares
of the Portfolios are .60%.
(3) Absent the voluntary fee waivers described above, total operating expenses
for the Class B shares of the Portfolios would be .75% for the Money Market
Portfolio, .60% for the Prime Obligation Portfolio, .65% for the Government
Portfolio, .60% for the Government II Portfolio, .65% for the Treasury
Portfolio and .65% for the Treasury II Portfolio.
EXAMPLE
<TABLE>
-------------------------------------------------------------------------------
<CAPTION>
1 YR. 3 YRS. 5 YRS. 10 YRS.
----- ------ ------ -------
<S> <C> <C> <C> <C>
An investor would pay the following expenses on a
$1,000 investment assuming (1) 5% annual return
and (2) redemption at the end of each time period:
Money Market Portfolio $5.00 $16.00 $28.00 $63.00
Prime Obligation Portfolio $5.00 $16.00 $28.00 $63.00
Government Portfolio $5.00 $16.00 $28.00 $63.00
Government II Portfolio $5.00 $16.00 $28.00 $63.00
Treasury Portfolio $5.00 $16.00 $28.00 $63.00
Treasury II Portfolio $6.00 $18.00 $31.00 $69.00
-------------------------------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR 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 Class B shares.
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 NASD Rules.
3
<PAGE>
ANNUAL OPERATING EXPENSES (as a percentage of average net assets) CLASS C
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MONEY PRIME
MARKET OBLIGATION GOVERNMENT GOVERNMENT II TREASURY TREASURY II
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ---------- ---------- ------------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Management/Advisory Fees
(after fee waiver) (1) .12% .12% .12% .12% .12% .17%
12b-1 Fees (2) .55% .55% .54% .55% .55% .56%
Other Expenses .03% .03% .04% .03% .03% .02%
---------------------------------------------------------------------------------------------
Total Operating Expenses
(after fee waiver) (3) .70% .70% .70% .70% .70% .75%
---------------------------------------------------------------------------------------------
</TABLE>
(1) For the Money Market and Government Portfolios the Manager has waived, on a
voluntary basis, a portion of its fee, and the management/advisory fees
shown reflect this voluntary waiver. The Manager reserves the right to
terminate its waiver at any time in its sole discretion. Absent such fee
waiver, management/advisory fees would be .37% for the Money Market
Portfolio and .27% for the Government Portfolio. For the Prime Obligation,
Government II, Treasury and Treasury II Portfolios, the manager has
contractually agreed to waive its fee, and, if necessary, pay other
operating expenses of the Portfolios in an amount that operates to limit
the total operating expenses of the Class C shares. Absent these
contractual provisions, management/advisory fees would be .22% for the
Prime Obligation Portfolio, .22% for the Government II Portfolio, .27% for
the Treasury Portfolio and .27% for the Treasury II Portfolio.
(2) 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 C shares
of the Portfolios are .80%.
(3) Absent the voluntary fee waivers described above, total operating expenses
for the Class C shares of the Portfolios would be .95% for the Money Market
Portfolio, .80% for the Prime Obligation Portfolio, .85% for the Government
Portfolio, .80% for the Government II Portfolio, .85% for the Treasury
Portfolio and .85% for the Treasury II Portfolio.
EXAMPLE
<TABLE>
-------------------------------------------------------------------------------
<CAPTION>
1 YR. 3 YRS. 5 YRS. 10 YRS.
----- ------ ------ -------
<S> <C> <C> <C> <C>
An investor would pay the following expenses on a
$1,000 investment assuming (1) 5% annual return
and (2) redemption at the end of each time period:
Money Market Portfolio $7.00 $22.00 $39.00 $87.00
Prime Obligation Portfolio $7.00 $22.00 $39.00 $87.00
Government Portfolio $7.00 $22.00 $39.00 $87.00
Government II Portfolio $7.00 $22.00 $39.00 $87.00
Treasury Portfolio $7.00 $22.00 $39.00 $87.00
Treasury II Portfolio $8.00 $24.00 $42.00 $93.00
-------------------------------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR 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 Class C shares.
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 NASD Rules.
4
<PAGE>
FINANCIAL HIGHLIGHTS ___________________________________________________________
The following information has been audited by Arthur Andersen LLP, the Trust's
independent accountants, as indicated in their report dated March 8, 1995 on
the Trust's financial statements as of January 31, 1995 included in the Trust's
Statement of Additional Information under "Financial Information." Additional
performance information is set forth in the 1995 Annual Report to shareholders
and is available upon request and without charge by calling 1-800-342-5734. As
of the most recent fiscal year end, there were no Class B or C shares
outstanding of the Government and Treasury Portfolios, and no Class C shares
outstanding of the Money Market, Government II or Treasury II Portfolios. The
Federal Securities Portfolio only offers Class A shares. This table should be
read in conjunction with the Trust's financial statements and notes thereto.
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Money Market Portfolio
----------------------
For Fiscal Year Ended January 31,
--------------------------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of
Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------------------------------------------------------------------------------------------------------------------------
Income from Investment
Operations:
Net Investment
Income 0.04 0.03 0.04 0.06 0.08 0.09 0.08 0.07 0.06 0.08
Net Realized and
Unrealized Gains
(Losses) on
Securities -- -- -- -- -- -- -- -- -- --
---------------------------------------------------------------------------------------------------------------------------
Total from
Investment
Operations $ 0.04 $ 0.03 $ 0.04 $ 0.06 $ 0.08 $ 0.09 $ 0.08 $ 0.07 $ 0.06 $ 0.08
---------------------------------------------------------------------------------------------------------------------------
Less
Distributions:
Dividends from
Net Investment
Income (0.04) (0.03) (0.04) (0.06) (0.08) (0.09) (0.08) (0.07) (0.06) (0.08)
Distributions
from Realized
Capital Gains -- -- -- -- -- -- -- -- -- --
---------------------------------------------------------------------------------------------------------------------------
Total
Distributions $(0.04) $(0.03) $(0.04) $(0.06) $(0.08) $(0.09) $(0.08) $(0.07) $(0.06) $(0.08)
---------------------------------------------------------------------------------------------------------------------------
Net Asset Value,
End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
Total Return 4.55% 2.98% 3.60% 5.76% 8.18% 9.24% 7.82% 6.90% 6.67% 8.29%
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental
Data:
Net Assets End
of Period (000) $213,988 $203,803 $264,450 $312,151 $815,847 $589,683 $507,821 $606,117 $295,121 $300,059
Ratio of
Expenses to
Average Net
Assets 0.21% 0.35% 0.35% 0.35% 0.33% 0.35% 0.35% 0.35% 0.35% 0.35%
Ratio of
Expenses to
Average Net
Assets
(Excluding
Waivers) 0.45% 0.44% 0.39% 0.39% 0.38% 0.40% 0.39% 0.42% 0.41% 0.44%
Ratio of Net
Investment
Income to
Average Net
Assets 4.49% 2.95% 3.56% 5.84% 7.88% 8.90% 7.52% 6.76% 6.39% 7.97%
Ratio of Net
Investment
Income to
Average Net
Assets
(Excluding
Waivers) 4.25% 2.86% 3.52% 5.80% 7.83% 8.85% 7.48% 6.69% 6.33% 7.88%
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
<CAPTION>
1985
---------------------------------------------------------------------------------------------------------------------------
<S> <C>
Net Asset Value,
Beginning of
Period $ 1.00
---------------------------------------------------------------------------------------------------------------------------
Income from Investment
Operations:
Net Investment
Income 0.10
Net Realized and
Unrealized Gains
(Losses) on
Securities --
---------------------------------------------------------------------------------------------------------------------------
Total from
Investment
Operations $ 0.10
---------------------------------------------------------------------------------------------------------------------------
Less
Distributions:
Dividends from
Net Investment
Income (0.10)
Distributions
from Realized
Capital Gains --
---------------------------------------------------------------------------------------------------------------------------
Total
Distributions $(0.10)
---------------------------------------------------------------------------------------------------------------------------
Net Asset Value,
End of Period $ 1.00
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
Total Return 10.98%
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental
Data:
Net Assets End
of Period (000) $253,027
Ratio of
Expenses to
Average Net
Assets 0.30%
Ratio of
Expenses to
Average Net
Assets
(Excluding
Waivers) 0.47%
Ratio of Net
Investment
Income to
Average Net
Assets 10.38%
Ratio of Net
Investment
Income to
Average Net
Assets
(Excluding
Waivers) 10.21%
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________
FOR A CLASS B SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Money Market Portfolio
--------------------------------------
For Fiscal Year Ended January 31,
--------------------------------------
1995 1994 1993 1992 1991(1)
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------------------------------------------------------------------------
Income from Investment
Operations:
Net Investment Income 0.04 0.03 0.04 0.05 0.02
Net Realized and Unrealized
Gains (Losses) on
Securities -- -- -- -- --
------------------------------------------------------------------------------
Total from Investment
Operations $ 0.04 $ 0.03 $ 0.04 $ 0.05 $ 0.02
------------------------------------------------------------------------------
Less Distributions:
Dividends from Net
Investment Income (0.04) (0.03) (0.04) (0.05) (0.02)
Distributions from Realized
Capital Gains -- -- -- -- --
------------------------------------------------------------------------------
Total Distributions $ (0.04) $ (0.03) $ (0.04) $ (0.05) $(0.02)
------------------------------------------------------------------------------
Net Asset Value, End of
Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Total Return 4.24% 2.68% 3.29% 5.45% 7.37%
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period
(000) $6,314 $2 ,334 $ 309 $ 2,305 $ 830
Ratio of Expenses to
Average Net Assets 0.51% 0.65% 0.65% 0.53% 0.65%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers) 0.75% 0.74% 0.69% 0.61% 0.72%
Ratio of Net Investment
Income to Average Net
Assets 4.49% 2.65% 3.47% 5.18% 7.17%
Ratio of Net Investment
Income to Average Net
Assets (Excluding Waivers) 4.25% 2.56% 3.43% 5.10% 7.10%
------------------------------------------------------------------------------
------------------------------------------------------------------------------
</TABLE>
(1)The Money Market Portfolio, Class B commenced operations on October 12,
1990. All ratios including total return for that period have been annualized.
6
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) __________________________________________
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Prime Obligation Portfolio
----------------------------------------------------------------------------
For Fiscal Year Ended January 31,
----------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988(1)
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-----------------------------------------------------------------------------------------------------------------
Income from Investment
Operations:
Net Investment Income 0.04 0.03 0.04 0.06 0.08 0.09 0.08 0.01
Net Realized and
Unrealized Gains
(Losses) on Securities -- -- -- -- -- -- -- --
-----------------------------------------------------------------------------------------------------------------
Total from Investment
Operations $ 0.04 $ 0.03 $ 0.04 $ 0.06 $ 0.08 $ 0.09 $ 0.08 $ 0.01
-----------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends from Net
Investment Income (0.04) (0.03) (0.04) (0.06) (0.08) (0.09) (0.08) (0.01)
Distributions from
Realized Capital Gains -- -- -- -- -- -- -- --
-----------------------------------------------------------------------------------------------------------------
Total Distributions $(0.04) $(0.03) $(0.04) $(0.06) $(0.08) $(0.09) $(0.08) $(0.01)
-----------------------------------------------------------------------------------------------------------------
Net Asset Value, End of
Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
Total Return 4.46% 3.10% 3.72% 5.97% 8.34% 9.36% 8.58% 7.48%
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
Ratios/Supplemental
Data:
Net Assets End of
Period (000) $2,778,326 $2,541,126 $2,564,340 $1,661,619 $825,081 $532,137 $237,273 $139,944
Ratio of Expenses to
Average Net Assets 0.20% 0.20% 0.20% 0.20% 0.20% 0.20% 0.20% 0.13%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers) 0.30% 0.28% 0.30% 0.29% 0.30% 0.33% 0.34% 0.58%
Ratio of Net
Investment Income to
Average Net Assets 4.41% 3.07% 3.62% 5.73% 8.03% 8.86% 7.68% 7.22%
Ratio of Net
Investment Income to
Average Net Assets
(Excluding Waivers) 4.31% 2.98% 3.52% 5.64% 7.93% 8.73% 7.54% 6.77%
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
</TABLE>
(1)The Prime Obligation Portfolio, Class A commenced operations on December 22,
1987. All ratios including total return for that period have been annualized.
7
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________
FOR A CLASS B SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Prime Obligation Portfolio
-------------------------------------
For Fiscal Year Ended January 31,
-------------------------------------
1995 1994 1993 1992 (1)
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.04 0.03 0.04 0.04
Net Realized and Unrealized Gains
(Losses) on Securities -- -- -- --
-------------------------------------------------------------------------------
Total from Investment Operations $ 0.04 $ 0.03 $ 0.04 $ 0.04
-------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income (0.04) (0.03) (0.04) (0.04)
Distributions from Realized Capital
Gains -- -- -- --
-------------------------------------------------------------------------------
Total Distributions $(0.04) $(0.03) $(0.04) $(0.04)
-------------------------------------------------------------------------------
Net Asset Value, End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Total Return 4.15% 2.79% 3.41% 5.58%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period (000) $ 21,852 $ 6,312 $ 4,699 $ 67,016
Ratio of Expenses to Average Net
Assets 0.50% 0.50% 0.47% 0.50%
Ratio of Expenses to Average Net
Assets (Excluding Waivers) 0.60% 0.58% 0.53% 0.59%
Ratio of Net Investment Income to
Average Net Assets 4.55% 2.77% 3.63% 4.98%
Ratio of Net Investment Income to
Average Net Assets (Excluding Waivers) 4.45% 2.68% 3.57% 4.89%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
</TABLE>
(1) The Prime Obligation Portfolio, Class B commenced operations on March 26,
1991. All ratios including total return for that period have been
annualized.
8
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________
FOR A CLASS C SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Prime Obligation Portfolio
-----------------------------------
For fiscal year ended
January 31,
-----------------------------------
1995 (2) 1994 1993 (1)
------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $ 1.00 $ 1.00 $ 1.00
------------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.03 0.03 0.03
Net Realized and Unrealized Gains
(Losses) on Securities -- -- --
------------------------------------------------------------------------------
Total from Investment Operations $ 0.03 $ 0.03 $ 0.03
------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income (0.03) (0.03) (0.03)
Distributions from Realized Capital
Gains -- -- --
------------------------------------------------------------------------------
Total Distributions $(0.03) $(0.03) $(0.03)
------------------------------------------------------------------------------
Net Asset Value, End of Period $ 1.00 $ 1.00 $ 1.00
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Total Return 2.55% (3) 2.59% 3.13%
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period (000) $0 $ 20,602 $ 85,325
Ratio of Expenses to Average Net Assets 0.70% 0.70% 0.70%
Ratio of Expenses to Average Net Assets
(Excluding Waivers) 0.77% 0.78% 0.83%
Ratio of Net Investment Income to
Average Net Assets 2.79% 2.57% 3.05%
Ratio of Net Investment Income to
Average Net Assets (Excluding Waivers) 2.27% 2.48% 2.92%
------------------------------------------------------------------------------
------------------------------------------------------------------------------
</TABLE>
(1) The Prime Obligation Portfolio, Class C commenced operations on March 25,
1992. All ratios including total return for that period have been
annualized.
(2) The Prime Portfolio, Class C shares were fully liquidated October 27, 1994.
All ratios that period have been annualized.
(3) Returns are for the period indicated and have not been annualized.
9
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Government Portfolio
----------------------
For fiscal year ended
January 31,
----------------------
1994 (1) 1993 (2)
-------------------------------------------------------------------------------
<S> <C> <C>
Net Asset Value, Beginning of Period $ 1.00 $ 1.00
-------------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.01 0.03
Net Realized and Unrealized Gains (Losses) on
Securities -- --
-------------------------------------------------------------------------------
Total from Investment Operations $ 0.01 $ 0.03
-------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income (0.01) (0.03)
Distributions from Realized Capital Gains -- --
-------------------------------------------------------------------------------
Total Distributions $ (0.01) $(0.03)
-------------------------------------------------------------------------------
Net Asset Value, End of Period $ 1.00 $ 1.00
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Total Return 3.22% 3.19%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period (000) $ 0 $ 20,022
Ratio of Expenses to Average Net Assets 0.20% 0.20%
Ratio of Expenses to Average Net Assets (Excluding
Waivers) 0.37% 0.38%
Ratio of Net Investment Income to Average Net Assets 3.04% 3.41%
Ratio of Net Investment Income to Average Net Assets
(Excluding Waivers) 2.87% 3.23%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
</TABLE>
(1) The Government Portfolio, Class A fully liquidated June 2, 1993. All ratios
including total return for that period have been annualized.
(2) The Government Portfolio, Class A commenced operations on March 8, 1992.
All ratios including total return for that period have been annualized.
10
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________
FOR A CLASS C SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Government Portfolio
---------------------
For fiscal year ended
January 31,
---------------------
1995 (1)
-----------------------------------------------------------------------------
<S> <C>
Net Asset Value, Beginning of Period $ 1.00
-----------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.03
Net Realized and Unrealized Gains (Losses) on
Securities --
-----------------------------------------------------------------------------
Total from Investment Operations $0.03
-----------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income (0.03)
Distributions from Realized Capital Gains --
-----------------------------------------------------------------------------
Total Distributions $(0.03)
-----------------------------------------------------------------------------
Net Asset Value, End of Period $ 1.00
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Total Return 3.41%(2)
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period (000) $310,835
Ratio of Expenses to Average Net Assets 0.70%
Ratio of Expenses to Average Net Assets (Excluding
Waivers) 0.89%
Ratio of Net Investment Income to Average Net Assets 4.32%
Ratio of Net Investment Income to Average Net Assets
(Excluding Waivers) 4.13%
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
</TABLE>
(1) The Government Portfolio, Class C shares were offered beginning April 7,
1994, all ratios have been annualized.
(2) Returns are for the period indicated and have not been annualized.
11
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Government II Portfolio
----------------------------------------------------------------------------------------
For Fiscal Year Ended January 31,
----------------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 (1)
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-----------------------------------------------------------------------------------------------------------------------------
Income from Investment
Operations:
Net Investment Income 0.04 0.03 0.04 0.06 0.08 0.09 0.07 0.06 0.06 0.01
Net Realized and
Unrealized Gains
(Losses) on Securities -- -- -- -- -- -- -- -- -- --
-----------------------------------------------------------------------------------------------------------------------------
Total from Investment
Operations $ 0.04 $ 0.03 $ 0.04 $ 0.06 $ 0.08 $ 0.09 $ 0.07 $ 0.06 $ 0.06 $ 0.01
-----------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends from Net
Investment Income (0.04) (0.03) (0.04) (0.06) (0.08) (0.09) (0.07) (0.06) (0.06) (0.01)
Distributions from
Realized Capital Gains -- -- -- -- -- -- -- -- -- --
-----------------------------------------------------------------------------------------------------------------------------
Total Distributions $(0.04) $(0.03) $(0.04) $(0.06) $(0.08) $(0.09) $(0.07) $(0.06) $(0.06) $(0.01)
-----------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of
Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
Total Return 4.39% 3.02% 3.57% 5.73% 8.01% 8.90% 7.53% 6.55% 6.55% 15.61%
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental
Data:
Net Assets End of
Period (000) $786,405 $738,040 $664,540 $534,303 $500,526 $257,523 $155,987 $158,361 $143,736 $106,944
Ratio of Expenses to
Average Net Assets 0.20% 0.20% 0.20% 0.20% 0.20% 0.20% 0.20% 0.20% 0.20% 0.20%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers) 0.30% 0.29% 0.29% 0.28% 0.31% 0.32% 0.36% 0.34% 0.35% 0.21%
Ratio of Net
Investment Income to
Average Net Assets 4.33% 2.98% 3.48% 5.56% 7.66% 8.49% 7.22% 6.35% 6.26% 7.62%
Ratio of Net
Investment Income to
Average Net Assets
(Excluding Waivers) 4.23% 2.89% 3.39% 5.48% 7.55% 8.37% 7.06% 6.21% 6.11% 7.61%
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Government II Portfolio, Class A commenced operations on September 6,
1985. All ratios including total return for that period have been
annualized.
12
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________
FOR A CLASS B SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Government II Portfolio
------------------------------------------
For Fiscal Year Ended January 31,
------------------------------------------
1995 1994 1993 1992 1991 (1)
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.04 0.03 0.03 0.05 0.00
Net Realized and Unrealized Gains
(Losses) on Securities -- -- -- -- --
-------------------------------------------------------------------------------
Total from Investment Operations $ 0.04 $ 0.03 $ 0.03 $ 0.05 $ 0.00
-------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment
Income (0.04) (0.03) (0.03) (0.05) (0.00)
Distributions from Realized
Capital Gains -- -- -- -- --
-------------------------------------------------------------------------------
Total Distributions $(0.04) $(0.03) $(0.03) $(0.05) $(0.00)
-------------------------------------------------------------------------------
Net Asset Value, End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Total Return 4.08% 2.71% 3.26% 5.02% 0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period (000) $15,201 $21,462 $338 $1,906 $607
Ratio of Expenses to Average Net
Assets 0.50% 0.50% 0.50% 0.48% 0.50%
Ratio of Expenses to Average Net
Assets (Excluding Waivers) 0.60% 0.60% 0.59% 0.59% 3.76%
Ratio of Net Investment Income to
Average Net Assets 4.33% 2.68% 3.35% 4.75% 6.44%
Ratio of Net Investment Income to
Average Net Assets (Excluding
Waivers) 4.23% 2.58% 3.26% 4.64% 3.18%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
</TABLE>
(1) The Government II Portfolio, Class B commenced operations on January 28,
1991. All ratios including total return for that period have been
annualized.
13
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Treasury Portfolio
--------------------------
For Fiscal Year Ended
January 31,
--------------------------
1995 1994 1993 (1)
---------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $ 1.00 $ 1.00 $ 1.00
---------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.04 0.03 0.01
Net Realized and Unrealized Gains (Losses) on
Securities -- -- --
---------------------------------------------------------------------------
Total from Investment Operations $ 0.04 $ 0.03 $ 0.01
---------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income (0.04) (0.03) (0.01)
Distributions from Realized Capital Gains -- -- --
---------------------------------------------------------------------------
Total Distributions $(0.04) $(0.03) $(0.01)
---------------------------------------------------------------------------
Net Asset Value, End of Period $ 1.00 $ 1.00 $ 1.00
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Total Return 4.29% 3.00% 2.91%
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period (000) $39,129 $46,296 $44,624
Ratio of Expenses to Average Net Assets 0.20% 0.20% 0.20%
Ratio of Expenses to Average Net Assets
(Excluding Waivers) 0.34% 0.33% 0.42%
Ratio of Net Investment Income to Average Net
Assets 4.17% 2.96% 2.89%
Ratio of Net Investment Income to Average Net
Assets (Excluding Waivers) 4.03% 2.82% 2.67%
---------------------------------------------------------------------------
---------------------------------------------------------------------------
</TABLE>
(1)The Treasury Portfolio, Class A commenced operations on September 30, 1992.
All ratios including total return for that period have been annualized.
14
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) __________________________________________
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Treasury II Portfolio
----------------------------------------------------------
For Fiscal Year Ended January 31,
----------------------------------------------------------
1995 1994 1993 1992 1991 1990 (1)
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------------------------------------------------------------------------------
Income from Investment
Operations:
Net Investment Income 0.04 0.03 0.03 0.06 0.07 0.08
Net Realized and
Unrealized Gains
(Losses) on Securities -- -- -- -- -- --
------------------------------------------------------------------------------------
Total from Investment
Operations $ 0.04 $ 0.03 $ 0.03 $ 0.06 $ 0.07 $ 0.08
------------------------------------------------------------------------------------
Less Distributions:
Dividends from Net In-
vestment Income (0.04) (0.03) (0.03) (0.06) (0.07) (0.08)
Distributions from Re-
alized Capital Gains -- -- -- -- -- --
------------------------------------------------------------------------------------
Total Distributions $(0.04) $(0.03) $(0.03) $(0.06) $(0.07) $(0.08)
------------------------------------------------------------------------------------
Net Asset Value, End of
Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Total Return 4.17% 2.88% 3.46% 5.48% 7.76% 7.90%
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Ratios/Supplemental
Data:
Net Assets End of
Period (000) $397,682 $364,334 $352,435 $282,535 $490,705 $72,777
Ratio of Expenses to
Average Net Assets 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers) 0.35% 0.34% 0.34% 0.31% 0.41% 0.69%
Ratio of Net
Investment Income to
Average Net Assets 4.11% 2.84% 3.40% 5.43% 7.11% 7.66%
Ratio of Net
Investment Income to
Average Net Assets
(Excluding Waivers) 4.01% 2.76% 3.31% 5.37% 6.95% 7.22%
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
</TABLE>
(1)The Treasury II Portfolio, Class A commenced operations on July 28, 1989.
All ratios including total return for that period have been annualized.
15
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________
FOR A CLASS B SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Treasury II Portfolio
--------------------------------------------
For Fiscal Year Ended January 31,
--------------------------------------------
1995 1994 1993 1992 1991 (1)
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------------------------------------------------------------------------
Income from Investment Opera-
tions:
Net Investment Income 0.04 0.03 0.03 0.05 0.07
Net Realized and Unrealized
Gains (Losses) on Securities -- -- -- -- --
------------------------------------------------------------------------------
Total from Investment Operations $ 0.04 $ 0.03 $ 0.03 $ 0.05 $ 0.07
------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment
Income (0.04) (0.03) (0.03) (0.05) (0.07)
Distributions from Realized
Capital Gains -- -- -- -- --
------------------------------------------------------------------------------
Total Distributions $(0.04) $(0.03) $(0.03) $(0.05) $(0.07)
------------------------------------------------------------------------------
Net Asset Value, End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Total Return 3.86% 2.57% 3.15% 5.16% 7.16%
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period (000) $44,680 $22,448 $6,038 $102,182 $85,439
Ratio of Expenses to Average
Net Assets 0.55% 0.55% 0.55% 0.55% 0.55%
Ratio of Expenses to Average
Net Assets (Excluding Waivers) 0.65% 0.64% 0.64% 0.61% 0.67%
Ratio of Net Investment Income
to Average Net Assets 3.71% 2.54% 3.42% 4.97% 7.18%
Ratio of Net Investment Income
to Average Net Assets
(Excluding Waivers) 3.61% 2.46% 3.33% 4.91% 7.06%
------------------------------------------------------------------------------
------------------------------------------------------------------------------
</TABLE>
(1)The Treasury II Portfolio, Class B commenced operations on February 15,
1990. All ratios including total return for that period have been annualized.
16
<PAGE>
FINANCIAL HIGHLIGHTS (CONCLUDED) _______________________________________________
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Federal Securities Portfolio
----------------------------
For Fiscal Year Ended January 31,
----------------------------------
1995 (1) 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------------------------------------------------------------------------------------------------------------------------------
Income from Investment
Operations:
Net Investment Income 0.01 0.03 0.03 0.05 0.07 0.08 0.07 0.06 0.06 0.07 0.09
Net Realized and
Unrealized Gains
(Losses) on
Securities -- -- -- -- -- -- -- -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total from Investment
Operations $ 0.01 $ 0.03 $ 0.03 $ 0.05 $ 0.07 $ 0.08 $ 0.07 $ 0.06 $ 0.06 $ 0.07 $ 0.09
---------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends from Net
Investment Income (0.01) (0.03) (0.03) (0.05) (0.07) (0.08) (0.07) (0.06) (0.06) (0.07) (0.09)
Distributions from
Realized Capital
Gains -- -- -- -- -- -- -- -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total Distributions $(0.01) $(0.03) $(0.03) $(0.05) $(0.07) $(0.08) $(0.07) $(0.06) $(0.06) $(0.07) $(0.09)
---------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of
Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
Total Return 1.37%(2) 2.70% 3.28% 5.31% 7.70% 8.73% 7.32% 6.23% 6.24% 7.59% 9.97%
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Da-
ta:
Net Assets End of Pe-
riod (000) $ 0 24,846 $105,501 $201,631 $209,194 $166,177 $37,093 $85,518 $109,271 $96,831 $52,163
Ratio of Expenses to
Average Net Assets 0.60% 0.60% 0.60% 0.60% 0.60% 0.60% 0.60% 0.60% 0.60% 0.60% 0.56%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers) 0.63% 0.60% 0.67% 0.67% 0.70% 0.72% 0.68% 0.75% 0.78% 0.85% 1.08%
Ratio of Net
Investment Income to
Average Net Assets 2.98% 2.70% 3.22% 5.17% 7.40% 8.29% 6.91% 5.95% 6.02% 7.43% 9.40%
Ratio of Net
Investment Income to
Average Net Assets
(Excluding Waivers) 2.95% 2.70% 3.15% 5.10% 7.30% 8.17% 6.83% 5.80% 5.84% 7.18% 8.88%
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Federal Portfolio, Class A shares were fully liquidated July 15, 1994.
All ratios for that period have been annualized.
(2) Returns are for the period indicated and have not been annualized.
17
<PAGE>
THE TRUST ______________________________________________________________________
SEI DAILY INCOME 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, Class B and
Class C shares of the Trust's Money Market, Prime Obligation, Government,
Government II, Treasury, Treasury II and Federal Securities Portfolios (the
"Portfolios," and each of these, a "Portfolio"). Each Portfolio may have
separate classes of shares which provide for variations in distribution and
transfer agent costs, voting rights and dividends. Additional information
pertaining to the Trust may be obtained from SEI Financial Services Company,
680 East Swedesford Road, Wayne, PA 19087 or by calling 1-800-342-5734.
INVESTMENT OBJECTIVES AND POLICIES _____________________________________________
THE MONEY The Money Market Portfolio seeks to preserve principal value
MARKET and maintain a high degree of liquidity while providing
PORTFOLIO current income. Under normal conditions the Portfolio
invests in obligations denominated in U.S. dollars
consisting of: (i) commercial paper rated at least A-1 or A-
2 by Standard & Poor's Corporation ("S&P") or Prime-1 or
Prime-2 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. savings and loan and
thrift 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 last
published financial statements at the time of investment;
(iii) short-term corporate obligations with a remaining term
of not more than one year of issuers with commercial paper
of comparable priority and security meeting the above
ratings; (iv) investments permitted for the Government II
Portfolio (see below); and (v) repurchase agreements
involving any of the foregoing obligations.
Except for temporary defensive purposes, the Money Market
Portfolio will concentrate its investments in obligations
issued by the banking industry, consisting of U.S. dollar
denominated obligations of domestic banks and U.S. branches
of foreign banks. Concentration in this context means the
investment of more than twenty-five percent of the
Portfolios assets in such industry.
THE 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 obligations of U.S. issuers
(excluding foreign branches of U.S. banks or U.S. branches
of foreign banks) consisting of: (i) commercial paper rated
at least A-1 by S&P or Prime-1 by 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 or savings and
18
<PAGE>
loan institutions having total assets of $500 million or
more as shown on their last published financial statements
at the time of investment and that are insured by the
Federal Deposit Insurance Corporation; (iii) corporate
obligations with a remaining term of not more than one year
of issuers with commercial paper of comparable priority and
security meeting the above ratings or, if not rated,
determined by the Adviser to be of comparable quality; (iv)
investments permitted for the Government II Portfolio (see
below); and (v) repurchase agreements involving any of the
foregoing obligations.
THE GOVERNMENT The Government Portfolio seeks to preserve principal value
PORTFOLIO and maintain a high degree of liquidity 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.
THE GOVERNMENT The Government II Portfolio seeks to preserve principal
II PORTFOLIO value and maintain a high degree of liquidity while
providing current income. Under normal conditions the
Portfolio invests exclusively in U.S. Treasury obligations
and obligations issued or guaranteed as to principal and
interest by the agencies or instrumentalities of the U.S.
Government.
THE TREASURY The Treasury Portfolio seeks to preserve principal value and
PORTFOLIO maintain a high degree of liquidity while providing current
income. Under normal conditions the Portfolio invests
exclusively in U.S. Treasury obligations and repurchase
agreements involving such obligations.
THE TREASURY II
PORTFOLIO The Treasury II Portfolio seeks to preserve principal value
and maintain a high degree of liquidity while providing
current income. Under normal conditions the Portfolio
invests exclusively in U.S. Treasury obligations.
THE FEDERAL The Federal Securities Portfolio seeks to preserve principal
SECURITIES value and maintain a high degree of liquidity while
PORTFOLIO providing current income. Under normal conditions the
Portfolio invests exclusively in general obligations issued
by the U.S. Treasury and repurchase agreements involving
such obligations.
GENERAL INVESTMENT POLICIES _______________________________________________
Each Portfolio complies with regulations of the Securities
and Exchange Commission applicable to money market funds, as
amended effective June 1, 1991. These regulations impose
certain quality, maturity and diversification restraints on
investments by a Portfolio. Under these regulations, the
Portfolio will maintain an average maturity on a dollar-
weighted basis of 90 days or less. For a description of
certain of these restraints, see "Description of Permitted
Investments and Risk Factors."
Each Portfolio may invest up to 10% of its net assets in
illiquid securities, including illiquid restricted
securities. However, restricted securities, including Rule
144A securities
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<PAGE>
and Section 4(2) commercial paper, that meet the criteria
established by the Board of Trustees of the Trust will be
considered liquid. In addition, each Portfolio may invest in
STRIPS (as defined in the "Description of Permitted
Investments and Risk Factors").
Each Portfolio may purchase securities on a when-issued
basis.
For the Money Market and Prime Obligation Portfolios, the
purchase of unrated securities by the Adviser is subject to
the approval or ratification by the Trustees. For a
description of the permitted investments and the above ratings
see "Description of Permitted Investments and Risk Factors"
and the Statement of Additional Information.
INVESTMENT
LIMITATIONS _______________________________________________________________
The investment objectives and investment limitations are
fundamental policies of the Portfolios. 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. There can be
no assurance that the investment objective of any Portfolio
will be met or that any Portfolio will be able to maintain a
net asset value of $1.00 per share on a continuing basis. In
addition, it is currently a fundamental policy of the Money
Market and Prime Obligation Portfolios to invest in assets
of each Portfolio solely in the securities listed as
appropriate investments for that Portfolio.
Fundamental policies cannot be changed with respect to
the Trust or a Portfolio without the consent of the holders
of a majority of the Trust or that Portfolio's outstanding
shares.
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; provided, however, that any
Portfolio except the Money Market and Prime Obligation
Portfolios may invest up to 25% of its total assets
without regard to this restriction as permitted by Rule
2a-7 under the Investment Company Act of 1940, as amended
(the "1940 Act").
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; provided, however, the
Money Market Portfolio will generally invest at least 25%
of its total assets in obligations issued by the banking
industry.
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<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"), a wholly owned subsidiary of SEI
Corporation ("SEI"), and the Trust are parties to a
management agreement (the "Management Agreement"). Under the
terms of the Management Agreement, the Manager is
responsible for providing 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.
For these services, the Manager is entitled to a fee
which is calculated daily and paid monthly at an annual rate
of each Portfolio's average daily net assets as follows:
Money Market Portfolio--.33%; Prime Obligation Portfolio--
.19%; Government II Portfolio--.19%; Government Portfolio--
.24%; Treasury Portfolio--.24%; Treasury II Portfolio--.24%;
and Federal Securities Portfolio--.55%. The Manager has
contractually agreed to waive all or a portion of its fee
and, if necessary, pay other operating expenses in order to
limit the total operating expenses to not more than (i) .20%
of the Class A shares of the Prime Obligation, Government II
and Treasury Portfolios; (ii) .25% of the Class A shares of
the Treasury II Portfolio; (iii) .50% of the Class B shares
of the Prime Obligation, Government II and Treasury
Portfolios; (iv) .55% of the Class B shares of the Treasury
II Portfolio; (v) .70% of the Class C shares of the Prime
Obligation, Government II and Treasury Portfolios; and (vi)
.75% of the Class C shares of the Treasury II Portfolio;
each on an annualized basis. The Manager has voluntarily
agreed to waive all or a portion of its fee in order to
limit total operating expenses to not more than (i) .20% of
the average daily net assets of Class A shares, (ii) .50% of
the average daily net assets of Class B shares and (iii)
.70% of the daily net assets of Class C shares of the Money
Market and Government Portfolios, each on an annualized
basis. The Manager reserves the right, in its sole
discretion, to terminate this voluntary waiver at any time.
21
<PAGE>
THE ADVISER ____________________________________________________________________
Wellington Management Company ("WMC" or the "Adviser") has
acted as the investment adviser for the Portfolios under an
advisory agreement (the "Advisory Agreement") with the
Trust. WMC is a professional investment counseling firm
which provides investment services to investment companies,
employee benefit plans, endowments, foundations, and other
institutions and individuals. Under the Advisory Agreement,
the Adviser is responsible for the investment decisions for
the Portfolios and continuously reviews, supervises and
administers each Portfolio's investment program. The Adviser
is independent of the Manager and SEI and discharges its
responsibilities subject to the supervision of, and policies
set by, the Trustees of the Trust.
The Adviser's predecessor organizations have provided
investment advisory services to investment companies since
1933 and to investment counseling clients since 1960. As of
March 31, 1995, the Adviser had discretionary management
authority with respect to approximately $ billion of
assets, including the assets of the Trust, SEI Liquid Asset
Trust and the Insurance Investment Products Trust, each an
open-end money market investment company. Wellington Trust
Company, National Association, a wholly-owned subsidiary of
the Adviser, utilizes SEI's trust accounting services. The
principal address of Wellington Management Company is 75
State Street, Boston, MA 02109. 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 Portfolios of the
Trust up to $500 million and .02% of such combined average
daily net assets in excess of $500 million. Such fees are
allocated daily among the Portfolios on the basis of their
relative net assets. For the fiscal year ended January 31,
1995, the Portfolios paid the Adviser advisory fees (shown
here as a percentage of average daily net assets after
voluntary fee waivers) as follows: Money Market Portfolio--
.02%; Prime Obligation Portfolio--.01%; Government
Portfolio--.01%; Government II Portfolio--.01%; Treasury
Portfolio--.01%; Treasury II Portfolio--.01%; and Federal
Securities Portfolio--.03%.
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"). Each Class of each Portfolio has
a separate distribution plan ("Class A Plan," "Class B Plan"
and "Class C Plan"; collectively, the "Plans") pursuant to
Rule 12b-1 under the 1940 Act. 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
22
<PAGE>
terms and with the Rules of Fair Practice (the "Rules") of
the National Association of Securities Dealers, Inc.
("NASD") concerning sales charges.
The Distribution Agreement and Plan for each class
provide for reimbursement of expenses incurred by the
Distributor in an amount not to exceed .30% of a Portfolio's
average daily net assets on an annualized basis, provided
those expenses are permissible as to both type and amount
under a budget, and the Class B and Class C Plans provide
for additional payments for distribution and shareholder
services, as described below. The budget must be approved
and monitored quarterly by the Trustees, including those
Trustees 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 laws registration 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 (shown here
as a percentage of average daily net assets) is as follows:
Money Market--.04%; Prime Obligation--.04%; Government--
.04%; Government II--.05%; Treasury--.04%; Treasury II--
.04%; and Federal Securities--.00% (and the Manager will
reimburse operating expenses of this Portfolio in the amount
of .10%). Distribution expenses not attributable to a
specific portfolio of the Trust are allocated among each of
the portfolios of the Trust based on average net assets.
The Class B and Class C Plans, in addition to providing
for the reimbursement payments described above, provide for
payments to the Distributor at an annual rate of .30% and
.50%, respectively, of each Portfolio's average daily net
assets attributable to Class B and Class C shares. These
additional payments 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 Class B and
Class C shareholders that provide distribution related
services to their customers.
It is possible that an institution may offer different
classes of shares to its customers and thus receive
compensation with respect to different classes. These
financial institutions may also charge separate fees to
their customers. Certain financial institutions offering
shares to their customers may be required to register as
dealers pursuant to state laws.
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
23
<PAGE>
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.
PURCHASE AND
REDEMPTION OF
SHARES _________________________________________________________________________
Financial institutions may acquire shares of the Portfolios
for their own accounts 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 for
processing and transmittal of these orders to the Transfer
Agent for effectiveness the same day. Financial institutions
that purchase shares for the accounts of their customers may
impose separate charges on these customers for account
services. Shares of each Portfolio 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 can not be purchased by Federal Reserve wire on
Federal holidays restricting wire transfers.
Shareholders who desire to purchase shares with cash must
place their orders with the Transfer Agent prior to the
determination of net asset value 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 of shares
owned after each transaction. The purchase price of shares
is the net asset value next determined after a purchase
order is received and accepted by the Trust, which is
expected to remain constant at $1.00. The net asset value
per share of a Portfolio is determined by dividing the total
value of its investments and other assets, less any
liabilities, by the total outstanding shares of the
Portfolio. A Portfolio's investments will be valued by the
amortized cost method described in the Statement of
Additional Information. Net asset value per share is
determined daily as of 2:00 p.m. Eastern time on each
Business Day, except that the net asset value per share of
the Money Market and Treasury Portfolios is determined as of
4:30 p.m. Eastern time on each Business Day and the net
asset value per share of the Government Portfolio is
determined as of 3:00 p.m. Eastern time on each Business
Day. Financial institutions which purchase and redeem shares
for the accounts of their
24
<PAGE>
customers may impose their own cut-off times for receipt of
purchase and redemption requests directed through them.
Shareholders who desire to redeem shares of a Portfolio
must place their redemption orders with the Transfer Agent
prior to the determination of net asset value 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. For redemption
orders received before the cut-off time on any Business Day,
payment will be made the same day by transfer of federal
funds. Otherwise, the redemption order will be effective on
the next Business Day.
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 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.
PERFORMANCE ____________________________________________________________________
For any Portfolio, the performance on Class A shares will
normally be higher than that on Class B shares because of
the additional distribution expenses charged Class B shares.
Likewise, the performance on Class B shares will normally be
higher than that on Class C shares because of the additional
distribution expenses charged Class C shares.
From time to time, each Portfolio may advertise the
"current yield" and "effective yield" (also called
"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 a hypothetical investment
in such Portfolio over a seven-day period (which period will
be stated in the advertisement). This income is then
"annualized," i.e., the income generated 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" (also called "effective compound yield") is
calculated similarly but, when annualized, the income earned
by an investment in a 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) or financial and
business publications and periodicals, broad groups of
comparable mutual funds, unmanaged indices
25
<PAGE>
which may assume investment of dividends but generally do
not reflect deductions for administrative and management
costs or to other investment alternatives. A Portfolio may
also quote financial and business publications and
periodicals as they relate to fund management, investment
philosophy and investment techniques.
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. Accordingly, shareholders
are urged to consult their tax advisers regarding specific
questions as to federal, state and local income taxes. State
and local tax consequences of an investment in the Portfolio
may differ from the federal income tax consequences
described below. Additional information concerning taxes is
set forth in the Statement of Additional Information.
Tax Status of Each Portfolio is treated as a separate entity for federal
the Portfolios income tax purposes and is not combined with the Trust's
other portfolios. Each Portfolio intends to qualify or to
continue to qualify for the special tax treatment afforded
regulated investment companies ("RICs") under Subchapter M
of the Internal Revenue Code of 1986 (the "Code"), 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 gains over net short-term
capital losses) distributed to shareholders. Each Portfolio
also intends to distribute sufficient amounts each calendar
year to avoid liability for federal excise tax.
Tax Status of Each Portfolio distributes substantially all of its net
Distributions investment income (including net short-term capital gains)
to shareholders. Dividends from net investment company
taxable income are taxable to its shareholders as ordinary
income (whether received in cash or in additional shares)
and will not qualify for the corporate dividends-received
deduction. Distributions of net capital gains are taxable to
shareholders as long-term capital gains. The Portfolios
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.
Income received on direct U.S. Government obligations is
exempt from tax at the state level when received directly
and may be exempt, depending on the state, when received by
a shareholder from a Portfolio provided certain 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
26
<PAGE>
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 accreted interest
on any 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.
Sale, 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 March 15, 1982. The
Declaration of Trust permits the Trust to offer separate
portfolios of shares and different classes of each
portfolio. In addition to the Portfolios, the Trust consists
of the following portfolios: Short-Term Government
Portfolio, Intermediate-Term Government Portfolio, GNMA
Portfolio, Short-Term Mortgage Portfolio (formerly
Adjustable Rate Mortgage Portfolio) Short Duration Mortgage
Portfolio, Corporate Daily Income Portfolio and Government
Securities Daily Income Portfolio. All consideration
received by the Trust for shares of any portfolio and all
assets of such portfolio belong to that portfolio and would
be 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 materials and
reports to shareholders, costs of custodial services and
registering the shares under state and federal 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.
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<PAGE>
Reporting The Trust issues unaudited financial information 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 E. Swedesford Road,
Wayne, PA 19087.
Dividends Substantially all of the net investment income (exclusive of
capital gains) of each Portfolio is distributed in the form
of monthly dividends. The dividends are determined and
declared as a dividend for shareholders of record on the
close of business on that day. Dividends are paid by the
Portfolio in federal funds or in additional shares at the
discretion of the shareholder on the first Business Day of
each month. The dividends on Class A shares are normally
higher than those on Class B shares of each Portfolio
because of the additional distribution expenses charged to
Class B shares. Likewise, the dividends on Class B shares
are normally higher than those on Class C shares of each
Portfolio because of the additional distribution expenses
charged to Class C shares.
Counsel and Morgan, Lewis & Bockius serves as counsel to the Trust.
Independent Arthur Andersen LLP serves as the independent public
Accountants accountants of the Trust.
Custodians and Bank of New York, 48 Wall Street, New York, NY 10286 (a
Wire Agent "Custodian"), acts as the custodian and wire agent of the
assets of the Money Market and Treasury Portfolios. First
Interstate Bank of Oregon, 1300 S.W. Fifth Street, Portland,
OR 97208 (a "Custodian"), acts as custodian of the assets of
the Federal Securities Portfolio. CoreStates Bank, N.A.,
Broad and Chestnut Streets, P.O. Box 7618, Philadelphia, PA
19101 (a "Custodian," and together, the "Custodians"), acts
as custodian of the assets of the Prime Obligation,
Government, Government II and Treasury II Portfolios, and as
wire agent of all the Portfolios of the Trust except the
Money Market and Treasury Portfolios. The Custodians hold
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
investment practices for the Portfolios and the associated
risk factors:
Bankers' Bankers' acceptances are bills of exchange or time drafts
Acceptance drawn on and accepted by a commercial bank. Bankers'
acceptances are used by corporations to finance the shipment
and storage of goods. Maturities are generally six months or
less.
Certificates of Certificates of deposit are interest-bearing instruments
Deposit 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 with penalties
for early withdrawal will be considered illiquid.
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<PAGE>
Commercial Commercial paper is a term used to describe unsecured short-
Paper term promissory notes issued by banks, municipalities,
corporations and other entities. Maturities on these issues
vary from a few to 270 days.
Demand Certain instruments may entail a demand feature which
Instruments permits the holder to demand payment of the principal amount
of the instrument. Demand instruments may include variable
rate master demand notes.
Illiquid Illiquid securities are securities which cannot be disposed
Securities of within seven business days at approximately the price at
which they are being carried on a Portfolio's books. An
illiquid security includes a demand instrument with a demand
notice period exceeding seven days, where there is no
secondary market for such security, 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 within a number of days from the date of purchase.
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
rights 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.
Restraints on Investments by a money market fund are subject to
Investments by limitations imposed under regulations adopted by the
Money Market Securities and Exchange Commission. These regulations
Funds generally require money market funds to acquire only U.S.
dollar denominated obligations maturing in 397 days or less
(currently the Money Market and Prime Obligation Portfolios
have a fundamental policy limiting their investments to
obligations maturing in one year or less) and to maintain a
dollar-weighted average portfolio maturity of 90 days or
less. In addition, money market funds may acquire only
obligations that present minimal credit risk 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 rating category or, if unrated, determined to be of
comparable quality ("second tier security"). A security is
not considered to be unrated if its issuer has outstanding
obligations of comparable priority and security that have a
short-term rating. In the case of taxable money market
funds, 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 second tier
securities, and (ii) any investment in securities of any one
issuer is limited to the greater of 1% of the Portfolio's
29
<PAGE>
total assets or $1 million. A taxable money market fund may
also hold more than 5% of its total assets in the first tier
securities of a single issuer for three business days.
Time Deposits Time deposits are non-negotiable receipts issued by a bank
in exchange for the deposit of funds. Like a certificate of
deposit, it earns a specified rate of interest over a
definite period of time; however, it cannot be traded in the
secondary market. Time deposits are considered to be
illiquid securities.
U.S. Government Obligations issued or guaranteed by agencies of the U.S.
Agencies Government, including, among others, the Federal Farm Credit
Bank, the Federal Housing Administration and the Small
Business Administration, and obligations issued or
guaranteed by instrumentalities of the U.S. Government,
including, among others, the Federal Home Loan Mortgage
Corporations, the Federal Land Banks and the U.S. Postal
Service. Some of these securities are supported by the full
faith and credit of the U.S. Treasury (e.g., Government
National Mortgage Association), others are supported by the
right of the issuer to borrow from the Treasury (e.g.,
Federal Farm Credit Bank), while 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 on the
obligation prior to maturity. Guarantees as to the timely
payment of principal and interest do not extend to the value
or yield of these securities nor to the value of the
Portfolio's shares.
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 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 securities. See also "Taxes."
Variable and Certain obligations may carry variable or floating rates of
Floating Rate interest, and may involve a conditional or unconditional
Instruments demand feature. 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
some other reset period, 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 exceeding seven days may be considered
illiquid if there is no secondary market for such security.
30
<PAGE>
When-Issued and When-issued or delayed delivery basis transactions involve
Delayed the purchase of an instrument with payment and delivery
Delivery taking place in the future. Delivery of and payment for
Securities these 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 it deems appropriate.
31
<PAGE>
TABLE OF CONTENTS
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
Expense Summary....................................... 2
Financial Highlights.................................. 5
The Trust............................................. 18
Investment Objectives and Policies.................... 18
General Investment Policies........................... 19
Investment Limitations................................ 20
The Manager and Shareholder Servicing Agent........... 21
</TABLE>
<TABLE>
<S> <C>
The Adviser.......................................... 22
Distribution......................................... 22
Purchase and Redemption of Shares.................... 24
Performance.......................................... 25
Taxes................................................ 26
General Information.................................. 27
Description of Permitted Investments and Risk Factors 28
</TABLE>
32
<PAGE>
SEI DAILY INCOME TRUST
MAY 31, 1995
--------------------------------------------------------------------------------
CORPORATE DAILY INCOME PORTFOLIO
GOVERNMENT SECURITIES DAILY INCOME PORTFOLIO
SHORT-TERM MORTGAGE PORTFOLIO
SHORT DURATION MORTGAGE PORTFOLIO
SHORT-TERM GOVERNMENT PORTFOLIO
INTERMEDIATE-TERM GOVERNMENT PORTFOLIO
GNMA PORTFOLIO
--------------------------------------------------------------------------------
Please read this Prospectus carefully before investing, and keep it on file for
future reference.
A Statement of Additional Information dated May 31, 1995 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 Daily Income 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 professionally managed
diversified portfolios of securities. Some portfolios offer separate classes of
units of beneficial interest ("shares") that differ from each other primarily
in the allocation of certain distribution expenses and minimum investment
amounts. This Prospectus offers Class A, Class B and Class C shares of the
seven fixed income portfolios (the "Portfolios," and each of these, a
"Portfolio") listed above.
--------------------------------------------------------------------------------
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 TRUST'S 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) CLASS A
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GOVERNMENT
CORPORATE SECURITIES SHORT INTERMEDIATE-
DAILY DAILY SHORT-TERM DURATION SHORT-TERM TERM
INCOME INCOME MORTGAGE MORTGAGE GOVERNMENT GOVERNMENT GNMA
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ---------- ---------- --------- ---------- ------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Management/Advisory Fees
(after fee waiver) (1) .24% .25% .26% .10% .37% .37% .40%
12b-1 Fees (2) .06% .06% .04% .08% .05% .05% .05%
Other Expenses .05% .04% .15% .27% .03% .03% .04%
------------------------------------------------------------------------------------------------------
Total Operating Expenses
(after fee waiver) (3)
(4) (5) .35% .35% .45% .45% .45% .45% .49%
------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Manager has waived, on a voluntary basis, a portion of its fee, and the
management/advisory fees shown reflect this voluntary waiver. The Manager
reserves the right to terminate its waiver at any time in its sole
discretion. Absent such fee waiver, management/advisory fees would be .45%
for the Corporate Daily Income, Government Securities Daily Income, Short-
Term Mortgage, Short Duration Mortgage .44% for the Short-Term Government
and the Intermediate-Term Government Portfolios and .41 for the GNMA
Portfolio.
(2) 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%.
(3) Total operating expenses for the Government Securities Portfolio and the
Short Duration Mortgage Portfolio, are based on estimated amounts for the
current fiscal year.
(4) Total operating expenses for the GNMA Portfolio have been restated to
reflect a reduction in the fee waivers.
(5) Absent the voluntary fee waiver and reimbursement described above, total
operating expenses for Class A shares of the Portfolios would be .56% for
the Corporate Daily Income Portfolio, .55% for the Government Securities
Daily Income Portfolio, .64% for the Short-Term Mortgage Portfolio, .80%
for the Short Duration Mortgage Portfolio, .52% for the Short-Term
Government Portfolio, .52% for the Intermediate-Term Government Portfolio
and .50 for the GNMA Portfolio.
EXAMPLE
<TABLE>
--------------------------------------------------------------------------------
<CAPTION>
1 YR. 3 YRS. 5 YRS. 10 YRS.
----- ------ ------ -------
<S> <C> <C> <C> <C>
An investor would pay the following expenses on a
$1,000 investment of each portfolio assuming (1) 5%
annual return and (2) redemption at the end of each
time period:
Corporate Daily Income Portfolio $4.00 $11.00 $20.00 $44.00
Government Securities Daily Income Portfolio $4.00 $11.00 $20.00 $44.00
Short-Term Mortgage Portfolio $5.00 $14.00 $25.00 $57.00
Short Duration Mortgage Portfolio $5.00 $14.00 $25.00 $57.00
Short-Term Government Portfolio $5.00 $14.00 $25.00 $57.00
Intermediate-Term Government Portfolio $5.00 $14.00 $25.00 $57.00
GNMA Portfolio $5.00 $16.00 $27.00 $62.00
--------------------------------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR 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 Class A shares.
The Short-Term Government, Intermediate-Term Government and GNMA Portfolios
also offer Class D shares, which are subject to the same expenses except that
Class D 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. ("NASD").
2
<PAGE>
ANNUAL OPERATING EXPENSES (as a percentage of average net assets) CLASS B
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GOVERNMENT
CORPORATE SECURITIES SHORT INTERMEDIATE-
DAILY DAILY SHORT-TERM DURATION SHORT-TERM TERM
INCOME INCOME MORTGAGE MORTGAGE GOVERNMENT GOVERNMENT GNMA
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ---------- ---------- --------- ---------- ------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Management/Advisory Fees
(after fee waiver) (1) .24% .25% .26% .10% .37% .37% .40%
12b-1 Fees (2) .36% .36% .34% .38% .35% .35% .35%
Other Expenses .05% .04% .15% .27% .03% .03% .04%
------------------------------------------------------------------------------------------------------
Total Operating Expenses
(after fee waiver ) (3)
(4) (5) .65% .65% .75% .75% .75% .75% .79%
------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Manager has waived, on a voluntary basis, a portion of its fee, and the
management/advisory fees shown reflect this voluntary waiver. The Manager
reserves the right to terminate its waiver at any time in its sole
discretion. Absent such fee waiver, management/advisory fees would be .45%
for the Corporate Daily Income, Government Securities Daily Income, Short-
Term Mortgage, Short Duration Mortgage, .44% for the Short-Term Government
and the Intermediate-Term Government Portfolios; and .41% for the GNMA
Portfolio.
(2) 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 B shares
for each Portfolio are .60%.
(3) Total operating expenses for the Government Securities Portfolio and the
Short Duration Mortgage Portfolio are based on estimated amounts for the
current fiscal year.
(4) Total operating expenses for the GNMA Portfolio have been restated to
reflect a reduction in the fee waivers.
(5) Absent the voluntary fee waiver and reimbursement described above, total
operating expenses for Class B shares of the Portfolios would be .86% for
the Corporate Daily Income Portfolio, .85% for the Government Securities
Daily Income Portfolio, .94% for the Short-Term Mortgage Portfolio, 1.10%
for the Short Duration Mortgage Portfolio, .82% for the Short-Term
Government Portfolio and .82% for the Intermediate-Term Government
Portfolio and .80% for the GNMA Portfolio.
EXAMPLE
<TABLE>
--------------------------------------------------------------------------------
<CAPTION>
1 YR. 3 YRS. 5 YRS. 10 YRS.
----- ------ ------ -------
<S> <C> <C> <C> <C>
An investor would pay the following expenses on a
$1,000 investment of each portfolio assuming (1) 5%
annual return and (2) redemption at the end of each
time period:
Corporate Daily Income Portfolio $7.00 $21.00 $36.00 $81.00
Government Securities Daily Income Portfolio $7.00 $21.00 $36.00 $81.00
Short-Term Mortgage Portfolio $8.00 $24.00 $42.00 $93.00
Short Duration Mortgage Portfolio $8.00 $24.00 $42.00 $93.00
Short-Term Government Portfolio $8.00 $24.00 $42.00 $93.00
Intermediate-Term Government Portfolio $8.00 $24.00 $42.00 $93.00
GNMA Portfolio $8.00 $25.00 $44.00 $98.00
--------------------------------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR 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 Class B shares.
The Short-Term Government, Intermediate-Term Government and GNMA Portfolios
also offer Class D shares, which are subject to the same expenses except that
Class D 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 NASD Rules.
3
<PAGE>
ANNUAL OPERATING EXPENSES (as a percentage of average net assets) CLASS C
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GOVERNMENT
CORPORATE SECURITIES SHORT INTERMEDIATE-
DAILY DAILY SHORT-TERM DURATION SHORT-TERM TERM
INCOME INCOME MORTGAGE MORTGAGE GOVERNMENT GOVERNMENT GNMA
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ---------- ---------- --------- ---------- ------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Management/Advisory Fees
(after fee waiver) (1) .24% .25% .26% .10% .37% .37% .40%
12b-1 Fees (2) .56% .56% .54% .58% .55% .55% .55%
Other Expenses .05% .04% .15% .27% .03% .03% .04%
------------------------------------------------------------------------------------------------------
Total Operating Expenses
(after the waiver)
(3)(4)(5) .85% .85% .95% .95% .95% .95% .99%
------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Manager has waived, on a voluntary basis, a portion of its fee, and the
management/advisory fees shown reflect this voluntary waiver. The Manager
reserves the right to terminate its waiver at any time in its sole
discretion. Absent such fee waiver, management/advisory fees would be .45%
for the Corporate Daily Income, Government Securities Daily Income, Short-
Term Mortgage and Short Duration Mortgage Portfolios, .44% for the Short-
Term Government and the Intermediate-Term Government Portfolios and .41%
for the GNMA Portfolio.
(2) 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 C shares
for each Portfolio are .80%.
(3) Total operating expenses for the Government Securities Daily Income
Portfolio and the Short Duration Mortgage Portfolio are based on estimated
amounts for the current fiscal year.
(4) Total operating expenses for the GNMA Portfolio have been restated to
reflect a reduction in the fee waivers.
(5) Absent the voluntary fee waiver and reimbursement described above, total
operating expenses for Class C shares of the Portfolios would be 1.06% for
the Corporate Daily Income Portfolio, 1.05% for the Government Securities
Daily Income Portfolio, 1.14% for the Short-Term Mortgage Portfolio, 1.30%
for the Short Duration Mortgage Portfolio, 1.02% for the Short-Term
Government Portfolio, 1.02% for the Intermediate-Term Government Portfolio
and 1.00% for the GNMA Portfolio.
EXAMPLE
<TABLE>
-------------------------------------------------------------------------------
<CAPTION>
1 YR. 3 YRS. 5 YRS. 10 YRS.
------ ------ ------ -------
<S> <C> <C> <C> <C>
An investor would pay the following expenses on a
$1,000 investment of each portfolio assuming (1)
5% annual return and (2) redemption at the end of
each time period:
Corporate Daily Income Portfolio $ 9.00 $27.00 $47.00 $105.00
Government Securities Daily Income Portfolio $ 9.00 $27.00 $47.00 $105.00
Short-Term Mortgage Portfolio $10.00 $30.00 $53.00 $117.00
Short Duration Mortgage Portfolio $10.00 $30.00 $53.00 $117.00
Short-Term Government Portfolio $10.00 $30.00 $53.00 $117.00
Intermediate-Term Government Portfolio $10.00 $30.00 $53.00 $117.00
GNMA Portfolio $10.00 $32.00 $55.00 $121.00
-------------------------------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR 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 Class C shares.
The Short-Term Government, Intermediate-Term Government and GNMA Portfolios
also offer Class D shares, which are subject to the same expenses except that
Class D 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 NASD Rules.
4
<PAGE>
FINANCIAL HIGHLIGHTS ___________________________________________________________
The following information has been audited by Arthur Andersen LLP, the Trust's
independent accountants, as indicated in their report dated March 8, 1995 on
the Trust's financial statements as of January 31, 1995 included in the Trust's
Statement of Additional Information under "Financial Information." Additional
performance information is set forth in the 1995 Annual Report to shareholders
and is available upon request and without charge by calling 1-800-342-5734. As
of the most recent fiscal year end, there were no shares outstanding of the
Government Securities Daily Income or Short Duration Mortgage Portfolios, no
Class B or C shares outstanding of the Corporate Daily Income or Short-Term
Mortgage Portfolios, and no Class C shares outstanding of the GNMA Portfolio.
This table should be read in conjunction with the Trust's financial statements
and notes thereto.
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Corporate Daily Income Portfolio
-----------------------------------
For Fiscal Year Ended
January 31,
1995 1994 (1)
------------------------------------------------------------------------------
<S> <C> <C>
Net Asset Value, Beginning of Period $ 2.00 $ 2.00
------------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.09 0.02
Net Realized and Unrealized Gains
(Losses) on Securities (0.04) --
------------------------------------------------------------------------------
Total from Investment Operations $ 0.05 $ 0.02
------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income (0.09) (0.02)
Distributions from Realized Capital
Gains -- --
------------------------------------------------------------------------------
Total Distributions $(0.09) $(0.02)
------------------------------------------------------------------------------
Net Asset Value, End of Period $ 1.96 $ 2.00
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Total Return 2.59% 3.45%
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period (000) $50,495 $43,655
Ratio of Expenses to Average Net Assets 0.35% 0.35%
Ratio of Expenses to Average Net Assets
(Excluding Waivers) 0.55% 0.63%
Ratio of Net Investment Income to
Average Net Assets 4.60% 3.45%
Ratio of Net Investment Income to
Average Net Assets (Excluding Waivers) 4.40% 3.18%
Portfolio Turnover Rate 147% 34%
------------------------------------------------------------------------------
------------------------------------------------------------------------------
</TABLE>
(1) The Corporate Daily Income Portfolio, Class A commenced operations on
September 28, 1993. All ratios including total return for that period have
been annualized.
5
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) __________________________________________
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Short-Term Mortgage Portfolio
-----------------------------
For Fiscal Year Ended
January 31,
1995 (2) 1994 (1)
-------------------------------------------------------------------------------
<S> <C> <C>
Net Asset Value, Beginning of Period $ 9.90 $10.00
-------------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.48 0.22
Net Realized and Unrealized Gains (Losses)
on Securities (0.24) (0.10)
-------------------------------------------------------------------------------
Total from Investment Operations $ 0.24 $ 0.12
-------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income (0.48) (0.22)
Distributions from Realized Capital Gains (0.02) --
-------------------------------------------------------------------------------
Total Distributions $(0.50) $(0.22)
-------------------------------------------------------------------------------
Net Asset Value, End of Period $ 9.64 $ 9.90
===============================================================================
Total Return 2.29% 1.84%
===============================================================================
Ratios/Supplemental Data:
Net Assets End of Period (000) $3,607 $3,921
Ratio of Expenses to Average Net Assets 0.45% 0.45%
Ratio of Expenses to Average Net Assets
(Excluding Waivers) 0.64% 0.93%
Ratio of Net Investment Income to Average
Net Assets 4.90% 3.16%
Ratio of Net Investment Income to Average
Net Assets (Excluding Waivers) 4.71% 2.68%
Portfolio Turnover Rate 741% 166%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
</TABLE>
(1) The Short-Term Mortgage Portfolio, Class A commenced operations on May 20,
1993. All ratios including total return for that period have been
annualized.
(2) Effective June 30, 1994, Wellington Management Company began serving as the
Investment Adviser of the Short-Term Mortgage Portfolio. Prior to June 30,
1994, Bear Stearns Asset Management served as the Investment Adviser.
6
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) __________________________________________
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Short-Term Government Portfolio
------------------------------------------------------------------------
For Fiscal Year Ended January 31,
------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988(1)
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period $10.06 $10.13 $10.09 $ 9.82 $ 9.65 $ 9.54 $ 9.81 $10.00
---------------------------------------------------------------------------------------------------
Income from Investment
Operations:
Net Investment Income 0.40 0.40 0.52 0.68 0.76 0.75 0.76 0.76
Net Realized and
Unrealized Gains
(Losses) on Securities (0.32) 0.04 0.14 0.27 0.17 0.11 (0.27) (0.19)
---------------------------------------------------------------------------------------------------
Total from Investment
Operations $ 0.08 $ 0.44 $ 0.66 $ 0.95 $ 0.93 $ 0.86 $ 0.49 $ 0.57
---------------------------------------------------------------------------------------------------
Less Distributions:
Dividends from Net
Investment Income (0.40) (0.40) (0.52) (0.68) (0.76) (0.75) (0.76) (0.76)
Distributions from
Realized Capital Gains (0.01) (0.11) (0.10) -- -- -- -- --
---------------------------------------------------------------------------------------------------
Total Distributions $(0.41) $ (0.51) $ (0.62) $ (0.68) $(0.76) $(0.75) $(0.76) $(0.76)
---------------------------------------------------------------------------------------------------
Net Asset Value, End of
Period $ 9.73 $10.06 $10.13 $10.09 $ 9.82 $ 9.65 $ 9.54 $ 9.81
===================================================================================================
Total Return 0.93% 4.41% 6.66% 10.00% 9.98% 9.01% 5.21% 6.09%
===================================================================================================
Ratios/Supplemental
Data:
Net Assets End of
Period (000) $99,458 $128,063 $100,153 $63,194 $51,457 $48,683 $54,887 $27,279
Ratio of Expenses to
Average Net Assets 0.45% 0.45% 0.45% 0.45% 0.45% 0.45% 0.41% 0.32%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers) 0.52% 0.52% 0.55% 0.56% 0.54% 0.58% 0.58% 0.78%
Ratio of Net
Investment Income to
Average Net Assets 4.12% 3.98% 5.04% 6.82% 7.73% 7.72% 7.95% 8.17%
Ratio of Net
Investment Income to
Average Net Assets
(Excluding Waivers) 4.05% 3.91% 4.94% 6.71% 7.64% 7.59% 7.78% 7.71%
Portfolio Turnover
Rate 45% 105% 80% 36% 17% 6% 55% 85%
===================================================================================================
</TABLE>
(1) The Short-Term Government Portfolio, Class A commenced operations on
February 17, 1987. All ratios including total return for that period have
been annualized.
7
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________
FOR A CLASS B SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Short-Term Government Portfolio
---------------------------------------
For Fiscal Year Ended January 31,
---------------------------------------
1995 1994 1993 1992 1991(1)
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $10.04 $10.13 $10.09 $ 9.82 $ 9.75
-------------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.38 0.37 0.48 0.65 0.17
Net Realized and Unrealized Gains
(Losses) on Securities (0.32) 0.02 0.14 0.27 0.07
-------------------------------------------------------------------------------
Total from Investment Operations $ 0.06 $ 0.39 $ 0.62 $ 0.92 $ 0.24
-------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment
Income (0.38) (0.37) (0.48) (0.65) (0.17)
Distributions from Realized Capital
Gains (0.01) (0.11) (0.10) -- --
-------------------------------------------------------------------------------
Total Distributions $(0.39) $(0.48) $(0.58) $(0.65) $ (0.17)
-------------------------------------------------------------------------------
Net Asset Value, End of Period $ 9.71 $10.04 $10.13 $10.09 $ 9.82
===============================================================================
Total Return 0.70% 3.93% 6.34% 9.68% (0.25)%
===============================================================================
Ratios/Supplemental Data:
Net Assets End of Period (000) $ 131 $ 37 $ 135 $ 135 $ 150
Ratio of Expenses to Average Net
Assets 0.75% 0.75% 0.75% 0.75% 0.75%
Ratio of Expenses to Average Net
Assets (Excluding Waivers) 0.82% 0.82% 0.85% 0.85% 0.93%
Ratio of Net Investment Income to
Average Net Assets 3.92% 3.67% 4.74% 6.52% 7.25%
Ratio of Net Investment Income to
Average Net Assets (Excluding
Waivers) 3.85% 3.60% 4.64% 6.42% 7.07%
Portfolio Turnover Rate 45% 105% 80% 36% 17%
===============================================================================
</TABLE>
(1) The Short-Term Government Portfolio, Class B commenced operations on
November 5, 1990. All ratios including total return for that period have
been annualized.
8
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) __________________________________________
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Intermediate-Term Government Portfolio
------------------------------------------------------------------------------
For Fiscal Year Ended January 31,
------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988(1)
---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period $ 10.13 $10.23 $10.06 $ 9.75 $ 9.48 $ 9.32 $ 9.71 $10.00
---------------------------------------------------------------------------------------------------------
Income from Investment
Operations:
Net Investment Income 0.50 0.54 0.62 0.70 0.73 0.76 0.78 0.77
Net Realized and
Unrealized Gains
(Losses) on Securities (0.73) 0.11 0.28 0.40 0.28 0.16 (0.39) (0.29)
---------------------------------------------------------------------------------------------------------
Total from Investment
Operations $ (0.23) $ 0.65 $ 0.90 $ 1.10 $ 1.01 $ 0.92 $ 0.39 $ 0.48
---------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends from Net
Investment Income (0.50) (0.54) (0.62) (0.70) (0.74) (0.76) (0.78) (0.77)
Distributions from
Realized Capital Gains (0.07) (0.21) (0.11) (0.09) -- -- -- --
---------------------------------------------------------------------------------------------------------
Total Distributions $ (0.57) $(0.75) $(0.73) $(0.79) $(0.74) $(0.76) $(0.78) $ (0.77)
---------------------------------------------------------------------------------------------------------
Net Asset Value, End of
Period $ 9.33 $10.13 $10.23 $10.06 $ 9.75 $ 9.48 $ 9.32 $ 9.71
=========================================================================================================
Total Return (2.19)% 6.44% 9.51% 11.44% 11.06% 9.94% 4.23% 5.37%
=========================================================================================================
Ratios/Supplemental
Data:
Net Assets End of
Period (000) $243,671 $336,814 $259,488 $199,901 $184,193 $127,966 $102,166 $77,542
Ratio of Expenses to
Average Net Assets 0.45% 0.45% 0.45% 0.45% 0.45% 0.45% 0.41% 0.28%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers) 0.52% 0.53% 0.53% 0.54% 0.54% 0.74% 0.72% 1.67%
Ratio of Net
Investment Income to
Average Net Assets 5.20% 5.24% 6.16% 7.08% 7.78% 8.01% 8.32% 8.40%
Ratio of Net
Investment Income to
Average Net Assets
(Excluding Waivers) 5.13% 5.16% 6.08% 6.99% 7.69% 7.72% 8.01% 7.01%
Portfolio Turnover
Rate 61% 56% 52% 62% 39% 34% 36% 56%
=========================================================================================================
</TABLE>
(1) The Intermediate-Term Government Portfolio, Class A commenced operations on
February 17, 1987. All ratios including total return for that period have
been annualized.
9
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) __________________________________________
FOR A CLASS B SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
Intermediate-Term Government Portfolio
--------------------------------------
For Fiscal Year Ended January 31,
--------------------------------------
1995(1)
------------------------------------------------------------------------------
<S> <C>
Net Asset Value,
Beginning of Period $ 9.64
------------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.31
Net Realized and Unrealized Gains
(Losses) on Securities (0.24)
------------------------------------------------------------------------------
Total from Investment Operations $ 0.07
------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income (0.31)
Distributions from Realized Capital
Gains (0.07)
------------------------------------------------------------------------------
Total Distributions $ (0.38)
------------------------------------------------------------------------------
Net Asset Value, End of Period $ 9.33
==============================================================================
Total Return 0.61%(2)
==============================================================================
Ratios/Supplemental Data:
Net Assets End of Period (000) $ 93
Ratio of Expenses to Average Net
Assets 0.75%
Ratio of Expenses to Average Net
Assets (Excluding Waivers) 0.83%
Ratio of Net Investment Income to
Average Net Assets 5.07%
Ratio of Net Investment Income to
Average Net Assets (Excluding
Waivers) 4.99%
Portfolio Turnover Rate 61%
==============================================================================
</TABLE>
(1) The Intermediate-Term Government Portfolio, Class B commenced operations on
June 8, 1994. All ratios including total return for that period have been
annualized.
(2) Returns are for the period indicated and have not been annualized.
10
<PAGE>
FINANCIAL HIGHLIGHTS (CONCLUDED) __________________________________________
FOR A CLASS A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
GNMA Portfolio
------------------------------------------------------------------------
For Fiscal Year Ended January 31,
------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988(1)
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period $10.07 $10.22 $ 9.99 $ 9.61 $ 9.31 $ 9.15 $ 9.47 $10.00
--------------------------------------------------------------------------------------------------
Income from Investment
Operations:
Net Investment Income 0.64 0.66 0.75 0.79 0.83 0.88 0.87 0.77
Net Realized and
Unrealized Gains
(Losses) on Securities (0.90) (0.06) 0.27 0.38 0.30 0.16 (0.32) (0.53)
--------------------------------------------------------------------------------------------------
Total from Investment
Operations $(0.26) $ 0.60 $ 1.02 $ 1.17 $ 1.13 $ 1.04 $ 0.55 $ 0.24
--------------------------------------------------------------------------------------------------
Less Distributions:
Dividends from Net
Investment Income (0.64) (0.66) (0.75) (0.79) (0.83) (0.88) (0.87) (0.77)
Distributions from
Realized Capital Gains -- (0.09) (0.04) -- -- -- -- --
--------------------------------------------------------------------------------------------------
Total Distributions $(0.64) $(0.75) $(0.79) $(0.79) $(0.83) $(0.88) $(0.87) $(0.77)
--------------------------------------------------------------------------------------------------
Net Asset Value, End of
Period $ 9.17 $10.07 $10.22 $ 9.99 $ 9.61 $ 9.31 $ 9.15 $ 9.47
==================================================================================================
Total Return (2.46)% 6.09% 10.92% 12.49% 12.74% 11.53% 6.19% 3.25%
==================================================================================================
Ratios/Supplemental
Data:
Net Assets End of
Period (000) $182,225 $262,162 $193,204 $120,712 $56,912 $7,899 $8,367 $4,968
Ratio of Expenses to
Average Net Assets 0.47% 0.45% 0.45% 0.45% 0.45% 0.44% 0.37% 0.03%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers) 0.50% 0.50% 0.52% 0.52% 0.61% 0.49% 0.44% 0.74%
Ratio of Net
Investment Income to
Average Net Assets 6.89% 6.38% 7.49% 8.09% 8.66% 9.50% 9.49% 9.49%
Ratio of Net
Investment Income to
Average Net Assets
(Excluding Waivers) 6.86% 6.32% 7.42% 8.02% 8.50% 9.45% 9.42% 8.78%
Portfolio Turnover
Rate 85% 70% 23% 9% 16% 29% 19% 48%
==================================================================================================
</TABLE>
(1) The GNMA Portfolio, Class A commenced operations on March 20, 1987. All
ratios including total return for that period have been annualized.
11
<PAGE>
FINANCIAL HIGHLIGHTS (CONCLUDED) _______________________________________________
FOR A CLASS B SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
GNMA Portfolio
---------------------------------
For Fiscal Year Ended January 31,
---------------------------------
1995(1)
-------------------------------------------------------------------------------
<S> <C>
Net Asset Value, Beginning of Period $ 9.16
-------------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.35
Net Realized and Unrealized Gains (Losses)
on Securities 0.01
-------------------------------------------------------------------------------
Total from Investment Operations $ 0.36
-------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income (0.35)
Distributions from Realized Capital Gains --
-------------------------------------------------------------------------------
Total Distributions $(0.35)
-------------------------------------------------------------------------------
Net Asset Value, End of Period $ 9.17
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Total Return 4.00%(2)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period (000) $14
Ratio of Expenses to Average Net Assets 0.79%
Ratio of Expenses to Average Net Assets
(Excluding Waivers) 0.82%
Ratio of Net Investment Income to Average
Net Assets 6.80%
Ratio of Net Investment Income to Average
Net Assets (Excluding Waivers) 6.77%
Portfolio Turnover Rate 85%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
</TABLE>
(1) The GNMA Portfolio, Class B commenced operations on July 12, 1994. All
ratios for that period have been annualized.
(2) Returns are for the period indicated and have not been annualized.
12
<PAGE>
THE TRUST ______________________________________________________________________
SEI DAILY INCOME 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, Class B and
Class C shares of the Trust's Corporate Daily Income, Government Securities
Daily Income, Short-Term Mortgage (formerly Adjustable Rate Mortgage), Short
Duration Mortgage, Short-Term Government, Intermediate-Term Government and GNMA
Portfolios (the "Portfolios," and each of these seven, a "Portfolio"). Each
Portfolio may have separate classes of shares which provide for variations in
distribution and transfer agent costs, sales charges, voting rights and
dividends. Shares in the Short-Term Government, Intermediate-Term Government
and GNMA Portfolios may also be purchased through those Portfolios' Class D
shares. Additional information pertaining to the Trust's other portfolios may
be obtained by writing to SEI Financial Services Company, 680 East Swedesford
Road, Wayne, PA 19087 or by calling 1-800-342-5734.
INVESTMENT OBJECTIVES AND POLICIES _____________________________________________
THE CORPORATE The Corporate Daily Income Portfolio seeks to provide higher
DAILY INCOME current income than that typically offered by a money market
PORTFOLIO fund while maintaining a high degree of liquidity and a
correspondingly higher risk of principal volatility. Under
normal conditions the Portfolio invests exclusively in high
quality obligations of U.S. domiciled issuers (not including
foreign branches of U.S. banks or U.S. branches of foreign
banks) consisting of: (i) commercial paper rated in one of
the two highest rating category by a nationally recognized
statistical rating organization ("NRSRO") or, if unrated, of
comparable quality at the time of investment as determined
by the Adviser; (ii) obligations (certificates of deposit,
time deposits, bankers' acceptances and bank notes) of U.S.
commercial banks or savings and loan institutions having net
assets of at least $500 million as of the end of their most
recent fiscal year; (iii) U.S. Treasury obligations and
obligations issued or guaranteed as to principal and
interest by agencies or instrumentalities of the U.S.
Government; (iv) corporate obligations (notes, bonds and
debentures) rated in one of the four highest rating
categories by a NRSRO or, if unrated, of comparable quality
at the time of investment as determined by the Adviser; (v)
mortgage-backed securities, asset-backed securities rated in
one of the four highest rating categories by a NRSRO or, if
unrated, of comparable quality at the time of investment as
determined by the Adviser; and (vi) repurchase agreements
involving the foregoing securities. However, the Adviser
intends to limit the Portfolio's purchases of non-mortgage
asset-backed securities to securities that are readily
marketable at the time of purchase. Securities rated in the
lowest category of investment grade may have speculative
characteristics. In the event a security owned by the
Portfolio is downgraded below these rating categories, the
Adviser will review and take appropriate action with regard
to such security. The Portfolio's dollar-weighted average
maturity will range from 6 to 18 months. Maximum remaining
maturity on any single issue will be 5 years, with the
exception of floating rate securities that reset at least
annually.
13
<PAGE>
THE GOVERNMENT The Government Securities Daily Income Portfolio seeks to
SECURITIES provide higher current income than that typically offered by
DAILY INCOME a money market fund while maintaining a high degree of
PORTFOLIO liquidity and a correspondingly higher risk of principal
volatility. Under normal conditions the Portfolio invests
exclusively in U.S. Treasury obligations, obligations issued
or guaranteed as to principal and interest by the agencies
and instrumentalities of the U.S. Government, and repurchase
agreements involving such obligations. The Portfolio's
dollar-weighted average maturity will range from 6 to 18
months. Maximum remaining maturity on any single issue will
be 5 years, with the exception of floating rate securities
that reset at least annually.
THE SHORT-TERM Under normal conditions, the Short-Term Mortgage Portfolio
MORTGAGE seeks to provide a high level of current income consistent
PORTFOLIO with low principal volatility. Under normal conditions the
Portfolio will invest at least 65% of its total assets in
fixed rate and adjustable rate mortgage-backed securities
("ARMs") that are either privately issued or guaranteed by
the U.S. Government, its agencies or instrumentalities; and
asset-backed securities rated in one of the two highest
rating categories. The Portfolio may also invest in direct
obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities. In addition, the Portfolio
may invest in futures contracts and related options, swaps,
caps, and floors, as described in this Prospectus and in the
Statement of Additional Information, as a hedging strategy.
Under normal conditions, the Portfolio is expected to
maintain an average effective maturity of less than three
years. Effective maturity as used herein takes into account
not only the stated maturity but other characteristics that
may cause the instrument to trade similarly to securities
with shorter maturities. The Adviser believes the effective
maturity of a mortgage security is a more accurate gauge of
its potential price volatility than its final maturity date
in light of the variable nature of mortgage prepayments from
the underlying mortgages which comprise the pool. These
uncertain prepayments result in a different average term
than the final principal payment from the underlying
mortgages. With respect to adjustable rate mortgage
securities (securities whose coupon periodically resets),
the effective maturity is equal to the remaining time until
the next coupon reset date. The effective maturity of
securities with fixed cash flows is equal to the stated
maturity date of the security.
In addition, the Portfolio will acquire only adjustable
rate securities that have an interest rate reset period not
exceeding one year.
THE SHORT The Short Duration Mortgage Portfolio seeks to provide a
DURATION high level of current income consistent with low principal
MORTGAGE volatility. Under normal conditions the Portfolio will
PORTFOLIO invest in the investments permitted for the Short-Term
Mortgage Portfolio, in mortgage-backed securities that are
privately issued and not guaranteed by the U.S. Government,
its agencies or instrumentalities, and in asset-backed
securities rated in one of the two highest rating categories
for such securities. Under normal conditions, the Portfolio
will invest at least 65% of its total assets in fixed rate
and adjustable rate mortgage-backed securities.
14
<PAGE>
For more information about the mortgage-backed securities in
which the Portfolio may invest, see "Description of
Permitted Investments and Risk Factors."
The maturity of any single instrument held by the
Portfolio is not limited. However, the dollar-weighted
average maturity of the Portfolio will not exceed three
years. The Adviser will seek to maintain a duration of
approximately two years but may, subject to the foregoing
limitation on average maturity, vary the Portfolio's
duration depending upon market conditions. Duration
incorporates a security's yield, coupon interest payments,
final maturity and option features into one measure, and is
computed by determining the weighted average maturity of a
security's cash flows, where the present values of the cash
flows serve as weights. Since the Portfolio ordinarily will
invest in securities with longer maturities than those found
in money market funds, its total return is expected to be
higher and fluctuations in its net asset value are expected
to be greater. In addition, the Portfolio will acquire only
adjustable rate securities that have an interest rate reset
period not exceeding one year.
THE SHORT-TERM The Short-Term Government Portfolio seeks to preserve
GOVERNMENT 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 and instrumentalities of the U.S.
Government, and repurchase agreements involving such
obligations. The Portfolio will have a dollar-weighted
average portfolio maturity of up to three years.
THE The Intermediate-Term Government Portfolio seeks to preserve
INTERMEDIATE- principal value and maintain a high degree of liquidity
TERM GOVERNMENT while providing current income. Under normal conditions the
PORTFOLIO Portfolio invests exclusively in the investments permitted
for the Short-Term Government Portfolio. This Portfolio will
have a dollar-weighted average portfolio maturity of three
to five years.
THE GNMA The GNMA Portfolio seeks to preserve principal value and
PORTFOLIO maintain a high degree of liquidity while providing current
income. Under normal conditions the Portfolio invests
exclusively in the investments permitted for the Short-Term
Government Portfolio, but without restrictions on portfolio
maturity. At least 65% of the total assets of the Portfolio
will, under normal circumstances, be invested in instruments
issued by the Government National Mortgage Association
("GNMA"). In addition, the GNMA Portfolio may enter into
dollar roll transactions with selected banks and broker-
dealers.
For a description of permitted investments, see
"Description of Permitted Investments and Risk Factors."
15
<PAGE>
GENERAL
INVESTMENT
POLICIES __________________________________________________________________
There is no assurance that the investment objective of any
Portfolio will be met.
Each Portfolio may invest up to 10% of its net assets in
illiquid securities, including illiquid restricted
securities. However, restricted securities, including Rule
144A securities and section 4(2) commercial paper, that meet
the criteria established by the Board of Trustees of the
Trust will be considered liquid. In addition, each
Portfolio's investments may include STRIPS ( as defined in
the "Description of Permitted Investments and Risk
Factors").
Each Portfolio may purchase securities on a when-issued
basis.
Each Portfolio may invest in fixed income securities
rated in the fourth highest category by a NRSRO; such
securities, while still investment grade, are considered to
have speculative characteristics.
For temporary defensive purposes during periods when the
Adviser believes that market conditions warrant, any
Portfolio may invest up to 100% of its assets in investments
such as money market instruments (including securities
issued or guaranteed by the U.S. Government, its agencies or
instrumentalities, repurchase agreements, certificates of
deposit and bankers' acceptances issued by banks or savings
and loan associations having net assets of at least $500
million as of the end of their most recent fiscal year) or
other long- and short-term debt instruments which are rated
A or higher by Standard & Poor's Corporation ("S&P") or
Moody's Investors Service, Inc. ("Moody's"), and it also may
hold a portion of its assets in cash or cash equivalents.
During such periods, the Intermediate-Term Government
Portfolio can reduce its average weighted maturity to less
than three years.
Under normal circumstances, it is anticipated that the
annual portfolio turnover rate for each Portfolio will not
exceed 150%. A high turnover rate will result in higher
transaction costs and may result in additional taxes for
shareholders. See "Taxes."
INVESTMENT
LIMITATIONS _______________________________________________________________
The investment objective and investment limitations are
fundamental policies of the Portfolios.
Fundamental policies cannot be changed with respect to
the Trust or a Portfolio without the consent of the holders
of a majority of the Trust's or that Portfolio's outstanding
shares.
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
16
<PAGE>
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 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 obligations issued or guaranteed by the
U.S. Government or its agencies and instrumentalities
(but does apply to mortgage-backed securities of non-
government issuers). For purposes of this limitation,
asset-backed securities secured by truck and auto loan
leases, credit card receivables and home equity loans
each will be considered a separate industry.
3. Borrow money except for temporary or emergency purposes
and then only 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"), a wholly owned subsidiary of SEI
Corporation ("SEI"), and the Trust are parties to a
management agreement (the "Management Agreement"). Under
the terms of the Management Agreement, the Manager is
responsible for (i) providing the Trust with overall
management services, regulatory reporting, all necessary
office space, equipment, personnel and facilities and (ii)
acting as transfer agent, dividend disbursing agent, and
shareholder servicing agent for Class A, Class B and Class
C shares of each Portfolio.
For these services, the Manager is entitled to a fee
which is calculated daily and paid monthly at an annual
rate of .35% of the average daily net assets of each
Portfolio except the GNMA Portfolio, for which the Manager
is entitled to a fee of .32%. The Manager has voluntarily
agreed to waive a portion of its fee in order to limit
total operating expenses on an annualized basis to not more
than .45% of the average daily net assets of Class A, .75%
of the average daily net assets of Class B and .95% of the
average daily net assets of Class C of the Short-Term
Mortgage, Short Duration Mortgage, Short-Term Government
and Intermediate-Term Government Portfolios; .49% of the
average daily net assets of Class A, .79% of the average
daily net assets of Class B and .99% of the average daily
net assets of Class C of the GNMA Portfolio; and to not
more than .35%
17
<PAGE>
of the average daily net assets of Class A, .65% of the
average daily net assets of Class B and .85% of the average
daily net assets of Class C of the Corporate Daily Income
and Government Securities Daily Income Portfolios. The
Manager reserves the right, in its sole discretion, to
terminate this voluntary waiver at any time.
THE ADVISER ____________________________________________________________________
Wellington Management Company ("WMC" or the "Adviser") acts
as the investment adviser for each Portfolio under advisory
agreements with the Trust. WMC is a professional investment
counseling firm which provides investment services to
investment companies, employee benefit plans, endowments,
foundations, and other institutions and individuals. Under
these advisory agreements, the Adviser is responsible for
the investment decisions for the Portfolios and continuously
reviews, supervises and administers their investment
program. The Adviser is independent of the Manager and SEI
and discharges its responsibilities subject to the
supervision of, and policies set by, the Trustees of the
Trust.
John C. Keogh, Senior Vice President of the Adviser,
serves as the portfolio manager for the Corporate Daily
Income, Government Securities Daily Income and Short-Term
Government Portfolios. He has been an investment
professional with the Adviser since 1983. Mr. Keogh has
served as portfolio manager for the Government Securities
Daily Income since its inception in 1993 and has served as
portfolio manager for the Short-Term Government Portfolio
since 1995. Mr. Keogh will also serve as portfolio manager
for the Corporate Daily Income Portfolio upon its inception.
Paul D. Kaplan, Senior Vice President of the Adviser,
serves as the portfolio manager for the GNMA Portfolio. He
has been an investment professional with the Adviser since
1978. Mr. Kaplan has served as portfolio manager for the
GNMA Portfolio since its inception in 1987.
Thomas L. Pappas, Vice President of the Adviser, serves
as the portfolio manager for the Intermediate-Term
Government, Short-Term Mortgage and Short Duration Mortgage
Portfolios. He has been an investment professional with the
Adviser since 1987. Mr. Pappas has served as portfolio
manager for the Intermediate-Term Government and Short-Term
Mortgage Portfolios since 1995. Mr. Pappas will also serve
as portfolio manager for the Short Duration Mortgage
Portfolio upon its inception.
As of March 31, 1995, the Adviser had discretionary
management authority with respect to approximately $
billion of assets, including the assets of the Trust, SEI
Liquid Asset Trust and the Insurance Investment Products
Trust, each an open-end money market investment company. 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. The
principal address of WMC is 75 State Street, Boston, MA
02109. WMC is a Massachusetts general partnership, of which
the following persons are managing partners: Robert W.
Doran, Duncan M.McFarland and John B. Neff.
18
<PAGE>
WMC is entitled to a fee with respect to each Portfolio,
which fee is calculated daily and paid monthly, at an annual
rate of .10% of the average daily net assets of each group
of Portfolios up to $500 million, .075% of such average
daily net assets from $500 million to $1 billion and .05% of
such average daily net assets in excess of $1 billion. For
the purpose of calculating such fees, the Portfolios are
aggregated into the following groups: (i) Corporate Daily
Income and Government Securities Daily Income Portfolios,
(ii) Short-Term Government, Intermediate-Term Government and
GNMA Portfolios and (iii) Short-Term Mortgage and Short
Duration Mortgage Portfolios. The fees are based upon each
group's aggregate average daily net assets, and are
allocated daily among each Portfolio within a group on the
basis of each Portfolio's relative net assets. For the
fiscal year ended January 31, 1995, the Portfolios paid WMC
advisory fees (shown here as a percentage of average daily
net assets, after voluntary fee waivers) as follows:
Corporate Daily Income Portfolio--.08%; Short-Term
Government Portfolio--.08%; Intermediate-Term Government
Portfolio--.08%; and GNMA Portfolio--.08%. In addition, for
the fiscal year ended January 31, 1995, the Short-Term
Mortgage Portfolio paid an advisory fee of .10% of average
daily net assets. Of this advisory fee, .04% of the
Portfolio's total average daily net assets was paid to Bear
Stearns & Co. Inc. and .06% was paid to WMC. The Government
Daily Income Securities and Short Duration Mortgage
Portfolios have not commenced operations as of January 31,
1995.
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 each
Portfolio has a separate distribution plan (the "Class A
Plan", "Class B Plan", "Class C Plan" and "Class D Plan";
collectively, the "Plans") pursuant to Rule 12b-1 under the
Investment Company Act of 1940, as amended (the "1940 Act").
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 Rules of Fair Practice (the
"Rules") of the (National Association & Securities Dealers,
Inc. ("NASD") concerning sales charges.
The Distribution Agreement and Plan for each class
provide for reimbursement of expenses incurred by the
Distributor in an amount not to exceed .30% of a Portfolio's
average daily net assets on an annualized basis, provided
those expenses are permissible as to both type and amount
under a budget, and the Class B and Class C Plans provide
for additional payments for distribution and shareholder
services, as described below. The budget must be approved
and monitored quarterly by the Trustees, including those
Trustees who are not interested persons and have no
financial interest in the Plan or any related agreement
("Qualified Trustees").
19
<PAGE>
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 laws 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 (shown here as a percentage of average daily net
assets) is as follows: Corporate Daily Income--.15%;
Government Securities Daily Income--.06%; Short-Term
Mortgage--.13%; Short Duration Mortgage--.08%; Short-Term
Government--.05%; Intermediate-Term Government--.06%; and
GNMA--.06%. For any given Portfolio, the budget does not
vary from class to class. Distribution expenses not
attributable to a specific portfolio of the Trust are
allocated among each of the portfolios of the Trust based on
average net assets.
The Class B and Class C Plans, in addition to providing
for the reimbursement payments described above, provide for
payments to the Distributor at an annual rate of .30% and
.50%, respectively, of each Portfolio's average daily net
assets attributable to Class B and Class C shares. The Class
D Plan also provides for additional payments to the
Distributor of up to .30% of each Portfolio's average daily
net assets attributable to Class D 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 Class B and
Class C shareholders that provide distribution related
services to their customers.
It is possible that an institution may offer different
classes of shares to its customers and thus receive
compensation with respect to different classes. These
financial institutions may also charge separate fees to
their customers. Certain financial institutions offering
shares to their customers may be required to register as
dealers pursuant to state laws.
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.
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PURCHASE AND
REDEMPTION OF
SHARES _________________________________________________________________________
Financial institutions may acquire 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 for
processing and transmittal of these orders to the Transfer
Agent for effectiveness 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 each Portfolio 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").
Shareholders who desire to purchase shares with cash
must place their orders with the Transfer Agent prior to
4:00 p.m. Eastern time 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
on the next Business Day following the 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.
Shares of the GNMA Portfolio may be purchased in
exchange for securities that are permissible investments of
that Portfolio, subject to the Adviser's and Manager's
determination that the securities are acceptable. Securities
accepted in exchange will be valued at the mean between
their bid and asked quotations.
Purchases will be made in full and fractional shares of
a Portfolio calculated to three decimal places. The Trust
will send shareholders a statement of shares owned after
each transaction. The purchase price of shares is the net
asset value next determined after a purchase order is
received and accepted by the Trust plus, in the case of the
Class D shares of the Portfolios, the applicable sales load.
The net asset value per share of each Portfolio is
determined by dividing the total market value of a
Portfolio's investments and other assets, less any
liabilities, by the total outstanding shares of that
Portfolio. Securities having maturities of 60 days or less
at the time of purchase will be valued using the amortized
cost method (described in the Statement of Additional
Information), which approximates the securities' market
value. Net asset value per share is determined daily as of
4:00 p.m. Eastern time on each Business Day. The market
value of each security is obtained by the Manager from an
independent pricing service. The pricing service may use a
matrix system to determine valuations of equity and fixed
income securities. The pricing
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service may also provide market quotations. Portfolio
securities for which market quotations are available are
valued at the last quoted sale price on each Business Day
or, if there is no such reported sale, at the most recently
quoted bid price. Although the methodology and procedures
are identical, the net asset value of classes within a
Portfolio may differ because of the different Rule 12b-1
fees charged to each class.
Shareholders who desire to redeem shares of a Portfolio
must place their redemption orders with the Transfer Agent
prior to 4:00 p.m. Eastern time 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 redemption 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 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.
PERFORMANCE ____________________________________________________________________
For any Portfolio, the performance on Class A shares will
normally be higher than that on Class B shares of each
Portfolio because of the additional distribution expenses
charged Class B shares. Likewise, the performance on Class B
shares will normally be higher than on Class D shares of a
Portfolio because of the sales load and additional
distribution expenses and transfer agent fees charged to
Class D shares. The performance on Class C shares of a
Portfolio may be lower than the performance on that
Portfolio's Class D shares because of the additional
distribution expenses charged to Class C shares.
From time to time, each Portfolio may advertise yield
and total return. 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 yield of a Portfolio refers to
the income generated by a hypothetical investment, net of
any sales charge imposed in the case of some of the Class D
shares, in such Portfolio over a thirty-day period. This
income is then "annualized," i.e. the income over thirty
days is assumed to be generated over one year and is shown
as a percentage of the investment.
The total return of a Portfolio refers to the average
compounded rate of return on a hypothetical investment for
designated time periods, assuming that the entire investment
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is redeemed at the end of each period and assuming the
reinvestment of all dividend and capital gain distributions.
A Portfolio may periodically compare its performance to
that of other mutual funds tracked by mutual fund rating
services (such as Lipper Analytical) or financial and
business publications and periodicals, broad groups of
comparable mutual funds, unmanaged indices which may assume
investment of dividends but generally do not reflect
deductions for administrative and management costs or to
other investment alternatives. A Portfolio may quote
Morningstar, Inc., a service that ranks mutual funds on the
basis of risk-adjusted performance. A Portfolio may use
long-term performance of these capital markets to
demonstrate general long-term risk versus reward scenarios
and could include the value of a hypothetical investment in
any of the capital markets. A Portfolio may also quote
financial and business publications and periodicals as they
relate to fund management, investment philosophy and
investment techniques.
A Portfolio may quote various measures of volatility and
benchmark correlation in advertising and may compare these
measures to those of other funds. Measures of volatility
attempt to compare historical share price fluctuations or
total returns to a benchmark while measures of benchmark
correlation indicate how valid a comparative benchmark might
be. Measures of volatility and correlation are calculated
using averages of historical data and cannot be calculated
precisely.
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. Accordingly, shareholders
are urged to consult their tax advisers regarding specific
questions as to federal, state and local income taxes. State
and local tax consequences of an investment in a Portfolio
may differ from the federal income tax consequences
described below. Additional information concerning taxes is
set forth in the Statement of Additional information.
Tax Status of Each Portfolio is treated as a separate entity for federal
the Portfolios income tax purposes and is not combined with the Trust's
other portfolios. Each Portfolio intends to continue to
qualify for the special tax treatment afforded regulated
investment companies ("RICs") under Subchapter M of the
Internal Revenue Code of 1986, as amended, (the "Code") 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 gains 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
23
<PAGE>
shares) and will not qualify for the corporate dividends-
received deduction. Distributions of net capital gains are
taxable to shareholders as long-term capital gains. The
Portfolios provide annual reports to shareholders of the
federal income tax status of all distributions.
Each Portfolio intends to make sufficient distributions
to avoid liability for the federal excise tax.
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.
Income received on direct U.S. Government obligations is
exempt from tax at the state level when received directly
and may be exempt, depending on the state, when received by
a shareholder from a Portfolio provided certain conditions
are satisfied. 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.
With respect to investments such as 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
accreted interest on such obligations even though such
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.
Sale, 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 March 15, 1982. The
Declaration of Trust permits the Trust to offer separate
portfolios of shares and different classes of each
portfolio. In addition to the Portfolios, the Trust consists
of the following portfolios: Money Market Portfolio, Prime
Obligation Portfolio, Government Portfolio, Government II
Portfolio, Treasury Portfolio, Treasury II Portfolio and
Federal Securities Portfolio. All consideration received by
the Trust for shares of any portfolio and all assets of such
portfolio belong to that portfolio and would be 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 materials and
reports to shareholders, costs of custodial services and
registering the shares under state and federal
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<PAGE>
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.
Reporting The Trust issues unaudited financial information 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 E. Swedesford Road,
Wayne, PA 19087.
Dividends Substantially all of the net investment income (exclusive of
capital gains) of each Portfolio is distributed in the form
of monthly dividends. Dividends are determined and declared
on each Business Day as a dividend for shareholders of
record as of the close of business on that day. Dividends
are paid by the Portfolios in federal funds or in additional
shares at the discretion of the shareholder on the first
Business Day of each month. The dividends on Class A shares
are normally higher than those on Class B shares of each
Portfolio because of the additional distribution expenses
charged to Class B shares. Likewise, the dividends on Class
B shares are normally higher than those on Class D shares of
a Portfolio because of the additional distribution expenses
charged to Class D shares, and the dividends on Class D
shares are normally higher than those on Class C shares of
each Portfolio because of the additional distribution
expenses charged to Class C shares.
Counsel and Morgan, Lewis & Bockius serves as counsel to the Trust.
Independent Arthur Andersen LLP serves as the independent public
Accountants accountants of the Trust.
Custodian and CoreStates Bank, N.A., Broad and Chestnut Streets, P.O. Box
Wire Agent 7618, Philadelphia, PA 19101 (the "Custodian"), acts as
custodian and wire agent of the assets of the Portfolios.
The Custodian holds cash, securities and other assets of the
Trust as required by the 1940 Act.
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DESCRIPTION
OF PERMITTED
INVESTMENTS
AND RISK FACTORS _______________________________________________________________
The following is a description of the permitted investment
practices for the Portfolios, and the associated risk
factors:
Commercial Commercial paper is a term used to describe unsecured short-
Paper term promissory notes issued by banks, municipalities,
corporations and other entities. Maturities on these issues
vary from a few to 270 days.
Dollar Roll Dollar rolls are transactions in which securities are sold
Transactions for delivery in the current month and the seller
simultaneously contracts to repurchase substantially similar
securities on a specified future date. Any difference
between the sale price and the purchase price is netted
against the interest income foregone on the securities sold
to arrive at an implied borrowing rate. Alternatively, the
sale and purchase transactions can be executed at the same
price, with a Portfolio being paid a fee as consideration
for entering into the commitment to purchase. Dollar rolls
may be renewed prior to cash settlement and initially may
involve only a firm commitment agreement by a Portfolio to
buy a security. If the broker-dealer to whom a Portfolio
sells the security becomes insolvent, a Portfolio's right to
repurchase the security may be restricted. Other risks
involved in entering into dollar rolls include the risk that
the value of the security may change adversely over the term
of the dollar roll and that the security a Portfolio is
required to repurchase may be worth less than the security
the Portfolio originally held.
Fixed Income Fixed income securities are debt obligations issued by
Securities corporations, municipalities and other borrowers. The market
value of fixed income investments will generally change in
response to interest rate changes and other factors. During
periods of falling interest rates, the values of outstanding
fixed income securities generally rise. Conversely, during
periods of rising interest rates, the values of such
securities generally decline. Moreover, while securities
with longer maturities tend to produce higher yields, the
prices of longer maturity securities are also subject to
greater market fluctuations as a result of changes in
interest rates. Changes by recognized agencies in the rating
of any fixed income security and in the ability of an issuer
to make payments of interest and principal will also affect
the value of these investments. Changes in the value of
portfolio securities will not affect cash income derived
from these securities but will affect a Portfolio's net
asset value.
Illiquid Illiquid securities are securities which cannot be disposed
Securities of within seven business days at approximately the price at
which they are being carried on a Portfolio's books. An
illiquid security includes a demand instrument with a demand
notice period exceeding seven days, when there is no
secondary market for such security, and repurchase
agreements with maturities over seven days in length.
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<PAGE>
Mortgage-Backed Mortgage-backed securities are instruments that entitle the
Securities holder to a share of all interest and principal payments
from mortgages underlying the security. The mortgages
backing these securities include conventional thirty-year
fixed-rate mortgages, graduated payment mortgages, and
adjustable rate mortgages. During periods of declining
interest rates, prepayment of mortgages underlying mortgage-
backed securities can be expected to accelerate. Prepayment
of mortgages which underlie securities purchased at a
premium often results in capital losses, while prepayment of
mortgages purchased at a discount often results in capital
gains. Because of these unpredictable prepayment
characteristics, it is often not possible to predict
accurately the average life or realized yield of a
particular issue.
Government Pass-Through Securities: These are securities
that are issued or guaranteed by a U.S. Government agency
representing an interest in a pool of mortgage loans. The
primary issuers or guarantors of these mortgage-backed
securities are GNMA, FNMA and FHLMC. FNMA and FHLMC
obligations are not backed by the full faith and credit of
the U.S. Government as GNMA certificates are, but FNMA and
FHLMC securities are supported by the instrumentalities'
right to borrow from the U.S. Treasury. GNMA, FNMA and FHLMC
each guarantees timely distributions of interest to
certificate holders. GNMA and FNMA also each guarantees
timely distributions of scheduled principal. FHLMC has in
the past guaranteed only the ultimate collection of
principal of the underlying mortgage loan; however, FHLMC
now issues mortgage-backed securities (FHLMC Gold PCs) which
also guarantee timely payment of monthly principal
reductions. Government and private guarantees do not extend
to the securities' value, which is likely to vary inversely
with fluctuations in interest rates.
Private Pass-Through Securities: These are mortgage-
backed securities issued by a non-governmental entity, such
as a trust. These securities include collateralized mortgage
obligations ("CMOs") and real estate mortgage investments
conduits ("REMICs") that are rated in one of the top two
rating categories. While they are generally structured with
one or more types of credit enhancement, private pass-
through securities typically lack a guarantee by an entity
having the credit status of a governmental agency or
instrumentality.
Collateralized Mortgage Obligations ("CMOs"): CMOs are
debt obligations or multiclass pass-through certificates
issued by agencies or instrumentalities of the U.S.
Government or by private originators or investors in
mortgage loans. In a CMO, series of bonds or certificates
are usually issued in multiple classes. Principal and
interest paid on the underlying mortgage assets may be
allocated among the several classes of a series of a CMO in
a variety of ways. Each class of a CMO, often referred to as
a "tranche," is issued with a specific fixed or floating
coupon rate and has a stated maturity or final distribution
date. Principal payments on the underlying mortgage assets
may cause CMOs to be retired substantially earlier than
their stated maturities or final distribution dates,
resulting in a loss of all or part of any premium paid.
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<PAGE>
REMICs: A REMIC is a CMO that qualifies for special tax
treatment under the Internal Revenue Code and invests in
certain mortgages principally secured by interests in real
property. Investors may purchase beneficial interests in
REMICs, which are known as "regular" interests, or
"residual" interests. Guaranteed REMIC pass-through
certificates ("REMIC Certificates") issued by FNMA or FHLMC
represent beneficial ownership interests in a REMIC trust
consisting principally of mortgage loans or FNMA, FHLMC or
GNMA-guaranteed mortgage pass-through certificates. For
FHLMC REMIC Certificates, FHLMC guarantees the timely
payment of interest, and also guarantees the payment of
principal as payments are required to be made on the
underlying mortgage participation certificates. FNMA REMIC
Certificates are issued and guaranteed as to timely
distribution of principal and interest by FNMA.
Parallel Pay Securities: PAC Bonds: Parallel pay CMOs
and REMICs are structured to provide payments of principal
on each payment date to more than one class. These
simultaneous payments are taken into account in calculating
the stated maturity date or final distribution date of each
class, which must be retired by its stated maturity date or
final distribution date, but may be retired earlier. Planned
Amortization Class CMOs ("PAC Bonds") generally require
payments of a specified amount of principal on each payment
date. PAC Bonds are always parallel pay CMOs with the
required principal payment on such securities having the
highest priority after interest has been paid to all
classes.
REITs: REITs are trusts that invest primarily in
commercial real estate or real estate-related loans. The
value of interests in REITs may be affected by the value of
the property owned or the quality of the mortgages held by
the trust.
Stripped Mortgage-Backed Securities ("SMBs"): SMBs are
usually structured with two classes that receive specified
proportions of the monthly interest and principal payments
from a pool of mortgage securities. One class may receive
all of the interest payments and is thus termed an interest-
only class ("IO"), while the other class may receive all of
the principal payments and is thus termed the principal-only
class ("PO"). The value of IOs tends to increase as rates
rise and decrease as rates fall; the opposite is true of
POs. SMBs are extremely sensitive to changes in interest
rates because of the impact thereon of prepayment of
principal on the underlying mortgage securities can
experience wide swings in value in response to changes in
interest rates and associated mortgage prepayment rates.
During times when interest rates are experiencing
fluctuations, such securities can be difficult to price on a
consistent basis. The market for SMBs is not as fully
developed as other markets; SMBs therefore may be illiquid.
Risk Factors: Due to the possibility of prepayments of the
underlying mortgage instruments, mortgage-backed securities
generally do not have a known maturity. In the absence of a
known maturity, market participants generally refer to an
estimated average life. An average life estimate is a
function of an assumption regarding anticipated prepayment
patterns, based upon current interest rates, current
conditions in the relevant housing markets and other
factors. The assumption is necessarily subjective, and thus
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<PAGE>
different market participants can produce different average
life estimates with regard to the same security. There can
be no assurance that estimated average life will be a
security's actual average life.
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 within a number of days from the date of purchase.
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
rights to dispose of the collateral securities 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.
U.S. Government Obligations issued or guaranteed by agencies of the U.S.
Agencies Government, including, among others, the Federal Farm Credit
Bank, the Federal Housing Administration and the Small
Business Administration, and obligations issued or
guaranteed by instrumentalities of the U.S. Government,
including, among others, the Federal Home Loan Mortgage
Corporation, the Federal Land Banks and the U.S. Postal
Service. Some of these securities are supported by the full
faith and credit of the U.S. Treasury (e.g., Government
National Mortgage Association), others are supported by the
right of the issuer to borrow from the Treasury (e.g.,
Federal Farm Credit Bank), while 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 on the
obligation prior to maturity. Guarantees as to the timely
payment of principal and interest do not extend to the value
or yield of these securities nor to the value of the
Portfolio's shares.
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 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 fixed income securities. See also "Taxes."
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When-Issued and
Delayed
Delivery When-issued or delayed delivery basis transactions involve
Securities the purchase of an instrument with payment and delivery
including TBA taking place in the future. Delivery of and payment for
Mortgage-Backed these securities may occur a month or more after the date of
Securities 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 it deems appropriate.
One form of when-issued or delayed-delivery security that a
Portfolio may purchase is a "to be announced" ("TBA")
mortgage-backed security. A TBA mortgage-backed security
transaction arises when a mortgage-backed security, such as
a GNMA pass-through security, is purchased or sold with the
specific pools that will constitute that GNMA pass-through
security to be announced on a future settlement date.
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TABLE OF CONTENTS
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
Expense Summary.......................................................... 2
Financial Highlights..................................................... 5
The Trust................................................................ 13
Investment Objectives and Policies....................................... 13
General Investment Policies.............................................. 16
Investment Limitations................................................... 16
The Manager and Shareholder Servicing Agent.............................. 17
The Adviser.............................................................. 18
Distribution............................................................. 19
Purchase and Redemption of Shares........................................ 21
Performance.............................................................. 22
Taxes.................................................................... 23
General Information...................................................... 24
Description of Permitted Investments and Risk Factors.................... 26
</TABLE>
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PROSPECTUS
MAY 31, 1994
--------------------------------------------------------------------------------
SHORT-TERM GOVERNMENT PORTFOLIO
INTERMEDIATE-TERM GOVERNMENT PORTFOLIO
GNMA 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 May 31, 1995 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 Daily Income Trust (the "Trust") is a mutual fund that offers a convenient
means of investing in one or more professionally managed diversified portfolios
of securities. Class D shares differ from other classes of the Trust primarily
in the imposition of sales charges and 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 three fixed income portfolios (the "Portfolios,"
and each of these, a "Portfolio") listed above.
--------------------------------------------------------------------------------
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 TRUST'S 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>
HOW TO READ THIS PROSPECTUS ____________________________________________________
This Prospectus gives you information that you should know about the Portfolios
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.
PORTFOLIO HIGHLIGHTS ___________________________________________________________
The following summary provides basic information about the Class D shares of
the Trust's Short-Term Government Portfolio, Intermediate-Term Government
Portfolio and GNMA 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 Short-Term Government, Intermediate-Term Government and
OBJECTIVES AND GNMA Portfolios seek to preserve principal value and maintain
POLICIES a high degree of liquidity while providing current income by
investing in U.S. Treasury obligations, U.S. Government
agency obligations and repurchase agreements involving any of
these obligations. See "Investment Objectives and Policies"
and "Description of Permitted Investments and Risk Factors."
UNDERSTANDING Shares of each Portfolio, like shares of any mutual fund,
RISK will fluctuate in value and when you sell your shares,
they may be worth more or less than what you paid for them.
The value of fixed income funds and the fixed income
securities in which they invest tend to vary inversely with
interest rates and may be affected by other market and
economic factors. In addition, there is no assurance that any
Portfolio will achieve its investment objective. See
"Investment Objectives and Policies" and "Description of
Permitted Investments and Risk Factors."
MANAGEMENT Wellington Management Company (the "Adviser") serves
PROFILE as the investment adviser of the Portfolios. 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"). Supervised Service Company ("SSC") serves as
transfer agent (the "Transfer Agent") and dividend disbursing
agent for the Class D shares of the Trust. SEI Financial
Services Company acts as distributor (the "Distributor") of
the Trust's shares. See "The Manager and Shareholder Servicing
Agent," "Distribution" and "The Adviser."
TABLE OF
CONTENTS
<TABLE>
<S> <C>
Portfolio Highlights...... 2
Portfolio Expenses........ 4
Financial Highlights...... 5
Your Account and Doing
Business with Us......... 6
Investment Objectives and
Policies................. 9
General Investment
Policies................. 10
Investment Limitations.... 11
The Manager and
Transfer Agent........... 11
The Adviser............... 12
Distribution.............. 13
Performance............... 15
Taxes..................... 16
Additional Information
About Doing Business With
Us....................... 17
General Information....... 21
Description of Permitted
Investments and Risk
Factors.................. 23
</TABLE>
2
<PAGE>
YOUR ACCOUNT You may open an account with just $1,000 and make additional
AND DOING investments with as little as $100. Class D shares of a
BUSINESS WITH Portfolio are offered at net asset value per share plus a
US maximum sales charge at the time of purchase of 3.50% for the
Short-Term Government and Intermediate-Term Government
Portfolios and 4.50% for the GNMA Portfolio. Shareholders who
purchase larger amounts may qualify for a reduced sales
charge. Redemptions of a Portfolio's shares are made at net
asset value per share. See "Purchase of Shares" and
"Redemption of Shares."
DIVIDENDS 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. Any realized net capital gain
is distributed at least annually. Distributions are paid in
additional shares unless the shareholder elects to take the
payment in cash. See "Dividends."
INFORMATION/ For more information about Class D shares of the Portfolios
SERVICE call 1-800-437-6016.
CONTACTS
[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
themselves within their areas of specialization are selected to advise our
mutual funds.
3
<PAGE>
PORTFOLIO EXPENSES _____________________________________________________________
The purpose of the following table is to help you understand the various costs
and expenses that you, as a shareholder, will bear directly or indirectly in
connection with an investment in the Class D shares of a Portfolio.
SHAREHOLDER TRANSACTION EXPENSES (as a percentage of offering price)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHORT-TERM INTERMEDIATE-TERM
GOVERNMENT GOVERNMENT GNMA
PORTFOLIO PORTFOLIO PORTFOLIO
---------- ----------------- ---------
<S> <C> <C> <C>
Maximum Sales Charge Imposed on Pur-
chases 3.50% 3.50% 4.50%
Maximum Sales Charge Imposed on Rein-
vested Dividends none none none
Redemption Fees (1) none none none
ANNUAL OPERATING EXPENSES (as a percentage of average net assets)
-----------------------------------------------------------------------------
Management/Advisory Fees (after fee
waiver) (2) .37% .37% .40%
12b-1 Fees (3) .30% .30% .30%
Other Expenses (after fee waivers) .18% .18% .19%
-----------------------------------------------------------------------------
Total Operating Expenses (after fee
waiver) (4) (5) .85% .85% .89%
-----------------------------------------------------------------------------
</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 waived, on a voluntary basis, a portion of its fee, and the
management/advisory fees shown reflect this voluntary waiver. The Manager
reserves the right to terminate its waiver at any time in its sole
discretion. Absent such waiver, the management/advisory fees for the Short-
Term Government and Intermediate-Term Government Portfolios would be .44%
and for the GNMA Portfolio would be .41%.
(3) The 12b-1 fees shown reflect both the current 12b-1 budget for
reimbursement of expenses and the Distributor's voluntary waiver of a
portion of its compensatory fee. The Distributor reserves the right to
terminate its waiver at any time in its sole discretion. The maximum 12b-1
fees payable by the Class D shares for each Portfolio are .60%.
(4) Total operating expenses for the GNMA Portfolio have been restated to
reflect a reduction in the fee waivers.
(5) Absent the voluntary fee waivers described above, total operating expenses
for Class D shares of the Short-Term Government and Intermediate-Term
Government Portfolios would be .92% and of the GNMA Portfolio would be
.90%.
EXAMPLE
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
1 YR. 3 YRS. 5 YRS. 10 YRS.
------ ------ ------ -------
<S> <C> <C> <C> <C>
An investor in the Portfolio 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:
Short-Term Government Portfolio $43.00 $61.00 $80.00 $136.00
Intermediate-Term Government Portfolio $43.00 $61.00 $80.00 $136.00
GNMA Portfolio $54.00 $72.00 $92.00 $150.00
------------------------------------------------------------------------------
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
The purpose of the expense table and example 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 each Portfolio. 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 Class D shares. Each Portfolio also offers Class A, Class B
and Class C shares, which are subject to the same expenses, except that 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," "Distribution" and "The Adviser."
The rules of the Securities and Exchange Commission require that the maximum
sales charge be reflected in the above table. However, certain investors may
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 charges otherwise permitted by the Rules of Fair Practice (the
"Rules") of the National Association of Securities Dealers, Inc. ("NASD").
4
<PAGE>
FINANCIAL HIGHLIGHTS ___________________________________________________________
The following information has been audited by Arthur Andersen LLP, the Trust's
independent public accountants, as indicated in their report dated March 8,
1995 on the Trust's financial statements as of January 31, 1995 included in the
Trust's Statement of Additional Information under "Financial Information."
Additional performance information is set forth in the 1995 Annual Report to
shareholders and is available upon request and without charge by calling 1-800-
437-6016. Class D shares of the Short-Term Government Portfolio were not
offered as of the most recent fiscal year end. This table should be read in
conjunction with the Trust's financial statements and notes thereto.
FOR A CLASS D SHARE OUTSTANDING THROUGHOUT THE PERIOD
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Intermediate-Term
Government GNMA
Portfolio Portfolio
--------------------- --------------------
9/26/93 9/30/93
to to
1995 (3) 1/31/94 (2) 1995 1/31/94 (1)
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period $10.13 $10.44 $10.09 $10.22
-------------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income 0.47 0.17 0.61 0.19
Net Realized and Unrealized Gains
(Losses) on Securities (0.74) (0.10) (0.93) (0.04)
-------------------------------------------------------------------------------
Total from Investment Operations $(0.27) $0.07 $(0.32) $0.15
-------------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment
Income (0.47) (0.17) (0.61) (0.19)
Distributions from Realized
Capital Gains (0.07) (0.21) -- (0.09)
-------------------------------------------------------------------------------
Total Distributions $(0.54) $(0.38) $(0.61) $(0.28)
-------------------------------------------------------------------------------
Net Asset Value, End of Period $9.32 $10.13 $9.16 $10.09
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Total Return (3) (2.61)% 1.52% (3.04)% 4.24%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net Assets End of Period (000) $99 $107 $169 $133
Ratio of Expenses to Average Net
Assets 0.84% 0.75% 0.86% 0.75%
Ratio of Expenses to Average Net
Assets (excluding waivers) 0.92% 0.83% 0.89% 0.80%
Ratio of Net Investment Income to
Average Net Assets 4.80% 4.94% 6.54% 6.06%
Ratio of Net Investment Income to
Average Net Assets (excluding
waivers) 4.72% 4.86% 6.51% 6.01%
Portfolio Turnover Rate 61% 56% 85% 70%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
</TABLE>
(1) Class D of the GNMA Portfolio commenced operations on September 30, 1993.
All ratios including total return for that period have been annualized.
(2) Class D of the Intermediate-Term Government Portfolio commenced operations
on September 26, 1993. All ratios including total return for that period
have been annualized.
(3) Total return does not reflect the sales charge on Class D shares.
5
<PAGE>
YOUR ACCOUNT AND DOING BUSINESS WITH US ________________________________________
Class D shares of the Portfolios 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, SELL Class D shares of the Portfolios may be purchased through
AND EXCHANGE Intermediaries that provide various levels of shareholder
SHARES THROUGH services to their customers. Contact your Intermediary for
INTERMEDIARIES information about the services available to you and for
specific instructions on how to buy, sell and exchange shares.
To allow for processing and transmittal of orders to the
Distributor 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 Account Application forms can be obtained by calling 1-800-
SHARES FROM THE 437-6016. Class D shares of the Portfolio are offered only to
DISTRIBUTOR residents of states in which the shares are eligible for
purchase.
Opening an You may buy Class D shares by mailing a completed application
Account and a check (or other negotiable bank instrument or money
By Check order) payable to "Class D (Portfolio Name)." 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. The AIP is subject to account minimum initial
purchase amounts and minimum balance maintenance
requirements.
[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 agreement with the
Distributor to sell Class D shares of the Portfolios to their customers.
6
<PAGE>
OTHER Your purchase is subject to a sales charge which varies
INFORMATION depending on the size of your purchase and the Portfolio
ABOUT BUYING shares that you are purchasing. The following table shows
SHARES the regular sales charges on Class D shares of each
Portfolio to a "single purchaser", together with the
Sales Charges reallowance paid to dealers and the agency commission paid
to brokers (collectively the "commission"):
SHORT-TERM GOVERNMENT PORTFOLIO
INTERMEDIATE-TERM GOVERNMENT PORTFOLIO
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------
SALES CHARGE REALLOWANCE AND
SALES CHARGE AS AS APPROPRIATE BROKER COMMISSION
A PERCENTAGE OF PERCENTAGE OF AS A PERCENTAGE OF
AMOUNT OF PURCHASE OFFERING PRICE NET AMOUNT INVESTED OFFERING PRICE
----------------------------------------------------------------------------------------
<S> <C> <C>
(less than) $50,000 3.50% 3.63% 3.00%
$50,000 (less than) $100,000 3.00% 3.09% 2.50%
$100,000 (less than) $250,000 2.50% 2.56% 2.00%
$250,000 (less than) $500,000 2.00% 2.04% 1.50%
$500,000 (less than) $1,000,000 1.50% 1.52% 1.25%
$1,000,000 (less than) $2,000,000 1.00% 1.01% 1.00%
$2,000,000 (less than) $4,000,000 .50% .50% .50%
Over $4,000,000 none none none
-----------------------------------------------------------------------------------------
GNMA PORTFOLIO
-----------------------------------------------------------------------------------------
(less than) $50,000 4.50% 4.71% 4.00%
$50,000 (less than) $100,000 4.00% 4.17% 3.50%
$100,000 (less than) $250,000 3.50% 3.63% 3.00%
$250,000 (less than) $500,000 2.50% 2.56% 2.00%
$500,000 (less than) $1,000,000 2.00% 2.04% 1.75%
$1,000,000 (less than) $2,000,000 1.00% 1.01% 1.00%
$2,000,000 (less than) $4,000,000 .50% .50% .50%
Over $4,000,000 none none none
-----------------------------------------------------------------------------------------
</TABLE>
The commissions shown in the table above apply to sales
through Intermediaries. Under certain circumstances,
commissions up to the amount of the entire sales charge may
be re-allowed to certain Intermediaries, who might then be
deemed to be "underwriters" under the Securities Act of
1933, as amended. Commission rates may vary among the
Portfolios.
Rights of Rights of Accumulation allow you, under certain
Accumulation circumstances, to combine your current purchase with the
current market value of previously purchased shares of that
Portfolio and Class D shares of other portfolios ("Eligible
Portfolios") in order to obtain a reduced sales charge.
Letter of A Letter of Intent allows you, under certain circumstances,
Intent to aggregate anticipated purchases over a 13-month period to
obtain a reduced sales charge.
7
<PAGE>
Sales Charge Certain shareholders may qualify for a sales charge waiver.
Waiver To determine whether or not you qualify for a sales charge
waiver see "Additional Information about Doing Business with
Us." Shareholders who qualify for a sales charge waiver must
notify the Transfer Agent before purchasing shares.
EXCHANGING Once payment for your shares has been received and accepted
SHARES (i.e., an account has been established), you may exchange
some or all of your shares for Class D shares of other
When Can You portfolios. Exchanges are made at net asset value plus any
Exchange applicable sales charge.
Shares?
When Do Sales Portfolios that are not money market portfolios currently
Charges Apply impose a sales charge on Class D shares. If you exchange into
to an one of these "non-money market" portfolios, you will have to
Exchange? 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" portfolio
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 portfolios'
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 sixty 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.
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.
[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.
8
<PAGE>
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, who will
subtract a wire redemption charge (presently $10.00) from the
amount of the redemption.
Systematic You may establish a SWP account with a $10,000 minimum
Withdrawal balance. Under the plan, redemptions can be automatically
Plan ("SWP") processed from accounts (monthly, quarterly, semi-annually or
annually) by check or by ACH with a minimum redemption amount
of $50.
INVESTMENT
OBJECTIVES AND
POLICIES _______________________________________________________________________
SHORT-TERM The investment objective of the Short-Term Government
GOVERNMENT Portfolio is to preserve principal value and maintain a high
PORTFOLIO degree of liquidity while providing current income.
Under normal conditions, the Short-Term Government
Portfolio invests exclusively in U.S. Treasury obligations,
obligations issued or guaranteed as to principal and interest
by the agencies and instrumentalities of the U.S. Government
and repurchase agreements involving such obligations. The
Portfolio will have a dollar-weighted average portfolio
maturity of up to three years.
INTERMEDIATE- The investment objective of the Intermediate-Term Government
TERM Portfolio is to preserve principal value and maintain a high
GOVERNMENT degree of liquidity while providing current income.
PORTFOLIO Under normal conditions, the Intermediate-Term Government
Portfolio invests exclusively in U.S. Treasury obligations,
obligations issued or guaranteed as to principal and interest
by the agencies and instrumentalities of the U.S. Government
and repurchase agreements involving such obligations. The
Portfolio will have a dollar-weighted average portfolio
maturity of three to five years.
[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.
9
<PAGE>
GNMA PORTFOLIO The investment objective of the GNMA Portfolio is to preserve
principal value and maintain a high degree of liquidity while
providing current income.
Under normal conditions, the GNMA Portfolio invests
exclusively in U.S. Treasury obligations, obligations issued
or guaranteed as to principal and interest by the agencies and
instrumentalities of the U.S. Government and repurchase
agreements involving such obligations. In addition, the GNMA
Portfolio may enter into dollar roll transactions with
selected banks and broker-dealers. The Portfolio has no
restrictions on its portfolio maturity. At least 65% of the
total assets of the Portfolio will, under normal
circumstances, be invested in instruments issued by the
Government National Mortgage Association ("GNMA").
For additional information regarding the permitted
investments of the Portfolios, see the "Description of
Permitted Investments and Risk Factors" in this Prospectus
and in the Statement of Additional Information.
GENERAL INVESTMENT POLICIES ____________________________________________________
There is no assurance that the investment objective of any
Portfolio will be met.
Each Portfolio may invest up to 10% of its net assets in
illiquid securities, including illiquid restricted
securities. However, restricted securities, including Rule
144A securities and Section 4(2) commercial paper, that meet
the criteria established by the Board of Trustees of the
Trust will be considered liquid. In addition, each Portfolio
may invest in STRIPS (as defined in the "Description of
Permitted Investments and Risk Factors").
Each Portfolio may purchase securities on a when-issued
basis.
Each Portfolio may invest in fixed income securities
rated in the fourth highest category by a nationally
recognized statistical rating organization ("NRSRO"); such
securities, while still investment grade, are considered to
have speculative characteristics.
For temporary defensive purposes during periods when the
Adviser believes that market conditions warrant, each
Portfolio may invest up to 100% of its assets in investments
such as money market instruments (consisting of securities
issued or guaranteed by the U.S. Government, its agencies or
instrumentalities, repurchase agreements, certificates of
deposit and bankers' acceptances issued by banks or savings
and loan associations having net assets of at least $500
million as of the end of their most recent fiscal year),
other long- and short-term debt instruments which are rated
A or higher by Standard & Poor's Corporation ("S&P") or
Moody's Investors Service, Inc.
[SYMBOL APPEARS HERE]
WHAT ARE
INVESTMENT
OBJECTIVES AND
POLICIES?
A 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 each Portfolio invests.
10
<PAGE>
("Moody's"), and also may hold a portion of its assets in
cash or cash equivalents. During such periods, the
Intermediate-Term Government Portfolio can reduce its
average weighted maturity to less than three years.
As a result of the Portfolio's investment strategies, the
annual portfolio turnover rate for each Portfolio is
expected to be over 150%. A high turnover rate will result
in higher transaction costs and may result in additional
taxes for shareholders. See "Taxes."
INVESTMENT LIMITATIONS _________________________________________________________
The investment objective and investment limitations are
fundamental policies of the Portfolios. Fundamental policies
cannot be changed with respect to the Trust or a Portfolio
without the consent of the holders of a majority of the
Trust's or that Portfolio's outstanding shares.
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 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 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 TRANSFER AGENT ____________________________________________
SEI Financial Management Corporation (the "Manager"), a
wholly owned subsidiary of SEI Corporation ("SEI"), and the
Trust are parties to a management agreement (the "Management
Agreement"). Under the terms of the Management Agreement,
the Manager
11
<PAGE>
is responsible for providing the Trust with overall
management services, regulatory reporting, all necessary
office space, equipment, personnel, and facilities, and for
acting as shareholder servicing agent.
For these services, the Manager is entitled to a fee which
is calculated daily and paid monthly at an annual rate of
.35% of the average daily net assets of the Short-Term
Government and Intermediate-Term Government Portfolios and
.32% of the average daily net assets of the GNMA Portfolio.
The Manager has voluntarily agreed to waive a portion of its
fee in order to limit the total operating expenses to not
more than .85% of the average daily net assets of the Class D
shares of the Short-Term Government and Intermediate-Term
Government Portfolios and to not more than .85% of the
average daily net assets of the Class D shares of the GNMA
Portfolio on an annualized basis. The Manager reserves the
right, in its sole discretion, to terminate this waiver at
any time.
The Trust and Supervised Service Company, 811 Main Street,
Kansas City, MO 64105, have entered into a separate transfer
agent agreement with respect to the Class D shares of each
Portfolio. Under this agreement, Supervised Service Company
acts as the transfer and dividend disbursing agent (the
"Transfer Agent") for the Class D shares of the Trust.
THE ADVISER ____________________________________________________________________
Wellington Management Company ("WMC" or the "Adviser") acts
as the investment adviser for the Portfolios under an
advisory agreement (the "Advisory Agreement") with the Trust.
WMC is a professional investment counseling firm which
provides investment services to investment companies,
employee benefit plans, endowments, foundations, and other
institutions and individuals. Under the Advisory Agreement
with the Trust, the Adviser makes the investment decisions
for the Portfolios and continuously reviews, supervises and
administers each Portfolio's investments program. The Adviser
is independent of the Manager and SEI and discharges its
responsibilities, subject to the supervision of, and policies
set by, the Trustees of the Trust.
John C. Keogh, Senior Vice President of the Adviser, serves
as the portfolio manager for the Short-Term Government
Portfolio. He has been an investment professional with the
Adviser since 1983. Mr. Keogh has served as portfolio manager
for the Short-Term Government Portfolio since 1995. Paul D.
Kaplan, Senior Vice President of the Adviser, serves as the
portfolio manager for the GNMA Portfolio. He has been an
investment professional with the Adviser since 1978. Mr.
Kaplan has served as portfolio manager for
[SYMBOL APPEARS HERE]
INVESTMENT
ADVISER
A Portfolio's investment adviser manages the investment activities and is
responsible for the performance of the Portfolio. The adviser conducts
investment research, executes investment strategies based on an assessment of
economic and market conditions, and determines which securities to buy, hold
or sell.
12
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the GNMA Portfolio since its inception in 1987. Thomas L.
Pappas, Vice President of the Adviser, serves as the
portfolio manager for the Intermediate-Term Government
Portfolio. He has been an investment professional with the
Adviser since 1987. Mr. Pappas has served as portfolio
manager for the Intermediate-Term Government Portfolio since
1995.
As of March 31, 1995, the Adviser had discretionary
management authority with respect to approximately $
billion of assets, including the assets of the Trust, SEI
Liquid Asset Trust and the Insurance Investment Products
Trust, each an open-end money market investment company. 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. The
principal address of WMC is 75 State Street, Boston, MA
02109. 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 .10% of the
combined average daily net assets of the Portfolios up to
$500 million, .075% of such assets from $500 million to $1
billion and .05% of such net assets in excess of $1 billion.
Such fees are allocated daily among the Portfolios on the
basis of their relative net assets. For the fiscal year
ended January 31, 1995, the Portfolios each paid WMC
advisory fees of .078%.
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 each
Portfolio has a separate distribution plan (the "Class A
Plan", "Class B Plan", "Class C Plan" and "Class D Plan";
collectively, the "Plans") pursuant to Rule 12b-1 under the
Investment Company Act of 1940, as amended (the "1940 Act").
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 Rules of Fair Practice (the
"Rules") of the National Association of Securities Dealers,
Inc. ("NASD") concerning sales charges.
The Distribution Agreement and the Plan for each class
provide for reimbursement of expenses incurred by the
Distributor in an amount not to exceed .30% of each
Portfolio's average daily net assets on an annualized basis,
provided those expenses are permissible as to both type and
amount under a budget approved and monitored quarterly
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<PAGE>
by the Trustees, including those Trustees 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 laws 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 .06% 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 Class D Plan, in addition to providing for the
reimbursement payments described above, provides for
payments to the Distributor at an annual rate of .30% of
each Portfolio's average daily net assets attributable to
Class D 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 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 only .25% of each Portfolio's average
daily net assets, on an annualized basis, attributable to
Class D shares.
The Class B and Class C Plans are similar to the Class D
Plan described above, except that for each Portfolio, the
Class B and Class C Plans provide for additional payments to
the Distributor of .30% and .50%, respectively, and they
apply only to Class B or Class C shares. It is possible that
a financial 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. Certain financial institutions offering
shares to their customers may be required to register as
dealers pursuant to state laws.
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
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<PAGE>
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.
PERFORMANCE ____________________________________________________________________
For any Portfolio, the performance of the Class D shares
will normally be lower than that on Class A or Class B
shares of the Portfolio because of the sales charge (when
applicable) and additional distribution and transfer agent
expenses charged to Class D shares. The performance of the
Class D shares will normally be higher than on Class C
shares of each Portfolio because of the additional
distribution expenses charged to Class C shares.
From time to time, each Portfolio may advertise its yield
and total return. 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 yield of a Portfolio refers to
the income generated by a hypothetical investment, net of
any sales charge imposed in the case of some of the Class D
shares, in that Portfolio over a thirty day period. This
income is then "annualized," (i.e. the income generated by
the investment over thirty days is assumed to be generated
over one year and is shown as a percentage of the
investment.
The total return of a Portfolio refers to the average
compounded rate of return on a hypothetical investment, for
designated time periods (including but not limited to, the
period from which the Portfolio commenced operations through
the specified date), assuming that the entire investment is
redeemed at the end of each period and assuming the
reinvestment of all dividend and capital gain distributions.
A Portfolio may periodically compare its performance to
that of other mutual funds tracked by mutual fund rating
services (such as Lipper Analytical) or financial and
business publications and periodicals, broad groups of
comparable mutual funds, 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 quote
Morningstar, Inc., a service that ranks mutual funds on the
basis of risk-adjusted performance. The Portfolios may also
quote Ibbotson Associates of Chicago, Illinois, which
provides historical returns of the capital markets in the
U.S. The Portfolios may use the long-term performance of
these capital markets to demonstrate general long-term risk
versus reward scenarios and could include the value of a
hypothetical investment in any of the capital markets. The
Portfolios may also quote financial and business
publications and periodicals as they relate to fund
management, investment philosophy and investment techniques.
A Portfolio may quote various measures of volatility and
benchmark correlation in advertising and may compare these
measures to those of other funds. Measures of volatility
attempt to compare historical share price fluctuations or
total returns to a
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<PAGE>
benchmark while measures of benchmark correlation indicate
how valid a comparative benchmark might be. Measures of
volatility and correlation are calculated using averages of
historical data and cannot be calculated precisely.
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. Accordingly, shareholders
are urged to consult their tax advisers regarding specific
questions as to federal, state and local income taxes. State
and local tax consequences of an investment in any Portfolio
may differ from the federal income tax consequences described
below. Additional information concerning taxes is set forth
in the Statement of Additional Information.
Tax Status of A Portfolio is treated as a separate entity for federal
the Portfolio income tax purposes and is not combined with the Trust's
other portfolios. The Portfolios intend to continue to
qualify for the special tax treatment afforded regulated
investment companies ("RICs") under Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code"), 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 will distribute substantially all of its net
Distributions investment income (including net short-term capital gains)
and net capital gain to shareholders. Dividends from each
Portfolio's net investment income will be taxable to its
shareholders as ordinary income, whether received in cash or
in additional shares and do not qualify for the corporate
dividends-received deduction. Distributions of net capital
gains are taxable to shareholders as long-term capital gains.
The Portfolios will make annual reports to shareholders of
the federal income tax status of all distributions. Each
Portfolio intends to make sufficient distributions to avoid
liability for federal excise tax. 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 that year if
paid by the Portfolio at any time during the following
January.
Income received on direct U.S. Government obligations is
exempt from tax at the state level when received directly and
may be exempt, depending on the state, when received by a
shareholder from any Portfolio provided certain 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
[SYMBOL APPEARS HERE]
TAXES
You must pay taxes on your Portfolio's earnings whether you take your payments
in cash or additional shares.
16
<PAGE>
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 such as STRIPS, which are sold
at original issue discount and thus do not make periodic cash
interest payments, a Portfolio will be required to include as
part of its current income the accreted 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, 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.
Sale, exchange or redemption of any 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 (a "Business Day").
All purchase, exchange and redemption requests are 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 order and, in the case of a purchase request, payment
before 4:00 p.m. Eastern time. Otherwise the purchase will be
effective when payment is received. Broker-dealers may have
separate arrangements with Class D shares of the Portfolios.
If an exchange request is for shares of a portfolio whose
net asset value is calculated as of a time earlier than 4:00
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.
[SYMBOL APPEARS HERE]
DISTRIBUTIONS
A Portfolio distributes income dividends and capital gains. Income dividends
represent the earnings from the Portfolio's investments; capital gains
distributions occur when investments in the Portfolio are sold for more than
they were originally bought.
[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
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<PAGE>
Minimum The minimum initial investment in each Portfolio is $1,000;
Investments 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 preapproved 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 Account investments, the Portfolios reserve the right to redeem, at
Balance net asset value, the shares of any shareholder if, because
of redemptions of shares by or on behalf of the shareholder,
the account of such shareholder in a Portfolio has a value
of less than $1,000, the minimum initial purchase amount.
Accordingly, an investor purchasing shares of a 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 a 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 the 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, a Portfolio may be requested 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 Portfolios intend 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.
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 plus any
applicable sales charge (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. 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 each Portfolio is
Asset Value is determined by dividing the total market value of its other
Determined assets, less any liabilities, by the total number of
outstanding shares of that Portfolio. Securities having
maturities of 60 days or less at the time of purchase will
be valued using the amortized cost method (described in the
Statement of Additional Information), which approximates the
securities' market value. A Portfolio may use a pricing
service to obtain the last equity or fixed income security
held by that Portfolio. In addition, portfolio securities
for which market quotations are available are valued at the
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<PAGE>
last quoted sales price on each Business Day, or, if there
is not such reported sale, at the most recently quoted bid
price. Unlisted securities for which market quotations are
readily available are valued at the most recently quoted bid
price. Net asset value per share is determined daily as of
4:00 p.m. Eastern time on each Business Day. Purchases will
be made in full and fractional shares of the Portfolios
calculated to three decimal places. Although the methodology
and procedures for determining net asset value per share are
identical for all classes of each 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.
Rights of In calculating the sale charge rates applicable to current
Accumulation purchases of a Portfolio's shares, a "single purchaser"
(defined below) is entitled to combine current purchases
with the current market value of previously purchased shares
of the Portfolios and Class D shares of other portfolios
("Eligible Portfolios") which are sold subject to a
comparable sales charge.
The term "single purchaser" refers to (i) an individual,
(ii) an individual spouse purchasing shares of the Portfolio
for their own account or for trust or custodian accounts of
their minor children, or (iii) a fiduciary purchasing for
any one trust, estate or fiduciary account, including
employee benefit plans created under Sections 401 or 457 of
the Code, including related plans of the same employer.
Furthermore, under this provision, purchases by a single
purchaser shall include purchases by an individual for
his/her own account in combination with (i) purchases of
that individual and spouse for their joint accounts or for
trust and custodial accounts for their minor children and
(ii) purchases of that individual's spouse for his/her own
account. To be entitled to a reduced sales charge based upon
shares already owned, the investor must ask the Transfer
Agent for such reduction at the time of purchase and provide
the account number(s) of the investor, the investor and
spouse, and their children (under age 21). The Portfolios
may amend or terminate this right of accumulation at any
time as to subsequent purchases.
Letter of By submitting a Letter of Intent (the "Letter") to the
Intent Transfer Agent, a single purchaser may purchase shares of
any Portfolio and the other Eligible Portfolios during a 13-
month period at the reduced sales charge rates applying to
the aggregate amount of the intended purchases stated in the
Letter. The Letter may apply to purchases made up to 90 days
before the date of the Letter. It is the shareholder's
responsibility to notify the Transfer Agent at the time the
Letter is submitted that there are prior purchases that may
apply.
Five percent (5%) of the total amount intended to be
purchased will be held in escrow by the Transfer Agent until
such purchase is completed within the 13-month period. 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 on the shares purchased at the reduced rate
and the sales charge otherwise applicable to the total
shares purchased. Such purchasers may include the value of
all their shares of the
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Portfolios and of any of the other Eligible Portfolios in
the Trust towards the completion of such Letter.
Sales Charge No sales charge is imposed on shares of the Portfolios: (i)
Waivers issued in plans of reorganization, such as mergers, asset
acquisitions and exchange offers, to which the Trust is a
party; (ii) sold to dealers or brokers that have a sales
agreement with the Distributor ("participating broker-
dealers"), for their own account or for retirement plans for
employees or sold to present employees of dealers or brokers
that certify to the Distributor at the time of purchase that
such purchase is for their own account; (iii) sold to
present employees of SEI or one of its affiliates, or of any
entity which is a current service provider to the Trust;
(iv) sold to tax-exempt organizations enumerated in Section
501(c) of the Code or qualified employee benefit plans
created under Sections 401, 403(b)(7) or 457 of the Code
(but not IRAs or SEPs); (v) sold to fee-based clients of
banks, financial planners and investment advisers; (vi) sold
to clients of trust companies and bank trust departments;
(vii) sold to trustees and officers of the Trust; (viii)
purchased with proceeds from the recent redemption of
another class of shares of a portfolio of SEI Tax-Exempt
Trust, SEI Institutional Managed Trust, SEI International
Trust, SEI Liquid Asset Trust or SEI Daily Income Trust;
(ix) purchased with the proceeds from the recent redemption
of shares of a mutual fund with similar investment
objectives and policies (other than Class D shares of the
Trusts listed in (viii) above) for which a front-end sales
charge was paid (this offer will be extended, to cover
shares on which a deferred sales charge was paid, if
permitted under regulatory authorities' interpretation of
applicable law); or (x) sold to participants or members of
certain affinity groups, such as trade associations or
membership organizations, which have entered into
arrangements with the Distributor.
The waiver of the sales charge under circumstances (viii)
and (ix) above applies only if the following conditions are
met: the purchase must be made within 60 days of the
redemption; the Transfer Agent must be notified in writing
by the investor, or his or her agent, at the time a purchase
is made; and a copy of the investor's account statement
showing such redemption must accompany such notice. The
waiver policy with respect to the purchase of shares through
the use of proceeds from a recent redemption as described in
clauses (viii) and (ix) above will not be continued
indefinitely and may be discontinued at any time without
notice. Investors should call the Transfer Agent at 1-800-
437-6016 to confirm availability prior to initiating the
procedures described in clauses (viii) and (ix) above.
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
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<PAGE>
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 Daily Income Trust (the "Trust") was organized as a
Massachusetts business trust under a Declaration of Trust
dated March 15, 1982. 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 four separate classes: Class A, Class
B, Class C and Class D, which provide for variation in
distribution and transfer agent costs, voting rights,
dividends, and the imposition of a sales charge on Class D
shares. This Prospectus offers the Class D shares of the
Trust's Short-Term Government Portfolio, Intermediate-Term
Portfolio and GNMA Portfolio (the "Portfolios"). In addition
to the Portfolios, the Trust consists of the following
portfolios: Money Market Portfolio, Prime Obligation
Portfolio, Government Portfolio, Government II Portfolio,
Treasury Portfolio, Treasury II Portfolio, Federal
Securities Portfolio, Short-Term Mortgage Portfolio, Short
Duration Mortgage Portfolio, Corporate Daily Income
Portfolio and Government Securities Daily Income Portfolio.
Additional information pertaining to the Trust may be
obtained by writing to SEI Financial Management Corporation,
680 East Swedesford Road, Wayne, Pennsylvania 19087 or by
calling 1-800-437-6016. All consideration received by the
Trust for shares of any Portfolio and all assets of such
Portfolio belong to that Portfolio and would be subject to
liabilities related thereto.
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<PAGE>
The Trust pays its expenses, including fees of its
service providers, audit and legal expenses, expenses of
preparing prospectuses, proxy solicitation materials and
reports to shareholders, costs of custodial services and
registering the shares under federal and state securities
laws, pricing, insurance expenses, including 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.
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 Supervised
Inquiries Service Company, P.O. Box 419240, Kansas City, MO 64141-
6240.
Dividends The dividends of Class D shares will normally be lower than
on Class A and Class B shares of each Portfolio because of
the additional distribution and transfer agent expenses
charged to Class D shares and the dividends on Class D
shares are normally higher then on Class C shares of each
Portfolio because of the additional distribution expenses
charged to Class C 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
Transfer Agent 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
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<PAGE>
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
Independent Morgan, Lewis & Bockius serves as counsel to the Trust.
Public Arthur Andersen LLP serves as the independent public
Accountants accountants of the Trust.
Custodian and CoreStates Bank, N.A., Broad and Chestnut Streets, P.O. Box
Wire Agent 7618, Philadelphia, PA 19101 (the "Custodian"), acts as
custodian and wire agent of the assets of the Portfolios.
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 the permitted investments
practices for the Portfolios and the associated risk
factors:
Dollar Roll Dollar rolls are transactions in which securities are sold
Transactions for delivery in the current month and the seller
simultaneously contracts to repurchase substantially similar
securities on a specified future date. Any difference
between the sale price and the purchase price is netted
against the interest income foregone on the securities sold
to arrive at an implied borrowing rate. Alternatively, the
sale and purchase transactions can be executed at the same
price, with a Portfolio being paid a fee as consideration
for entering into the commitment to purchase. Dollar rolls
may be renewed prior to cash settlement and initially may
involve only a firm commitment agreement by a Portfolio to
buy a security. If the broker-dealer to whom a Portfolio
sells the security becomes insolvent, a Portfolio's right to
purchase the security may be restricted. Other risks
involved in entering into dollar rolls include the risk that
the value of the security may change adversely over the term
of the dollar roll and that the security a Portfolio is
required to repurchase may be worth less than the security
the Portfolio originally held.
Fixed Income Fixed income securities are debt obligations issued by
Securities corporations, municipalities and other borrowers. The market
value of fixed income investments will generally change in
response to interest rate changes and other factors. During
periods of falling interest rates, the values of outstanding
fixed income securities generally rise. Conversely, during
periods of rising interest rates, the values of such
securities generally decline. Moreover, while securities
with longer maturities tend to produce higher yields, the
prices of longer maturity securities are also subject to
greater market fluctuations as a result of change in
interest rates. Changes by recognized agencies in the rating
of any fixed income security and in the ability of an issuer
to make payments of interest and principal will also affect
the value of these investments. Changes in the value of
portfolio securities will not affect cash income derived
from these securities but will affect a Portfolio's net
asset value.
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Illiquid Illiquid securities are securities which cannot be disposed
Securities of within seven business days at approximately the value at
which they are being carried on a Portfolio's books. An
illiquid security includes a demand instrument with a demand
notice period exceeding seven days, when there is no
secondary market for such security, and repurchase
agreements with maturities over seven days in length.
Mortgage-Backed Mortgage-backed securities are instruments that entitle the
Securities holder to a share of all interest and principal payments
from mortgages underlying the security. The mortgages
backing these securities include conventional thirty-year
fixed-rate mortgages, graduated payment mortgages, and
adjustable rate mortgages. During periods of declining
interest rates, prepayment of mortgages underlying mortgage-
backed securities can be expected to accelerate. Prepayment
of mortgages which underlie securities purchased at a
premium often results in capital losses, while prepayment of
mortgages purchased at a discount often results in capital
gains. Because of these unpredictable prepayment
characteristics, it is often not possible to predict
accurately the average life or realized yield of a
particular issue.
Government Pass-Through Securities: These are securities
that are issued or guaranteed by a U.S. Government agency
representing an interest in a pool of mortgage loans. The
primary issuers or guarantors of these mortgage-backed
securities are GNMA, FNMA and FHLMC. FNMA and FHLMC
obligations are not backed by the full faith and credit of
the U.S. Government as GNMA certificates are, but FNMA and
FHLMC securities are supported by the instrumentalities'
right to borrow from the U.S. Treasury. GNMA, FNMA and FHLMC
each guarantees timely distributions of interest to
certificate holders. GNMA and FNMA also each guarantees
timely distributions of scheduled principal. FHLMC has in
the past guaranteed only the ultimate collection of
principal of the underlying mortgage loan; however, FHLMC
now issues mortgage-backed securities (FHLMC Gold PCs) which
also guarantee timely payment of monthly principal
reductions. Government and private guarantees do not extend
to the securities' value, which is likely to vary inversely
with fluctuations in interest rates.
Private Pass-Through Securities: These are mortgage-
backed securities issued by a non-governmental entity, such
as a trust. These securities include collateralized mortgage
obligations ("CMOs") and real estate mortgage investments
conduits ("REMICs") that are rated in one of the top two
rating categories. While they are generally structured with
one or more types of credit enhancement, private pass-
through securities typically lack a guarantee by an entity
having the credit status of a governmental agency or
instrumentality.
Collateralized Mortgage Obligations ("CMOs"): CMOs are
debt obligations or multiclass pass-through certificates
issued by agencies or instrumentalities of the U.S.
Government or by private originators or investors in
mortgage loans. In a CMO, series of bonds or certificates
are usually issued in multiple classes. Principal and
interest paid on the underlying mortgage assets may be
allocated among the several classes of a series of a
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CMO in a variety of ways. Each class of a CMO, often
referred to as a "tranche," is issued with a specific fixed
or floating coupon rate and has a stated maturity or final
distribution date. Principal payments on the underlying
mortgage assets may cause CMOs to be retired substantially
earlier than their stated maturities or final distribution
dates, resulting in a loss of all or part of any premium
paid.
REMICs: A REMIC is a CMO that qualifies for special tax
treatment under the Internal Revenue Code and invests in
certain mortgages principally secured by interests in real
property. Investors may purchase beneficial interests in
REMICs, which are known as "regular" interests, or
"residual" interests. Guaranteed REMIC pass-through
certificates ("REMIC Certificates") issued by FNMA or FHLMC
represent beneficial ownership interests in a REMIC trust
consisting principally of mortgage loans or FNMA, FHLMC or
GNMA-guaranteed mortgage pass-through certificates. For
FHLMC REMIC Certificates, FHLMC guarantees the timely
payment of interest, and also guarantees the payment of
principal as payments are required to be made on the
underlying mortgage participation certificates. FNMA REMIC
Certificates are issued and guaranteed as to timely
distribution of principal and interest by FNMA.
Parallel Pay Securities: PAC Bonds: Parallel pay CMOs
and REMICs are structured to provide payments of principal
on each payment date to more than one class. These
simultaneous payments are taken into account in calculating
the stated maturity date or final distribution date of each
class, which must be retired by its stated maturity date or
final distribution date, but may be retired earlier. Planned
Amortization Class CMOs ("PAC Bonds") generally require
payments of a specified amount of principal on each payment
date. PAC Bonds are always parallel pay CMOs with the
required principal payment on such securities having the
highest priority after interest has been paid to all
classes.
REITs: REITs are trusts that invest primarily in
commercial real estate or real estate-related loans. The
value of interests in REITs may be affected by the value of
the property owned or the quality of the mortgages held by
the trust.
Stripped Mortgage-Backed Securities ("SMBs"): SMBs are
usually structured with two classes that receive specified
proportions of the monthly interest and principal payments
from a pool of mortgage securities. One class may receive
all of the interest payments and is thus termed an interest-
only class ("IO"), while the other class may receive all of
the principal payments and is thus termed the principal-only
class ("PO"). The value of IOs tends to increase as rates
rise and decrease as rates fall; the opposite is true of
POs. SMBs are extremely sensitive to changes in interest
rates because of the impact thereon of prepayment of
principal on the underlying mortgage securities can
experience wide swings in value in response to changes in
interest rates and associated mortgage prepayment rates.
During times when interest rates are experiencing
fluctuations, such securities can be difficult to price on a
consistent basis. The market for SMBs is not as fully
developed as other markets; SMBs therefore may be illiquid.
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Risk Factors: Due to the possibility of prepayments of the
underlying mortgage instruments, mortgage-backed securities
generally do not have a known maturity. In the absence of a
known maturity, market participants generally refer to an
estimated average life. An average life estimate is a
function of an assumption regarding anticipated prepayment
patterns, based upon current interest rates, current
conditions in the relevant housing markets and other
factors. The assumption is necessarily subjective, and thus
different market participants can produce different average
life estimates with regard to the same security. There can
be no assurance that estimated average life will be a
security's actual average life.
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 within a number of days from the date of purchase.
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 its right to
dispose of the collateral securities 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.
U.S. Government Obligations issued or guaranteed by agencies of the U.S.
Agencies Government, including, among others, the Federal Farm Credit
Bank, the Federal Housing Administration and the Small
Business Administration, and obligations issued or
guaranteed by instrumentalities of the U.S. Government,
including, among others, the Federal Home Loan Mortgage
Corporation, the Federal Land Banks and the U.S. Postal
Service. Some of these securities are supported by the full
faith and credit of the U.S. Treasury (e.g., Government
National Mortgage Association), others are supported by the
right of the issuer to borrow from the Treasury (e.g.,
Federal Farm Credit Bank), while 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 on the
obligation prior to maturity. Guarantees as to the timely
payment of principal and interest do not extent to the value
or yield of these securities nor to the value of the
Portfolio's shares.
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 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
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of interest or principal. This discount is accredited 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 fixed income securities. See also "Taxes."
When-Issued and When-issued or delayed delivery basis transactions involve
Delayed the purchase of an instrument with payment and delivery
Delivery taking place in the future. Delivery of and payment for
Securities these securities may occur a month or more after the date of
including TBA the purchase commitment. A Portfolio will maintain with the
Mortgage-Backed Custodian a separate account with liquid high grade debt
Securities 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 it deems appropriate.
One form of when-issued or delayed-delivery security that a
Portfolio may purchase is a "to be announced" ("TBA")
mortgage-backed security. A TBA mortgage-backed security
transaction arises when a mortgage-backed security, such as
a GNMA pass-through security, is purchased or sold with the
specific pools that will constitute that GNMA pass-through
security to be announced on a future settlement date.
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SEI DAILY INCOME 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
Daily Income Trust (the "Trust") and should be read in conjunction with the
Trust's Prospectuses dated May 31, 1995. Prospectuses may be obtained through
SEI Financial Services Company, 680 East Swedesford Road, Wayne, PA 19087.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
THE TRUST................................................................... 2
DESCRIPTION OF PERMITTED INVESTMENTS........................................ 2
THE MANAGER AND SHAREHOLDER SERVICING AGENT................................. 10
THE ADVISER................................................................. 12
TRUSTEES AND OFFICERS OF THE TRUST.......................................... 15
INVESTMENT LIMITATIONS...................................................... 17
PERFORMANCE................................................................. 19
DETERMINATION OF NET ASSET VALUE............................................ 23
PURCHASE AND REDEMPTION OF SHARES........................................... 24
SHAREHOLDER SERVICES........................................................ 25
PORTFOLIO TRANSACTIONS...................................................... 27
DESCRIPTION OF SHARES....................................................... 28
LIMITATION OF TRUSTEES' LIABILITY........................................... 29
SHAREHOLDER LIABILITY....................................................... 29
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES......................... 29
EXPERTS..................................................................... 31
FINANCIAL STATEMENTS........................................................ 31
</TABLE>
,1995
SEI- - -
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THE TRUST
SEI Daily Income Trust (formerly SEI Cash+Plus Trust) (the "Trust") is a
diversified, open-end management investment company established under
Massachusetts law as a Massachusetts business trust under a Declaration of Trust
dated March 15, 1982. 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 the Class A,
Class B, Class C and/or 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. The Trust changed its name from SEI Cash+Plus
Trust to its current name in April 1994.
This Statement of Additional Information relates to the following portfolios:
Money Market, Prime Obligation, Government, Government II, Treasury, Treasury
II, Federal Securities, Corporate Daily Income, Government Securities Daily
Income, Short-Term Mortgage (formerly Adjustable Rate Mortgage), Short Duration
Mortgage, Short-Term Government, Intermediate-Term Government and GNMA
Portfolios (each a "Portfolio," and collectively, the "Portfolios") and any
different classes of the Portfolios. Currently, the Government Securities Daily
Income Portfolio and the Short Duration Mortgage Portfolio are not selling
shares.
Shareholders may purchase shares in some of the Portfolios through four separate
classes: Class A, Class B, Class C and Class D shares.
DESCRIPTION OF PERMITTED INVESTMENTS
ADJUSTABLE RATE FEATURES
Resets--Interest rates on the mortgages underlying the adjustable rate
securities and other floating rate securities are reset at intervals of one year
or less in response to changes in a predetermined interest rate index. There
are two main categories of indices: those based on U.S. Treasury securities and
those derived from a calculated measure such as a cost-of-funds index or a
moving average of mortgage rates. Commonly used indices include the one-year
and three-year constant maturity Treasury rates (CMT), the three-month Treasury
Bill rate, the 180-day Treasury Bill rate, the Eleventh District Federal Home
Loan Bank Cost-of-Funds Index, the one-month, three-month, six-month or one-year
London Interbank Offered Rate.
Caps and Floors--Underlying mortgages or other obligations which collateralize
the adjustable rate securities and other floating rate securities will
frequently have caps and floors which limit the maximum amount by which the loan
rate may change up or down, either at each reset or adjustment interval or over
the life of the loan. This provides the mortgage borrower and lender some
degree of protection against large changes in monthly payments. Some
residential mortgage loans restrict periodic adjustments by limiting changes in
the borrower's monthly principal and interest payments rather than limiting
interest rate changes. These payment caps may result in negative amortization,
i.e., an increase in the balance of the mortgage loan. The adjustable rate
feature of the mortgages underlying the adjustable rate mortgage securities
("ARMs"), collateralized mortgage obligations ("CMOs") and real estate mortgage
investment conduits ("REMICs") in which these Portfolios may invest should
reduce, but will not eliminate, price fluctuations in such securities,
particularly during periods of extreme fluctuations in market interest rates.
Since the interest rates on many mortgages underlying ARMs, CMOs and REMICs are
reset on an annual basis and generally are subject to caps, it can be expected
that the prices of such ARMs, CMOs and REMICs will fluctuate to the extent
prevailing market interest rates are not reflected in the interest rates payable
on the underlying ARMs, CMOs or REMICs. In this regard, the net asset value of
the Trust's shares could fluctuate to the extent interest rates on underlying
mortgages differ from prevailing market interest rates during interim periods
between interest rate reset dates. Accordingly, investors could experience some
principal loss, or less gain than might otherwise be achieved, if they redeem
their shares of the Trust before
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the interest rates on the mortgages underlying the Trust's portfolio securities
are adjusted to reflect prevailing market interest rates.
The Short-Term Mortgage Portfolio and Short Duration Mortgage Portfolio will
enter into interest rate and mortgage swaps only on a net basis, i.e., the two
payment streams are netted out, with the Portfolio receiving or paying, as the
case may be, only the net amount of the two payments. Since these transactions
are entered into for good faith hedging purposes, the Trust and the Adviser do
not believe that such obligations constitute senior securities as defined in the
Investment Company Act of 1940 (the "1940 Act") and, accordingly, will not treat
them as being subject to the Trust's or any Portfolio's borrowing restrictions.
The net amount of the excess, if any, of each Portfolio's obligations over its
entitlements with respect to each interest rate or mortgage swap will be accrued
on a daily basis and an amount of cash or liquid securities rated in one of the
top three ratings categories by Moody's Investors Service, Inc. ("Moody's") or
Standard & Poor's Corporation ("S&P"), or, if unrated by either Moody's or S&P,
deemed by the Adviser to be of comparable quality having an aggregate net asset
value at least equal to such accrued excess will be maintained in a segregated
account by the Portfolio's custodian.
ASSET-BACKED SECURITIES--Asset-backed securities are securities secured by non-
mortgage assets such as company receivables, truck and auto loans, leases and
credit card receivables. Such securities are generally issued as pass-through
certificates, which represent undivided fractional ownership interests in the
underlying pools of assets. Such securities also may be debt instruments, which
are also known as collateralized obligations and are generally issued as the
debt of a special purpose entity, such as a trust, organized solely for the
purpose of owning of such assets and issuing such debt.
Asset-backed securities are not issued or guaranteed by the United States
Government or its agencies or instrumentalities; however, the payment of
principal and interest on such obligations may be guaranteed up to certain
amounts and for a certain period by a letter of credit issued by a financial
institution (such as a bank or insurance company) unaffiliated with the issuers
of such securities. The purchase of asset-backed securities raises risk
considerations peculiar to the financing of the instruments underlying such
securities. For example, there is a risk that another party could acquire an
interest in the obligations superior to that of the holders of the asset-backed
securities. There also is the possibility that recoveries on repossessed
collateral may not, in some cases, be available to support payments on those
securities. Asset-backed securities entail prepayment risk, which may vary
depending on the type of asset, but is generally less than the prepayment risk
associated with mortgage-backed securities. In addition, credit card
receivables are unsecured obligations of the card holder.
The market for asset-backed securities is at a relatively early stage of
development. Accordingly, there may be a limited secondary market for such
securities. The Corporate Daily Income, Short-Term Mortgage and Short Duration
Mortgage Portfolios may invest in asset-backed securities.
BANKERS' ACCEPTANCES--a bill of exchange or time draft drawn on and accepted
by a commercial bank. Bankers' acceptances are used by corporations to finance
the shipment and storage of goods and to furnish dollar exchange. Maturities
are generally six months or less. All Portfolios may invest in bankers'
acceptances.
CERTIFICATES OF DEPOSIT--a negotiable interest bearing instrument with a
specific maturity. Certificates of deposit 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. All Portfolios may invest in
certificates of deposit.
COMMERCIAL PAPER--the term used to designate unsecured short-term promissory
notes issued by corporations and other entities. Maturities on these issues
vary from a few days to nine months. All Portfolios may invest in commercial
paper.
The following descriptions of commercial paper ratings have been published by
S&P and Moody's, respectively.
3
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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, 2 and 3 to indicate the relative degree of safety. Issues rated
A-1+ are those with an "overwhelming degree" of credit protection. Those rated
A-1 reflect a "very strong" degree of safety regarding timely payment. Those
rated A-2 reflect a "satisfactory" degree of safety regarding timely payment.
Commercial paper issuers rated Prime-1 or Prime-2 by Moody's are judged by
Moody's to be of "superior" quality and "strong" quality, respectively, on the
basis of relative repayment capacity.
DOLLAR ROLLS--in order to seek a high level of current income, the GNMA
Portfolio may enter into dollar rolls or "covered rolls" in which the Portfolio
sells securities (usually mortgage-backed securities) and simultaneously
contracts to repurchase, typically in 30 or 60 days, substantially similar, but
not identical, securities on a specified future date. During the roll
commitment period, a Portfolio forgoes principal and interest paid on such
securities. A Portfolio is compensated by the difference between the current
sales price and the forward price for the future purchase (often referred to as
the "drop") as well as by the interest earned on the cash proceeds of the
initial sale. A "covered roll" is a specific type of dollar roll for which
there is an offsetting cash position or cash equivalent securities position that
matures on or before the forward settlement date of the dollar roll transaction.
As used herein the term "dollar roll" refers to dollar rolls that are not
"covered rolls." At the end of the roll commitment period, a Portfolio may or
may not take delivery of the securities the Portfolio has contracted to
purchase.
FOREIGN SECURITIES--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 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. The Money Market Portfolio
may invest in foreign securities.
FUTURES CONTRACTS AND OPTIONS ON FUTURES CONTRACTS--The Short-Term Mortgage and
Short Duration Mortgage Portfolios will enter into transactions in futures
contracts and in options on futures contracts for hedging purposes only. In
addition, a Portfolio may not purchase or sell such instruments if, immediately
thereafter, the sum of the amount of initial margin deposits on existing futures
contracts and options on futures contracts, and premiums paid for the purchase
of such options would exceed 5% of the Portfolio's total assets after taking
into account unrealized profits and unrealized losses on such contracts;
provided, however, that in the case of an option that is in-the-money at the
time of purchase, the in-the-money amount may be excluded in calculating the 5%.
Transactions in the foregoing instruments may be entered into by a Portfolio on
U.S. exchanges regulated by the Securities and Exchange Commission ("SEC") or
the Commodities Futures Trading Commission ("CFTC"). Over-the-counter
transactions involve certain risks which may not be present in an exchange
environment.
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Futures Contracts: A futures contract is a bilateral agreement providing for
the purchase and sale for future delivery of a fixed income security, or a
futures contract may be based on municipal bond or other financial indices,
including any index of fixed income securities. A "sale" of a futures contract
means a contractual obligation to deliver the securities called for by the
contract at a specified price on a specified date. A "purchase" of a futures
contract means a contractual obligation to acquire the securities called for by
the contract at a specified price on a specified date. Although futures
contracts call for the actual delivery or acquisition of securities or, in the
case of futures contracts based on an index, the making or acceptance of a cash
settlement at a specified future time, the contractual obligation is usually
fulfilled before such date without the making or taking of delivery by "closing
out" the contract, that is, by buying or selling, as the case may be, on a
commodities exchange, an identical futures contract calling for settlement in
the same month, subject to the availability of a liquid secondary market; there
can be no assurance that a liquid secondary market will exist for any particular
futures contract. Brokerage commissions are incurred when a futures contract is
bought or sold.
Futures contracts have been designed by exchanges which have been designated as
"contract markets" by the CFTC, and must be executed through a futures
commission merchant or brokerage firm which is a member of the relevant contract
market. Presently, futures contracts are based on such debt securities as long-
term U.S. Treasury Bonds, Treasury Notes, three-month U.S. Treasury Bills and
bank certificates of deposit. Existing contract markets include the Chicago
Board of Trade and the International Monetary Market of the Chicago Mercantile
Exchange. Futures contracts are traded on these markets, and, through their
clearing corporations, the exchanges guarantee performance of the contracts as
between the clearing members of the exchange.
Futures traders are required to make a good faith margin deposit in cash or
government securities with or for the account of a broker or custodian to
initiate and maintain open positions in futures contracts. A margin deposit is
intended to assure completion of the contract (delivery or acceptance of the
underlying security) if it is not terminated prior to the specified delivery
date. Minimal initial margin requirements are established by the futures
exchange and may be changed. Brokers may establish deposit requirements which
are higher than the exchange minimums. Deposit requirements on futures
contracts customarily range upward from less than 5% of the value of the
contract being traded.
After a futures contract position is opened, the value of the contract is marked
to market daily. If the futures contract price changes to the extent that the
margin on deposit does not satisfy the required margin, payment of additional
"variation" margin will be required. Conversely, change in the contract value
may reduce the required margin, resulting in a repayment of excess margin to the
contract holder. Variation margin payments are made to and from the futures
broker for as long as the contract remains open. The Portfolios expect to earn
interest income on their margin deposits.
At the time of delivery of securities pursuant to a futures contract based on
fixed income securities, adjustments are made to recognize differences in value
arising from the delivery of securities with a different interest rate from that
specified in the contract. In some (but not many) cases, securities called for
by a futures contract may not have been issued when the contract was written.
Traders in futures contracts and related options may be broadly classified as
either "hedgers" or "speculators." Hedgers use the futures markets primarily to
offset unfavorable changes in the value of securities otherwise held or expected
to be acquired for investment purposes. Speculators are less inclined to own
the securities underlying the futures contracts which they trade, and use
futures contracts with the expectation of realizing profits from fluctuations in
the prices of underlying securities. The purpose of the purchase or sale of a
futures contract, in the case of a Portfolio which holds or intends to acquire
long-term fixed income securities, is to hedge, that is, to attempt to protect
the Portfolio from fluctuations in interest rates without actually buying or
selling long-term fixed income securities. For example, if a Portfolio owns
long-term bonds and interest rates were expected to increase, the Portfolio
might enter into futures contracts for the sale of debt securities. Such a sale
would have much the same effect as selling an equivalent value of the long-term
bonds owned by the
5
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Portfolio. If interest rates did increase, the value of the debt securities in
the portfolio would decline, but the value of the futures contracts would
increase at approximately the same rate, thereby keeping the net asset value of
the Portfolio from declining as much as it otherwise would have. The Portfolio
could accomplish similar results by selling bonds with long maturities and
investing in bonds with short maturities when interest rates are expected to
increase. However, the use of futures contracts as an investment technique
allows a Portfolio to maintain a hedging position without having to sell its
portfolio securities.
Similarly, when it is expected that interest rates may decline, futures
contracts may be purchased to attempt to hedge against anticipated purchases of
long-term bonds at higher prices. Since the fluctuations in the value of
futures contracts should be similar to that of long-term bonds, a Portfolio
could take advantage of the anticipated rise in the value of long-term bonds
without actually buying them until the market had stabilized. At that time, the
futures contracts could be liquidated and the Portfolio could then buy long-term
bonds. To the extent a Portfolio purchases futures contracts for this purpose,
the assets in the segregated asset account maintained to cover the Portfolio's
obligations with respect to such futures contracts will consist of cash,
government securities or high quality fixed income securities in an amount equal
to the difference between the fluctuating market value of such futures contracts
and the aggregate value of the initial and variation margin payments made by the
Portfolio with respect to such futures contracts.
In order to insure that no Portfolio will be deemed to be a "commodity pool" as
defined in CFTC Regulations, all futures transactions must constitute either
bona fide hedging transactions or transactions for other purposes so long as the
aggregate initial margin and premiums required for such transaction will not
exceed five percent of the liquidation value of the qualifying entity's
portfolio, after taking into account unrealized profits and unrealized losses on
any such contracts it has entered into. The Portfolio will only sell futures
contracts to protect securities owned against declines in price or purchase
contracts to protect against an increase in the price of securities intended for
purchase. As evidence of this hedging interest, the Portfolio expects that
approximately 75% of its futures contracts will be "completed"; that is,
equivalent amounts of related securities will have been purchased or are being
purchased by the Portfolio upon sale of open futures contracts.
Options on Futures Contracts: A Portfolio, subject to any applicable laws, may
purchase and write options on futures contracts ("options on futures contracts")
for hedging purposes. An option on a futures contract provides the holder with
the right to enter into a "long" position in the underlying futures contract
(i.e., a purchase of the futures contract), in the case of a call option, or a
"short" position in the underlying futures contract (i.e., a sale of the futures
contract), in the case of a put option, at a fixed exercise price up to a stated
expiration date or, in the case of certain options, on such date. Such options
on futures contracts will be traded on contract markets regulated by the CFTC.
Depending on the pricing of the option compared to either the price of the
futures contract upon which it is based or the price of the underlying debt
securities, it may or may not be less risky than ownership of the futures
contract or underlying debt securities. As with the purchase of futures
contracts, when a Portfolio is not fully invested the Adviser may purchase a
call option on a futures contract on behalf of the Portfolio to hedge against a
market advance due to declining interest rates.
The writing of a call option on a futures contract constitutes a partial hedge
against declining prices of the securities which are deliverable upon exercise
of the futures contract. If the futures price at expiration of the option is
below the exercise price, a Portfolio will retain the full amount of the option
premium which provides a partial hedge against any decline that may have
occurred in the Portfolio's holdings. The writing of a put option on a futures
contract constitutes a partial hedge against increasing prices of the securities
which are deliverable upon exercise of the futures contract. If the futures
price at expiration of the options is higher than the exercise price, a
Portfolio will retain the full amount of the option premium, less related
transaction costs, which provides a partial hedge against any increase in the
price of securities which the Portfolio intends to purchase. If a put or call
option a Portfolio has written is exercised, the Portfolio may incur a loss
which will be reduced by the amount of the premium it receives, less related
transaction costs. A straddle involves the simultaneous writing of put and call
options with respect to a futures contract. The Portfolios will cover these
6
<PAGE>
straddles in accordance with applicable law. Depending on the degree of
correlation between changes in the value of the portfolio securities of a
Portfolio and changes in the value of its futures positions, a Portfolio's
losses from existing options on futures contracts may to some extent be reduced
or increased by changes in the value of the Portfolio's securities. The writer
of an option futures contract is subject to the requirement of initial and
variation margin payments.
A Portfolio may cover the writing of call options on futures contracts (a)
through purchases of the underlying futures contract, or (b) through the holding
of a call on the same futures contract and in the same principal amount as the
call written where the exercise price of the call held (i) is equal to or less
than the exercise price of the call written or (ii) is greater than the exercise
price of the call written if the difference is maintained by the Trust on behalf
of a Portfolio in cash, cash equivalents or U.S. Treasury securities in a
segregated account with its custodian. The Trust may cover the writing of put
options on futures contracts on behalf of a Portfolio (a) through sales of the
underlying futures contract, (b) through segregation of cash, cash equivalents
or U.S. Treasury securities in an amount equal to the value of the security or
index underlying the futures contract, or (c) through the holding of a put on
the same futures contract and in the same principal amount as the put written
where the exercise price of the put held is equal to or greater than the
exercise price of the put written or less than the exercise price of the put
written if the difference is maintained by the Portfolio in cash, cash
equivalents or U.S. Treasury securities in a segregated account with its
custodian. Put and call options on futures contracts written by the Trust on
behalf of a Portfolio may also be covered in such other manner as may be in
accordance with the requirements of the exchange on which they are traded and
applicable laws and regulations.
The amount of risk a Portfolio assumes when it purchases an option on a futures
contract is the premium paid for the option plus related transaction costs,
although in order to realize a profit it may be necessary to exercise the option
and close out the underlying futures contract, subject to the risks of futures
trading described herein. In addition to the correlation risks discussed above,
the purchase of an option also entails the risk that changes in the value of the
underlying futures contract will not be fully reflected in the value of the
option purchased. The writing of an option on a futures contract, however,
involves all of the risks of futures trading, including the requirement to make
initial and variation margin payments.
Although techniques other than the sale and purchase of futures contracts and
options on futures contracts could be used to control a Portfolios' exposure to
market fluctuations, the use of futures contracts may be a more effective means
of hedging this exposure. While a Portfolio will incur commission expenses in
both opening and closing out futures positions, these costs are lower than
transaction costs incurred in the purchase and sale of the underlying
securities.
Risks of Futures Contracts and Options on Futures Contracts: Various additional
risks exist with respect to the trading of futures contracts and options on
futures contracts. For example, the Trust's ability effectively to hedge all or
a portion of the holdings of a Portfolio through transactions in such
instruments will depend on the degree to which price movements in the underlying
index or instrument correlate with price movements in the relevant portion of
the Portfolio's holdings. The trading of futures contracts and options entails
the additional risk of imperfect correlation between movements in the futures or
option price and the price of the underlying index or obligation, while the
writing of options also entails the risk of imperfect correlation between
securities used to cover options written and the securities underlying such
options.
Positions in futures contracts may be closed out only on an exchange which
provides a secondary market for such futures. However, there can be no
assurance that a liquid secondary market will exist for any particular futures
contract at any specific time. Thus, it may not be possible to close a futures
position. In the event of adverse price movements, a Portfolio unable to close
out a futures position would continue to be required to make daily cash payments
to maintain its required margin. In such situations, if a Portfolio has
insufficient cash, it may have to sell portfolio securities to meet daily margin
requirements at a time when it may be disadvantageous to do so. In addition, a
Portfolio may be required to make delivery of the instruments underlying futures
7
<PAGE>
contracts it holds. The inability to close options and futures positions also
could have an adverse impact on the ability of the Portfolio to hedge
effectively. A Portfolio will minimize the risk that it will be unable to close
out a futures contract by only entering into futures which are traded on
national futures exchanges and for which there appears to be a liquid secondary
market.
Futures contracts entail risks. If the Adviser's investment judgment about the
general direction of interest rates is incorrect, the overall performance of a
Portfolio that has entered into a futures contract would be poorer than if it
had not entered into any such contract. If, for example, a Portfolio has hedged
against the possibility of an increase in interest rates, which increase would
adversely affect the price of bonds held in its portfolio, and interest rates
decrease instead, the Portfolio will lose part or all of the benefit of the
increased value of its hedged bonds because it will have offsetting losses in
its futures positions. In addition, in such situations, if a Portfolio has
insufficient cash, it may have to sell bonds from its portfolio to meet daily
variation margin requirements. Such sales of bonds may be, but will not
necessarily be, at increased prices which reflect the rising market. A
Portfolio may, therefore, have to sell securities at a time when it may be
disadvantageous to do so.
The risk of loss in trading futures contracts in some strategies can be
substantial, due to both the low margin deposits required and the extremely high
degree of leverage involved in futures pricing. As a result, a relatively small
price movement in a futures contract may result in immediate and substantial
loss (as well as gain) to a Portfolio. For example, if at the time of purchase
10% of the value of the futures contract is deposited as margin, a subsequent
10% decrease in the value of the futures contract would result in a total (100%)
loss of the margin deposit, before any deduction for the transaction costs, if
the account were then closed out. A 15% decrease would result in a loss equal to
150% of the original margin deposit if the contract were closed out. Thus, a
purchase or sale of a futures contract may result in losses in excess of the
amount invested in the contract. However, because a Portfolio will engage in
futures strategies only for hedging purposes, the Adviser does not believe that
the Portfolio is subject to the risks of loss frequently associated with futures
transactions. A Portfolio would presumably have sustained comparable losses if,
instead of transacting in the futures contract, it had invested in the
underlying financial instrument and sold it after the decline. The risk of loss
from the purchase of options is less than the risk from the purchase or sale of
futures contracts because the maximum amount at risk is the premium paid for the
option.
Utilization of futures transactions by a Portfolio does involve the risk of
imperfect or no correlation where the securities underlying futures contracts
have different maturities than the portfolio securities being hedged. It is
also possible that a Portfolio could both lose money on futures contracts and
experience a decline in the value of its portfolio securities. There is also
the risk of loss by a Portfolio of margin deposits in the event of the
bankruptcy of a broker with whom the Portfolio has an open position in a futures
contract or related option.
Most futures exchanges limit the amount of fluctuation permitted in futures
contract prices during a single trading day. The daily limit establishes the
maximum amount that the price of a futures contract may vary either up or down
from the previous day's settlement price at the end of a trading session. Once
the daily limit has been reached in a particular type of contract, no trades may
be made on that day at a price beyond that limit. The daily limit governs only
price movement during a particular trading day and therefore does not limit
potential losses because the limit may prevent the liquidation of unfavorable
positions. Futures contract prices have occasionally moved to the daily limit
for several consecutive trading days with little or no trading, thereby
preventing prompt liquidation of future positions and subjecting some futures
traders to substantial losses.
GNMA SECURITIES--Securities issued by GNMA are wholly-owned U.S. Government
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
8
<PAGE>
payments, GNMA certificates have a shorter average maturity and, therefore, less
principal volatility than a comparable 30-year 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, a Portfolio will receive monthly scheduled payments of principal and
interest. In addition, a Portfolio 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.
In determining the dollar-weighted average maturity or duration of each non-
money market Portfolio (except the Short-Term Mortgage, Short Duration Mortgage,
Treasury, Treasury II and Federal Securities Portfolios), the Adviser will
follow industry practice in assigning an average life to the mortgage-related
securities of each Portfolio. If the interest rate on the mortgages underlying
such securities is such that prepayments are likely, the Adviser will assign an
average life to such securities that differs from their stated maturity. For
example, where a GNMA certificate has a high interest rate relative to the
market rate, that GNMA certificate is likely to have a shorter overall maturity
because of prepayments on the underlying mortgages than a GNMA certificate with
a current market rate of interest. Moreover, the Adviser may deem it appropriate
to change the projected average life for a Portfolio's securities as a result of
fluctuations in market interest rates and other factors.
REPURCHASE AGREEMENTS - 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. A Portfolio involved
bears a risk of loss in the event that the other party to a repurchase agreement
defaults on its obligations and a Portfolio is delayed or prevented from
exercising its rights to dispose of the collateral securities. The Adviser
enters into repurchase agreements only with financial institutions which they
deem to present minimal risk of bankruptcy during the term of the agreement
based on guidelines which are periodically reviewed by the Board of Trustees.
These guidelines currently permit a Portfolio 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 a Portfolio 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 any Portfolio, the
custodian for that Portfolio or an agent of that custodian must take possession
of the underlying collateral. However, if the seller defaults, a Portfolio
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, a Portfolio
may incur delay and costs in selling the security and may suffer a loss of
principal and interest if that Portfolio is treated as an unsecured creditor.
Each Portfolio except the Short-Term Mortgage, Short Duration Mortgage,
Government II and Treasury II may invest in repurchase agreements.
TIME DEPOSITS--a non-negotiable receipt issued by a bank in exchange for the
deposit of funds. Like a certificate of deposit, it earns a specified rate of
interest over a definite period of time; however, it cannot be traded in the
secondary market. Time deposits with a withdrawal penalty are considered to be
illiquid securities; no Portfolio will invest more than 10% of its net assets in
such time deposits and other illiquid securities. All Portfolios may invest in
time deposits.
U.S. GOVERNMENT AGENCY OBLIGATIONS--agencies of the U.S. Government which issue
obligations consisting of, among others, the Export Import Bank of the United
States, Farmers Home Administration, Federal Farm Credit Bank, Federal Housing
Administration, Government National Mortgage Association,
9
<PAGE>
Maritime Administration, Small Business Administration, and The Tennessee Valley
Authority. The 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 instrumentalities of the U.S. 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 U.S. Postal Service. Some of these
securities are supported by the full faith and credit of the U.S. Treasury
(e.g., Government National Mortgage Association), others (in which all
Portfolios permitted to invest in agencies' securities may invest) are supported
by the right of the issuer to borrow from the Treasury and still others (in
which only the Short Duration Mortgage, Short-Term Mortgage, Corporate Daily
Income and Government Securities Daily Income Portfolios may invest) 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 Trust does not intend to purchase securities issued by the World
Bank, the Inter-American Development Bank or the Asian Development Bank. All
Portfolios except the Treasury, Treasury II and Federal Securities Portfolio may
invest in U.S. agency obligations.
VARIABLE OR FLOATING RATE INSTRUMENTS--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 that 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 Advisers, be equivalent to the
long-term bond or commercial paper 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 Government Securities Daily Income
Portfolio may invest in variable or floating rate instruments.
WHEN-ISSUED SECURITIES
These securities involve the purchase of debt obligations on a when-issued
basis, in which case delivery and payment normally take place within 45 days
after the date of commitment to purchase. The Portfolios will make commitments
to purchase obligations on a when-issued basis only with the intention of
actually acquiring the securities, but may sell them before the settlement date.
The when-issued securities are subject to market fluctuation, and no interest
accrues to the purchaser during the period prior to settlement. The payment
obligation and the interest rate that a Portfolio will receive on the securities
are each fixed at the time the Portfolio enters into the commitment. Purchasing
obligations on a when-issued basis is a form of leveraging and can involve a
risk that the yields available in the market when delivery takes place may
actually be higher than those obtained in the transaction itself, in which case
the Portfolio could experience an unrealized loss at the time of delivery.
Segregated accounts comprised of liquid assets will be established with the
custodian for the Portfolios in an amount at least equal in value to each such
Portfolio's commitments to purchase when-issued securities. If the value of
these assets declines, the appropriate Portfolio will place additional liquid
assets in the account on a daily basis so that the value of the assets in the
account is equal to the amount of such commitments. All Portfolios may invest in
when-issued securities.
THE MANAGER AND SHAREHOLDER SERVICING AGENT
The Management Agreement provides that 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
10
<PAGE>
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 continuance of the Management Agreement with respect to each Portfolio must
be specifically approved at least annually (i) by the vote of a majority of the
Trustees or by the vote of a majority of the outstanding voting securities of
that Portfolio, and (ii) by the vote of a majority of the Trustees of the Trust
who are not parties to the Management Agreement or an "interested person" (as
that term is defined in the 1940 Act) of any party thereto, cast in person at a
meeting called for the purpose of voting on such approval. The Management
Agreement is terminable, without penalty, at any time as to any Portfolio by the
Trustees of the Trust, by a vote of a majority of the outstanding shares of that
Portfolio or by the Manager on not less than 30 days' nor more than 60 days'
written notice.
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 101
Main Street, Cambridge, Massachusetts 02142. Alfred P. West, Jr., Carmen V.
Romeo and Henry H. Greer constitute the Board of Directors of the Manager. Mr.
West serves as the Chairman of the Board of Directors and Chief Executive
Officer of the Manager and SEI. Mr. Greer serves as President and Chief
Operating Officer of the Manager and 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 to the following other
mutual funds: SEI Liquid Asset Trust; SEI Tax Exempt Trust; SEI Institutional
Managed Trust; SEI Index Funds; SEI International Trust; Stepstone Funds
(formerly Union Investors Funds); The Compass Capital Group of Funds; 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.; First American Mutual Funds; Rembrandt Funds; The Arbor
Fund; 1784 Funds; The PBHG Funds, Inc. (formerly, The Advisors' Inner Circle II
Fund, Inc.); Marquis Funds ; Nationar Funds, Inc.; Inventor Funds, Inc.; Morgan
Grenfell Investment Trust; and Insurance Investments Products Trust.
The Manager is obligated under the Management Agreement to pay the excess of a
Portfolio's operating expenses over the following limitations: Federal
Securities Portfolio and Money Market Portfolio (Class A shares), 1.00% of
average daily net assets; Money Market Portfolio (Class B shares), 1.30% of
average daily net assets; Money Market Portfolio (Class C shares), 1.50% of
average daily net assets; Treasury II Portfolio (Class A shares) and Government
Portfolio (Class A shares), .25% of average daily net assets; Treasury II
Portfolio (Class B shares) and Government Portfolio (Class B shares), .55% of
average daily net assets; Treasury II Portfolio (Class C shares) and Government
Portfolio (Class C shares), .75% of average daily net assets; Prime Obligation
Portfolio (Class A shares), Government II Portfolio (Class A shares) and
Treasury Portfolio (Class A shares), .20% of average daily net assets; Prime
Obligation Portfolio (Class B shares), Government II Portfolio (Class B shares)
and Treasury Portfolio (Class B shares), .50% of average daily net assets; and
Prime Obligation Portfolio (Class C shares), Government II Portfolio (Class C
shares) and Treasury Portfolio (Class C shares), .70% of average daily net
assets. If operating expenses of any Portfolio exceed limitations established
by certain states, the Manager will pay such excess. 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. The term "expenses" is defined in such
laws or regulations, and generally excludes brokerage commissions, distribution
expenses, taxes, interest and extraordinary expenses. Certain voluntary and
contractual fee waivers and reimbursement arrangements by the Manager were in
effect during the fiscal year ended January 31, 1995; these voluntary fee
waivers and reimbursement arrangements are described in the Prospectuses.
For the fiscal years ended January 31, 1993, 1994 and 1995, the Portfolios
paid fees to the Manager as follows:
11
<PAGE>
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
Fees Paid (000) Fee Waivers and Reimbursements (000)
---------------------------------------------------------------------------------
1993 1994 1995 1993 1994 1995
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Money Market Portfolio $ 768 $ 542 $ 220 $ 92 $ 181 $ 491
----------------------------------------------------------------------------------------------------------------------------------
Prime Obligation Portfolio $1,902 $2,669 $2,551 $1,555 $1,337 $1,697
----------------------------------------------------------------------------------------------------------------------------------
Government Portfolio $ 13 $ 6 $ 121 $ 26 $ 7 $ 285
----------------------------------------------------------------------------------------------------------------------------------
Government II Portfolio $ 697 $ 826 $ 861 $ 454 $ 473 $ 574
----------------------------------------------------------------------------------------------------------------------------------
Treasury Portfolio $ 7 $ 55 $ 56 $ 30 $ 51 $ 59
----------------------------------------------------------------------------------------------------------------------------------
Treasury II Portfolio $ 582 $ 639 $ 616 $ 222 $ 263 $ 313
----------------------------------------------------------------------------------------------------------------------------------
Federal Securities Portfolio $1,236 $ 166 $ 50 $ 175 $ 0 $ 2
----------------------------------------------------------------------------------------------------------------------------------
Corporate Daily Income Portfolio * $ 14 $ 70 * $ 29 $ 82
----------------------------------------------------------------------------------------------------------------------------------
Government Securities Daily Income Portfolio * * * * * *
----------------------------------------------------------------------------------------------------------------------------------
Short-Term Mortgage Portfolio * $ (1) $ 8 * $ 5 $ 9
----------------------------------------------------------------------------------------------------------------------------------
Short Duration Mortgage Portfolio * * * * * *
----------------------------------------------------------------------------------------------------------------------------------
Short-Term Government Portfolio $ 226 $ 323 $ 333 $ 69 $ 65 $ 61
----------------------------------------------------------------------------------------------------------------------------------
Intermediate-Term Government Portfolio $ 645 $ 885 $ 866 $ 154 $ 188 $ 188
----------------------------------------------------------------------------------------------------------------------------------
GNMA Portfolio $ 435 $ 671 $ 744 $ 74 $ 86 $ 34
==================================================================================================================================
</TABLE>
* Not in operation during such period.
THE ADVISER
The Trust and Wellington Management Company ("the Adviser") have entered into
four advisory agreements (the "Advisory Agreements," and each an "Advisory
Agreement") dated September 30, 1983, December 15, 1986, August 4, 1993 and June
30, 1994. The Advisory Agreements provide 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 Agreements with respect to any Portfolio after
the first two (2) years of such 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 such Advisory Agreements or "interested persons" of any
party thereto, cast in person at a meeting called for the purpose of voting on
such approval. The Advisory Agreements 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.
Wellington Management Company ("WMC"), Adviser to the Money Market, Prime
Obligation, Government, Government II, Treasury, Treasury II, Federal
Securities, Corporate Daily Income, Government Securities Daily Income, Short-
Term Mortgage, Short Duration Mortgage, Short- Term Government, Intermediate-
Term Government and GNMA Portfolios, is entitled to a fee, for its investment
advisory services, which is accrued daily and paid monthly at the following
annual rates: .075% of the combined daily net assets of the Money Market, Prime
Obligation, Government, Government II, Treasury, Treasury II and Federal
Securities Portfolios up to $500 million and .02% of
12
<PAGE>
such net assets in excess of $500 million; .10% of the combined daily net assets
of the Short-Term Government, Intermediate-Term Government and GNMA Portfolios
up to $500 million, .075% of such net assets from $500 million to $1 billion,
and .05% of such net assets in excess of $1 billion; .10% of the combined daily
net assets of the Corporate Daily Income and Government Securities Daily Income
Portfolios up to $500 million, .075% of such net assets from $500 million to $1
billion, and .05% of such assets in excess of $1 billion; and .10% of the
combined average daily net assets of the of the Short-Term Mortgage and Short
Duration Mortgage for the first $500 million, .075% of such assets from $500
million to $1 billion and .05% of such assets in excess of $1 billion. WMC may
voluntarily waive portions of its fees, although such waiver is not expected to
affect any Portfolio's total operating expenses, due to the nature of the
Manager's fee waivers. WMC may terminate its waiver at any time. The Trust's
investment advisory agreement respecting the Short-Term Mortgage and Short
Duration Mortgage Portfolios with Bear Stearns Asset Management was terminated
by the Board of Trustees on June 8, 1994 and by written consent of sole
shareholder on September 30, 1994, respectively. As of June 30, 1994, WMC has
served as investment adviser to the Short-Term Mortgage and Short Duration
Mortgage Portfolios, respectively.
For the fiscal years ended January 31, 1993, 1994 and 1995, the Portfolios
paid WMC advisory fees as follows:
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------
Fees Paid (000) Fee Waivers (000)
----------------------------------------------------------------------
1993 1994 1995 1993 1994 1995
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Money Market Portfolio $ 65 $ 52 $ 46 $ 7 $ 9 $ 13
-----------------------------------------------------------------------------------------------------------------------
Prime Obligation Portfolio $ 147 $ 207 $ 165 $ 105 $ 381 $ 443
-----------------------------------------------------------------------------------------------------------------------
Government Portfolio $ 1 $ 1 $ 12 $ 1 $ 1 $ 34
-----------------------------------------------------------------------------------------------------------------------
Government II Portfolio $ 51 $ 68 $ 56 $ 33 $ 123 $ 150
-----------------------------------------------------------------------------------------------------------------------
Treasury Portfolio $ 1 $ 4 $ 3 $ 1 $ 8 $ 10
-----------------------------------------------------------------------------------------------------------------------
Treasury II Portfolio $ 30 $ 37 $ 28 $ 17 $ 68 $ 77
-----------------------------------------------------------------------------------------------------------------------
Federal Securities Portfolio $ 60 $ 8 $ 2 $ 11 $ 0 $ 0
-----------------------------------------------------------------------------------------------------------------------
Corporate Daily Income Portfolio * $ 4 $ 36 * $ 8 $ 6
-----------------------------------------------------------------------------------------------------------------------
Government Securities Daily Income Portfolio * * * * * *
-----------------------------------------------------------------------------------------------------------------------
Short-Term Mortgage Portfolio * $ 1 $ 5 * $ 0 $ 0
----------------------------------------------------------------------
Bear Stearns Asset Management N/A $ 1 $ 2 N/A $ 0 $ 0
----------------------------------------------------------------------
Wellington Management Company N/A N/A $ 3 N/A N/A $ 0
-----------------------------------------------------------------------------------------------------------------------
Short Duration Mortgage Portfolio * * * * * *
-----------------------------------------------------------------------------------------------------------------------
Short-Term Government Portfolio $ 67 $ 89 $ 88 $ 16 $ 16 $ 16
-----------------------------------------------------------------------------------------------------------------------
Intermediate-Term Government Portfolio $ 187 $ 248 $ 235 $ 43 $ 44 $ 43
-----------------------------------------------------------------------------------------------------------------------
GNMA Portfolio $ 127 $ 191 $ 190 $ 30 $ 34 $ 35
=======================================================================================================================
</TABLE>
* Not in operation during such period.
13
<PAGE>
DISTRIBUTION
The Trust has adopted a Distribution Plan (each a "Plan" and, collectively, the
"Plans") for the Class A, Class B, Class C and Class D shares of each
Portfolio (the Federal Securities Portfolio has only Class A shares, and only
the Short-Term Government, Intermediate-Term Government and GNMA Portfolios have
Class D shares) in accordance with the provisions of Rule 12b-1 under the 1940
Act, which regulates 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 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 or class affected. All
material amendments of the Plans will require approval by a majority of the
Trustees of the Trust and of the Qualified Trustees.
The Class D Distribution Plan adopted by the Class D shareholders provides
that the Trust will pay the Distributor a fee up to .30% of the average daily
net assets of a Portfolio's Class D class which the Distributor can use to
compensate broker-dealers and service providers, including SEI Financial
Services Company and its affiliates which provide distribution related services
to Class D shareholders or their customers who beneficially own Class D
shares.
The distribution-related services that may be provided under the Plans include
establishing and maintaining customer accounts and records; aggregating and
processing purchase and redemption requests from customers; placing net purchase
and redemption orders with the Distributor; automatically investing customer
account cash balances, providing periodic statements to customers; arranging for
wires; answering customer inquiries concerning their investments; assist
customers in changing dividend options, account designations, and addresses;
performing sub-accounting functions; processing dividend payments from the Trust
on behalf of customers; and forwarding shareholder communications from the Trust
(such as proxies, shareholder reports and dividend distribution and tax notices)
to these customers with respect to investments in the Trust. Certain state
securities laws may require those financial institutions providing such
distribution services to register as dealers pursuant to state law.
Except to the extent that the Manager and/or Adviser benefitted through
increased fees from an increase in the net assets of the Trust which may have
resulted in part from the expenditures, no interested person of the Trust nor
any Trustee of the Trust who is not an interested person of the Trust had a
direct or indirect financial interest in the operation of the Distribution Plans
or related agreements.
Although banking laws and regulations prohibit banks from distributing shares of
open-end investment companies such as the Trust, according to an opinion issued
to the staff of the SEC by the Office of the Comptroller of the Currency,
financial institutions are not prohibited from acting in other capacities for
investment companies, such as providing shareholder services. Should future
legislative, judicial or administrative action prohibit or restrict the
activities of financial institutions in connection with providing shareholder
services, the Trust may be required to alter materially or discontinue its
arrangements with such financial institutions.
For the fiscal year ended January 31, 1995, the Portfolios incurred the
following distribution expenses:
14
<PAGE>
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------------
Total Dist. Amount Paid to
Expenses as 3rd Parties by
Total Dist. a % of net SFS for Sales Printing Other
Portfolio Class Expenses assets Distributor Expenses Costs Costs*
Related Services
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
A $ 113,236 .05% N/A $ 64,307 $ 8,625 $ 40,304
Money Market Portfolio -----------------------------------------------------------------------------------
B $ 15,657 .35% $ 13,282 $ 1,349 $ 181 $ 845
-------------------------------------------------------------------------------------------------------------------------------
A $1,201,377 .05% N/A $668,626 $86,042 $446,709
Prime Obligation Portfolio -----------------------------------------------------------------------------------
B $ 50,369 .35% $ 42,665 $ 4,288 $ 552 $ 2,864
-----------------------------------------------------------------------------------
C $ 21,625 .55% $ 19,512 1,176 $ 151 $ 786
-------------------------------------------------------------------------------------------------------------------------------
Government Portfolio C $1,006,724 .60% $845,496 $ 47,602 $ 4,579 $109,047
-------------------------------------------------------------------------------------------------------------------------------
A $ 404,173 .06% N/A $235,307 $29,491 $139,375
Government II Portfolio -----------------------------------------------------------------------------------
B $ 49,458 .36% $ 41,866 $ 4,420 $ 554 $ 2,618
-------------------------------------------------------------------------------------------------------------------------------
Treasury Portfolio A $ 23,466 .05% N/A $ 14,780 $ 1,999 $ 6,687
-------------------------------------------------------------------------------------------------------------------------------
A $ 204,292 .06% N/A $111,541 $14,974 $ 77,777
Treasury II Portfolio -----------------------------------------------------------------------------------
B $ 90,893 .36% $ 76,482 $ 7,868 $ 1,056 $ 5,487
-------------------------------------------------------------------------------------------------------------------------------
Federal Securities Portfolio*** A $ (4,452) (.05)% N/A $ 3,190 $(2,429) $ (5,213)
-------------------------------------------------------------------------------------------------------------------------------
Corporate Daily Income Portfolio A $ 24,364 .06% N/A $ 13,223 $ 2,697 $ 8,444
-------------------------------------------------------------------------------------------------------------------------------
Government Securities Daily A ** **% ** ** ** **
Income Portfolio
-------------------------------------------------------------------------------------------------------------------------------
Short-Term Mortgage Portfolio A $ 1,761 .04% N/A $ 1,517 $ 300
-------------------------------------------------------------------------------------------------------------------------------
Short Duration Mortgage Portfolio A ** **% ** ** ** **
-------------------------------------------------------------------------------------------------------------------------------
A $ 51,326 .05% N/A $ 34,900 $ 8,787 $ 7,639
Short-Term Government Portfolio -----------------------------------------------------------------------------------
B $ 312 .35% $ 271 $ 28 $ 7 $ 6
-------------------------------------------------------------------------------------------------------------------------------
A $ 158,953 .053% N/A $ 93,915 $40,668 $ 24,370
Intermediate-Term Government Portfolio -----------------------------------------------------------------------------------
D $ 446 .304% $ 367 $ 47 $ 21 $ 11
-------------------------------------------------------------------------------------------------------------------------------
A $ 130,001 .054% N/A $ 77,556 $35,262 $ 17,183
GNMA -----------------------------------------------------------------------------------
D $ 469 .303% $ 387 $ 48 $ 21 $ 13
===============================================================================================================================
</TABLE>
* Costs of complying with securities laws pertaining to the distribution of
shares.
** Not in operation during such period.
TRUSTEES AND OFFICERS OF THE TRUST
15
<PAGE>
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 E. Swedesford Road, Wayne, PA 19087. Certain
trustees and officers of the Trust also serve as trustees and officers of some
or all of the following: SEI Liquid Asset Trust, SEI Institutional Managed
Trust, SEI Tax Exempt Trust, SEI Index Funds, SEI International Trust; Stepstone
Funds, The Compass Capital Group of Funds, 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., First
American Mutual Funds, The Arbor Fund, 1784 Funds, The PBHG Funds, Inc., Marquis
Funds , Morgan Grenfell Investment Trust Inventor Funds, Nationar Funds, Inc.
and Insurance Investment Products Trust, open-end management investment
companies which are managed by SEI Financial Management Corporation and
distributed by SEI Financial Services Company.
ROBERT A. NESHER - Chief Executive Officer, Chairman of the Board of Trustees* -
Retired since 1994. 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, 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. Director, STI
Classic Funds since 1992. 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. Trustee of STI Classic Funds.
FRANK E. MORRIS - Trustee** - 105 Walpole Street, Dover, MA 02030. Retired
since 1990. Peter Drucker Professor of Management, Boston College since 1989.
President, Federal Reserve Bank of Boston, 1968-1988. Trustee of The Arbor
Fund, Marquis Funds, Advisors' Inner Circle Fund, Advisors' Inner Circle Fund
II, Inc. and FFB Lexicon Funds.
JAMES M. STOREY - Trustee** - Ten Post Office Square, Boston, MA 02109. Partner
of Dechert Price & Rhodes (law firm).
DAVID G. LEE - President - Senior Vice President of the Distributor since 1993.
Vice President of the Distributor since 1991. President, GW Sierra Trust Funds
prior to 1991.
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 and
Assistant Secretary of the 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 (lawfirm),
prior to 1990.
16
<PAGE>
KATHRYN L. STANTON - Vice President, Assistant Secretary - Vice President and
Assistant Secretary of SEI Corporation, the Manager and Distributor since 1994.
Associate, Morgan, Lewis & Bockius (law firm), 1989-1994.
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 the Distributor 1992-1994. Associate,
Morgan, Lewis & Bockius (law firm) prior to 1992.
JEFFREY A. COHEN - Controller, Assistant Secretary - Director of Funds
Accounting of SEI since 1991. Senior Accountant of Price Waterhouse 1989-1991.
RICHARD W. GRANT - Secretary - 2000 One Logan Square, Philadelphia, PA 19103,
Partner, Morgan, Lewis & Bockius, counsel to the Trust, Manager and Distributor.
================================================================================
*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, Morris and Storey serve as members of the Audit
Committee of the Trust.
The Trustees and officers of the Trust own, as a group, 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.
COMPENSATION TABLE
<TABLE>
<CAPTION>
===================================================================================================================================
Aggregate Compensation Total Compensation From
Name of Person, from Registrant for the Pension or Retirement Estimated Annual Registrant and Trust
Position Fiscal Year Ended Benefits Accrued as Benefits Upon Complex Paid to Trustees
January 31, 1995 Part of Fund Expenses Retirement for the Fiscal Year Ended
January 31, 1995
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Edward W. Binshadler $ 75,000 $75,000 for services on 1
board
-----------------------------------------------------------------------------------------------------------------------------------
Richard F. Blanchard $ 75,000 $75,000 for services on 1
board
-----------------------------------------------------------------------------------------------------------------------------------
F. Wendell Gooch $ 75,000 $75,000 for services on 1
board
-----------------------------------------------------------------------------------------------------------------------------------
Frank E. Morris $100,000 $100,000 for services on 2
boards
-----------------------------------------------------------------------------------------------------------------------------------
James M. Storey $100,000 $100,000 for services on 2
boards
====================================================================================================================================
</TABLE>
INVESTMENT LIMITATIONS
Fundamental Policies
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.
17
<PAGE>
A Portfolio may not:
1. Make loans, except that each 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.
2. Pledge, mortgage or hypothecate assets except to secure temporary borrowings
permitted by (1) above in aggregate amounts not to exceed 10% of the net
assets of such Portfolio taken at fair market value at the time of the
incurrence of such loan.
3. Invest in companies for the purpose of exercising control.
4. Acquire more than 10% of the voting securities of any one issuer.
5. Purchase or sell real estate, real estate limited partnership interests,
commodities or commodities contracts including (with the exception of the
Short-Term Government, Intermediate-Term Government, GNMA, Short-Term
Mortgage and Short Duration Mortgage Portfolios) futures contracts. However,
subject to its permitted investments, the Portfolios may purchase
obligations issued by companies which invest in real estate, commodities or
commodities contracts.
6. Make short sales of securities, maintain a short position or purchase
securities on margin, except that the Portfolios may obtain short-term
credits as necessary for the clearance of security transactions.
7. Act as an underwriter of securities of other issuers except as it may be
deemed an underwriter in selling a portfolio security.
8. Purchase securities of other investment companies; provided that all
Portfolios may purchase such securities as permitted by the 1940 Act and the
rules and regulations thereunder but, in any event, such Portfolios (except
the Short-Term Mortgage and Short Duration Mortgage Portfolios) may not
purchase securities of other open-end investment companies.
9. Issue senior securities (as defined in the 1940 Act) except in connection
with permitted borrowings as described in the Prospectuses and this
Statement of Additional Information or as permitted by rule, regulation or
order of the SEC.
10. 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.
11. 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) would be invested in such
securities.
12. Purchase warrants, puts, calls, straddles, spreads or combinations thereof,
except that the Short-Term Mortgage and Short Duration Mortgage Portfolios
may invest in options on futures contracts.
13. Invest in interests in oil, gas or other mineral exploration or development
programs.
18
<PAGE>
14. 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 Prospectuses and
this Statement of Additional Information.
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. These
investment limitations and the investment limitations in each Prospectus are
fundamental policies of the Trust and may not be changed without shareholders'
approval. In addition, it is a fundamental policy of the Money Market and Prime
Obligation Portfolios to invest only in high quality, U.S. dollar denominated
obligations maturing in one year or less (although obligations subject to
repurchase agreements may have a maturity in excess thereof), and to maintain an
average maturity (on a dollar weighted basis) of 90 days or less.
In addition, it is a non-fundamental policy of the Portfolios not to invest in
oil, gas or mineral leases.
PERFORMANCE
From time to time, each Portfolio may advertise yield and/or total return.
These figures will be based on historical earnings and are not intended to
indicate future performance.
The current yield of the Portfolios that are money market funds is calculated
daily based upon the 7 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.
These money market 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 divided by
the 7th power)} - 1. The current and the effective yields reflect the
reinvestment of net income earned daily on portfolio assets.
From time to time, the Trust may advertise the yield of the Short-Term
Government, Intermediate-Term Government, GNMA, Short-Term Mortgage, Short
Duration Mortgage, Corporate Daily Income and/or Government Securities Daily
Income Portfolios. These figures will be based on historical earnings and are
not intended to indicate future performance. The yield of these Portfolios
refers to the annualized income generated by an investment in a Portfolio over a
specified 30-day period. The yield is calculated by assuming that the income
generated by the investment during that period generated each period over one
year and is shown as a percentage of the investment. In particular, yield will
be calculated according to the following formula: Yield = 2[(((a-b)/cd) + 1)/6/
- 1], where a = dividends and interest earned during the period; b = expenses
accrued for the period (net of reimbursement); c = the current daily number of
shares outstanding during the period that were entitled to receive dividends;
and d = the maximum offering price per share on the last day of the period.
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
mutual funds; however, yields of other 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.
19
<PAGE>
For the 7-day period ended January 31, 1995, the end of the Trust's most recent
fiscal year, the current and effective yield for Class A of each money market
Portfolio was: Money Market, 5.96% and 6.14%; Prime Obligation, 5.91% and
6.08%; Government II, 5.77% and 5.94%; Treasury, 5.54% and 5.69%; Treasury
II, 5.55% and 5.71%; respectively. As of the end of the fiscal year, the
Federal Securities Portfolio had no outstanding shares.
For the 7-day period ended January 31, 1995, the end of the Trust's most recent
fiscal year, the current and effective yield for Class B of each money market
Portfolio was: Money Market, 5.66% and 5.82%; Prime Obligation, 5.61% and
5.77%; Government II, 5.48% and 5.63%; and Treasury II, 5.25% and 5.39%,
respectively.
For the 7-day period ended January 31, 1995, the end of the Trust's most recent
fiscal year, the current and effective yield for Class C of the Government
Portfolio was 5.30% and 5.44%.
For the 30-day period ended January 31, 1995, the yield for Class A of each
non-money market Portfolio was: Corporate Daily Income, 6.17%; Short-Term
Mortgage, 7.37%; Short-Term Government, 6.87%; Intermediate-Term Government,
7.20%; and GNMA, 7.12%.
For the 30-day period ended January 31, 1995, the yield for Class B of each
non-money market Portfolio was: Short-Term Government Portfolio, 6.59%;
Intermediate-Term Government, 6.89%; and GNMA Securities, 6.82%.
For the 30-day period ended January 31, 1995, the yield (without loads) for
Class D class of each Portfolio which had offered Class D shares as of the end
of the 1995 fiscal year was: Intermediate-Term Government, 6.56%; and GNMA,
6.42%.
As of January 31, 1995, there were no shares outstanding of Class D shares of
Short-Term Government Portfolio.
From time to time, the Trust may advertise total return for one or more of the
following Portfolios: Short-Term Government, Intermediate-Term Government,
GNMA, Short-Term Mortgage, Short Duration Mortgage, Corporate Daily Income and
Government Securities Daily Income. The total return of a Portfolio refers to
the average compounded rate of return to a hypothetical investment for
designated time periods (including, but not limited to, the period from which
the Portfolio commenced operations through the specified date), assuming that
the entire investment is redeemed at the end of each period. In particular,
total return will be calculated according to the following formula: P(1 + T)/n/
= ERV, where P = a hypothetical initial payment of $1,000; T = average annual
total return; n = number of years; and ERV = ending redeemable value of a
hypothetical $1,000 payment made at the beginning of the designated time period
as of the end of such period.
Corporate Daily Income Portfolio - Class A
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,025.90, resulting in an annual total return equal to
2.59%. For the period from September 28, 1993 (commencement of operations)
through January 31, 1995, the ending redeemable value of a $1,000 payment was
$1,037.80, resulting in an annual return for the Portfolio equal to 2.81%.
Short-Term Mortgage Portfolio - Class A
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,022.90 resulting in an annual return equal to 2.29%.
For the period from May 20, 1993 (commencement of operations) through January
31, 1995, the ending redeemable value of a $1,000 payment was $1,036.00,
resulting in an annual return for the Portfolio equal to 2.11%.
Short-Term Government Portfolio - Class A
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,009.30, resulting in an annual total return equal to
.93%. For the five year period ended January 31, 1995, the ending redeemable
value of a $1,000 investment was $1,360.46, resulting in a total return equal
to 6.35%. For the period
20
<PAGE>
from February 17, 1987 (commencement of operations) through January 31, 1995,
the ending redeemable value of a $1,000 payment was $1,065.10, resulting in an
annual return for the Portfolio equal to 6.51%.
Short-Term Government Portfolio - Class B
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,007.00, resulting in an annual total return equal to
.70%. For the period from November 5, 1990 (commencement of operations) through
January 31, 1995, the ending redeemable value of a $1,000 payment was
$1,251.30 resulting in an annual return for the Portfolio equal to 5.44%.
Money Market Portfolio - Class A
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,045.50, resulting in an annual total return equal to
4.55%. For the five year period ended January 31, 1995, the ending redeemable
value of a $1,000 investment was $1,276.28, resulting in a total return equal
to 5.00%. For the ten year period ended January 31, 1995, the ending
redeemable value of a $1,000 investment was $1,856.10, resulting in a total
return equal to 6.38%. For the period from November 15, 1983 (commencement of
operations) through January 31, 1995, the ending redeemable value of a $1,000
payment was $2,092.80, resulting in an annual return for the Portfolio equal to
6.89%.
Money Market Portfolio - Class B
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,042.40, resulting in an annual total return equal to
4.24%. For the period from October 12, 1990 (commencement of operations)
through January 31, 1995, the ending redeemable value of a $1,000 payment was
$1,192.10, resulting in an annual return for the Portfolio equal to 4.18%.
Prime Obligation Portfolio - Class A
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,044.60, resulting in an annual total return equal to
4.46%. For the five year period ended January 31, 1995, the ending redeemable
value of a $1,000 investment was $1,282.37, resulting in a total return equal
to 5.10%. For the period from September 6, 1985 (commencement of operations)
through January 31, 1995, the ending redeemable value of a $1,000 payment was
$1,522.90, resulting in an annual return for the Portfolio equal to 6.13%.
Prime Obligation Portfolio - Class B
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,041.50, resulting in an annual total return equal to
4.15%. For the period from March 26, 1991 (commencement of operations) through
January 31, 1995, the ending redeemable value of a $1,000 payment was
$1,158.50, resulting in an annual return for the Portfolio equal to 3.90%.
Government Portfolio - Class C
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,034.10, resulting in an annual total return equal to
4.19%. For the period from March 8, 1992 (commencement of operations) through
January 31, 1995, the ending redeemable value of a $1,000 payment was
$1,034.10, resulting in an annual return for the Portfolio equal to 3.41%.
Government II Portfolio - Class A
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,043.90, resulting in an annual total return equal to
4.39%. For the five year period ended January 31, 1995, the ending redeemable
value of a $1,000 investment was $1,271.90, resulting in a total return equal
to 4.93%. For the period
21
<PAGE>
from September 6, 1985 (commencement of operations) through January 31, 1995,
the ending redeemable value of a $1,000 payment was $1,712.80, resulting in an
annual return for the Portfolio equal to 6.06%.
Government II Portfolio - Class B
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,040.80, resulting in an annual total return equal to
4.08%. For the period from January 28, 1991 (commencement of operations)
through January 31, 1995, the ending redeemable value of a $1,000 payment was
$1,164.50, resulting in an annual return for the Portfolio equal to 3.87%.
Treasury Portfolio - Class A
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,042.90, resulting in an annual total return equal to
4.29%. For the period from September 30, 1992 (commencement of operations)
through January 31, 1995, the ending redeemable value of a $1,000 payment was
$1,084.60, resulting in an annual return for the Portfolio equal to 3.54%.
Treasury II Portfolio - Class A
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,041.70, resulting in an annual total return equal to
4.17%. For the five year period ended January 31, 1995, the ending redeemable
value of a $1,000 investment was $1,260.56, resulting in a total return equal to
4.74%. For the period from July 28, 1989 (commencement of operations) through
January 31, 1995, the ending redeemable value of a $1,000 payment was $1,310.10,
resulting in an annual return for the Portfolio equal to 5.03%.
Treasury II Portfolio - Class B
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $1,038.60, resulting in an annual total return equal to
3.86%. For the period from February 15, 1990 (commencement of operations)
through January 31, 1995, the ending redeemable value of a $1,000 payment was
$1,023.46, resulting in an annual return for the Portfolio equal to 4.35%.
Intermediate-Term Government Portfolio - Class A
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $978.10, resulting in an annual total return equal to
(2.19)%. For the five year period ended January 31, 1995, the ending
redeemable value of a $1,000 investment was $1,411.09, resulting in a total
return equal to 7.13%. For the period from February 17, 1987 (commencement of
operations) through January 31, 1995, the ending redeemable value of a $1,000
payment was $1,699.50, resulting in an annual return for the Portfolio equal to
6.90%.
Intermediate-Term Government Portfolio - Class B
For the period from June 8, 1994 (commencement of operations) through January
31, 1995, the ending redeemable value of a $1,000 payment was $1,009.30,
resulting in an annual return for the Portfolio equal to .93%.
GNMA Portfolio - Class A
For the fiscal year ended January 31, 1995, the ending redeemable value of a
$1,000 investment was $975.40, resulting in an annual total return equal to
(2.46)%. For the five year period ended January 31, 1995, the ending
redeemable value of a $1,000 investment was $1,455.77, resulting in a total
return equal to 7.80%. For the period from March 20, 1987 (commencement of
operations) through January 31, 1995, the ending redeemable value of a $1,000
payment was $1,772.40, resulting in an annual return for the Portfolio equal to
7.55%.
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GNMA Portfolio - Class B
For the period from July 12, 1994 (commencement of operations) through January
31, 1995, the ending redeemable value of a $1,000 payment was $1,073.10,
resulting in an annual return for the Portfolio equal to 7.31%.
Intermediate-Term Government Portfolio - Class D
For the fiscal year ended January 31, 1995, assuming the maximum sales load is
deducted from the initial investment, the annual return for the Portfolio is
equal to (6.05)%. For the same period, assuming the sales load is not deducted
from the initial investment, the annual return for the Portfolio is equal to
(2.61)%.
For the period from September 26, 1993 (the date Class D shares of the
Intermediate-Term Government Portfolio were first offered) through January 31,
1995, assuming the maximum sales load is deducted from the initial investment,
the annual return for the Portfolio is equal to (3.83)%. For the same period,
assuming the sales load is not deducted from the initial investment, the annual
return for the Portfolio is equal to (1.22)%.
GNMA Portfolio - Class D
For the fiscal year ended January 31, 1995, assuming the maximum sales load is
deducted from the initial investment, the annual return for the Portfolio is
equal to (7.44)%. For the same period, assuming the sales load is not deducted
from the initial investment, the annual return for the Portfolio is equal to
(3.04)%.
For the period from September 30, 1993 (the date Class D shares of the GNMA
Portfolio were first offered) through January 31, 1995, assuming the maximum
sales load is deducted from the initial investment, the annual return for the
Portfolio is equal to (4.59)%. For the same period, assuming the sales load is
not deducted from the initial investment, the annual return for the Portfolio is
equal to (1.25)%.
The Portfolios may, from time to time, compare their performance to the
performance of other mutual funds tracked by mutual fund rating services, to
broad groups of comparable mutual funds or unmanaged indices which may assume
investment of dividends but generally do not reflect deductions for
administrative and management costs.
DETERMINATION OF NET ASSET VALUE
Securities of the Money Market, Prime Obligation, Government, Government II,
Treasury, Treasury II and Federal Securities 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, there may be periods during
which the value of an instrument, as determined by this method, is higher or
lower than the price the Trust 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 (with respect to the Money Market,
Prime Obligation, Government, Government II, Treasury, Treasury II and Federal
Securities Portfolios) and the maintenance of the Trust's net asset value at
$1.00 are permitted, provided certain conditions are met, by Rule 2a-7,
promulgated by the SEC under the 1940 Act. Under Rule 2a-7 as amended, a money
market portfolio must maintain a dollar-weighted average maturity of 90 days or
less and not purchase any instrument having a remaining maturity of more than
397 days. In addition,
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money market funds may acquire only U.S. dollar denominated obligations that
present minimal credit risks and that are "eligible securities". An "eligible
security" is one that is (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 Advisers 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 money market 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 share at $1.00 for each
Portfolio. However, there is no assurance that the Trust will be able to meet
this objective for any Portfolio. The Trust's procedures include the
determination of the extent of deviation, if any, of each Portfolio's current
net asset value per share calculated using available market quotations from each
Portfolio's amortized cost price per share 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 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.
Securities of the Short-Term Government, Intermediate-Term Government, GNMA,
Short-Term Mortgage, Short Duration Mortgage, Corporate Daily Income and
Government Securities Daily Income Portfolios are valued by the Manager pursuant
to valuations provided by an independent pricing service. The pricing service
relies primarily on prices of actual market transactions as well as trader
quotations. However, the service may also use a matrix system to determine
valuations, which system considers such factors as security prices, yields,
maturities, call features, ratings and developments relating to specific
securities in arriving at valuations. The procedures of the pricing service and
its valuations are reviewed by the officers of the Trust under the general
supervision of the Trustees.
PURCHASE AND REDEMPTION OF SHARES
It is currently the Trust's policy to pay all redemptions in cash. The Trust
retains the right, however, to alter this policy to provide for redemptions in
whole or in part by a distribution in kind of readily marketable securities held
by a Portfolio in lieu of cash. Shareholders may incur brokerage charges on the
sale of any such securities so received in payment of redemptions. However, a
shareholder will at all times be entitled to aggregate cash redemptions from all
Portfolios of the Trust during any 90-day period of up to the lesser of $250,000
or 1% of the Trust's net assets.
A gain or loss for federal income tax purposes may be realized by a taxable
shareholder upon an in-kind redemption depending upon the shareholder's basis in
the shares of the Trust redeemed.
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 by order permit. The
Trust also reserves the right to suspend sales of shares of the Portfolios for
any period during which the New York Stock Exchange, the Manager, the
Adviser(s), the Distributor and/or the Custodian(s) are not open for business.
The Manager or Distributor will not accept securities as payment for shares of
the GNMA Portfolio unless (a) such securities meet the investment objectives and
policies of the Trust; (b) the securities are acquired for investment and
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not for resale; (c) such securities are liquid securities which are not
restricted as to transfer either by law or liquidity of market; (d) such
securities have a value which is readily ascertainable (and not established only
by evaluation).
SHAREHOLDER SERVICES
The following is a description of plans and privileges by which the sale charges
imposed on the Class D shares of the Short-Term Government, Intermediate-Term
Government and GNMA Portfolios may be reduced.
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 charges 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 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 other Portfolios and consider the
differences in 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
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 a Portfolio's Class D for
which payment has been received (i.e., an established account), may be exchanged
for Class D shares of other portfolios of the Trust or of SEI Liquid Asset
Trust, SEI Tax Exempt Trust, SEI International Trust and SEI Institutional
Managed Trust ("SEI Funds"). Exchanges are made at net asset value plus any
applicable sales charge. SEI Funds' portfolios that are not money market
portfolios currently impose a sales charge on Class D shares. A shareholder
who exchanges into one of these "non-money market" portfolios will have to pay a
sales charge on any portion of the exchanged Class D shares for which he or she
has not previously paid a sales charge. If a shareholder has paid a sales
charge on Class D shares, no additional sales charge will be assessed when he
or she exchanges those Class D shares for other Class D shares. If a
shareholder buys Class D shares of a "non-money market" fund and receives a
sales load waiver, he or she will be deemed to have paid the sales load for
purposes of this exchange privilege. In calculating any sales charge payable on
an exchange transaction, the SEI Funds will assume that the first shares a
shareholder exchanges are those on which
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he or she has already paid a sales charge. Sales charge waivers may also be
available under certain circumstances, as described in the portfolios'
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 sixty days' notice. 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 the shares of each Portfolio's Class D shares, for
which good payment has been received, in his or her account at any time,
regardless of how long he or she has held his or her 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 (the "Old Portfolio") to be exchanged and the
purchase at net asset value (i.e., without a sales charge) of the shares of the
other portfolios. 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 Transfer Agent in writing or by telephone
on any business day prior to the redemption cut-off time specified in each
Prospectus, the exchange usually will occur 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 Old Portfolios, and thus the purchase of shares of
the New Portfolios, may be delayed for up to seven days if the Portfolio
determines 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
Qualification as a RIC
In order to qualify for treatment as a regulated investment company ("RIC")
under Subchapter M of the Internal Revenue Code of 1986, as amended (the
"Code"), a Portfolio must distribute annually to its shareholders at least 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 or securities;
(ii) less than 30% of a Portfolio's gross income each taxable year may be
derived from the sale or other disposition of stock of securities 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 RICs 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 RICs) of any one
issuer or of two or more issuers which the Portfolio controls and which are
engaged in the same, similar or related trades or businesses.
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, a Portfolio will be subject to a nondeductible 4% 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 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, then the loss is treated
as a long-term capital loss to the extent of the capital gain distributions.
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If a Portfolio fails to qualify as a RIC for any year, all of its income will be
subject to tax at corporate rates, 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 who have held shares for more than 45 days.
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. 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 Advisers are 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 Advisers
generally seek 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 SEC.
The money market securities in which certain of the Portfolios invest are traded
primarily in the over-the-counter market. Bonds and debentures are usually
traded over-the-counter, but may be traded on an exchange. 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 are generally traded on a net basis and do not normally
involve either brokerage commissions or transfer taxes. The cost of executing
portfolio securities transactions of the Portfolios will primarily consist of
dealer spreads and underwriting commissions.
It is expected that certain of the Portfolios may execute brokerage or other
agency transactions through the Distributor, a registered broker-dealer, for a
commission, in conformity with the 1940 Act, the Securities Exchange Act of 1934
and rules of the SEC. Under these provisions, the Distributor is permitted to
receive and retain compensation for effecting portfolio transactions for a
Portfolio on an exchange if a written contract is in effect between the
Distributor and the Trust expressly permitting the Distributor to receive and
retain such compensation. These provisions further require that commissions
paid to the Distributor by the Trust for exchange transactions not exceed "usual
and customary" brokerage commissions. The rules define "usual and customary"
commissions to include amounts which are "reasonable and fair compared to the
commission, fee or other remuneration received or to be received by other
brokers in connection with comparable transactions involving similar
securities being purchased or sold on a securities exchange during a comparable
period of time." In addition, the Portfolio may direct commission business to
one or more designated broker-dealers, including the Distributor, in connection
with such broker-dealer's payment of certain of the Portfolio's expenses. The
Trustees, including those who are not "interested persons" of the Trust, have
adopted procedures for evaluating the reasonableness of commissions paid to the
Distributor and will review these procedures periodically. For the fiscal years
ended January 31, 1993, 1994 and 1995, no Portfolio paid any brokerage
commissions.
The portfolio turnover rate for each fixed income Portfolio for the fiscal years
ending January 31, 1993 , 1994 and 1995 was as follows: Short-Term Government,
80%, 105% and 45%, respectively; Intermediate-Term Government, 56%, 52% and
61% respectively; GNMA, 23%, 70% and 85% respectively; and in each case is
expected to be comparable in the coming year. The portfolio turnover rate for
the Corporate Daily Income Portfolio and the Short-Term Mortgage Portfolio for
the fiscal years ended January 31, 1994 and 1995 were 34%, 166% and 147%,
respectively for the Corporate Daily Income Portfolio and 34%, 166% and 741%,
respectively for the Short Term Mortgage Portfolio, respectively, and is
expected to be comparable in the coming year.
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A portfolio turnover rate would exceed 100% if all of its securities, exclusive
of U.S. Government securities and other securities whose maturities at the time
of acquisition are one year or less, are replaced in the period of one year.
Turnover rates may vary from year to year and may be affected by cash
requirements for redemptions and by requirements which enable a portfolio to
receive favorable tax treatment.
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.
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 Advisers under the Advisory Agreement,
and the expenses of the Adviser will not necessarily be reduced as a result of
the receipt of such supplemental information.
The Trust is required to identify any securities of its "regular brokers or
dealers" (as such term is defined in the 1940 Act) which the Trust has acquired
during its most recent fiscal year. As of January 31, 1995, the Money Market
Portfolio held Commercial Paper issued by Bear Stearns in the amount of
$5,000,000 and an Overnight Repurchase Agreement issued by Donaldson, Lufkin, &
Jenrette in the amount of $1,526,000. As of January 31, 1995, the Prime
Obligation Portfolio held Commercial Paper issued by Merrill Lynch in the
amount of $80,000,000, Commercial Paper issued by Prudential Funding in the
amount of $60,000,000 and Overnight Repurchase Agreements issued by Donaldson,
Lufkin, & Jenrette; PaineWebber; Salomon Brothers and UBS Securities in the
respective amounts of $12,468,000, $25,000,000 and $87,000,000. As of January
31, 1995, the Corporate Daily Income Portfolio held Floating Rate Securities
issued by Dean Witter Reynolds in the amount of $1,000,000, Commercial Paper
issued by Merrill Lynch in the amount of $1,499,000 and an Overnight Repurchase
Agreement issued by Paine Webber in the amount of $6,337,000. As of January 31,
1995, the Government I Portfolio held Tri-Party Repurchase Agreement issued by
UBS Securities in the amount of $58,750,000, and Overnight Repurchase Agreements
issued by Paine Webber in the amount of $14,434,000. As of January 31, 1995,
the Short-Term Government Securities Portfolio held Overnight Repurchase
Agreements issued by Paine Webber in the amount of $646,000. As of January 31,
1995, the Intermediate-Term Government Portfolio held Overnight Repurchase
Agreements issued by Paine Webber in the amount of $4,817,000. As of January
31, 1995, the Treasury Portfolio held Overnight Repurchase Agreements issued by
Donaldson, Lufkin, & Jenrette; J. P. Morgan; Langston Aubray; Lehman Brothers
and Paine Webber in the respective amounts of $1,551,000; $7,500,000; $7,500,000
and $7,500,000. As of January 31, 1995, the GNMA Portfolio held an Overnight
Repurchase Agreement issued by Paine Webber in the amount of $12,589,000. As of
January 31, 1995 the Short-Term Mortgage Portfolio held an Overnight Repurchase
Agreement issued by Paine Webber in the amount of $48,000,000.
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 all 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 or
her 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
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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 wilful misfeasance, bad faith, gross
negligence or reckless disregard of his or her duties.
VOTING
Where the Prospectuses for the Portfolios or Statement of Additional Information
state that an investment limitation or a fundamental policy may not be changed
without shareholder approval, such approval means the vote of (i) 67% or more of
the Portfolio's shares present at a meeting if the holders of more than 50% of
the outstanding shares of the Portfolio are present or represented by Proxy, or
(ii) more than 50% of the Portfolio's outstanding shares, whichever is less.
SHAREHOLDER LIABILITY
The Trust is an entity of the type commonly known as a "Massachusetts business
trust". Under Massachusetts law, shareholders of such a Trust could, under
certain circumstances, be held personally liable as partners for the obligations
of the Trust. Even if, however, the Trust were held to be a partnership, the
possibility of the shareholders' incurring financial loss for that reason
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, and because the Declaration of Trust provides for indemnification out
of the Trust property for any shareholders held personally liable for the
obligations of the Trust.
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
As of February 28, 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 above were held by the above persons in accounts for their
fiduciary, agency, or custodial customers.
Money Market Portfolio-Class A: Calhoun & Co., c/o Comerica Bank, Attn: Dennis
Miriani, P.O. Box 1319, 7th floor, Detroit, MI 48231, 17.99%; Lilgran Co.,
c/o First Colonial Trust Company, Attn: Maureen Kruszynski, 104 North Oak Park
Avenue, Oak Park, IL 60301, 7.4%; Keystone Financial Inc., Attn: ACM Desk, P.O.
Box 2450, Altoona, PA, 16603-2450, 48.59%.
Money Market Portfolio-Class B: Palm Beach National Bank & Trust Company, Attn:
Diana Z. Hellmann, 11760 U.S. Highway One #100, North Palm Beach, FL 33408,
100%.
Prime Obligations Portfolio-Class A: Calhoun & Co., c/o Comerica Bank, Attn:
Dennis Miriani, P.O. Box 1319, 7th floor, Detroit, MI 48231, 25.12%;
Boatmen's Trust Company, Attn: Fund Accounting LBT 0785, 100 N. Broadway, St.
Louis, MO 63101, 5.91%; CoreStates Bank NA, Attn: Jim Quinlan, Penn Mutual
Insurance Building, Philadelphia, PA 19106, 8.65%; The New Hillman Company,
c/o Amalgamated Bank of New York, Attn: David Guitano, 11-15 Union Square, New
York, NY 1003, 18.52%.
Prime Obligation Portfolio-Class B: Muir & Co., c/o Frost National Bank, Attn:
Julia Warden, P.O. Box 2950, San Antonio, TX 78299, 57.67%; Oltrust & Co., c/o
Old National Bank in Evansville, Attn: David Crow, P.O. Box 207, Evansville, IN
47702, 35.44%; Eagle Trust Company, Attn: Martha Schaffer, 680 E. Swedesford
Rd, Wayne, PA 19087, 5.83%.
Government Portfolio- Class C: Southwest Securities Inc., Attn: Mary
McCallum/Paula Branum, 1201 Elm Street, Suite 4300, Dallas, TX 75270, 79.18%;
City National Bank, Attn: Michael Nunnelee, 400 N. Roxbury Dr., Suite 700,
Beverly Hills, CA 90210, 20.82%.
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Government II Portfolio-Class A: Shawmut Bank, NA, Attn: Kevin Adamson, ACI
Unit of 0504, One Federal Street, Boston, MA 02211, 22.71%; Enele Co., c/o
Pacific Northwest Trust Company, Attn: Dan De Polo, 121 SW Morrison, Suite 1450,
Portland, OR 97204, 7.81%; United States Trust Company, Attn: Rich Lynch, P.O.
Box 131, Boston, MA 02101, 14.68%; Dixie Company, c/o Jefferson National Bank,
Attn: Katherine Randolph, P.O. Box 12312, Richmond, VA 23241, 7.05%; Meg and
Co., c/o United States National Bank, Attn: Debbie Moraca, P.O. Box 520,
Johnstown, PA 15907, 5.39%.
Government II Portfolio-Class B: Muir & Co., c/o Frost National Bank,
Attn: Julia Warden, P.O. Box 2950, San Antonio, TX 78299, 50.03%; Oltrust & Co.,
c/o Old National Bank in Evansville, Attn: David Crow, P.O. Box 207, Evansville,
IN 47702, 10.31%; Gabco, German American Bank, Attn: Norm Kempf, 711 Main
Street, Jasper, IN 47547, 25.75%; Palm Beach National Bank & Trust Company,
Attn: Diana Z. Hellmann, 11760 U.S. Highway One #100, North Palm Beach, FL
33408, 9.69%.
Treasury Portfolio-Class A: BMS and Company, c/o Central Trust Bank, Attn:
Wanda McGlade, P.O. Box 779, Jefferson City, MO 65102, 88.78%; Southwest
Guaranty Trust Company, Attn: Susan Wolverton, 2121 Sage Road, Suite 150,
Houston, TX 77056, 8.06%.
Treasury II Portfolio-Class A: New England Trust Company, Attn: Nancy McFadden,
144 Westminster St., Providence, RI 02903, 8.12%; Kaw & Co. Y Bank, c/o One
Valley Bank, Attn: Pam Taylor, P.O. Box 1793, One Valley Square, Charlestown,
WV, 5.65%; Westar Bank, Attn: Shelia Evans, P.O. Box 2248, Bartlesville, OK
74005, 9.04%; West One Bank, Idaho NA, Attn: Tom Coleman, Trust Department
Securities Clearance, P.O. Box 7928, Boise, ID 83707, 6.13%; The New Hillman
Company, c/o Amalgamated Bank of New York, Attn: David Guitano, 11-15 Union
Square, New York, NY 1003, 29.90%; Trulin & Co., c/o Chase Lincoln First
Bank, Attn: Pat Whalen, P.O. Box 1412, Rochester, NY 14603, 5.35%.
Treasury II Portfolio-Class B: Muir & Co., c/o Frost National Bank, Attn: Julia
Warden, P.O. Box 2950, San Antonio, TX 78299, 86.11%; Second National Bank of
Saginaw, Attn: Bonnie Wenzel, 101 N. Washington Ave., Saginaw, MI 48607,
5.38%.
Corporate Daily Income Portfolio-Class A: Port & Co., c/o State Bank of
Freeport, Attn: Wendy Harbach, 50 W. Douglas St., Freeport, IL 61032, 10.29%;
Wellington Trust Company NA, Attn: Diane Bissell, 200 State Street, Floor 6,
Boston, MA 02109, 8.15%; Eagle Trust Company, Attn: Jacqueline Keenan, 680 E.
Swedesford Rd, Wayne, PA 19087, 26.94%; Professional Investment Magmt. Inc.,
Agent, Attn: Douglas Cowgill, 3455 Mill Run Dr., Suite 311, Hilliard, OH 43026,
8.50%; Smith & Co., c/o First Security Bank of Utah NA, Attn: Rick Parr,
P.O.Box 30007, Salt Lake City, UT 84130, 5.90%.
Short-Term Government Portfolio-Class A: Meg and Co., c/o United States
National Bank, Attn: Debbie Moraca, P.O. Box 520, Johnstown, PA 15907, 11.52%;
Eagle Trust Company, Attn: Jacqueline Keenan, 680 E. Swedesford Rd, Wayne, PA
19087, 7.05%; First Hawaiian Bank, Financial Management Group (FIDAC), Attn:
Dolores Mollring, P.O. Box 3200, Honolulu, HI 96847, 18.16%; Garico, c/o First
National Bank of Chicago, Trust Operations- Inst. Mutual Fund Desk, 218 E.
Wesley St., Suite 2027, Wheaton, IL 60187, 16.00%.
Short-Term Government Portfolio-Class B: Relico, c/o Reliance Trust Company,
Attn: Patrick O'Connor, 3295 Northcrest Rd. NE, Atlanta, GA 30340-4009, 89.43%.
Short-Term Mortgage Portfolio-Class A: New England Trust Company, Attn: Nancy
McFadden, 144 Westminster St., Providence, RI 02903, 34.08%; Pershing Division
of DLJ, Attn: Rich Boulanger, P.O. Box 2052, Jersey City, NJ , 07303, 12.68%;
CherryTrust Co., c/o The Bank of Cherry Creek, Attn: Daniel Rich, 3033 E. 1st
Ave., Denver, CO, 8.99%.
Short-Term Mortgage Portfolio-Class D: Reliance Trust Company, P.O. Box 48449,
Atlanta, GA 30362, 100%.
30
<PAGE>
Intermediate-Term Government -Class A: First Hawaiian Bank, Financial
Management Group (FIDAC), Attn: Dolores Mollring, P.O. Box 3200, Honolulu, HI
96847, 5.78%; Transco & Company, c/o Intrust Bank, NA, Attn: Pat Willis, P.O.
Box 48698, 10.12%; ACO, c/o Integra Trust Services, Attn: Karen White, Trust
Securities Section 2-032, 300 Fourth Avenue, Pittsburgh, PA 15278-2232, 31.89%.
Intermediate-Term Government -Class B: Relico, c/o Reliance Trust Company,
Attn: Patrick O'Connor, 3295 Northcrest Rd. NE, Atlanta, GA 30340-4009, 100%.
Intermediate-Term Government-Class D: Sumitomo Bank Trustee , FBO, JJ Cornell,
935 S. Park Circle, Anaheim, CA 92804, 5.26%; Sumitomo Bank Trustee , FBO,
Garland Chandler & Alma Chandler JTTN, 336 S. Acacia Street, San Dimas CA 91773,
5.31%; Relico, P.O. Box 48449, Atlanta, GA 30362-1449, 54.06%; Sumitomo Bank
Trustee FBO, Hillis O & Margaret B. Folkins Co TTEES, Hillis O & Margaret B.
Folkins 1989 Trust, 1048 Harding Court, Claremont, CA 91711, 10.23%; Dorell
Carter, 134-51 229th St., Queens, NY 11413, 10.83%.
GNMA Portfolio-Class A: BMS and Company, c/o Central Trust Bank, Attn: Wanda
McGlade, P.O. Box 779, Jefferson City, MO 65102, 9.11%; Eagle Trust Company,
Attn: Jacqueline Keenan, 680 E. Swedesford Rd, Wayne, PA 19087, 6.54%;
Transco & Company, c/o Intrust Bank, NA, Attn: Pat Willis, P.O. Box 48698,
22.52%; The Fulton Company, c/o Fulton Bank Trust Dept., Attn: Dennis
Patrick, One Penn Center, Lancaster, PA 17602, 7.15%.
GNMA Portfolio- Class B: Relico, c/o Reliance Trust Company, Attn: Patrick
O'Connor, 3295 Northcrest Rd. NE, Atlanta, GA 30340-4009, 100%.
GNMA Portfolio-Class D: Sumitomo Bank Trustee, FBO , The Chiu 1981 Revocable
Trust, 173 First Street, Suite 2000, Los Altos, CA 94022, 15.83%; Isamu Sam
Ishikata & Chiyoko Ishikata JTTN, 1814 Butte St., Richmond CA 94804, 8.69%;
Sumitomo Bank Trustee, FBO , Mary Ota, 538 39th Avenue, San Franciso, CA 94121,
14.51%; Sumitomo Bank Trustee , FBO, Etsuko M Horio & Mike Horio JJTEN, 264
Belblossom Dr., Los Gatos, CA 95032, 17.57%; Sumitomo Bank Trustee, FBO, Joseph
Cefalu Cust. FBO Giuliana & Cefalu Ugma Ca, 7061 Valentine Dr., Huntington
Beach, CA 92647, 21.66%.
EXPERTS
The financial statements in this Statement of Additional Information and the
Financial Highlights included in the Prospectuses have been audited by Arthur
Andersen 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 January 31, 1995, and the Report of Independent Accountants of Arthur
Andersen LLP dated March 8, 1995, relating to the financial statements and
Financial Highlights of the Trust.
31
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
MONEY MARKET PORTFOLIO
<TABLE>
-----------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
-----------------------------------------------------------------
<S> <C> <C>
COMMERCIAL PAPER -- 69.6%
ANZ Delaware
5.800%, 02/06/95 $ 8,000 $ 7,994
Banque Indosuez
6.070%, 02/06/95 8,000 7,993
BCI Funding
6.250%, 04/07/95 8,000 7,910
Bear Stearns Companies
6.020%, 02/06/95 5,000 4,996
BHF Finance Delaware
5.700%, 02/13/95 8,800 8,783
Caisse Nationale Des Telecommunications
6.080%, 02/03/95 8,000 7,997
Central & Southwest
6.050%, 03/08/95 5,000 4,971
Chevron Transport
5.700%, 02/10/95 8,000 7,989
Chrysler Financial
6.250%, 04/27/95 8,000 7,882
CIESCO LP
6.000%, 03/21/95 8,000 7,936
Coca Cola Enterprises
6.200%, 05/02/95 8,000 7,876
Commercial Credit
5.750%, 02/09/95 5,200 5,193
Commerzbank US Finance
5.810%, 02/02/95 8,000 7,999
Corporate Receivable
6.100%, 04/04/95 7,000 6,926
Creditanstalt Finance
6.150%, 03/15/95 4,284 4,253
Ford Motor Credit
6.160%, 04/11/95 8,000 7,906
General Electric Capital
6.050%, 02/02/95 8,000 7,999
General Motors Acceptance
6.350%, 04/13/95 8,000 7,900
ING Finance
5.775%, 02/06/95 8,900 8,892
Preferred Receivables Funding
5.850%, 02/06/95 6,000 5,995
Sears Roebuck Acceptance
6.300%, 04/10/95 8,000 7,905
--------
Total Commercial Paper
(Cost $153,295) 153,295
--------
FLOATING RATE INSTRUMENTS -- 15.9%
Bank of New York (DE)
5.960%, 06/02/95 (A) 5,000 $ 5,000
First Alabama Bank
6.000%, 02/28/95 (A) 8,000 8,000
</TABLE>
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
People's Security Funding Agreement
5.810%, 05/01/95 (A) (B) (C) $ 9,000 $ 9,000
Society National Bank
5.860%, 05/18/95 (A) 8,000 7,997
Synthetic Money Market Trust 1994-B
5.862%, 08/11/95 (A) (B) (C) 5,000 5,000
--------
Total Floating Rate Instruments
(Cost $34,997) 34,997
--------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 14.2%
FNMA
6.076%, 04/17/95 700 691
6.706%, 07/26/95 14,000 13,564
SLMA
6.150%, 03/10/95 (A) 17,000 17,001
--------
Total U.S. Government Agency Obligations
(Cost $31,256) 31,256
--------
REPURCHASE AGREEMENT -- 0.7%
Donaldson, Lufkin & Jenrette 5.75%, dated 01/31/95,
matures 02/01/95, repurchase price $1,526,244
(collateralized by U.S. Treasury Note, par value
$1,624,000, 5.125%, matures 02/28/98: market value
$1,621,000) 1,526
--------
Total Repurchase Agreement
(Cost $1,526) 1,526
--------
Total Investments (100.4%)
(Cost $221,074) 221,074
--------
OTHER ASSETS AND LIABILITIES -- (0.4)%
Other Assets and Liabilities, Net (772)
--------
NET ASSETS:
Portfolio shares of Class A (unlimited
authorization -- no par value) based on 214,024,404
outstanding shares of beneficial interest 214,024
Portfolio shares of Class B (unlimited
authorization -- no par value) based on 6,314,053
outstanding shares of beneficial interest 6,314
</TABLE>
32
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
MONEY MARKET PORTFOLIO
<TABLE>
-----------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
-----------------------------------------------------------------------------
<S> <C> <C>
Accumulated Net Realized Loss on Investments $ ( 36)
--------
TOTAL NET ASSETS -- 100.0% $220,302
========
NET ASSETS, OFFERING PRICE AND REDEMPTION PRICE PER
SHARE -- CLASS A $ 1.00
========
NET ASSETS, OFFERING PRICE AND REDEMPTION PRICE PER
SHARE -- CLASS B $ 1.00
========
</TABLE>
(A) Floating Rate Instrument. Rate reflected on the Statement on Net Assets is
the rate in effect on January 31, 1995. The date shown is the lower of the
reset date or the demand date.
(B) Private Placement.
(C) Illiquid Security.
FNMA Federal National Mortgage Association
LP Limited Partnership
SLMA Student Loan Marketing Association
GOVERNMENT II PORTFOLIO
<TABLE>
<S> <C> <C>
U.S. GOVERNMENT AGENCY
OBLIGATIONS -- 100.2%
FFCB
5.460%, 02/02/95 $ 1,385 $ 1,385
5.794%, 02/02/95 5,000 4,999
5.795%, 02/03/95 10,575 10,572
6.095%, 02/07/95 10,000 9,990
6.067%, 02/10/95 10,000 9,985
5.469%, 02/13/95 7,780 7,766
5.677%, 02/14/95 10,000 9,980
6.216%, 02/21/95 6,120 6,099
5.769%, 02/22/95 15,990 15,937
5.660%, 03/01/95 20,740 20,735
5.892%, 03/02/95 6,000 5,972
6.054%, 03/07/95 20,200 20,087
6.171%, 04/07/95 9,975 9,867
6.198%, 04/28/95 11,000 10,842
6.671%, 07/24/95 8,000 7,755
6.684%, 07/26/95 17,000 16,473
FHLB
5.780%, 02/01/95 (A) 7,800 7,795
5.507%, 02/06/95 1,245 1,244
5.587%, 02/06/95 1,365 1,364
5.682%, 02/06/95 17,525 17,511
6.083%, 02/06/95 50,000 49,961
5.838%, 02/08/95 6,440 6,433
5.704%, 02/09/95 25,000 24,969
5.705%, 02/09/95 39,835 39,785
5.642%, 02/10/95 22,005 21,975
5.729%, 02/10/95 5,000 4,993
</TABLE>
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
5.843%, 02/13/95 $ 5,000 $ 4,990
5.926%, 02/21/95 8,350 8,323
5.797%, 02/23/95 9,170 9,138
5.647%, 02/27/95 10,780 10,737
5.777%, 02/28/95 25,000 24,894
5.783%, 02/28/95 35,060 34,911
5.784%, 02/28/95 25,000 24,894
5.797%, 02/28/95 15,000 14,936
6.209%, 03/02/95 21,540 21,435
6.282%, 03/06/95 25,000 24,860
6.056%, 03/09/95 8,000 7,953
6.065%, 04/11/95 18,280 18,073
6.070%, 04/12/95 5,000 4,943
6.166%, 04/18/95 25,000 24,684
6.025%, 04/25/95 (A) 2,000 1,999
SLMA
6.130%, 02/07/95 (A) 5,000 5,000
6.130%, 02/07/95 (A) 30,000 30,000
6.150%, 02/07/95 (A) 20,000 20,000
6.170%, 02/07/95 (A) 44,450 44,454
6.180%, 02/07/95 (A) 40,000 40,000
6.310%, 02/07/95 (A) 30,000 30,119
5.809%, 02/21/95 30,000 29,905
TVA
6.194%, 02/21/95 4,025 4,011
6.195%, 02/22/95 18,485 18,420
--------
Total U.S. Government Agency Obligations
(Cost $803,153) 803,153
--------
Total Investments -- 100.2%
(Cost $803,153) 803,153
--------
OTHER ASSETS AND LIABILITIES -- (0.2)%
Other Assets and Liabilities, Net ( 1,547)
--------
NET ASSETS:
Portfolio shares of Class A (unlimited
authorization -- no par value) based on 786,606,423
outstanding shares of beneficial interest 786,607
Portfolio shares of Class B (unlimited
authorization -- no par value) based on 15,201,389
outstanding shares of beneficial interest 15,201
Accumulated Net Realized Loss on Investments ( 202)
--------
</TABLE>
33
<PAGE>
--------------------------------------------------------------------------------
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
TOTAL NET ASSETS -- 100.0% $ 801,606
==========
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE
PER SHARE -- CLASS A $ 1.00
==========
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE
PER SHARE -- CLASS B $ 1.00
==========
</TABLE>
(A) Floating Rate Instrument. The rate reflected on the Statement of Net Assets
is the rate in effect on January 31, 1995. The date shown is the longer of
the reset date or the demand date.
FFCB Federal Farm Credit Bank
FHLB Federal Home Loan Bank
SLMA Student Loan Marketing Association
TVA Tennessee Valley Authority
PRIME OBLIGATION PORTFOLIO
<TABLE>
<S> <C> <C>
COMMERCIAL PAPER -- 56.7%
American Express Credit
5.500%, 02/03/95 $ 20,000 $ 19,994
5.770%, 02/06/95 20,000 19,984
American General Finance
6.150%, 04/10/95 10,000 9,884
6.170%, 04/19/95 15,000 14,802
6.130%, 05/01/95 15,000 14,773
6.200%, 05/26/95 30,000 29,411
American Home (4-2)
5.920%, 02/06/95 (B) 75,000 74,937
Associates of North America
5.620%, 02/08/95 25,000 24,973
6.170%, 04/19/95 40,000 39,472
Beneficial
6.170%, 04/26/95 35,000 34,496
6.150%, 05/15/95 30,000 29,472
Central & Southwest
5.750%, 02/03/95 9,294 9,291
6.050%, 03/08/95 13,176 13,099
Chrysler Financial
6.250%, 04/27/95 55,000 54,188
CIESCO LP
6.000%, 02/01/95 10,000 10,000
5.875%, 02/03/95 40,000 39,987
6.000%, 03/21/95 13,000 12,896
6.170%, 04/18/95 11,500 11,350
5.950%, 12/01/95 20,000 19,983
CIT Group Holdings
5.970%, 12/01/95 40,000 39,993
Commercial Credit
5.750%, 02/08/95 25,000 24,972
5.630%, 12/01/95 25,000 24,977
</TABLE>
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
Corporate Receivables
6.170%, 04/11/95 $ 14,100 $ 13,933
CSW Credit
6.120%, 04/04/95 10,400 10,290
John Deere Capital
6.150%, 04/10/95 18,000 17,791
6.150%, 05/15/95 25,000 24,560
6.270%, 05/19/95 30,000 29,441
Ford Motor Credit
6.160%, 04/12/95 28,000 27,665
6.230%, 04/24/95 28,000 27,603
General Electric Capital
6.150%, 04/10/95 45,000 44,477
6.150%, 05/10/95 34,000 33,431
6.170%, 05/17/95 10,000 9,820
General Motors Acceptance
6.250%, 04/11/95 25,000 24,701
6.350%, 04/13/95 10,000 9,875
6.300%, 04/25/95 20,000 19,710
6.300%, 05/01/95 30,000 29,533
Household Finance
6.000%, 03/21/95 20,000 19,840
6.170%, 04/19/95 40,000 39,472
IBM Credit
5.660%, 02/10/95 30,000 29,958
International Lease Finance
5.980%, 02/02/95 10,000 9,998
6.000%, 03/07/95 6,000 5,966
6.170%, 04/10/95 10,000 9,883
Matterhorn Capital
5.750%, 02/07/95 10,000 9,990
Merrill Lynch
5.850%, 02/02/95 30,000 29,995
5.720%, 02/08/95 50,000 49,944
Metlife Funding
5.630%, 02/08/95 50,000 49,945
Norwest Corporation
6.170%, 05/17/95 20,000 19,640
Norwest Financial
5.600%, 02/07/95 10,000 9,991
6.150%, 05/01/95 33,500 32,991
PHH
5.650%, 02/10/95 40,000 39,944
Philip Morris
5.600%, 02/06/95 10,000 9,992
5.680%, 02/10/95 44,500 44,437
Preferred Receivables Funding
6.150%, 04/13/95 28,515 28,169
6.150%, 04/18/95 11,525 11,375
Prudential Funding
5.470%, 02/03/95 30,000 29,991
6.250%, 05/18/95 30,000 29,448
</TABLE>
34
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
PRIME OBLIGATION PORTFOLIO
<TABLE>
--------------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
--------------------------------------------------------------------------------
<S> <C> <C>
Puerto Rico Development Bank
6.130%, 04/13/95 $ 13,000 $ 12,843
6.050%, 04/18/95 26,000 25,668
Riverwood Funding
5.650%, 02/06/95 10,000 9,992
Sears Roebuck Acceptance
5.550%, 02/03/95 35,000 34,989
6.300%, 04/10/95 25,000 24,703
6.200%, 04/25/95 25,000 24,643
Transamerica Finance
5.650%, 02/07/95 48,000 47,955
----------
Total Commercial Paper
(Cost $1,587,526) 1,587,526
----------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 23.2%
FHLB
5.876%, 02/28/95 12,200 12,148
FHLMC
6.121%, 02/02/95 6,105 6,104
6.122%, 02/02/95 30,000 29,995
6.143%, 02/02/95 29,000 28,995
5.871%, 02/23/95 10,000 9,965
6.093%, 04/18/95 13,000 12,838
FNMA
6.140%, 02/07/95 (A) 100,000 99,999
5.644%, 02/09/95 50,000 49,938
5.769%, 02/21/95 100,000 99,686
6.076%, 04/17/95 35,000 34,570
6.438%, 06/12/95 7,000 6,842
6.671%, 07/24/95 15,000 14,541
6.673%, 07/25/95 39,000 37,799
6.706%, 07/26/95 100,000 96,889
SLMA
6.150%, 02/07/95 (A) 47,600 47,600
6.160%, 02/07/95 (A) 16,000 16,003
6.170%, 02/07/95 (A) 47,000 47,008
----------
Total U.S. Government Agency Obligations
(Cost $650,920) 650,920
----------
FLOATING RATE INSTRUMENTS -- 10.5%
Allstate
6.225%, 02/01/95 (A) (B) (C) 15,000 15,000
Bank of New York (DE)
5.960%, 06/02/95 (A) 65,000 64,998
CoreStates Capital
6.060%, 03/28/95 (A) 28,000 28,000
People's Security Funding Agreement
5.810%, 04/30/95 (A) (B) (C) 51,000 51,000
</TABLE>
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
Society National Bank
5.860%, 05/18/95 (A) $ 65,000 $ 64,979
Synthetic Money Market Trust 1994-A
6.425%, 03/17/95 (A) (B) (C) 45,000 45,000
Synthetic Money Market Trust 1994-B
5.862%, 08/11/95 (A) (B) (C) 25,000 25,000
----------
Total Floating Rate Instruments
(Cost $293,977) 293,977
----------
BANK NOTE -- 1.8%
National Bank of Detroit
6.200%, 04/17/95 50,000 50,000
----------
Total Bank Note
(Cost $50,000) 50,000
----------
REPURCHASE AGREEMENTS -- 8.0%
Donaldson, Lufkin, & Jenrette
5.75%, dated 01/31/95, matures 02/01/95, repurchase
price $12,469,992 (collateralized by U.S. Treasury
Note, par value $11,706,000, 8.875%, matures
02/15/99: market value $12,721,000) 12,468
Paine Webber
5.80%, dated 01/31/95, matures 02/01/95, repurchase
price $25,004,028 (collateralized by U.S. Treasury
Note, par value $25,240,000, 7.50%, matures
11/15/01: market value $25,532,000) 25,000
Salomon Brothers
5.82%, dated 01/31/95, matures 02/01/95, repurchase
price $50,008,083 (collateralized by various U.S.
Treasury Notes ranging in par value $3,456,000--
$50,000,000, 5.125%--5.50%, 04/30/96--03/31/98;
with total market value of $51,055,000) 50,000
</TABLE>
35
<PAGE>
--------------------------------------------------------------------------------
<TABLE>
-------------------------------------------------------------------------------
<CAPTION>
Description Value (000)
-------------------------------------------------------------------------------
<S> <C>
Salomon Brothers
5.85%, dated 01/31/95, matures 02/01/95, repurchase price
$50,008,125 (collateralized by various FHLMC obligations
ranging in par value $4,778,875 -- $7,963,132, 6.50% --
9.00%, 02/01/10 -- 01/01/24; FNMA obligations ranging in par
value $4,627,803 -- $6,386,020, 6.00% -- 9.50%, 06/01/09 --
01/01/25; with total market value of $51,329,000) $ 50,000
UBS Securities
5.90%, dated 01/31/95, matures 02/01/95, repurchase price
$87,014,258 (collateralized by various FHLMC obligations
ranging in par value $41,520 -- $8,088,986, 5.00% -- 9.50%,
01/01/98 -- 10/01/23; FNMA obligations ranging in par value
$21,074 -- $12,503,610, 6.00% -- 11.00%, 05/01/00 --
01/01/25; with total market value of $88,740,000) 87,000
----------
Total Repurchase Agreements
(Cost $224,468) 224,468
----------
Total Investments -- 100.2%
(Cost $2,806,891) 2,806,891
----------
OTHER ASSETS AND LIABILITIES -- (0.2)%
Other Assets and Liabilities, Net (6,713)
----------
NET ASSETS:
Portfolio shares of Class A (unlimited authorization -- no par
value) based on 2,778,440,629 outstanding shares of
beneficial interest 2,778,441
Portfolio shares of Class B (unlimited authorization -- no par
value) based on 21,852,601 outstanding shares of beneficial
interest 21,853
Accumulated Net Realized Loss on Investments (116)
----------
TOTAL NET ASSETS -- 100.0% $2,800,178
==========
</TABLE>
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE
PER SHARE -- CLASS A $ 1.00
=========
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE
PER SHARE -- CLASS B $ 1.00
=========
</TABLE>
(A) Floating Rate Instrument. Rate reflected on the Statement of Net Assets is
the rate in effect on January 31, 1995. The date shown is the longer of
the reset date or the demand date.
(B) Private Placement.
(C) Illiquid Security.
FHLB Federal Home Loan Bank
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
LP Limited Partnership
SLMA Student Loan Marketing Association
GOVERNMENT PORTFOLIO
<TABLE>
<S> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 93.5%
FHLB
5.780%, 02/01/95 (A) $30,000 $ 29,987
6.235%, 04/25/95 18,255 18,000
6.694%, 07/25/95 5,000 4,846
FHLMC
6.100%, 03/24/95 50,125 49,701
6.148%, 04/04/95 11,100 10,985
6.149%, 04/05/95 3,475 3,439
6.198%, 04/21/95 5,000 4,934
6.199%, 04/21/95 40,000 39,472
FNMA
6.140%, 02/07/95 (A) 22,000 22,000
6.082%, 02/08/95 3,000 2,997
6.017%, 02/15/95 1,120 1,117
6.106%, 02/22/95 1,500 1,495
6.069%, 03/30/95 1,000 991
6.245%, 04/28/95 50,000 49,275
6.318%, 05/11/95 2,555 2,512
6.341%, 05/23/95 30,000 29,433
6.696%, 07/27/95 20,000 19,375
--------
Total U.S. Government Agency Obligations
(Cost $290,559) 290,559
--------
</TABLE>
36
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
GOVERNMENT PORTFOLIO
<TABLE>
-------------------------------------------------------------------------------
<CAPTION>
Description Value (000)
-------------------------------------------------------------------------------
<S> <C>
REPURCHASE AGREEMENTS -- 23.5%
Paine Webber
5.75%, dated 01/31/95, matures 02/01/95, repurchase price
$14,436,305 (collateralized by U.S. Treasury Note, par value
$14,790,000, 6.50%, matures 05/15/97: market value
$14,731,000) $ 14,434
UBS Securities
5.85%, dated 01/31/95, matures 02/01/95, repurchase price
$6,501,056 (collateralized by U.S. Treasury Note, par value
$7,300,000, 5.75%, matures 08/15/03: market value $6,633,000) 6,500
UBS Securities
5.90%, dated 01/31/95, matures 02/01/95, repurchase price
$52,258,563 (collateralized by various FHLMC obligations
ranging in par value $65,000 -- $4,997,695, 5.50% -- 9.50%,
10/01/99 -- 01/01/25; FHLMC obligations ranging in par value
$39,557 -- $26,154,122, 8.00% -- 11.00%, 03/01/05 --
11/01/20; FNMA obligations ranging in par value $25,000 --
$8,445,339, 7.00% -- 10.50%, 04/01/98 -- 02/01/25; with
total market value of $53,295,000) 52,250
--------
Total Repurchase Agreements
(Cost $73,184) 73,184
--------
Total Investments -- 117.0% (Cost $363,743) 363,743
--------
OTHER ASSETS AND LIABILITIES -- (17.0)%
Payable for investment securities purchased (49,275)
Other Assets and Liabilities, Net (3,633)
--------
Total Other Assets and Liabilities (52,908)
--------
NET ASSETS:
Portfolio shares of Class C (unlimited authorization -- no par
value based on 310,909,420 outstanding shares of beneficial
interest 310,909
Accumulated Net Realized Loss on Investments (74)
--------
TOTAL NET ASSETS -- 100.0% $310,835
========
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER
SHARE -- CLASS C $ 1.00
========
</TABLE>
(A) Floating rate instrument. The rate reflected on the Statement of Net
Assets is the rate in effect on January 31, 1995. The date shown is the
longer of the reset date or the demand date.
FHLB Federal Home Loan Bank
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
TREASURY PORTFOLIO
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
U. S. TREASURY OBLIGATIONS -- 32.3%
United States Treasury Bills
6.344%, 07/13/95 $8,000 $ 7,781
6.436%, 08/03/95 5,000 4,845
-------
Total U. S. Treasury Obligations (Cost $12,626) 12,626
-------
REPURCHASE AGREEMENTS -- 80.6%
Donaldson, Lufkin & Jenrette
5.75%, dated 01/31/95, matures 02/01/95, repurchase
price $1,551,248 (collateralized by U.S. Treasury
Note, par value $1,557,000, 8.00%, matures
01/15/97: market value $1,583,000) 1,551
J.P. Morgan
5.75%, dated 01/31/95, matures 02/01/95, repurchase
price $7,501,198 (collateralized by U.S. Treasury
Note, par value $8,237,000, 4.75%, matures
09/30/98: market value $7,654,000) 7,500
Lanston Aubrey
5.80%, dated 01/31/95, matures 02/01/95, repurchase
price $7,501,208 (collateralized by U.S. Treasury
Bill, par value $7,800,000, 5.70%, matures 4/06/95:
market value $7,720,000) 7,500
Lehman Brothers
5.80%, dated 01/31/95, matures 02/01/95, repurchase
price $7,501,208 (collateralized by U.S. Treasury
Note, par value $7,790,000, 7.50%, matures
11/15/16: market value $7,668,000) 7,500
Paine Webber
5.75%, dated 01/31/95, matures 02/01/95, repurchase
price $7,501,198 (collateralized by U.S. Treasury
Note, par value $7,785,000, 7.50%, matures
11/15/16: market value $7,663,000) 7,500
-------
Total Repurchase Agreements
(Cost $31,551) 31,551
-------
Total Investments -- 112.9%
(Cost $44,177) 44,177
-------
</TABLE>
37
<PAGE>
--------------------------------------------------------------------------------
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
OTHER ASSETS AND LIABILITIES -- (12.9)%
Payable for investment securities purchased $ (4,845)
Other Assets and Liabilities, Net (203)
---------
Total Other Assets and Liabilities (5,048)
---------
NET ASSETS:
Portfolio shares (unlimited authorization -- no par
value) based on 39,132,422 outstanding shares of
beneficial interest 39,133
Accumulated Net Realized Loss on Investments (4)
---------
TOTAL NET ASSETS -- 100.0% $ 39,129
=========
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE
PER SHARE -- CLASS A $1.00
=========
TREASURY II PORTFOLIO
U. S. TREASURY OBLIGATIONS -- 99.6%
United States Treasury Bills
5.951%, 04/06/95 $159,230 $157,592
5.857%, 04/13/95 50,000 49,437
5.877%, 04/13/95 15,000 14,830
5.887%, 04/13/95 50,000 49,434
6.656%, 07/06/95 35,000 34,042
United States Treasury Note
5.500%, 02/15/95 135,070 135,065
---------
Total U. S. Treasury Obligations
(Cost $440,400) 440,400
---------
Total Investments -- 99.6%
(Cost $440,400) 440,400
---------
OTHER ASSETS AND LIABILITIES -- 0.4%
Other Assets and Liabilities, Net 1,962
---------
NET ASSETS:
Portfolio shares of Class A (unlimited
authorization -- no par value) based on 397,609,121
outstanding shares of beneficial interest 397,609
</TABLE>
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Face
Description Amount (000) Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
Portfolio shares of Class B (unlimited
authorization -- no par value) based on 44,675,986
outstanding shares of beneficial interest $ 44,676
Accumulated Net Realized Gain on Investments 77
--------
TOTAL NET ASSETS -- 100.0% $442,362
========
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE
PER SHARE -- CLASS A $ 1.00
========
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE
PER SHARE -- CLASS B $ 1.00
========
SHORT-TERM GOVERNMENT PORTFOLIO
U. S. TREASURY OBLIGATIONS -- 84.4%
United States Treasury Notes
5.125%, 11/15/95 $ 3,000 $ 2,964
4.250%, 12/31/95 10,000 9,769
4.625%, 02/15/96 21,000 20,520
4.250%, 05/15/96 10,000 9,656
4.375%, 08/15/96 11,000 10,562
6.875%, 10/31/96 6,000 5,965
4.375%, 11/15/96 10,000 9,526
7.375%, 11/15/97 5,000 4,999
7.750%, 12/31/99 10,000 10,073
--------
Total U. S. Treasury Obligations
(Cost $85,991) 84,034
--------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 13.6%
FHLMC
6.500%, 07/24/98 5,035 4,720
FNMA
6.750%, 04/06/96 6,090 5,986
5.300%, 10/16/96 3,000 2,870
--------
Total U.S. Government Agency Obligations
(Cost $13,688) 13,576
--------
</TABLE>
38
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
SHORT-TERM GOVERNMENT PORTFOLIO
INTERMEDIATE-TERM GOVERNMENT PORTFOLIO
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Market
Description Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
REPURCHASE AGREEMENT -- 0.7%
Paine Webber
5.75%, dated 01/31/95, matures 02/01/95, repurchase price
$646,103 (collateralized by U.S. Treasury Note, par value
$639,000, 8.50%, matures 11/15/95: market value $659,000) $ 646
-------
Total Repurchase Agreement
(Cost $646) 646
-------
Total Investments -- 98.7%
(Cost $100,325) 98,256
-------
OTHER ASSETS AND LIABILITIES -- 1.3%
Other Assets and Liabilities, Net 1,333
-------
NET ASSETS:
Portfolio shares of Class A (unlimited authorization -- no
par value) based on 10,221,020 outstanding shares of benefi-
cial interest 102,770
Portfolio shares of Class B (unlimited authorization -- no
par value) based on 13,500 outstanding shares of beneficial
interest 135
Accumulated Net Realized Loss on Investments (1,247)
Accumulated Net Unrealized Loss on Investments (2,069)
-------
TOTAL NET ASSETS -- 100.0% $99,589
=======
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER
SHARE -- CLASS A $ 9.73
=======
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER
SHARE -- CLASS B $ 9.71
=======
</TABLE>
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Face Market
Description Amount (000) Value (000)
------------------------------------------------------------------------------
<S> <C> <C>
U. S. TREASURY
OBLIGATIONS -- 77.8%
United States Treasury Notes
6.875%, 10/31/96 $13,000 $ 12,923
6.500%, 08/15/97 17,500 17,144
6.000%, 12/31/97 10,000 9,633
5.625%, 01/31/98 45,000 42,817
5.125%, 06/30/98 23,000 21,379
4.750%, 10/31/98 25,000 22,770
5.875%, 03/31/99 30,000 28,239
7.500%, 10/31/99 15,000 14,964
7.500%, 11/15/01 20,000 19,911
--------
Total U. S. Treasury Obligations
(Cost $198,784) 189,780
--------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 19.0%
FHLMC
5.000%, 04/02/97 5,000 4,713
6.500%, 07/24/98 7,586 7,112
6.250%, 07/21/99 7,000 6,568
5.950%, 01/26/98 10,000 9,389
FNMA
5.250%, 05/13/96 20,000 18,501
--------
Total U.S. Government Agency Obligations
(Cost $46,645) 46,283
--------
REPURCHASE AGREEMENT -- 2.0%
Paine Webber
5.75%, dated 01/31/95, matures 02/01/95, repurchase
price $4,817,769 (collateralized by U.S. Treasury
Note, par value $4,835,000, 6.75%, matures
02/28/97: market value $4,922,000) 4,817
--------
Total Repurchase Agreement
(Cost $4,817) 4,817
--------
Total Investments -- 98.8%
(Cost $250,246) 240,880
--------
OTHER ASSETS AND LIABILITIES -- 1.2%
Other Assets and Liabilites, Net 2,983
--------
</TABLE>
39
<PAGE>
--------------------------------------------------------------------------------
CORPORATE DAILY INCOME PORTFOLIO
<TABLE>
--------------------------------------------------------------------------------
<CAPTION>
Market
Description Value (000)
--------------------------------------------------------------------------------
<S> <C>
NET ASSETS:
Portfolio Shares of Class A (unlimited authorization -- no par
value) based on 26,124,963 outstanding shares of beneficial
interest $261,338
Portfolio Shares of Class B (unlimited authorization -- no par
value) based on 9,945 outstanding shares of beneficial
interest 96
Portfolio Shares of ProVantage Funds (unlimited
authorization -- no par value) based on 10,657 outstanding
shares of beneficial interest 112
Accumulated Net Realized Loss on Investments (8,317)
Accumulated Net Unrealized Loss on Investments (9,366)
--------
TOTAL NET ASSETS -- 100.0% $243,863
========
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER
SHARE --
CLASS A $ 9.33
========
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER
SHARE --
CLASS B $ 9.33
========
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE -- PROVANTAGE
FUNDS $ 9.32
========
MAXIMUM OFFERING PRICE PER SHARE -- PROVANTAGE FUNDS
(9.32 / 96.5%)+ $ 9.66
========
</TABLE>
+ The maximum offering price per share is calculated by dividing the net asset
value by 1 minus the maximum sales charge of 3.50%.
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
<TABLE>
--------------------------------------------------------------------------------
<CAPTION>
Face Market
Description Amount (000) Value (000)
--------------------------------------------------------------------------------
<S> <C> <C>
CORPORATE OBLIGATIONS -- 25.0%
BankAmerica Corporate
6.575%, 03/21/95 (A) $2,000 $ 1,992
Caterpillar MTN
7.440%, 04/03/95 (A) 1,000 980
Central Fidelity Bank
4.700%, 02/15/95 1,000 999
Continental Bank
6.312%, 02/15/95 (A) 825 821
Dean Witter Discover
5.996%, 02/15/95 (A) 1,000 1,000
Ford Motor Credit
6.840%, 02/15/99 1,500 1,468
General Electric Capital
5.990%, 02/01/95 (A) 1,000 999
General Motors Acceptance
7.600%, 03/27/95 (A) 1,000 984
9.400%, 05/30/95 MTN 500 504
5.300%, 09/08/95 MTN 300 297
5.150%, 09/14/95 MTN 100 99
Sears Roebuck MTN
7.084%, 03/10/95 (A) 1,000 995
Wells Fargo
6.500%, 03/15/95 (A) 1,500 1,500
-------
Total Corporate Obligations
(Cost $13,346) 12,638
-------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 18.6%
FHLMC
6.500%, 11/11/97 508 492
6.500%, 12/06/97 365 353
6.500%, 12/06/97 25 24
6.500%, 01/23/98 627 607
6.000%, 03/04/98 893 854
6.000%, 03/22/98 864 826
6.500%, 01/15/00 2,000 1,935
FNMA
8.070%, 01/24/97 3,000 3,012
FNMA 91-79
6.400%, 02/25/95 (A) 1,290 1,290
-------
Total U.S. Government Agency Obligations
(Cost $9,560) 9,393
-------
</TABLE>
40
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
CORPORATE DAILY INCOME PORTFOLIO
<TABLE>
--------------------------------------------------------------------------------
<CAPTION>
Face Market
Description Amount (000) Value (000)
--------------------------------------------------------------------------------
<S> <C> <C>
ASSET BACKED SECURITIES -- 18.6%
Daimler-Benz Auto Grantor
Trust 93-A
3.900%, 01/06/96 $ 462 $ 447
Ford Credit Grantor Trust 93-B
4.300%, 03/04/96 524 508
Ford Credit Grantor Trust 94-B
7.300%, 09/06/96 1,420 1,409
General Motors Acceptance 94-1
4.150%, 11/23/95 177 173
4.000%, 02/18/96 450 438
6.300%, 07/28/96 1,130 1,109
IBM Credit Receivables Lease Asset Master Trust
4.550%, 04/20/96 1,296 1,251
MBNA Master Credit 94-DA
6.090%, 03/15/00 1,500 1,498
Premier Auto Trust 92-5
4.550%, 02/04/96 254 247
Premier Auto Trust 93-6 A2
4.650%, 07/10/96 823 788
Premier Auto Trust 94-1 A2
6.074%, 02/02/95 (A) 1,106 1,105
Toyota Auto Receivables 93-A
3.900%, 11/05/95 431 419
-------
Total Asset Backed Securities
(Cost $8,898) 9,392
-------
U. S. TREASURY OBLIGATIONS -- 19.6%
U.S. Treasury Notes
6.500%, 09/30/96 4,000 3,956
6.875%, 10/31/96 6,000 5,965
-------
Total U. S. Treasury Obligations
(Cost $9,995) 9,921
-------
COMMERCIAL PAPER -- 8.9%
American Home
5.920%, 02/06/95 1,500 1,499
CIESCO LP
6.170%, 04/18/95 1,500 1,480
Merrill Lynch
5.850%, 02/02/95 1,500 1,499
-------
Total Commercial Paper
(Cost $4,479) 4,478
-------
</TABLE>
<TABLE>
------------------------------------------------------------------------------
<CAPTION>
Market
Description Value (000)
------------------------------------------------------------------------------
<S> <C>
REPURCHASE AGREEMENT -- 12.6%
Paine Webber
5.75%, dated 01/31/95, matures 02/01/95,
repurchase price $6,338,012 (collateralized by
U.S. Treasury Note, par value $6,273,000, 8.50%,
matures 11/15/95: market value $6,534,000) $ 6,337
-------
Total Repurchase Agreement
(Cost $6,337) 6,337
-------
Total Investments -- 103.3%
(Cost $52,615) 52,159
-------
OTHER ASSETS AND LIABILITIES -- (3.3)%
Other Assets and Liabilities, Net ( 1,664)
-------
NET ASSETS:
Portfolio shares (unlimited authorization -- no par
value) based on 25,713,916 outstanding shares of
beneficial interest 51,317
Accumulated Net Realized Loss on Investments ( 366)
Accumulated Net Unrealized Loss on Investments ( 456)
-------
TOTAL NET ASSETS -- 100.0% $50,495
=======
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER
SHARE -- CLASS A $ 1.96
=======
</TABLE>
(A) Floating Rate Instrument. The rate reflected on the Statement of Net
Assets is the rate in effect on January 31, 1995. The date shown is the
longer of the reset date or the demand date.
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
LP Limited Partnership
MTN Medium Term Note
41
<PAGE>
SCHEDULE OF INVESTMENTS
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
GNMA PORTFOLIO
<TABLE>
--------------------------------------------------------------------------------
<CAPTION>
Face Market
Description Amount (000) Value (000)
--------------------------------------------------------------------------------
<S> <C> <C>
GNMA -- 95.7%
6.50% 09/15/23 -- 12/15/23 $20,527 $ 18,115
7.00% 12/15/22 -- 04/15/24 47,857 43,758
7.50% 02/15/17 -- 11/15/23 35,442 33,483
8.00% 12/15/21 -- 01/01/25 16,065 15,635
8.50% 10/15/16 -- 08/15/22 20,867 20,842
9.00% 05/15/16 -- 07/15/22 20,546 20,987
9.50% 06/15/09 -- 12/15/20 13,804 14,362
10.00% 02/15/13 -- 07/15/20 4,574 4,872
10.50% 03/15/18 254 275
11.00% 12/15/09 -- 11/15/14 1,824 1,994
11.50% 04/15/10 -- 02/15/13 107 118
12.00% 01/15/13 -- 04/15/14 26 29
12.50% 12/15/06 -- 07/15/15 84 94
--------
Total GNMA
(Cost $185,299) 174,564
--------
REPURCHASE AGREEMENT -- 6.9%
Paine Webber
5.75%, dated 01/31/95, matures 02/01/95, repurchase
price $12,591,011 (collateralized by U.S. Treasury
Note, par value $12,710,000, 6.50%, matures
09/30/96: market value $12,846,000) 12,589
--------
Total Repurchase Agreement
(Cost $12,589) 12,589
--------
TOTAL INVESTMENTS (102.6% OF NET ASSETS)
(COST $197,888) $187,153
========
</TABLE>
<TABLE>
SHORT-TERM MORTGAGE PORTFOLIO
--------------------------------------------------------------------------------
<CAPTION>
Face Market
Description Amount (000) Value (000)
--------------------------------------------------------------------------------
<S> <C> <C>
U.S. MORTGAGE-BACKED
OBLIGATIONS -- 88.5%
FHLMC
6.106%, 01/21/06 (A) $162 $ 158
7.000%, 05/20/96 89 88
8.500%, 11/22/97 255 254
7.500%, 07/10/97 173 169
FHLMC IO
7.000%, 01/19/98 498 84
FNMA
7.000%, 10/16/97 150 146
7.161%, 03/14/00 (A) 316 322
7.500%, 05/26/00 (A) 565 581
GNMA
7.000%, 02/01/95 (A) 245 247
12.000%, 09/15/98 60 65
12.000%, 10/15/98 45 50
9.750%, 01/15/00 132 137
11.000%, 08/15/00 67 73
11.000%, 11/15/00 155 167
11.000%, 12/15/00 72 78
11.000%, 01/15/01 55 59
10.000%, 04/20/01 189 193
9.000%, 05/15/01 42 43
9.000%, 11/15/01 25 26
9.000%, 12/15/01 30 31
10.750%, 03/15/03 46 48
10.750%, 12/20/14 75 78
9.250%, 11/20/16 93 95
------
Total U.S. Mortgage-Backed Obligations
(Cost $3,183) 3,192
------
U. S. TREASURY OBLIGATIONS -- 8.4%
U.S. Treasury Notes
6.500%, 05/15/97 100 98
5.750%, 10/31/97 215 206
------
Total U. S. Treasury Obligations
(Cost $303) 304
------
</TABLE>
42
<PAGE>
SCHEDULE OF INVESTMENTS
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
SHORT-TERM MORTGAGE PORTFOLIO
<TABLE>
--------------------------------------------------------------------------------
<CAPTION>
Market
Description Value (000)
--------------------------------------------------------------------------------
<S> <C>
REPURCHASE AGREEMENT -- 1.3%
Paine Webber
5.75%, dated 01/31/95, matures 02/01/95, repurchase price
$48,008 (collateralized by U.S. Treasury Note, par value
$48,000, 8.50%, matures 11/15/95: market value $49,000) $ 48
------
Total Repurchase Agreement
(Cost $48) 48
------
TOTAL INVESTMENTS (98.2% OF NET ASSETS)
(COST $3,534) $3,544
======
</TABLE>
(A) Adjustable Rate Mortgage. The rate reflected on the Statement of Net
Assets is the rate in effect on January 31, 1995.
FNMA Federal National Mortgage Association
FHLMC Federal Home Loan Mortgage Corporation
GNMA Government National Mortgage Association
IO Interest Only
43
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES (000)
-------------------------------------------------------------------------------
SEI Daily Income Trust -- as of January 31, 1995
<TABLE>
<CAPTION>
-------- -----------
SHORT-TERM
GNMA MORTGAGE/1/
-------- -----------
<S> <C> <C>
ASSETS:
Investments at market value (identified cost $197,888
and $3,534 respectively) $187,153 $3,544
Cash 282 8
Receivable for investment securities sold 24,113 160
Accrued interest receivable 1,191 28
Receivable for capital shares sold 9 --
Other assets 14 4
-------- ------
Total assets 212,762 3,744
-------- ------
LIABILITIES:
Payable for investment securities purchased 24,078 98
Payable for capital shares purchased 4,943 4
Distribution payable 1,229 24
Accrued expenses payable 104 11
-------- ------
Total liabilities 30,354 137
-------- ------
NET ASSETS:
Portfolio shares of Class A (unlimited authorization --
no par value) based on 19,871,553 and 374,082
outstanding shares of beneficial interest,
respectively 202,621 3,751
Portfolio shares of Class B (unlimited authorization --
no par value) based on 1,567 and 0 outstanding shares
of beneficial interest, respectively 14 --
Portfolio shares of ProVantage Funds (unlimited
authorization -- no par value) based on 18,398 and 0
outstanding shares of beneficial interest,
respectively 183 --
Accumulated net realized loss on investments (9,675) (154)
Accumulated net unrealized gain (loss) on investments (10,735) 10
-------- ------
TOTAL NET ASSETS $182,408 $3,607
======== ======
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER
SHARE -- CLASS A $ 9.17 $ 9.64
======== ======
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER
SHARE -- CLASS B $ 9.17 --
======== ======
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE --
PROVANTAGE FUNDS $ 9.16 --
======== ======
MAXIMUM OFFERING PRICE PER SHARE-PROVANTAGE FUNDS
(9.16/95.5%)+ $ 9.59 --
======== ======
</TABLE>
+ The maximum offering price per share is calculated by dividing the net asset
value by 1 minus the maximum sales charge of 4.50%.
1 As of January 31, 1995, only the Class A shares of the Short-Term Mortgage
Portfolio were outstanding.
Amounts designated as "--" are either $0 or have been rounded to $0.
44
<PAGE>
STATEMENTS OF OPERATIONS (000)
--------------------------------------------------------------------------------
SEI Daily Income Trust -- for the period ended January 31, 1995
<TABLE>
<CAPTION>
------------ --------- ------------ ------------- ----------
FEDERAL MONEY PRIME
SECURITIES MARKET GOVERNMENT GOVERNMENT II OBLIGATION
PORTFOLIO/2/ PORTFOLIO PORTFOLIO/3/ PORTFOLIO PORTFOLIO
------------ --------- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C>
Interest Income $338 $10,143 $8,489 $34,272 $103,094
---- ------- ------ ------- --------
EXPENSES:
Management fee 52 711 406 1,435 4,248
Less management fees
waived (2) (491) (285) (574) (1,697)
Investment advisory fee 2 59 46 206 608
Less investment
advisory fees waived -- (13) (34) (150) (443)
Custodian/wire agent
fees 7 51 31 109 337
Trustee fees -- 5 4 18 54
Registration & filing
fees (5) 41 109 142 450
Distribution fees(1) 3 79 893 282 736
Other -- 34 15 85 240
Amortization of
deferred
organizational costs -- -- -- -- --
---- ------- ------ ------- --------
Total expenses 57 476 1,185 1,553 4,533
---- ------- ------ ------- --------
NET INVESTMENT INCOME 281 9,667 7,304 32,719 98,561
---- ------- ------ ------- --------
NET REALIZED AND
UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain
(loss) from security
transactions (7) (12) (74) (87) (138)
---- ------- ------ ------- --------
Net change in
unrealized
appreciation
(depreciation) of
investments -- -- -- -- --
---- ------- ------ ------- --------
NET INCREASE (DECREASE)
IN NET ASSETS FROM
OPERATIONS $274 $ 9,655 $7,230 $32,632 $ 98,423
==== ======= ====== ======= ========
</TABLE>
1 Includes class specific expenses of approximately $13, $845, $42, $62, $76,
$1, and $1 for the Money Market, Government, Government II, Prime Obligation,
Treasury II, Intermediate-Term Government, and GNMA Portfolios, respectively.
2 Federal Securities Portfolio closed on July 15, 1994.
3 Government Portfolio reopened on April 7, 1994.
Amounts designated as "--" are either $0 or have been rounded to $0.
45
<PAGE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
--------- ----------- ---------- ------------- --------- --------- ----------
INTERMEDIATE- CORPORATE
SHORT-TERM TERM DAILY SHORT-TERM
TREASURY TREASURY II GOVERNMENT GOVERNMENT GNMA INCOME MORTGAGE
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ----------- ---------- ------------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
$2,095 $16,840 $ 5,146 $ 17,019 $ 17,897 $2,149 $ 263
------ ------- ------- -------- -------- ------ -----
115 929 394 1,054 778 152 17
(59) (313) (61) (188) (34) (82) (9)
13 105 104 278 225 42 5
(10) (77) (16) (43) (35) (6) --
7 56 15 48 44 6 1
1 9 3 8 5 1 --
7 83 8 24 17 8 --
15 196 35 95 78 13 2
5 53 25 80 73 7 --
2 3 -- -- -- 11 6
------ ------- ------- -------- -------- ------ -----
96 1,044 507 1,356 1,151 152 22
------ ------- ------- -------- -------- ------ -----
1,999 15,796 4,639 15,663 16,746 1,997 241
------ ------- ------- -------- -------- ------ -----
(3) 95 (1,375) (8,331) (9,770) (367) (148)
------ ------- ------- -------- -------- ------ -----
-- -- (2,532) (16,030) (14,407) (442) 12
------ ------- ------- -------- -------- ------ -----
$1,996 $15,891 $ 732 $ (8,698) $ (7,431) $1,188 $ 105
====== ======= ======= ======== ======== ====== =====
</TABLE>
46
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS (000)
--------------------------------------------------------------------------------
SEI Daily Income Trust -- for the period ended January 31, 1995
<TABLE>
<CAPTION>
-------------------- ------------------------
FEDERAL MONEY
SECURITIES MARKET
-------------------- ------------------------
1995/1/ 1994 1995 1994
-------------------- ------------------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income $ 281 $ 814 $ 9,667 $ 6,452
Net realized gain (loss)
from securities transac-
tions (7) 6 (12) 24
--------- --------- ----------- -----------
Net increase in net assets
resulting from operations 274 820 9,655 6,476
--------- --------- ----------- -----------
DIVIDENDS DISTRIBUTED FROM:
Net investment income:
Class A (281) (814) (9,468) (6,404)
Class B -- -- (199) (48)
Class C -- -- -- --
Net realized gains -- -- -- --
--------- --------- ----------- -----------
Total dividends distributed (281) (814) (9,667) (6,452)
--------- --------- ----------- -----------
CAPITAL SHARE TRANSACTIONS
(ALL AT $1.00 PER SHARE):
Class A:
Proceeds from shares issued 88,616 247,602 2,811,452 2,641,632
Shares issued in lieu of
cash distributions -- -- 38 29
Cost of shares repurchased (113,455) (328,263) (2,801,293) (2,702,331)
--------- --------- ----------- -----------
Increase (decrease) in net
assets from Class A trans-
actions (24,839) (80,661) 10,197 (60,670)
--------- --------- ----------- -----------
Class B:
Proceeds from shares issued -- -- 13,161 3,985
Shares issued in lieu of
cash distributions -- -- -- --
Cost of shares repurchased -- -- (9,181) (1,961)
--------- --------- ----------- -----------
Increase (decrease) in net
assets from Class B trans-
actions -- -- 3,980 2,024
--------- --------- ----------- -----------
Class C:
Proceeds from shares issued -- -- -- --
Shares issued in lieu of
cash distributions -- -- -- --
Cost of shares repurchased -- -- -- --
--------- --------- ----------- -----------
Increase (decrease) in net
assets from Class C trans-
actions -- -- -- --
--------- --------- ----------- -----------
INCREASE (DECREASE) IN NET
ASSETS DERIVED FROM CAPITAL
SHARE TRANSACTIONS (24,839) (80,661) 14,177 (58,646)
--------- --------- ----------- -----------
Net increase (decrease) in
net assets (24,846) (80,655) 14,165 (58,622)
--------- --------- ----------- -----------
NET ASSETS:
Beginning of Period 24,846 105,501 206,137 264,759
--------- --------- ----------- -----------
End of Period $ -- $ 24,846 $ 220,302 $ 206,137
========= ========= =========== ===========
</TABLE>
1 Federal Portfolio closed on July 15, 1994.
2 Government Portfolio reopened on April 7, 1994.
3 Government Portfolio closed on June 2, 1993.
Amounts designated as "--" are either $0 or have been rounded to $0.
47
<PAGE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
-------------------- ------------------------ -------------------------- -------------------- ------------------------
PRIME
GOVERNMENT GOVERNMENT II OBLIGATION TREASURY TREASURY II
-------------------- ------------------------ -------------------------- -------------------- ------------------------
1995/2/ 1994/3/ 1995 1994 1995 1994 1995 1994 1995 1994
-------------------- ------------------------ -------------------------- -------------------- ------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 7,304 $ 174 $ 32,719 $ 20,352 $ 98,561 $ 64,328 $ 1,999 $ 1,312 $ 15,796 $ 10,659
(74) 5 (87) 19 (138) 109 (3) 1 95 28
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
7,230 179 32,632 20,371 98,423 64,437 1,996 1,313 15,891 10,687
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
-- (174) (32,116) (20,186) (97,805) (63,215) (1,999) (1,312) (14,850) (10,357)
-- -- (603) (166) (647) (82) -- -- (946) (302)
(7,304) -- -- -- (109) (1,031) -- -- -- --
-- -- -- -- -- -- -- -- -- --
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
(7,304) (174) (32,719) (20,352) (98,561) (64,328) (1,999) (1,312) (15,796) (10,659)
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
-- 42,310 3,658,726 4,310,605 16,480,679 16,194,065 225,159 138,136 2,198,439 2,137,457
-- -- 623 409 18,646 9,927 -- -- 5,301 3,069
-- (62,337) (3,610,898) (4,237,533) (16,261,984) (16,227,315) (232,323) (136,465) (2,170,484) (2,128,653)
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
(20,027) 48,451 73,481 237,341 (23,323) (7,164) 1,671 33,256 11,873
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
-- -- 70,987 25,585 56,734 14,081 -- -- 157,948 117,043
-- -- 57 -- 5 -- -- -- 4 16
-- -- (77,304) (4,461) (41,198) (12,468) -- -- (135,723) (100,651)
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
-- -- (6,260) 21,124 15,541 1,613 -- -- 22,229 16,408
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
824,507 -- -- -- 3,479 115,139 -- -- -- --
6,347 -- -- -- -- -- -- -- -- --
(519,945) -- -- -- (24,085) (179,862) -- -- -- --
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
310,909 -- -- -- (20,606) (64,723) -- -- -- --
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
310,909 (20,027) 42,191 94,605 232,276 (86,433) (7,164) 1,671 55,485 28,281
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
310,835 (20,022) 42,104 94,624 232,138 (86,324) (7,167) 1,672 55,580 28,309
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
-- 20,022 759,502 664,878 2,568,040 2,654,364 46,296 44,624 386,782 358,473
--------- -------- ----------- ----------- ------------ ------------ --------- --------- ----------- -----------
$ 310,835 $ -- $ 801,606 $ 759,502 $ 2,800,178 $ 2,568,040 $ 39,129 $ 46,296 $ 442,362 $ 386,782
========= ======== =========== =========== ============ ============ ========= ========= =========== ===========
</TABLE>
48
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS (000)
--------------------------------------------------------------------------------
SEI Daily Income Trust -- for the period ended January 31, 1995
<TABLE>
<CAPTION>
------------------ ------------------
SHORT-TERM INTERMEDIATE-TERM
GOVERNMENT GOVERNMENT
------------------ ------------------
1995 1994 1995 1994
------------------ ------------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income $ 4,639 $ 4,416 $ 15,663 $ 16,087
Net realized gain (loss) from
security transactions (1,375) 1,190 (8,331) 6,818
Net change in unrealized
appreciation (depreciation) of
investments (2,532) (828) (16,030) (3,988)
-------- -------- -------- --------
Net increase (decrease) in net
assets resulting from operations 732 4,778 (8,698) 18,917
-------- -------- -------- --------
DIVIDENDS DISTRIBUTED FROM:
Net investment income:
Class A (4,636) (4,365) (15,655) (16,033)
Class B (3) (51) (3) --
ProVantage Funds -- -- (7) (1)
Net Realized Gains:
Class A (143) (1,254) (2,132) (6,619)
Class B -- (16) (1) --
ProVantage Funds -- -- (1) (2)
-------- -------- -------- --------
Total dividends distributed (4,782) (5,686) (17,799) (22,655)
-------- -------- -------- --------
CAPITAL SHARE TRANSACTIONS:
Class A:
Proceeds from shares issued 61,290 97,489 109,590 165,868
Shares issued in lieu of cash
distributions 1,556 1,754 2,663 3,212
Cost of shares repurchased (87,404) (69,044) (178,914) (88,017)
-------- -------- -------- --------
Increase (decrease) in net assets
derived from Class A transactions (24,558) 30,199 (66,661) 81,063
-------- -------- -------- --------
Class B:
Proceeds from shares issued 112 7 96 --
Shares issued in lieu of cash
distributions -- 63 -- --
Cost of shares repurchased (15) (1,549) -- --
-------- -------- -------- --------
Increase (decrease) in net assets
derived from Class B transactions 97 (1,479) 96 --
-------- -------- -------- --------
ProVantage Funds:
Proceeds from shares issued -- -- 142 106
Proceeds from issued in lieu of cash
distributions -- -- 7 2
Cost of shares repurchased -- -- (145) --
-------- -------- -------- --------
Increase in net assets derived from
ProVantage Funds transactions -- -- 4 108
-------- -------- -------- --------
INCREASE (DECREASE) IN NET ASSETS
DERIVED FROM CAPITAL SHARE
TRANSACTIONS (24,461) 28,720 (66,561) 81,171
-------- -------- -------- --------
Net increase (decrease) in net
assets (28,511) 27,812 (93,058) 77,433
-------- -------- -------- --------
NET ASSETS:
Beginning of period 128,100 100,288 336,921 259,488
-------- -------- -------- --------
End of period $ 99,589 $128,100 $243,863 $336,921
======== ======== ======== ========
CAPITAL SHARE TRANSACTIONS:
Class A:
Shares issued 6,239 9,618 11,387 16,127
Shares issued in lieu of cash
distributions 159 174 280 314
Shares repurchased (8,911) (6,808) (18,803) (8,552)
-------- -------- -------- --------
Total Class A transactions (2,513) 2,984 (7,136) 7,889
-------- -------- -------- --------
Class B:
Shares issued 11 1 10 --
Shares issued in lieu of cash
distributions -- 6 -- --
Shares repurchased (1) (154) -- --
-------- -------- -------- --------
Total Class B transactions 10 (147) 10 --
-------- -------- -------- --------
ProVantage Funds:
Shares issued -- -- 14 10
Shares issued in lieu of cash
distributions -- -- 1 --
Shares repurchased -- -- (15) --
-------- -------- -------- --------
Total ProVantage Funds transactions -- -- -- 10
-------- -------- -------- --------
Increase (decrease) in capital
shares (2,503) 2,837 (7,126) 7,899
======== ======== ======== ========
Undistributed (distributions in
excess of) net investment income 0 0 0 2
======== ======== ======== ========
</TABLE>
49
<PAGE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
---------------------- -------------------------- -------------------------
CORPORATE
DAILY SHORT-TERM
GNMA INCOME MORTGAGE
---------------------- -------------------------- -------------------------
1995 1994 1995 1994 1995 1994
---------------------- -------------------------- -------------------------
<S> <C> <C> <C> <C> <C>
$ 16,746 $ 15,132 $ 1,997 $ 430 $ 241 $ 36
(9,770) 2,719 (367) 1 (148) (6)
(14,407) (4,277) (442) (14) 12 (2)
-------- -------- -------- ------- ------- -------
(7,431) 13,574 1,188 417 105 28
-------- -------- -------- ------- ------- -------
(16,618) (15,247) (1,997) (430) (241) (36)
(1) -- -- -- -- --
(10) (2) -- -- -- --
(66) (2,438) -- -- -- --
-- -- -- -- -- --
-- (1) -- -- -- --
-------- -------- -------- ------- ------- -------
(16,695) (17,688) (1,997) (430) (241) (36)
-------- -------- -------- ------- ------- -------
96,860 175,799 51,564 52,881 5,704 5,243
3,898 4,154 1,071 215 95 10
(156,581) (106,883) (44,986) (9,428) (5,977) (1,324)
-------- -------- -------- ------- ------- -------
(55,823) 73,070 7,649 43,668 (178) 3,929
-------- -------- -------- ------- ------- -------
28 -- -- -- -- --
-- -- -- -- -- --
(14) -- -- -- -- --
-------- -------- -------- ------- ------- -------
14 -- -- -- -- --
-------- -------- -------- ------- ------- -------
47 143 -- -- -- --
8 2 -- -- -- --
(7) (10) -- -- -- --
-------- -------- -------- ------- ------- -------
48 135 -- -- -- --
-------- -------- -------- ------- ------- -------
(55,761) 73,205 7,649 43,668 (178) 3,929
-------- -------- -------- ------- ------- -------
(79,887) 69,091 6,840 43,655 (314) 3,921
-------- -------- -------- ------- ------- -------
262,295 193,204 43,655 0 3,921 0
-------- -------- -------- ------- ------- -------
$182,408 $262,295 $ 50,495 $43,655 $ 3,607 $ 3,921
======== ======== ======== ======= ======= =======
10,398 17,191 26,175 26,462 584 529
421 409 544 108 10 --
(16,985) (10,475) (22,845) (4,730) (616) (134)
-------- -------- -------- ------- ------- -------
(6,166) 7,125 3,874 21,840 (22) 395
-------- -------- -------- ------- ------- -------
3 -- -- -- -- --
-- -- -- -- -- --
(1) -- -- -- -- --
-------- -------- -------- ------- ------- -------
2 -- -- -- -- --
-------- -------- -------- ------- ------- -------
5 14 -- -- -- --
1 -- -- -- -- --
(1) (1) -- -- -- --
-------- -------- -------- ------- ------- -------
5 13 -- -- -- --
-------- -------- -------- ------- ------- -------
(6,159) 7,138 3,874 21,840 (22) 395
======== ======== ======== ======= ======= =======
0 (117) 0 0 0 0
======== ======== ======== ======= ======= =======
</TABLE>
50
<PAGE>
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
SEI Daily Income Trust -- for the period ended January 31, 1995
For a Share Outstanding Throughout each Period
<TABLE>
<CAPTION>
Net Asset Net Realized and Dividends Distributions Ratio of
Value Net Unrealized from Net from Net Asset Net Assets Expenses
Beginning Investment Gains (Losses) Investment Realized Capital Value End Total End of to Average
of Period Income on Securities Income Gains of Period Return Period (000) Net Assets
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
------------------
FEDERAL SECURITIES
------------------
1995(1) $1.00 $0.01 -- $(0.01) -- $1.00 1.37%+ 0 0.60%
1994 1.00 0.03 -- (0.03) -- 1.00 2.70 24,846 0.60
1993 1.00 0.03 -- (0.03) -- 1.00 3.28 105,501 0.60
1992 1.00 0.05 -- (0.05) -- 1.00 5.31 201,631 0.60
1991 1.00 0.07 -- (0.07) -- 1.00 7.70 209,194 0.60
1990 1.00 0.08 -- (0.08) -- 1.00 8.73 166,177 0.60
1989 1.00 0.07 -- (0.07) -- 1.00 7.32 37,093 0.60
1988 1.00 0.06 -- (0.06) -- 1.00 6.23 85,518 0.60
1987 1.00 0.06 -- (0.06) -- 1.00 6.24 109,271 0.60
1986 1.00 0.07 -- (0.07) -- 1.00 7.59 96,831 0.60
-------------
MONEY MARKET
-------------
CLASS A
1995 $1.00 $0.04 -- $(0.04) -- $1.00 4.55% 213,988 0.21%
1994 1.00 0.03 -- (0.03) -- 1.00 2.98 203,803 0.35
1993 1.00 0.04 -- (0.04) -- 1.00 3.60 264,450 0.35
1992 1.00 0.06 -- (0.06) -- 1.00 5.76 312,151 0.35
1991 1.00 0.08 -- (0.08) -- 1.00 8.18 815,847 0.33
1990 1.00 0.09 -- (0.09) -- 1.00 9.24 589,683 0.35
1989 1.00 0.08 -- (0.08) -- 1.00 7.82 507,821 0.35
1988 1.00 0.07 -- (0.07) -- 1.00 6.90 606,117 0.35
1987 1.00 0.06 -- (0.06) -- 1.00 6.67 295,121 0.35
1986 1.00 0.08 -- (0.08) -- 1.00 8.29 300,059 0.35
CLASS B
1995 1.00 0.04 -- (0.04) -- 1.00 4.24 6,314 0.51
1994 1.00 0.03 -- (0.03) -- 1.00 2.68 2,334 0.65
1993 1.00 0.04 -- (0.04) -- 1.00 3.29 309 0.65
1992 1.00 0.05 -- (0.05) -- 1.00 5.45 2,305 0.53
1991(2) 1.00 0.02 -- (0.02) -- 1.00 7.37 830 0.65
--------------------
GOVERNMENT PORTFOLIO
--------------------
CLASS A
1994(3) $1.00 $0.01 -- $(0.01) -- $1.00 3.22% 0 0.20%
1993(4) 1.00 0.03 -- (0.03) -- 1.00 3.19 20,022 0.20
CLASS C
1995(5) 1.00 0.03 -- (0.03) -- 1.00 3.41+ 310,835 0.70
-------------
GOVERNMENT II
-------------
CLASS A
1995 $1.00 $0.04 -- $(0.04) -- $1.00 4.39% 786,405 0.20%
1994 1.00 0.03 -- (0.03) -- 1.00 3.02 738,040 0.20
1993 1.00 0.04 -- (0.04) -- 1.00 3.57 664,540 0.20
1992 1.00 0.06 -- (0.06) -- 1.00 5.73 534,303 0.20
1991 1.00 0.08 -- (0.08) -- 1.00 8.01 500,526 0.20
1990 1.00 0.09 -- (0.09) -- 1.00 8.90 257,523 0.20
1989 1.00 0.07 -- (0.07) -- 1.00 7.53 155,987 0.20
1988 1.00 0.06 -- (0.06) -- 1.00 6.55 158,361 0.20
1987 1.00 0.06 -- (0.06) -- 1.00 6.55 143,736 0.20
1986(6) 1.00 0.01 -- (0.01) -- 1.00 15.61 106,944 0.20
CLASS B
1995 1.00 0.04 -- (0.04) -- 1.00 4.08 15,201 0.50
1994 1.00 0.03 -- (0.03) -- 1.00 2.71 21,462 0.50
1993 1.00 0.03 -- (0.03) -- 1.00 3.26 338 0.50
1992 1.00 0.05 -- (0.05) -- 1.00 5.02 1,906 0.48
1991(7) 1.00 0.00 -- (0.00) -- 1.00 0.00 607 0.50
<CAPTION>
Ratio of
Ratio of Net Investment
Ratio of Expenses Income
Net Investment to Average to Average
Income Net Assets Net Assets
to Average (Excluding (Excluding
Net Assets Waivers) Waivers)
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
------------------
FEDERAL SECURITIES
------------------
1995(1) 2.98% 0.63% 2.95%
1994 2.70 0.60 2.70
1993 3.22 0.67 3.15
1992 5.17 0.67 5.10
1991 7.40 0.70 7.30
1990 8.29 0.72 8.17
1989 6.91 0.68 6.83
1988 5.95 0.75 5.80
1987 6.02 0.78 5.84
1986 7.43 0.85 7.18
-------------
MONEY MARKET
-------------
CLASS A
1995 4.49% 0.45% 4.25%
1994 2.95 0.44 2.86
1993 3.56 0.39 3.52
1992 5.84 0.39 5.80
1991 7.88 0.38 7.83
1990 8.90 0.40 8.85
1989 7.52 0.39 7.48
1988 6.76 0.42 6.69
1987 6.39 0.41 6.33
1986 7.97 0.44 7.88
CLASS B
1995 4.49 0.75 4.25
1994 2.65 0.74 2.56
1993 3.47 0.69 3.43
1992 5.18 0.61 5.10
1991(2) 7.17 0.72 7.10
--------------------
GOVERNMENT PORTFOLIO
--------------------
CLASS A
1994(3) 3.04% 0.37% 2.87%
1993(4) 3.41 0.38 3.23
CLASS C
1995(5) 4.32 0.89 4.13
-------------
GOVERNMENT II
-------------
CLASS A
1995 4.33% 0.30% 4.23%
1994 2.98 0.29 2.89
1993 3.48 0.29 3.39
1992 5.56 0.28 5.48
1991 7.66 0.31 7.55
1990 8.49 0.32 8.37
1989 7.22 0.36 7.06
1988 6.35 0.34 6.21
1987 6.26 0.35 6.11
1986(6) 7.62 0.21 7.61
CLASS B
1995 4.33 0.60 4.23
1994 2.68 0.60 2.58
1993 3.35 0.59 3.26
1992 4.75 0.59 4.64
1991(7) 6.44 3.76 3.18
</TABLE>
51
<PAGE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Asset Net Realized and Dividends Distributions Ratio of
Value Net Unrealized from Net from Net Asset Net Assets Expenses
Beginning Investment Gains (Losses) Investment Realized Capital Value End Total End of to Average
of Period Income on Securities Income Gains of Period Return Period (000) Net Assets
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
----------------
PRIME OBLIGATION
----------------
CLASS A
1995 $1.00 $0.04 -- $(0.04) -- $1.00 4.46% 2,778,326 0.20%
1994 1.00 0.03 -- (0.03) -- 1.00 3.10 2,541,126 0.20
1993 1.00 0.04 -- (0.04) -- 1.00 3.72 2,564,340 0.20
1992 1.00 0.06 -- (0.06) -- 1.00 5.97 1,661,619 0.20
1991 1.00 0.08 -- (0.08) -- 1.00 8.34 825,081 0.20
1990 1.00 0.09 -- (0.09) -- 1.00 9.36 532,137 0.20
1989 1.00 0.08 -- (0.08) -- 1.00 8.58 237,273 0.20
1988(8) 1.00 0.01 -- (0.01) -- 1.00 7.48 139,944 0.13
CLASS B
1995 1.00 0.04 -- (0.04) -- 1.00 4.15 21,852 0.50
1994 1.00 0.03 -- (0.03) -- 1.00 2.79 6,312 0.50
1993 1.00 0.04 -- (0.04) -- 1.00 3.41 4,699 0.47
1992(9) 1.00 0.04 -- (0.04) -- 1.00 5.58 67,016 0.50
CLASS C
1995(11) 1.00 0.03 -- (0.03) -- 1.00 2.55+ 0 0.70
1994 1.00 0.03 -- (0.03) -- 1.00 2.59 20,602 0.70
1993(10) 1.00 0.03 -- (0.03) -- 1.00 3.13 85,325 0.70
------------------
TREASURY PORTFOLIO
------------------
1995 $1.00 $0.04 -- $(0.04) -- $1.00 4.29% 39,129 0.20%
1994 1.00 0.03 -- (0.03) -- 1.00 3.00 46,296 0.20
1993(12) 1.00 0.01 -- (0.01) -- 1.00 2.91 44,624 0.20
---------------------
TREASURY II PORTFOLIO
---------------------
CLASS A
1995 $1.00 $0.04 -- $(0.04) -- $1.00 4.17% 397,682 0.25%
1994 1.00 0.03 -- (0.03) -- 1.00 2.88 364,334 0.25
1993 1.00 0.03 -- (0.03) -- 1.00 3.46 352,435 0.25
1992 1.00 0.06 -- (0.06) -- 1.00 5.48 282,535 0.25
1991 1.00 0.07 -- (0.07) -- 1.00 7.76 490,705 0.25
1990(13) 1.00 0.08 -- (0.08) -- 1.00 7.90 72,777 0.25
CLASS B
1995 1.00 0.04 -- (0.04) -- 1.00 3.86 44,680 0.55
1994 1.00 0.03 -- (0.03) -- 1.00 2.57 22,448 0.55
1993 1.00 0.03 -- (0.03) -- 1.00 3.15 6,038 0.55
1992 1.00 0.05 -- (0.05) -- 1.00 5.16 102,182 0.55
1991(14) 1.00 0.07 -- (0.07) -- 1.00 7.16 85,439 0.55
<CAPTION>
Ratio of
Ratio of Net Investment
Ratio of Expenses Income
Net Investment to Average to Average
Income Net Assets Net Assets
to Average (Excluding (Excluding
Net Assets Waivers) Waivers)
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
----------------
PRIME OBLIGATION
----------------
CLASS A
1995 4.41% 0.30% 4.31%
1994 3.07 0.28 2.98
1993 3.62 0.30 3.52
1992 5.73 0.29 5.64
1991 8.03 0.30 7.93
1990 8.86 0.33 8.73
1989 7.68 0.34 7.54
1988(8) 7.22 0.58 6.77
CLASS B
1995 4.55 0.60 4.45
1994 2.77 0.58 2.68
1993 3.63 0.53 3.57
1992(9) 4.98 0.59 4.89
CLASS C
1995(11) 2.79 0.77 2.72
1994 2.57 0.78 2.48
1993(10) 3.05 0.83 2.92
------------------
TREASURY PORTFOLIO
------------------
1995 4.17% 0.34% 4.03%
1994 2.96 0.33 2.82
1993(12) 2.89 0.42 2.67
---------------------
TREASURY II PORTFOLIO
---------------------
CLASS A
1995 4.11% 0.35% 4.01%
1994 2.84 0.34 2.76
1993 3.40 0.34 3.31
1992 5.43 0.31 5.37
1991 7.11 0.41 6.95
1990(13) 7.66 0.69 7.22
CLASS B
1995 3.71 0.65 3.61
1994 2.54 0.64 2.46
1993 3.42 0.64 3.33
1992 4.97 0.61 4.91
1991(14) 7.18 0.67 7.06
</TABLE>
+ Returns are for the period indicated and have not been annualized.
1 Federal Portfolio shares were fully liquidated July 15, 1994. All ratios for
that period have been annualized.
2 Money Market Class B shares were offered beginning October 12, 1990. All ra-
tios including total return for that period have been annualized.
3 Government I Class A shares were fully liquidated June 2, 1993. All ratios
including total return for that period have been annualized.
4 Government I Class A shares were offered beginning March 8, 1992. All ratios
including total return for that period have been annualized.
5 Government I Class C shares were offered beginning April 7, 1994. All ratios
for that period have been annualized.
6 Government II Class A shares were offered beginning September 6, 1985. All
ratios including total return for that period have been annualized.
7 Government II Class B shares were offered beginning January 28, 1991. All ra-
tios including total return for that period have been annualized.
8 Prime Obligation Class A shares were offered beginning September 6, 1985. All
ratios including total return for that period have been annualized.
9 Prime Obligation Class B shares were offered beginning March 26, 1991. All
ratios including total return for that period have been annualized.
10 Prime Obligation Class C shares were offered beginning March 25, 1992. All
ratios including total return for that period have been annualized.
11 Prime Obligation Class C shares were fully liquidated October 27, 1994. All
ratios for that period have been annualized.
12 Treasury I Class A shares were offered beginning September 30, 1992. All ra-
tios including total return for that period have been annualized.
13 Treasury II Class A shares were offered beginning July 28, 1989. All ratios
including total return for that period have been annualized.
14 Treasury II Class B shares were offered beginning February 15, 1990. All ra-
tios including total return for that period have been annualized.
52
<PAGE>
FINANCIAL HIGHLIGHTS (Continued)
--------------------------------------------------------------------------------
SEI Daily Income Trust -- for the period ended January 31, 1995
For a Share Outstanding Throughout each Period
<TABLE>
<CAPTION>
Net Asset Net Realized and Dividends Distributions Ratio of
Value Net Unrealized from Net from Net Asset Net Assets Expenses
Beginning Investment Gains (Losses) Investment Realized Capital Value End Total End of to Average
of Period Income on Securities Income Gains of Period Return Period (000) Net Assets
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-------------------------------
SHORT-TERM GOVERNMENT PORTFOLIO
-------------------------------
CLASS A
1995 $10.06 $0.40 $(0.32) $(0.40) (0.01) $ 9.73 0.93% 99,458 0.45%
1994 10.13 0.40 0.04 (0.40) (0.11) 10.06 4.41 128,063 0.45
1993 10.09 0.52 0.14 (0.52) (0.10) 10.13 6.66 100,153 0.45
1992 9.82 0.68 0.27 (0.68) -- 10.09 10.00 63,194 0.45
1991 9.65 0.76 0.17 (0.76) -- 9.82 9.98 51,457 0.45
1990 9.54 0.75 0.11 (0.75) -- 9.65 9.01 48,683 0.45
1989 9.81 0.76 (0.27) (0.76) -- 9.54 5.21 54,887 0.41
1988(1) 10.00 0.76 (0.19) (0.76) -- 9.81 6.09 27,279 0.32
CLASS B
1995 10.04 0.38 (0.32) (0.38) (0.01) 9.71 0.70 131 0.75
1994 10.13 0.37 0.02 (0.37) (0.11) 10.04 3.93 37 0.75
1993 10.09 0.48 0.14 (0.48) (0.10) 10.13 6.34 135 0.75
1992 9.82 0.65 0.27 (0.65) -- 10.09 9.68 135 0.75
1991(2) 9.75 0.17 0.07 (0.17) -- 9.82 (0.25) 150 0.75
--------------------------------------
INTERMEDIATE-TERM GOVERNMENT PORTFOLIO
--------------------------------------
CLASS A
1995 $10.13 $0.50 $(0.73) $(0.50) (0.07) $ 9.33 (2.19)% 243,671 0.45%
1994 10.23 0.54 0.11 (0.54) (0.21) 10.13 6.44 336,814 0.45
1993 10.06 0.62 0.28 (0.62) (0.11) 10.23 9.51 259,488 0.45
1992 9.75 0.70 0.40 (0.70) (0.09) 10.06 11.44 199,901 0.45
1991 9.48 0.73 0.28 (0.74) -- 9.75 11.06 184,193 0.45
1990 9.32 0.76 0.16 (0.76) -- 9.48 9.94 127,966 0.45
1989 9.71 0.78 (0.39) (0.78) -- 9.32 4.23 102,166 0.41
1988(3) 10.00 0.77 (0.29) (0.77) -- 9.71 5.37 77,542 0.28
CLASS B
1995(4) 9.64 0.31 (0.24) (0.31) (0.07) 9.33 0.61+ 93 0.75
PROVANTAGE FUNDS
1995(12) 10.13 0.47 (0.74) (0.47) (0.07) 9.32 (2.61) 99 0.84
1994(5), (12) 10.44 0.17 (0.10) (0.17) (0.21) 10.13 1.52 107 0.75
--------------
GNMA PORTFOLIO
--------------
CLASS A
1995 $10.07 $0.64 $(0.90) $(0.64) -- $ 9.17 (2.46)% 182,225 0.47%
1994 10.22 0.66 (0.06) (0.66) (0.09) 10.07 6.09 262,162 0.45
1993 9.99 0.75 0.27 (0.75) (0.04) 10.22 10.92 193,204 0.45
1992 9.61 0.79 0.38 (0.79) -- 9.99 12.49 120,712 0.45
1991 9.31 0.83 0.30 (0.83) -- 9.61 12.74 56,912 0.45
1990 9.15 0.88 0.16 (0.88) -- 9.31 11.53 7,899 0.44
1989 9.47 0.87 (0.32) (0.87) -- 9.15 6.19 8,367 0.37
1988(6) 10.00 0.77 (0.53) (0.77) -- 9.47 3.25 4,968 0.03
CLASS B
1995(7) 9.16 0.35 0.01 (0.35) -- 9.17 4.00+ 14 0.79
PROVANTAGE FUNDS
1995(12) 10.09 0.61 (0.93) (0.61) -- 9.16 (3.04)% 169 0.86
1994(8), (12) 10.22 0.19 (0.04) (0.19) (0.09) 10.09 4.24 133 0.75
----------------------
CORPORATE DAILY INCOME
----------------------
1995 $ 2.00 $0.09 $(0.04) $(0.09) -- $ 1.96 2.59% 50,495 0.35%
1994(9) 2.00 0.02 -- (0.02) -- 2.00 3.45 43,655 0.35
-----------------------------
SHORT-TERM MORTGAGE PORTFOLIO
-----------------------------
1995(11) $ 9.90 $0.48 $(0.24) $(0.48) (0.02) $ 9.64 2.29% 3,607 0.45%
1994(10), (11) 10.00 0.22 (0.10) (0.22) -- 9.90 1.84 3,921 0.45
<CAPTION>
Ratio of
Ratio of Net Investment
Ratio of Expenses Income
Net Investment to Average to Average
Income Net Assets Net Assets Portfolio
to Average (Excluding (Excluding Turnover
Net Assets Waivers) Waivers) Rate
-----------------------------------------------------------------
<S> <C> <C> <C> <C>
-------------------------------
SHORT-TERM GOVERNMENT PORTFOLIO
-------------------------------
CLASS A
1995 4.12% 0.52% 4.05% 45%
1994 3.98 0.52 3.91 105
1993 5.04 0.55 4.94 80
1992 6.82 0.56 6.71 36
1991 7.73 0.54 7.64 17
1990 7.72 0.58 7.59 6
1989 7.95 0.58 7.78 55
1988(1) 8.17 0.78 7.71 85
CLASS B
1995 3.92 0.82 3.85 45
1994 3.67 0.82 3.60 105
1993 4.74 0.85 4.64 80
1992 6.52 0.85 6.42 36
1991(2) 7.25 0.93 7.07 17
--------------------------------------
INTERMEDIATE-TERM GOVERNMENT PORTFOLIO
--------------------------------------
CLASS A
1995 5.20% 0.52% 5.13% 61%
1994 5.24 0.53 5.16 56
1993 6.16 0.53 6.08 52
1992 7.08 0.54 6.99 62
1991 7.78 0.54 7.69 39
1990 8.01 0.74 7.72 34
1989 8.32 0.72 8.01 36
1988(3) 8.40 1.67 7.01 56
CLASS B
1995(4) 5.07 0.83 4.99 61
PROVANTAGE FUNDS
1995(12) 4.80 0.92 4.72 61
1994(5), (12) 4.94 0.83 4.86 56
--------------
GNMA PORTFOLIO
--------------
CLASS A
1995 6.89% 0.50% 6.86% 85%
1994 6.38 0.50 6.32 70
1993 7.49 0.52 7.42 23
1992 8.09 0.52 8.02 9
1991 8.66 0.61 8.50 16
1990 9.50 0.49 9.45 29
1989 9.49 0.44 9.42 19
1988(6) 9.49 0.74 8.78 48
CLASS B
1995(7) 6.80 0.82 6.77 85
PROVANTAGE FUNDS
1995(12) 6.54 0.89 6.51 85
1994(8), (12) 6.06 0.80 6.01 70
----------------------
CORPORATE DAILY INCOME
----------------------
1995 4.60% 0.55% 4.40% 147%
1994(9) 3.45 0.63 3.18 34
-----------------------------
SHORT-TERM MORTGAGE PORTFOLIO
-----------------------------
1995(11) 4.90% 0.64% 4.71% 741%
1994(10), (11) 3.16 0.93 2.68 166
</TABLE>
+ Returns are for the period indicated and have not been annualized.
1 Short-Term Government Class A shares were offered beginning February 17,
1987. All ratios including total return for that period have been annualized.
2 Short-Term Government Class B shares were offered beginning November 5, 1990.
All ratios including total return for that period have been annualized.
3 Intermediate-Term Government Class A shares were offered beginning February
17, 1987. All ratios including total return for that period have been
annualized.
4 Intermediate-Term Class B shares were offered beginning June 8, 1994. All ra-
tios for that period have been annualized.
5 Intermediate-Term Government ProVantage Class shares were offered beginning
September 26, 1993. All ratios including total return for that period have
been annualized.
6 GNMA Class A shares were offered beginning March 20, 1987. All ratios includ-
ing total return for that period have been annualized.
7 GNMA Class B shares were offered beginning July 12, 1994. All ratios for that
period have been annualized.
8 GNMA ProVantage Class shares were offered beginning September 30, 1993. All
ratios including total return for that period have been annualized.
9 Corporate Daily Income Class A shares were offered beginning September 28,
1993. All ratios including total return for that period have been annualized.
10 Short-Term Mortgage Class A shares were offered beginning May 20, 1993. All
ratios including total return for that period have been annualized.
11 Effective June 30, 1994, Wellington Management Company began serving as the
Investment Adviser of the Short-Term Mortgage Portfolio. Prior to June 30,
1994, Bear Stearns Asset Management served as the Investment Adviser.
12 Total return does not reflect the sales charge on the ProVantage class.
53
<PAGE>
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
1. ORGANIZATION
SEI Daily Income Trust, formerly the SEI Cash + Plus Trust (the "Trust") was
organized as a Massachusetts business trust under a Declaration of Trust dated
March 15, 1982.
The Trust is registered under the Investment Company Act of 1940, as amended,
as a diversified, open-end investment company with eleven operational Portfo-
lios: the Money Market Portfolio, the Government Portfolio, the Government II
Portfolio, the Prime Obligation Portfolio, the Treasury Portfolio, the Treasury
II Portfolio (the "Money Market Portfolios"), the Short-Term Government Portfo-
lio, the Intermediate-Term Government Portfolio, the GNMA Portfolio, the Corpo-
rate Daily Income Portfolio and the Short-Term Mortgage Portfolio (formerly the
Adjustable Rate Mortgage Portfolio) (the "Fixed Income Portfolios"). The assets
of each portfolio are segregated, and a shareholder's interest is limited to
the Portfolio in which shares are held.
On July 15, 1994, the Federal Securities Portfolio closed and all of the out-
standing shares of the Portfolio were redeemed. SEI Financial Management Corpo-
ration, the Manager of the Portfolio, voluntarily agreed to bear the costs as-
sociated with the liquidation of the Portfolio which approximated $9,000.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Portfolios.
Security Valuation--Investment securities of the "Money Market Portfolios"
are stated at amortized cost which approximates market value. Under this valua-
tion method, purchase discounts and premiums are accreted and amortized ratably
to maturity and are included in interest income.
Investment securities of the "Fixed Income Portfolios" which are listed on a
securities exchange for which market quotations are available are valued by an
independent pricing service at the last quoted sales price for such securities
on each business day. If there is no such reported sale, these securities for
which market quotations are readily available are valued at the most recent
quoted bid price. Unlisted securities for which market quotations are readily
available are valued at the most recently quoted price with estimates of such
values determined under certain market conditions using procedures determined
in good faith by the Board of Trustees. Debt obligations with sixty days or
less remaining until maturity may be valued at their amortized cost.
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.
Net Asset Value Per Share--The net asset value per share is calculated on
each business day separately for each Portfolio. In general, it is computed by
dividing the assets of each Portfolio, less its liabilities, by the number of
outstanding shares of the Portfolio.
Security Transactions and Investment Income--Security transactions are ac-
counted for on the trade date of the security purchase or sale. Costs used in
determining net realized capital gains and losses on the sale of securities are
those of the specific securities sold, adjusted for the accretion and amortiza-
tion of purchase discounts and premiums during the respective holding period.
Interest income is recorded on the accrual basis.
Purchase discounts and premiums on securities held in the "Fixed Income Port-
folios" are accreted and amortized over the life of each security and recorded
as interest income, using the effective interest method.
Repurchase Agreements--Securities pledged as collateral for Repurchase Agree-
ments are held by each Portfolio's custodian bank until maturity of the Repur-
chase Agreements. Provisions of the Agreements and procedures adopted by the
Manager ensure that the market value of the collateral, including accrued in-
terest thereon, is sufficient in the event of default by the counterparty. 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 Portfolio may be delayed or limited.
54
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
Expenses--Expenses that are directly related to one of the Portfolios are
charged directly to that Portfolio. Other operating expenses of the Trust are
prorated to the Portfolios on the basis of relative net assets. Class specific
expenses, such as the 12b-1 fees, are borne by that Class. Income, other
expenses and realized and unrealized gains and losses of a Portfolio are allo-
cated to the respective Class on the basis of the relative net asset value each
day.
Distributions to Shareholders--Distributions from net investment income are
declared on a daily basis and are payable on the first business day of the fol-
lowing month. Any net realized capital gains on sales of securities for a Port-
folio are distributed to its shareholders at least annually.
3. ORGANIZATION COSTS AND TRANSACTIONS WITH AFFILIATES
Organizational costs have been capitalized by the Trust and are being amor-
tized on a straight line basis over a period of sixty months commencing with
operations. In the event any of the initial shares of the Trust are redeemed by
any holder thereof during the period that the Trust is amortizing its organiza-
tional costs, the redemption proceeds payable to the holder thereof by the
Trust will be reduced by the unamortized organizational costs in the same ratio
as the number of initial shares being redeemed bears to the number of initial
shares outstanding at the time of redemption.
The Trust and SEI Financial Management Corporation (the "Manager") are par-
ties to a Management Agreement dated May 23, 1986 under which the Manager pro-
vides management, administrative and shareholder services to the Portfolios for
an annual fee of .55% of the daily net asset value of the Federal Securities
Portfolio, .33% of the daily net asset value of the Money Market Portfolio,
.19% each of the daily net asset value of the Government II and Prime Obliga-
tion Portfolios, .24% each of the daily net asset value of the Government,
Treasury and Treasury II Portfolios, .35% of the daily net asset value of the
Short-Term Government, Intermediate-Term Government, Corporate Daily Income and
Short-Term Mortgage Portfolios; and .32% of the daily net asset value of the
GNMA Portfolio. However, the Manager has agreed to waive its annual fee in an
amount which limits total annual expenses of the Portfolios (including the an-
nual management fee) to the following amounts set forth in the Management
Agreement (expressed as a percentage of each Portfolio's daily net asset val-
ue):
<TABLE>
<CAPTION>
Federal Money Prime
Securities Market Obligation Gov't Gov't II Treasury Treasury II
---------- ------ ---------- ----- -------- -------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Class A 1.00% 1.00% .20% .25% .20% .20% .25%
Class B -- 1.30% .50% .55% .50% .50% .55%
Class C -- 1.50% .70% .75% .70% .70% .75%
</TABLE>
In the event that the total annual expenses of a Portfolio, after reflecting
a waiver of all fees by the Manager and Adviser, exceed the specified limita-
tion, the Manager has agreed to bear such excess.
SEI Financial Services Company ("SFS") acts as a distributor of the shares of
the Trust under a distribution plan which provides for the Trust to reimburse
SFS for its distribution expenses. Such expenses may not exceed .30% of the
Portfolios' average daily net assets of Class A, .60% of the average daily net
assets of Class B, .80% of the average daily net assets of Class C and .60% of
the average daily net assets of the ProVantage Class . Distribution expenses
include the compensation and benefits of sales personnel incurred by SFS in
connection with the promotion and sale of shares.
Certain officers and/or Trustees of the Trust are also officers and/or Direc-
tors of the Manager. The Trust pays each unaffiliated Trustee an annual fee for
attendance at quarterly, interim, and committee meetings. Compensation of offi-
cers and affiliated Trustees is paid by the Manager.
4. INVESTMENT ADVISORY AND CUSTODIAN AGREEMENTS
Under an Investment Advisory Agreement dated September 30, 1983, Wellington
Management Company serves as the Investment Adviser of the Trust on behalf of
the "Money Market Portfolios." For its services, the Investment Adviser re-
ceives a monthly fee equal to .075% of the combined daily net assets up to $500
million and .02% of such assets in excess of $500 million of the "Money Market
Portfolios." Such fees are allocated daily on the basis of the relative net as-
sets of each money market portfolio in the
55
<PAGE>
--------------------------------------------------------------------------------
Trust. The Adviser has agreed to waive 50% of the fee otherwise due for the
Prime Obligation, Government, Government II, Treasury and Treasury II Portfo-
lios. In addition, the Adviser has voluntarily agreed to waive its remaining
fee in an amount proportionate to the Manager's waiver of its fee.
Under an Investment Advisory Agreement dated December 15, 1986, Wellington
Management Company serves as the Investment Adviser of the Trust on behalf of
the Short-Term Government, Intermediate-Term Government and GNMA Portfolios.
Pursuant to an Investment Advisory Agreement dated August 4, 1993, Wellington
Management Company serves as Investment Adviser for the Corporate Daily Income
Portfolio. Monthly fees are equal to .10% of the Portfolios' average daily net
assets up to $500 million, .075% of the next $500 million and .05% of such net
assets in excess of $1 billion. The Adviser has voluntarily agreed to waive its
remaining fee in an amount proportionate to the Manager's waiver of its fee.
For the period of February 1, 1994 through June 29, 1994, Bear Stearns Asset
Management served as the Investment Adviser of the Trust on behalf of the
Short-Term Mortgage Portfolio for a monthly fee equal to .10% of the Portfo-
lio's average daily net assets. Effective June 30, 1994, Wellington Management
Company began serving as the Investment Adviser of the Trust on behalf of the
Short-Term Mortgage Portfolio for a monthly fee equal to .10% of the Portfo-
lio's average daily net assets.
Comerica Bank (formerly Manufacturers National Bank of Detroit) acts as cus-
todian of the Money Market Portfolio's securities under an agreement dated Sep-
tember 22, 1983. CoreStates Bank, N.A. acts as the custodian of the Government,
Government II, Prime Obligation, Treasury, Treasury II and "Fixed Income Port-
folios" under an agreement dated August 30, 1985. First Interstate Bank of Ore-
gon, N.A. acted as a custodian of the securities of the Federal Securities
Portfolio under an agreement dated July 15, 1982. The custodians play no role
in determining the investment policies of the Portfolios or which securities
are to be purchased or sold in the Portfolios.
5. INVESTMENT TRANSACTIONS
The cost of security purchases and the proceeds from the sale of securities,
other than temporary investments in short-term securities for the period ended
January 31, 1995, were as follows for the Fixed Income Portfolios:
<TABLE>
<CAPTION>
INTER-
SHORT- MEDIATE-
TERM TERM CORPORATE SHORT-
GOVERN- GOVERN- DAILY TERM
MENT MENT GNMA INCOME MORTGAGE
(000) (000) (000) (000) (000)
------- -------- -------- --------- --------
<S> <C> <C> <C> <C> <C>
PURCHASES
U.S.
Government $49,838 $179,193 $193,729 $24,797 $17,048
Other -- -- -- 17,249 486
SALES
U.S.
Government $73,425 $248,198 $252,143 $25,690 $18,251
Other -- -- -- 16,177 484
</TABLE>
At January 31, 1995 the total cost of securities and the net realized gains
or losses on securities sold for federal income tax purposes was not materially
different from amounts reported for financial reporting purposes. The aggregate
gross unrealized gain on securities in which there was an excess of market
value over cost, the aggregate gross unrealized loss on securities in which
there was an excess of cost over market value, the net unrealized gain and the
accumulated net realized gain/(loss) at January 31, 1995 for each "Fixed Income
Portfolio" is as follows (in thousands):
<TABLE>
<CAPTION>
INTERMEDIATE- CORPORATE
SHORT-TERM TERM DAILY SHORT-TERM
GOVERNMENT GOVERNMENT GNMA INCOME MORTGAGE
---------- ------------- -------- --------- ----------
<S> <C> <C> <C> <C> <C>
Aggregate gross
unrealized gain $ 113 $ 332 $ 604 $ 30 $ 27
Aggregate gross
unrealized loss (2,182) (9,698) (11,339) (486) (17)
------- ------- -------- ----- -----
Net unrealized gain/
(loss) $(2,069) $(9,366) $(10,735) $(456) $ 10
======= ======= ======== ===== =====
Accumulated net realized
gain/
(loss) $(1,247) $(8,317) $ (9,675) $(366) $(154)
======= ======= ======== ===== =====
</TABLE>
56
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
--------------------------------------------------------------------------------
SEI Daily Income Trust -- January 31, 1995
At January 31, 1995 the following funds have capital loss carryforwards:
<TABLE>
<CAPTION>
EXPIRATION
AMOUNT DATE
---------- ----------
<S> <C> <C>
Money Market $ 10,969 1998
5,203 2001
5,833 2003
Government II 85,545 2001
58,412 2002
84,628 2003
Prime Obligation 138,825 2003
Treasury 993 2002
2,785 2003
Short-Term Government 407,300 2003
Intermediate-Term Government 3,551,431 2003
GNMA 5,227,576 2003
Corporate Daily Income 367,658 2003
Short-Term Mortgage 95,977 2003
</TABLE>
Subsequent to October 31, 1994, the Portfolios recognized net capital losses
for tax purposes that have been deferred to 1995 and can be used to offset fu-
ture capital gains at January 31, 1995.
<TABLE>
<CAPTION>
POST OCTOBER 31, 1994 LOSSES
----------------------------
<S> <C>
Money Market $ 6,440
Government 73,436
Government II 2,110
Short-Term Government 966,628
Intermediate-Term Government 4,779,768
GNMA 4,542,261
Short-Term Mortgage 58,291
</TABLE>
57
<PAGE>
ARTHUR ANDERSEN LLP
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and Trustees of
the SEI Daily Income Trust:
We have audited the accompanying statements of net assets of the Money Market,
Government II, Prime Obligation, Government, Treasury, Treasury II, Short-Term
Government, Intermediate-Term Government, and Corporate Daily Income Portfolios
and the statements of assets and liabilities, including the schedules of
investments, of the GNMA and Short-Term Mortgage Portfolios as of January 31,
1995, and the related statements of operations, changes in net assets and
financial highlights for the periods presented. We have also audited the
statement of operations of the Federal Securities Portfolio for the year ended
January 31, 1995, and the related statements of changes in net assets and
financial highlights for the periods presented. These financial statements and
financial highlights are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
January 31, 1995, by correspondence with the custodians and brokers. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Money Market, Government II, Prime Obligation, Government, Treasury, Treasury
II, Short-Term Government, Intermediate-Term Government, Corporate Daily Income,
GNMA and Short-Term Mortgage Portfolios of the SEI Daily Income Trust as of
January 31, 1995, the results of their operations, changes in their net assets
and financial highlights for the periods presented, and the results of the
operations of the Federal Securities Portfolio of the SEI Daily Income Trust for
the year ended January 31, 1995, and the changes in its net assets and financial
highlights for the periods presented, in conformity with generally accepted
accounting principles.
/s/ Arthur Andersen LLP
Philadelphia, Pa.
March 8, 1995
<PAGE>
PART C: OTHER INFORMATION
Item 24. Financial Statements and Exhibits:
(a) Financial Statements
See Statement of Additional Information.
(b) Additional Exhibits
(1) Declaration of Trust originally filed on March 15, 1982, in the
Post-Effective Amendment to Form N-1A, is filed herewith.
(2) By-Laws originally filed on March 15, 1982, in the
Post-Effective Amendment to Form N-1A, is filed herewith.
(3) Not Applicable.
(4) Not Applicable.
(5)(a) Management Agreement dated May 23, 1986, as amended, originally
filed in the Post-Effective Amendment to Form N-1A, is filed
herewith.
(5)(b) Investment Advisory Agreement with Wellington Management Company,
originally filed on December 15, 1986, in the Post-Effective
Amendment to Form N-1A, is filed herewith.
(5)(e) Investment Advisory Agreement with Bear Stearns Asset Management,
originally filed May 18, 1993, in Post-Effective Amendment No. 28
to Form N-1A, is filed herewith.
(5)(f) Investment Advisory Agreement with Wellington Management
Company relating to the Registrant's Corporate Daily Income
Portfolio and Government Securities Daily Income Portfolio
originally filed May 18, 1993, in Post-Effective Amendment No. 28
to Form N-1A, is filed herewith.
(5)(g) Investment Advisory Agreement with Wellington Management Company
relating to the Registrant's Short-Term Mortgage Portfolio and
Short Duration Mortgage Portfolio is filed herewith.
(6)(a) Distribution Agreement originally filed on July 15, 1982 in the
Post-Effective Amendment to Form N-1A, is filed herewith.
(6)(b) Supplement to Distribution Agreement originally filed on May 29,
1990 in Post-Effective Amendment No. 22 to Form N-1A, is filed
herewith.
(6)(c) Supplement to Distribution Agreement originally filed on August
29, 1991, in Post-Effective Amendment No. 24 to Form N-1A, is
filed herewith.
(6)(d) Class D Distribution Plan originally filed on April 1, 1993, in
Post-Effective Amendment No. 27 to Form N-1A, is filed herewith.
(7) Not Applicable.
(8)(a) Custodian Agreement with United States National Bank of Oregon
originally filed on July 15, 1982, in the Post-Effective Amendment
to Form N-1A, is filed herewith.
(8)(b) Custodian Agreement with First Interstate Bank of Oregon, N.A.
originally filed on July 15, 1982, in the Post-Effective Amendment
to Form N-1A, is filed herewith.
(8)(c) Custodian Agreement with Manufacturers National Bank of Detroit
originally filed on September 22, 1983, in the Post-Effective
Amendment to Form N-1A, is filed herewith.
(8)(d) Custodian Agreement with Philadelphia National Bank originally
filed on August 30, 1985, in the Post-Effective Amendment to Form
N-1A, is filed herewith.
(9) Not Applicable.
(10) Opinion and Consent of Counsel Incorporated by Reference to Pre-
Effective Amendment No. 1.
(11) Consent of Independent Public Accountants is filed herewith.
(12) Not Applicable.
(13) Not Applicable.
(14) Not Applicable.
(16) Performance Quotation Computation, Incorporated by Reference to
Post-Effective Amendment No. 32 to Form N-1A, filed April 1, 1994.
(17) Powers of Attorney are filed herewith.
<PAGE>
Item 25. Persons Controlled by or under Common Control with Registrant
See the Prospectuses and 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 February 28, 1995:
Number of
Title of Class Record Holders
--------------------------------------------------------------------------------
<S> <C>
Units of beneficial interest, without par value-
Money Market Portfolio, Class A.................................. 22
Money Market Portfolio, Class B.................................. 1
Money Market Portfolio, Class C.................................. 0
Prime Obligation Portfolio, Class A.............................. 67
Prime Obligation Portfolio, Class B.............................. 4
Prime Obligation Portfolio, Class C.............................. 0
Government Portfolio, Class A.................................... 0
Government Portfolio, Class B.................................... 0
Government Portfolio, Class C.................................... 2
Government II Portfolio, Class A................................. 37
Government II Portfolio, Class B................................. 7
Government II Portfolio, Class C................................. 0
Treasury Portfolio, Class A...................................... 4
Treasury Portfolio, Class B...................................... 0
Treasury Portfolio, Class C...................................... 0
Treasury II, Class A............................................. 38
Treasury II, Class B............................................. 6
Treasury II, Class C............................................. 0
Federal Securities Portfolio..................................... 0
Corporate Daily Income Portfolio, Class A........................ 74
Corporate Daily Income Portfolio, Class B........................ 0
Corporate Daily Income Portfolio, Class C........................ 0
Government Securities Daily Income Portfolio, Class A............ 0
Government Securities Daily Income Portfolio, Class B............ 0
Government Securities Daily Income Portfolio, Class C............ 0
Short-Term Mortgage (formerly known as Adjustable
Rate Mortgage) Portfolio........................................ 0
Short-Term Mortgage Portfolio, Class B........................... 0
Short-Term Mortgage Portfolio, Class C........................... 0
Short Duration Mortgage Portfolio, Class A....................... 0
Short Duration Mortgage Portfolio, Class B....................... 0
Short Duration Mortgage Portfolio, Class C....................... 0
Short-Term Government Portfolio, Class A......................... 132
Short-Term Government Portfolio, Class B......................... 1
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Short-Term Government Portfolio, Class C......................... 21
Short-Term Government Portfolio, Class D......................... 1
Intermediate-Term Government Portfolio, Class A.................. 133
Intermediate-Term Government Portfolio, Class B.................. 1
Intermediate-Term Government Portfolio, Class C.................. 1
Intermediate-Term Government Portfolio, Class D.................. 13
GNMA Portfolio, Class A.......................................... 148
GNMA Portfolio, Class B.......................................... 1
GNMA Portfolio, Class C.......................................... 0
GNMA Portfolio, Class D.......................................... 19
</TABLE>
Item 27. Indemnification:
Article VIII of the Agreement and Declaration of Trust filed as Exhibit 1 to
the Registration Statement is incorporated by reference. Insofar as
indemnification for liabilities arising under the 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 Advisers:
The list required by this Item 28 of officers and partners of Wellington
Management Company ("WMC"), 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 WMC 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 securities of the
Registrant also acts as a principal underwriter, depositor 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 Liquid Asset Trust.................. November 29, 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
</TABLE>
<PAGE>
<TABLE>
<S> <C>
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
Marquis/SM/ Funds....................... August 17, 1993
Morgan Grenfell Investment Trust........ January 3, 1994
The PBHG Funds, Inc..................... July 16, 1993
Nationar Funds, Inc..................... June 15, 1994
Inventor Funds, Inc..................... August 1, 1994
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
</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 E. Swedesford Road, Wayne, PA 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 --
Gilbert L. Beebower Executive Vice President --
Richard B. Lieb Executive Vice President --
Charles A. Marsh Executive Vice President-Capital Resources Division --
Donal Botkin Senior Vice President --
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
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, General Counsel & --
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Position and Office Positions and Offices
Name with Underwriter with Registrant
---- ------------------- ---------------------
<S> <C> <C>
Secretary
Robert Wagner Senior Vice President --
Patrick K. Walsh Senior Vice President --
Kenneth Zimmer Senior Vice President --
Robert Crudup Managing Director --
Ward Curtis Managing Director --
Jeff Drennen Managing Director --
Vic Galef Managing Director --
Michael Howard Managing Director --
Lawrence D. Hutchison Managing Director --
Kim Kirk Managing Director --
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 --
Robert Ludwig Team Leader --
Vicki Malloy Team Leader --
Chris Schwartz Team Leader --
Robert Aller Vice President --
Charles Baker Vice President --
Steve Bendinelli Vice President --
Gordon W. Carpenter Vice President --
Robert B. Carroll Vice President & Assistant Secretary --
Ed Daly Vice President --
Lucinda Duncalfe Vice President --
Michael Kantor Vice President --
Samuel King Vice President --
Donald H. Korytowski Vice President --
Jack May Vice President --
Matt Mille Vice President --
David O'Donovan Vice President --
Sandra K. Orlow Vice President & Assistant Secretary --
Kim Rainey Vice President --
David Ray Vice President --
Paul Sachs Vice President --
Steve Smith Vice President --
Kathryn L. Stanton Vice President & Assistant Secretary --
Joseph Velez Vice President --
David Wheeler Vice President --
Daniel Spaventa Vice President --
William Zawaski Vice President --
James Dougherty Director of Brokerage Services --
</TABLE>
<PAGE>
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, as amended ("1940 Act"), 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 Custodians:
CoreStates Bank, N.A. First Interstate
Broad and Chestnut Street Bank of Oregon
P.O. Box 7618 1300 S.W. Fifth Street
Philadelphia, PA 19101 Portland, OR 97208
Bank of New York
48 Wall Street
New York, NY 10286
(b) With respect to Rules 31a-1(a); 31a-1(b)(1); 31a-1(b)(4); (2)(C) and (D);
(4); (5); (6); (8); (9); (10); (11); and 31a-1(c), the required books and
records are maintained at the offices of Registrant's Manager:
SEI Financial Management Corporation
680 E. Swedesford Road
Wayne, PA 19087
(c) 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 1940 Act inform the Board of Trustees of
their desire to communicate with shareholders of the Trust, 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 undertakes to call a meeting of shareholders for the purpose of
voting upon the question of the 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 each meeting to comply with the provisions of
Section 16(c) of the Investment Company Act of 1940 Act relating to shareholder
communications.
Registrant undertakes to furnish, upon request and without charge, to each
person to whom a prospectus is delivered, a copy of the Registrant's latest
annual report to shareholders, when such annual report is issued containing
information called for by Item 5A of Form N-1A.
<PAGE>
NOTICE
A copy of the Agreement and Declaration of Trust of SEI Daily Income Trust
(formerly now known as SEI Cash + Plus 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 shareholders 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, the Registrant certifies that it meets all of the
requirements for the effectiveness of this Registration Statement pursuant to
Rule 485(a) under the Securities Act of 1933 and has duly caused this Amendment
No. 33 to the Registration Statement (File No. 2-77048) 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 March, 1995.
SEI DAILY INCOME TRUST
By /s/ David G. Lee
--------------------------------
David G. Lee,
President & Chief Executive Officer
ATTEST:
/s/ Carmen V. Romeo
-------------------------------
Carmen V. Romeo,
Treasurer & Assistant Secretary
Pursuant to the requirements of the Securities Act of 1933, this Amendment has
been signed below by the following persons in the capacity on the dates
indicated.
<TABLE>
<S> <C> <C>
* Trustee March 30, 1995
--------------------------------
Richard F. Blanchard
* Trustee March 30, 1995
--------------------------------
William M. Doran
* Trustee March 30, 1995
--------------------------------
F. Wendell Gooch
* Trustee March 30, 1995
--------------------------------
Frank E. Morris
* Trustee March 30, 1995
--------------------------------
Robert A. Nesher
* Controller & Assistant March 30, 1995
-------------------------------- Secretary
Jeffrey A. Cohen
/s/ CARMEN V. ROMEO Treasurer & Assistant March 30, 1995
-------------------------------- Secretary
Carmen V. Romeo
*By: /s/ DAVID G. LEE President & Chief Executive March 30, 1995
-------------------------------- Officer
David G. Lee
Attorney-in-Fact
</TABLE>
<PAGE>
EXHIBIT INDEX
--------------
<TABLE>
<CAPTION>
Exhibit Page
<S> <C>
(1) Declaration of Trust originally filed on March 15, 1982, in the
Post-Effective Amendment to Form N-1A, is filed herewith.
(2) By-Laws originally filed on March 15, 1982, in the
Post-Effective Amendment to Form N-1A, is filed herewith.
(3) Not Applicable.
(4) Not Applicable.
(5)(a) Management Agreement dated May 23, 1986, as amended, originally
filed in the Post-Effective Amendment to Form N-1A, is filed
herewith.
(5)(b) Investment Advisory Agreement with Wellington Management Company,
originally filed on December 15, 1986, in the Post-Effective
Amendment to Form N-1A, is filed herewith.
(5)(e) Investment Advisory Agreement with Bear Stearns Asset Management,
originally filed May 18, 1993, in Post-Effective Amendment No. 28
to Form N-1A, is filed herewith.
(5)(f) Investment Advisory Agreement with Wellington Management
Company relating to the Registrant's Corporate Daily Income
Portfolio and Government Securities Daily Income Portfolio
originally filed May 18, 1993, in Post-Effective Amendment No. 28
to Form N-1A, is filed herewith.
(5)(g) Investment Advisory Agreement with Wellington Management Company
relating to the Registrant's Short-Term Mortgage Portfolio and
Short Duration Mortgage Portfolio is filed herewith.
(6)(a) Distribution Agreement originally filed on July 15, 1982 in the
Post-Effective Amendment to Form N-1A, is filed herewith.
(6)(b) Supplement to Distribution Agreement originally filed on May 29,
1990 in Post-Effective Amendment No. 22 to Form N-1A, is filed
herewith.
(6)(c) Supplement to Distribution Agreement originally filed on August
29, 1991, in Post-Effective Amendment No. 24 to Form N-1A, is
filed herewith.
(6)(d) Class D Distribution Plan originally filed on April 1, 1993, in
Post-Effective Amendment No. 27 to Form N-1A, is filed herewith.
(7) Not Applicable.
(8)(a) Custodian Agreement with United States National Bank of Oregon
originally filed on July 15, 1982, in the Post-Effective Amendment
to Form N-1A, is filed herewith.
(8)(b) Custodian Agreement with First Interstate Bank of Oregon, N.A.
originally filed on July 15, 1982, in the Post-Effective Amendment
to Form N-1A, is filed herewith.
(8)(c) Custodian Agreement with Manufacturers National Bank of Detroit
originally filed on September 22, 1983, in the Post-Effective
Amendment to Form N-1A, is filed herewith.
(8)(d) Custodian Agreement with Philadelphia National Bank originally
filed on August 30, 1985, in the Post-Effective Amendment to Form
N-1A, is filed herewith.
(9) Not Applicable.
(10) Opinion and Consent of Counsel Incorporated by Reference to Pre-
Effective Amendment No. 1.
(11) Consent of Independent Public Accountants is filed herewith.
(12) Not Applicable.
(13) Not Applicable.
(14) Not Applicable.
(16) Performance Quotation Computation, Incorporated by Reference to
Post-Effective Amendment No. 32 to Form N-1A, filed April 1, 1994.
(17) Powers of Attorney are filed herewith.
</TABLE>
<PAGE>
LIQUIDITY SERVICES TRUST
------------------------
AGREEMENT AND DECLARATION OF TRUST
----------------------------------
AGREEMENT AND DECLARATION OF TRUST made at Boston, Massachusetts, this 15th
day of March, 1982, 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 "Liquidity Services 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.
Definitions
-----------
Section 2. Whenever used herein, unless otherwise required by the context
---------
or specifically provided:
<PAGE>
(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 form 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
of Trust 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 one or more managed
investment portfolios 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 of 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 of liquidation thereof,
and any funds or payments derived from any reinvestment of such proceeds in
whatever form the same may
-3-
<PAGE>
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.
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 this 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. In each year beginning 1984, at the annual meeting of
---------
Shareholders or at any special meeting held in lieu thereof, or at any special
meeting held before 1984, the Shareholders shall elect a Board of not less than
three nor more than fifteen Trustees, each of whom shall serve until the next
annual meeting or special meeting in lieu thereof and until the election and
qualification of his or her successor, or until he or she sooner dies, resigns
or is
-4-
<PAGE>
removed. The number of Trustees to be so elected each year shall be fixed by the
Trustees in advance of the giving of notice of the meeting at which Trustees are
to be elected for such year, or if not so fixed, by vote of the Shareholders at
such meeting. The number of Trustees so fixed may be increased either by the
Shareholders or by the Trustees by a vote of a majority of the Trustees then in
office. The number of Trustees so fixed may be decreased either by the
Shareholders or by the Trustees by vote of a majority of the Trustees then in
office, but only to eliminate vacancies existing by reason of the death,
resignation or removal of one or more Trustees. The initial Trustees, each of
whom shall serve until the first meeting of Shareholders at which Trustees are
elected and until his or her successor is elected and qualified, or until he or
she sooner dies, resigns or is removed, shall be William M. Doran and such other
persons as the Trustee or Trustees then in office shall, prior to any sale of
Shares pursuant to public offering, appoint. By vote of the Shareholders holding
a majority of the Shares entitled to vote, the Shareholders may remove a Trustee
with or without cause. 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, etc., 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
-5-
<PAGE>
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 investment advisers or managers as provided in Section 7 of this
Article IV; 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:
(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 or 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 allocate assets, liabilities and expenses of the Trust to a
particular series of Shares or to apportion the same among two or more
series;
-6-
<PAGE>
(g) 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 such corporation or issuer, and to pay
calls or subscriptions with respect to any security held in the Trust;
(h) 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;
(i) 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;
(j) To enter into joint ventures, general or limited partnerships and any
other combinations or associations;
(k) To borrow funds;
(l) 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;
(m) 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,
-7-
<PAGE>
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
(n) 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 Trustee 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 (if a quorum be present), within or without Massachusetts, including
any meeting held be means of a conference telephone or other communications
equipment by means of which all persons participating in the meeting can
communicate with each other simultaneously 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.
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
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 services 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 services or similar
agent, an amount fixed from time to time by the
<PAGE>
Trustees, by setting off such charges due from such Shareholder from declared
but unpaid dividends owed such Shareholder and/or by 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 Services Company (the
"Advisor"), a Pennsylvania 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 the Advisor and/or an 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
-9-
<PAGE>
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.
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 any investment advisor or manager a provided in Article IV, Section
7, (iii) with respect to any termination of the Trust or any series 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,
<PAGE>
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 affected only the interests of one or more
series, then 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 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. There shall be an annual meeting of the Shareholders on the
---------
date fixed in the By-Laws at the principal office of the Trust, or at any such
other place within the United States as may be designated in the call thereof,
which call shall be made by the Trustees or the president of the Trust. In the
event that such meeting is not held in any year on the date fixed in the
By-Laws, whether the omission be by oversight or otherwise, a subsequent
special meeting may be called and held in lieu of the annual meeting with the
same force and effect as though held on such date.
Special meetings may also be called and held from time to time for the
purpose of taking action upon any matter requiring the vote or authority of the
Shareholders as herein provided or upon any other matter deemed by the Trustees
to be necessary or desirable. Special meetings may be called by the Trustees or
such other person or persons as may be specified in the By-Laws and 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 25% of the
Shares then outstanding requesting that a meeting be called for a purpose
requiring
<PAGE>
action by the Shareholders as provided herein or in the By-Laws.
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.
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<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, the Advisor, the
underwriter or the distributors, or at a principal office of a transfer or
shareholder service agent appointed by the Trust (as the Trustees may
determine), 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 Advisor, the underwriter or the
distributor, or the Trust's transfer or Shareholder
-13-
<PAGE>
services 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
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 above 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 to 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 closings; or
b. the Trustees or authorized officers of the Trust shall have
determined, in compliance with any applicable rules and regulations of
the 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 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
-14-
<PAGE>
asset value of such Shares in effect when the purchase or repurchase or any
contract to purchase or repurchase is made.
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
redeemed, purchased or 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 fractions to
a fraction of a cent.
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<PAGE>
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 times 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 for any such transaction may be fixed
by other provisions of this Declaration of Trust or by the By-Laws.
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 shall 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 sated 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.
-16-
<PAGE>
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 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 may be
reduced by the amount of dividends declared thereafter upon the Shares of the
Trust or 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.
-17-
<PAGE>
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.
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 Shareholders 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;
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<PAGE>
(c) in the event of a settlement or other disposition not involving a
final adjudication (as provided in paragraph (a) or (b)) and 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.
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 next to 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
<PAGE>
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 1940 Act) (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 .
In case 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 nor 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
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<PAGE>
disregard of the duties involved in the conduct of the office of 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.
Trustees' 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 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
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<PAGE>
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 Trust or 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 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
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<PAGE>
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 supplementing any defective or inconsistent provision contained
herein shall not require authorization by Shareholder vote.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal in
the City of Boston, Massachusetts for himself and his assigns, as of the day and
year first above written.
/s/ William Doran
--------------------------
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<PAGE>
BY-LAWS
-------
OF
--
LIQUIDITY SERVICES 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 LIQUIDITY SERVICES TRUST, the Massachusetts business
trust established by the Declaration of Trust (the "Trust").
1.2 Principal Office of the Trust; Resident Agent. The principal office of the
---------------------------------------------
Trust shall be located in Boston, Massachusetts.
Section 2. Shareholders
-----------------------
2.1 Annual Meeting. The annual meeting of the shareholders shall be at such
--------------
time and on such date in each year as the president or Trustees may from time to
time determine.
2.2 Special Meeting in Place of Annual Meeting. If no annual meeting has been
------------------------------------------
held in accordance with the foregoing provisions, a special meeting of the
shareholders may be held in place thereof, and any action taken at such special
meeting shall have the same force and effect as if taken at the annual meeting,
and in such case all references in these By-Laws to the annual meeting of the
shareholders shall be deemed to refer to such special meeting.
2.3 Special Meetings. A special meeting of the shareholders 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 25% of all
shares issued and outstanding and entitled to vote at the meeting, then such
shareholders may call such meeting. Each call of a meeting shall state the
place, date, hour and purposes of the meeting.
<PAGE>
2.4 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.
2.5 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.
2.6 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.
2.7 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 annual meeting of the shareholders
and until his successor is elected and qualified, or until he sooner dies,
resigns, is removed, or
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<PAGE>
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. A regular meeting of the
Trustees may be held without call or notice immediately after and at the same
place as the annual meeting of the shareholders.
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 then 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
-3-
<PAGE>
but none need be a Trustee or shareholder. Any two or more offices may be held
by the same person.
4.5 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 at their first meeting following the annual meeting of
the shareholders. Other officers, if any, may be elected or appointed by the
Trustees at said meeting or at any other time.
4.4 Tenure. The president, the treasurer and the secretary shall hold office
------
until the first meeting of Trustees following the next annual meeting of the
shareholders and 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 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 By-laws and, except as the
Trustees shall otherwise determine, preside at all meetings of the shareholders
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 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
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<PAGE>
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 or 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.
Section 5. Resignation 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, officer,
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 certificates certifying the ownership of shares
------------------
shall be issued except as the Trustees may otherwise authorize. In the event
that the Trustees
-5-
<PAGE>
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 registrar, 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.
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.
-6-
<PAGE>
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.
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
------------------------
The fiscal year of the Trust shall end on such date in each year as the Trustees
shall from time to time determine.
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
-7-
<PAGE>
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 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 or 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 adviser, 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 Trustee 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
-8-
<PAGE>
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 requirment.
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.
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 bythe 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 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 issued deposited with the system are
treated as fundible 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
-9-
<PAGE>
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. Each series of shares may 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 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) in any series of shares if as a result more than 5% of the total
assets of the Trust (based on their market 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 shall not apply to investments in (a) banks
and (b) 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 shall not be considered as a group for purposes of
this Section 12.5(d).
(e) Purchase or sell real esate, commodities or commodities contracts.
However, any series of shares may invest in 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
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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.
(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 7 days may not 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.
(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 own 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 issuer 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.
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<PAGE>
(o) Purchase parts, calls, straddles, spreads or combinations thereof.
(p) Invest in interests in oil, gas or other mineral exploration or
development programs.
(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 then in office at any meeting of the Trustees, or by one or more
writings signed by such majority.
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<PAGE>
MANAGEMENT AGREEMENT
THIS AGREEMENT is made as of this 23rd day of May, 1986 by and between
Cash+Plus 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 Federal Securities Portfolio,
Domestic Market Portfolio, Government Portfolio, Prime Obligation Portfolio,
Money Market 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. With respect to the
Federal Securities Portfolio, Domestic Market Portfolio and such other
portfolios as the Trust and the Manager may agree on, the Manager may, in its
discretion and at its expense, retain Sub-Administrators to furnish certain
administrative services in connection with its obligations under this Agreement,
pursuant to agreements between the Manager and each Sub-Administrator. 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
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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 advisers 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.
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
shares 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
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<PAGE>
determine 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.
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 stating that upon issuance they will be validly
issued and nonassessable; 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 Manager may deem necessary or appropriate.
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<PAGE>
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 on 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 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 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
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<PAGE>
any, of officers of the Trust as well as all Trustees of the Trust who are
affiliated persons of the Manager or 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 Trust 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 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.
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 with respect to each Portfolio
at the 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 contemplated 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 statute 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
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<PAGE>
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).
(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, 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
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<PAGE>
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 effect the rights hereunder.
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 or presented by the proper person or persons.
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
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<PAGE>
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, 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. 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.
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.
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<PAGE>
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 but one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
CASH+PLUS TRUST
By /s/ David B. Robb, Jr.
-----------------------
SEI FINANCIAL MANAGEMENT CORPORATION
By /s/ David B. Robb, Jr.
-----------------------
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<PAGE>
Schedule A to Management Agreement
Between TrustFunds Cash+Plus Trust and
SEI Financial Management Corporation
Dated May 23, 1986
TrustFunds Cash+Plus 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 dated May 23, 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) Federal Securities Portfolio: .50% of the average daily net
----------------------------
assets of the Portfolio.
(b) Domestic Market Portfolio: .50% of the average daily net assets
-------------------------
of the Portfolio.
(c) Money Market Portfolio: .25% of the average daily net assets of
----------------------
the Portfolio.
(d) Prime Obligation Portfolio: .19% of the average daily net assets
--------------------------
of the Portfolio.
(e) Government Portfolio: .19% 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) Federal Securities Portfolio: 1.0% of the average daily net
----------------------------
assets of the Portfolio.
(b) Domestic Market Portfolio: 1.0% of the average daily net assets
-------------------------
of the Portfolio.
(c) Money Market Portfolio: 1.0% of the average daily net assets of
----------------------
the Portfolio.
(d) Prime Obligation Portfolio: .20% of the average daily net assets
--------------------------
of the Portfolio.
(e) Government Portfolio: .20% of the average daily net assets of
--------------------
the Portfolio.
<PAGE>
Schedule B to Management Agreement
Between TrustFunds Cash+Plus Trust and
SEI Financial Management Corporation
Dated May 23, 1986
TrustFunds Cash+Plus 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 dated May 23, 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:
U.S. Government Portfolio: 1.00% of the average daily net assets of the
-------------------------
Portfolio.
Cash Reserve Portfolio: 1.00% 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:
U.S. Government Portfolio: Statutory
-------------------------
Cash Reserve Portfolio: Statutory
----------------------
<PAGE>
Schedule C to Management Agreement
Between TrustFunds Cash+Plus Trust and
SEI Financial Management Corporation
Dated May 23, 1986
TrustFunds Cash+Plus 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 dated May 23, 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) Short-Term Government Portfolio: .35% of the average daily net
-------------------------------
assets of the Portfolio.
(b) Intermediate-Term Government Portfolio: .35% of the average daily
--------------------------------------
net assets of the Portfolio.
(c) Government Bond Portfolio: .32% of the average daily net assets of
-------------------------
the Portfolio.
<PAGE>
Schedule D to Management Agreement
Between SEI Cash+Plus Trust and
SEI Financial Management Corporation
Dated May 23, 1986
SEI Cash+Plus 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 dated May 23, 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:
High Sierra U.S. Government Money Market Portfolio:
--------------------------------------------------
.20% of the average daily net assets of the Portfolio.
2. The annual rate of expenses for the following Trust Portfolio pursuant
to Article 7(B)(i) of the Agreement shall be as follows:
High Sierra U.S. Government Money Market Portfolio:
--------------------------------------------------
1.00% of the average daily net assets of the Portfolio
<PAGE>
Schedule E to Management Agreement
Between SEI Cash+Plus Trust and
SEI Financial Management Corporation
Dated May 23, 1986
SEI Cash+Plus 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 dated May 23, 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:
Government II Portfolio: .24% of the average daily net assets of the
-----------------------
Portfolio.
Treasury Portfolio: .24% of the average daily net assets of the
------------------
Portfolio.
2. The annual rate of expenses for the following Trust Portolios pursuant
to Article 7(B)(i) of the Agreement shall be as follows:
Government II Portfolio: .25% of the average daily net assets of the
-----------------------
Portfolio.
Treasury Portfolio: .25% of the average daily net assets of the
------------------
Portfolio.
<PAGE>
Schedule F to Management Agreement
Between SEI Cash+Plus Trust and
SEI Financial Management Corporation
Dated May 23, 1986
SEI Cash+Plus 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 dated May 23, 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:
High Sierra U.S. Government Note/Bond Portfolio:
-----------------------------------------------
.35% of the average daily net assets of the Portfolio.
2. The annual rate of expenses for the following Trust Portfolio
pursuant to Article 7(B)(i) of the Agreement shall be as follows:
High Sierra U.S. Government Note/Bond Portfolio:
-----------------------------------------------
statutory
<PAGE>
INVESTMENT ADVISORY AGREEMENT
-----------------------------
AGREEMENT made this 15th day of December, 1986 by and between TrustFunds
Cash+Plus Trust, a Massachusetts business trust (the "Trust"), and 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 Short-Term Government Portfolio,
Intermediate-Term Government Portfolio and Long-Term Government Portfolio and
such other portfolios as the Trust and the Adviser may agree upon (the
"Portfolios") and the Adviser is willing to render such services;
NOW, THEREFORE, in consideration of mutual covenants herein contained, the
parties hereto agree as follows:
1. Duties of 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 as amended 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
thePortfolios 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 Manger 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 Adviser. For the services to be rendered by the Adviser
as provided in Sections 1 and 2 of this Agreement, the Trust shall pay to the
Adviser compensation at the rate specified in the Schedule(s) which are attached
hereto and made a part of this agreement. Such compensation shall be paid to the
Adviser at the end of each month, and calculated by applying a daily rate, based
on the annual percentage rates as specified in the attached Schedule(s), to the
assets. The fee shall be based on the average daily net 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 cost.
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 for two years after its initial approval as to
each Portfolio 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 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 CASH+PLUS TRUST
THORNDIKE, DORAN, PAINE & LEWIS
By /s/ SIGNATURE APPEARS HERE By /s/ Susan L. Schelpf
--------------------------- -----------------------
Managing Partner
<PAGE>
Schedule A
Fee Schedule - TrustFunds Cash+Plus Trust
Short-Term Government Portfolio
Intermediate-Term Government Portfolio
Long-Term Government Portfolio
Net Asset Value Annual Fee
----------------------------------------------------
Up to $ 500,000,000 .100%
Over 500,000,000 .075
Over 1,000,000,000 .050
The fees for the Short-Term Government Portfolio, the Intermediate-Term
Government Portfolio and the Long-Term Government Portfolio shall be calculated
by aggregating the assets of the three portfolios, applying the above fee
schedule and then allocating the fee to each of these portfolios based upon
their relative net assets.
<PAGE>
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 9th day of February, 1993 by and between SEI Cash+Plus
Trust, a Massachusetts business trust (the "Trust"), and Bear Stearns & Co.
Inc., (the "Adviser").
WHEREAS, the Trust is an open-end, diversified management investment
company registered under the Investment Company Act of 1940, as amended, 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 with respect to its Adjustable Rate Mortgage and
Short-Duration Mortgage Portfolio and such other portfolios as the Trust and the
Adviser may agree upon (the "Portfolios") and the Adviser is willing to render
such services:
NOW, THEREFORE, in consideration of mutual covenants herein contained, the
parties hereto agree as follows:
1. Duties of 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 the Adviser's 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
Trustee 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 registration statement as amended from time to time, and
applicable laws and regulations. The Adviser accepts such employment
and agrees, at its own expense (except as provided in paragraph 4
hereof), 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.
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 current
registration statement as amended 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.
<PAGE>
3. Compensation of the Adviser. For the services to be rendered by the
---------------------------
Adviser as provided in Sections 1 and 2 of this Agreement, the Trust
shall pay to the Adviser compensation at the rate specified in the
Schedule(s) which are attached hereto and made a part of this
Agreement. Such compensation shall be paid to the Adviser at the end
of each month, and calculated by applying a daily rate, based on the
annual percentage rates as specified in the attached Schedule(s), to
the assets of the Portfolio. The fee shall be based on the average
daily net assets for the month involved.
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 a
price to be agreed upon by the Adviser and the Trust or the Manager.
5. Reports. The Trust agrees to furnish to the Adviser, if applicable,
-------
its Declaration of Trust, the resolutions of its Trustees authorizing
the appointment of the Adviser and the execution and delivery of this
Agreement, current prospectuses, proxy statements, reports to
shareholders, certified copies of its financial statements, and such
other information with regard to its affairs as the Adviser may
reasonably request. The Adviser agrees to furnish to the Trust such
information which the Adviser makes available to the public including
certified financial statements.
6. Status of Adviser. The services of the Adviser to the Trust are not
-----------------
to be deemed exclusive, and the Adviser, its directors, officers,
employees and affiliates 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 of 1940 which are prepared 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. Limitation of Liability of Adviser. The Adviser shall not be liable
----------------------------------
for any error of judgement or mistake of law or for any loss suffered
by the Trust in connection with the matters to which this Agreement
relates, expect a loss resulting from its willful misfeasance, bad
faith or gross negligence in the performance of its duties hereunder
or from its reckless disregard of its obligations under this
Agreement.
<PAGE>
9. Permissible Interests. To the extent permitted by law, 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; provided that all such interests shall be fully disclosed
between the parties on an ongoing basis and in the Trust's
registration statement as required by law.
10. Duration and Termination. This Agreement, unless sooner terminated as
provided herein, shall continue in effect for two years, after its
initial approval as to the Portfolio, 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 and regulations thereunder. The foregoing requirement
that continuance of this Agreement be "specifically approved at least
annually" shall be construed in a manner consistent with the
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 thirty (30) days
nor more than sixty (60) days written notice to the Adviser, or by the
Adviser at any time without the payment of any penalty, on ninety (90)
days written notice to the Trust. This Agreement will automatically
and immediately terminate in the event of its assignment.
As used in this Section 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.
<PAGE>
12. Notice. 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. Any notice to be given to the Adviser by the
Trust pursuant to the terms of this Agreement regarding (i) termination
of this Agreement, (ii) changes in investment objectives, policies or
guidelines, or (iii) changes in portfolio transaction practices shall
be deemed to have been given if provided in writing (including by
telecopy or similar hard copy reproduction) and delivered to: 245 Park
Avenue, New York, NY 10167, Attn: Seth Wolhberg.
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.
BEAR STEARNS & CO. INC. SEI CASH+PLUS TRUST
By:/s/ Signature appears here By:/s/ Kevin P. Robins
--------------------------- ---------------------------
<PAGE>
Schedule A
to the
Investment Advisory Agreement
between
SEI CASH+PLUS TRUST
and
BEAR STEARNS & CO. INC.
SEI Cash+Plus Trust (the "Trust") shall pay compensation to Bear Stearns & Co.
Inc. pursuant to Section 3 of the Investment Advisory Agreement between said
parties in accordance with the following annual percentage rate:
Adjustable Rate Mortgage: .10% of average daily net assets
Short-Duration Mortgage Portfolios: .10% of average daily net assets
<PAGE>
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 4th day of August, 1993, by and between SEI Cash+Plus
Trust, a Massachusetts business trust (the "Trust"), and Wellington Management
Company, (the "Adviser").
WHEREAS, the Trust is an open-end, diversified management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"), consisting of several series of shares, each having its own
investment policies; and
WHEREAS, the Trust has retained SEI Financial Management Corporation (the
"Administrator") to provide administration of the Trust's operations, subject to
the control of the Board of Trustees;
WHEREAS, the Trust desires to retain the Adviser to render investment
management services with respect to its Corporate Daily Income Portfolio and
Government Securities Daily Income Portfolio and such other portfolios as the
Trust and the Adviser may agree upon (the "Portfolios"), and the Adviser is
willing to render such services:
NOW, THEREFORE, in consideration of mutual covenants herein contained, the
parties hereto agree as follows:
1. Duties of the Adviser. The Trust employs the Adviser to
manage the investment and reinvestment of the assets, 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 Administrator and the Trust with
records concerning the Adviser's activities which the Trust is
required to maintain, and to render regular reports to the
Administrator and to the Trust's Officers and Trustees concerning the
Adviser's discharge of the foregoing responsibilities.
The Adviser shall discharge the foregoing responsibilities subject to
the control of the Board of Trustees of the Trust and in compliance
with such policies as the Trustees may from time to time establish,
and in compliance with the objectives, policies, and limitations for
each such Portfolio set forth in the Trust's prospectus and statement
of additional information as amended 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.
1
<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 and statement of additional information from time
to time. The Adviser will promptly communicate to the Administrator
and to the officers and the Trustees of the Trust such information
relating to portfolio transactions as they may reasonably request.
It is understood that the Adviser will not be deemed to have acted
unlawfully, or to have breached a fiduciary duty to the Trust or be in
breach of any obligation owing to the Trust under this Agreement, or
otherwise, solely by reason of its having directed a securities
transaction on behalf of the Trust to a broker-dealer in compliance
with the provisions of Section 28(e) of the Securities Exchange Act of
1934.
3. Compensation of the Adviser. For the services to be rendered
by the Adviser as provided in Sections 1 and 2 of this Agreement, the
Trust shall pay to the Adviser compensation at the rate specified in
the Schedule(s) which are attached hereto and made a part of this
Agreement. Such compensation shall be paid to the Adviser at the end
of each month, and calculated by applying a daily rate, based on the
annual percentage rates as specified in the attached Schedule(s), to
the assets. The fee shall be based on the average daily net assets for
the month involved.
All rights of compensation under this Agreement for services performed
as of the termination date shall survive the termination of this
Agreement.
4. 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.
5. Status of the Adviser. The services of the Adviser to the
Trust are not to be deemed exclusive, and the Adviser shall be free to
render similar services to others so long as its services to the Trust
are not impaired thereby. The Adviser shall be deemed to be an
independent contractor and shall, unless otherwise expressly provided
or authorized, have no authority to act for or represent the Trust in
any way or otherwise be deemed an agent of the Trust.
6. Certain Records. Any records required to be maintained and
preserved pursuant to the provisions of Rule 31a-1 and Rule 31a-2
promulgated under the 1940 Act which are prepared or maintained by the
Adviser on behalf of the Trust are the property of the Trust and will
be surrendered promptly to the Trust on request.
2
<PAGE>
7. Limitation of Liability of the Adviser. The duties of the Adviser shall
be confined to those expressly set forth herein, and no implied duties
are assumed by or may be asserted against the Adviser hereunder. The
Adviser shall not be liable for any error of judgment or mistake of law
or for any loss arising out of any investment or for any act or
omission in carrying out its duties hereunder, except a loss resulting
from willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of reckless disregard of its
obligations and duties hereunder, except as may otherwise be provided
under provisions of applicable state law which cannot be waived or
modified hereby. (As used in this Paragraph 7, the term "Adviser" shall
include directors, officers, employees and other corporate agents of
the Adviser as well as that partnership itself).
8. Permissible Interests. Trustees, agents, and shareholders of the Trust
are or may be interested in the Adviser (or any successor thereof) as
directors, partners, officers, or shareholders, or otherwise;
directors, partners, officers, agents, and shareholders of the Adviser
are or may be interested in the Trust as Trustees, shareholders or
otherwise; and the Adviser (or any successor) is or may be interested
in the Trust as a shareholder or otherwise. In addition, brokerage
transactions for the Trust may be effected through affiliates of the
Adviser if approved by the Board of Trustees, subject to the rules and
regulations of the Securities and Exchange Commission.
9. Duration and Termination. This Agreement, unless sooner terminated as
provided herein, shall remain in effect until two years from date of
execution, and thereafter, for periods of one year so long as such
continuance thereafter is specifically approved at least annually (a)
by the vote of a majority of those Trustees of the Trust who are not
parties to this Agreement or interested persons of any such party, cast
in person at a meeting called for the purpose of voting on such
approval, and (b) by the Trustees of the Trust or by vote of a majority
of the outstanding voting securities of each 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 1940 Act and
rules and regulations thereunder. The foregoing requirement that
continuance of this Agreement be "specifically approved at least
annually" shall be construed in a manner consistent with the 1940 Act
and the rules and regulations thereunder.
This Agreement may be terminated as to any Portfolio at any time,
without the payment of any penalty by vote of a majority of the
Trustees of the Trust or by vote of a majority of the outstanding
voting securities of the Portfolio on 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
3
<PAGE>
writing, addressed and delivered, or mailed postpaid, to the other
party at any office of such party.
As used in this Section 9, the terms "assignment", "interested
persons", and a "vote of a majority of the outstanding voting
securities" shall have the respective meanings set forth in the 1940
Act and the rules and regulations thereunder; subject to such
exemptions as may be granted by the Securities and Exchange
Commission under said Act.
10. Notice. 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 680 East
Swedesford Road, Wayne, PA and if to the Adviser at: 75 State
Street, Boston, MA 02109, ATTN: Legal Department.
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 Agreement and 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.
SEI Cash+Plus Trust Wellington Management Company
By: /s/ Sandra K. Orlow By: /s/ Duncan M. McFarland
Attest: /s/ Patricia A. Lewers Attest: /s/ Jacalyn Jepsen
4
<PAGE>
Schedule A
to the
Investment Advisory Agreement
between
SEI Cash+Plus Trust
and
Wellington Management Company
Pursuant to Article 3, the Trust shall pay the Advisor compensation at an annual
rate as follows:
Corporate Daily Income Portfolio
Government Securities Daily Income Portfolio
Net Asset Value Annual Fee
-------------------------------------------------------------
On first $500,000,000 .100%
Next $500,000,000 .075%
Over $1,000,000,000 .050%
The fees for the Corporate Daily Income Portfolio and the Government Securities
Daily Income Portfolio shall be calculated by aggregating the assets of the two
portfolios, applying the above fee schedule and then allocating the fee to each
of those portfolios based upon their relative net assets.
5
<PAGE>
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 30th day of June, 1994, by and between SEI Daily Income
Trust, a Massachusetts business trust (the "Trust"), and Wellington Management
Company, (the "Adviser").
WHEREAS, the Trust is an open-end, diversified management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"), consisting of several series of shares, each having its own
investment policies; and
WHEREAS, the Trust has retained SEI Financial Management Corporation (the
"Administrator") to provide administration of the Trust's operations, subject to
the control of the Board of Trustees;
WHEREAS, the Trust desires to retain the Adviser to render investment
management services with respect to its Short-Term Mortgage Portfolio and Short
Duration Mortgage Portfolio and such other portfolios as the Trust and the
Adviser may agree upon (the "Portfolios"), and the Adviser is willing to render
such services:
NOW, THEREFORE, in consideration of mutual covenants herein contained, the
parties hereto agree as follows:
1. Duties of the Adviser. The Trust employs the Adviser to manage the
investment and reinvestment of the assets, 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 Administrator and the Trust with records concerning the
Adviser's activities which the Trust is required to maintain, and to
render regular reports to the Administrator and to the Trust's Officers
and Trustees concerning the Adviser's discharge of the foregoing
responsibilities.
The Adviser shall discharge the foregoing responsibilities subject to
the control of the Board of Trustees of the Trust and in compliance
with such policies as the Trustees may from time to time establish, and
in compliance with the objectives, policies, and limitations for each
such Portfolio set forth in the Trust's prospectus and statement of
additional information as amended 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.
1
<PAGE>
2. Portfolio Transaction. 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
and statement of additional information from time to time. The Adviser
will promptly communicate to the Administrator and to the officers and
the Trustees of the Trust such information relating to portfolio
transactions as they may reasonably request.
It is understood that the Adviser will not deemed to have acted
unlawfully, or to have breached a fiduciary duty to the Trust or be in
breach of any obligation owing to the Trust under this Agreement, or
otherwise, solely by reason of its having directed a securities
transaction on behalf of the Trust to a broker-dealer in compliance
with the provisions of Section 28(e) of the Securities Exchange Act of
1934.
3. Compensation of the Adviser. For the services to be rendered by the
Adviser as provided in Sections 1 and 2 of this Agreement, the Trust
shall pay to the Adviser compensation at the rate specified in the
Schedule(s) which are attached hereto and made a part of this
Agreement. Such compensation shall be paid to the Adviser at the end
of each month, and calculated by applying a daily rate, based on the
annual percentage rates as specified in the attached Schedule(s), to
the assets. The fee shall be based on the average daily net assets for
the month involved.
All rights of compensation under this Agreement for services performed
as of the termination date shall survive the termination of this
Agreement.
4. 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.
5. Status of the Adviser. The services of the Adviser to the Trust are
not to be deemed exclusive, and the Adviser shall be free to render
similar services to others so long as its services to the Trust are
not impaired thereby. The Adviser shall be deemed to be an independent
contractor and shall, unless otherwise expressly provided or
authorized, have no authority to act for or represent the Trust in any
way or otherwise be deemed an agent of the Trust.
6. Certain Records. Any records required to be maintained and preserved
pursuant to be provisions of Rule 31a-1 and Rule 31a-2 promulgated
under the 1940 Act which are prepared 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.
2
<PAGE>
7. Limitation of Liability of the Adviser. The duties of the Adviser
shall be confined to those expressly set forth herein, and no implied
duties are assumed by or may be asserted against the Adviser
hereunder. The Adviser shall not be liable for any error of judgment
or mistake of law or for any loss arising out of any investment or for
any act or omission in carrying out its duties hereunder, except a
loss resulting from willful misfeasance, bad faith or gross negligence
in the performance of its duties, or by reason of reckless disregard
of its obligations and duties hereunder, except as may otherwise be
provided under provisions of applicable state law which cannot be
waived or modified hereby. (As used in this Paragraph 7, the term
"Adviser" shall include directors, officers, employees and other
corporate agents of the Adviser as well as that partnership itself).
8. Permissible Interests. Trustees, agents, and shareholders of the Trust
are or may be interested in the Adviser (or any successor thereof) as
directors, partners, officers, or shareholders, or otherwise;
directors, partners, officers, agents, and shareholders of the Adviser
are or may be interested in the Trust as Trustees, shareholders or
otherwise; and the Adviser (or any successor) is or may be interested
in the Trust as a shareholder or otherwise. In addition, brokerage
transactions for the trust may be effected through affiliates of the
Adviser if approved by the Board of Trustees, subject to the rules and
regulations of the Securities and Exchange Commission.
9. Duration and Termination. This Agreement, unless sooner terminated as
provided herein, shall remain in effect until two years from date of
execution, and thereafter, for periods of one year so long as such
continuance thereafter is specifically approved at least annually (a)
by the vote of a majority of those Trustees of the Trust who are not
parties to this Agreement or interested persons of any such party,
cast in person at a meeting called for the purpose of voting on such
approval, and (b) by the Trustees of the Trust or by vote of a
majority of the outstanding voting securities of each 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 1940
Act and rules and regulations thereunder. The foregoing requirement
that continuance of this Agreement be "specifically approved at least
annually" shall be construed in a manner consistent with the 1940 Act
and the rules and regulations thereunder.
This Agreement may be terminated as to any Portfolio at any time,
without the payment of any penalty by vote of a majority of the
Trustees of the Trust or by vote of a majority of the outstanding
voting securities of the Portfolio on 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
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<PAGE>
writing, addressed and delivered, or mailed postpaid, to the other
party at any office of such party.
As used in this Section 9, the terms "assignment", "interested
persons", and a "vote of a majority of the outstanding voting
securities" shall have the respective meanings set forth in the 1940
Act and the rules and regulations thereunder; subject to such
exemptions as may be granted by the Securities and Exchange
Commission under said Act.
10. Notice. 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 680 East
Swedesford Road, Wayne, PA and if to the Adviser at: 75 State
Street, Boston, MA 02109, ATTN: Legal Department.
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 Agreement and 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.
SEI Daily Income Trust Wellington Management Company
By: /s/ Sandra K. Orlow By: /s/ Duncan M. McFarland
--------------------------- ---------------------------
Attest: /s/ Jennifer Klass Attest: /s/ Jacalyn Jepsen
----------------------- -----------------------
4
<PAGE>
Schedule A
to the
Investment Advisory Agreement
between
SEI Daily Income Trust
and
Wellington Management Company
Pursuant to Article 3, the Trust shall pay the Advisor compensation at an annual
rate as follows:
Short-Term Mortgage Portfolio
Short Duration Mortgage Portfolio
Net Asset Value Annual Fee
-----------------------------------------------------------
On first $500,000,000 .100%
Next $500,000,000 .075%
Over $1,000,000,000 .050%
The fees for the Short-Term Mortgage Portfolio and the Short Duration Mortgage
Portfolio shall be calculated by aggregating the assets of the two portfolios,
applying the above fee schedule and then allocating the fee to each of those
portfolios based upon their relative net assets.
5
<PAGE>
DISTRIBUTION AGREEMENT
THIS AGREEMENT is made as of this 15th day of July, 1982, between Cash+Plus
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. Sales 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 Distribution 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 1993 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 be subject by reason of wilful
misfeasance, bad faith or gross negligence in the performance of its duties or
by reason of its reckless
<PAGE>
disregard of its obligations and duties under this Agreement, or (ii) is the
Trust to be liable under its indemnity agreement contianed 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 disignated 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 or
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 upon 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 the issue and sale of any of the units.
9. Effective Date. This Agreement shall be effective upon its execution,
--------------
and unless terminated as provided, shall continue in force for two (2) years
from the effective date and thereafter from year to year, provided continuance
after the two (2) year period is approved by either (i) the vote of a majority
of the Trustees of the Trust, or by the vote of a majority of the outstanding
voting securities of the Trust, and (ii) the vote of a majority of those
Trustees of
-8-
<PAGE>
the Trust who are not parties to this Agreement or interested persons of any
party, cast 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, c/o
SEI Corporation, 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 given that this Agreement is expected on
behalf of the
-9-
<PAGE>
Trustees of the Trust as 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.
CASH+PLUS TRUST
Attest: /s/ Carmen V. Romeo By /s/ Donald Putnam
------------------------- --------------------------------
Treasurer SEI FINANCIAL SERVICES COMPANY
Attest: /s/ Carmen V. Romeo By /s/ Donald Putnam
------------------------- ---------------------------------
Secretary
-10-
<PAGE>
SEI Cash+Plus Trust
SUPPLEMENT DATED MAY 10, 1989 TO THE
DISTRIBUTION AGREEMENT DATED JULY 15, 1982
WHEREAS SEI Cash+Plus Trust (the "Trust") has been authorized to issue
Class B units of beneficial interest ("Units") for certain portfolios of the
Trust;
WHEREAS the Trust has authorized the distribution of Class B Units by SEI
Financial Services Company ("SFS") in accordance with the terms of the
Distribution Agreement between the Trust and SFS dated July 15, 1982 (the
"Agreement");
WHEREAS the Trust and SFS wish to clarify the level of payments to be made
by the Trust to SFS in connection with the distribution of Class B units;
NOW THEREFORE, THE Trust and SFS hereby agree that the Agreement is hereby
supplemented as follows:
1. In addition to the reimbursement of expenses by the Trust to SFS as
provided for by Section 7 of the Agreement, the Trust shall also make monthly
payments to SFS on an annualized basis equal to .30% of the daily net assets of
all Class B units issued and outstanding.
2. The payments provided by paragraph 1 immediately above are in addition
to, and not in lieu of, any other payments provided for by the Agreement.
3. The payments provided by paragraph 1 immediately above shall be used by
SFS in whole or in part to reimburse Class B unitholders which provide
administrative services to their clients relating to the Trust.
SEI Cash+Plus Trust
By: /s/ Susan L. Schelpf
--------------------
Vice President
SEI Financial Services Company
By: /s/ Sandy M. Krauss
---------------------
Vice President
<PAGE>
SEI CASH+PLUS TRUST
SUPPLEMENT DATED AUGUST 23, 1991
DISTRIBUTION AGREEMENT DATED JULY 15, 1982
WHEREAS, SEI Cash+Plus Trust (the "Trust") has been authorized to issue Class C
units of beneficial interest ("Shares") for certain portfolios of the Trust;
WHEREAS, the Trust has authorized the distribution of Class C Shares by SEI
Financial Services Company ("SFS") in accordance with the terms of the
Distribution Agreement between the Trust and SFS dated July 15, 1982 (the
"Agreement");
WHEREAS, the Trust and SFS wish to clarify the level of payments to be made by
the Trust to SFS in connection with the distribution of Class C Shares;
NOW THEREFORE, the Trust and SFS hereby agree that the Agreement is hereby
supplemented as follows:
1. In addition to the reimbursement of expenses by the Trust to SFS as provided
for by Section 7 of the Agreement, the Trust shall also make monthly
payments to SFS on an annualized basis equal to .50% of the daily net assets
of all Class C Shares issued and outstanding.
2. The payments provided by paragraph 1 immediately above are in addition to,
and not in lieu of, any other payments provided for by the Agreement.
3. The payments provided by pargraph 1 immediately above shall be used by SFS
in part to reimburse Class C Shareholders which provide administrative
services to their clients relating to the Trust.
SEI CASH+PLUS TRUST
By: /s/ Sandra K. Orlow
---------------------------
Vice President
SEI FINANCIAL SERVICES COMPANY
By: /s/ Theresa Marcussi
---------------------------
Vice President
<PAGE>
DISTRIBUTION PLAN
ProVantage Funds
WHEREAS, SEI Cash+Plus 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. 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 class of the Portfolios up to the amount set forth on Exhibit A. The
Distributor may use this fee toward (i) compensation for its 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:
<PAGE>
(a) The incremental printing costs incurred in producing for and
distributing to 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 amount 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
-2-
<PAGE>
Shareholders holding a majority of the outstanding voting securities of the
Trust, and all 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 operations 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
---------
Intermediate-Term Government Portfolio................. .30%
GNMA Portfolio......................................... .30%
Short-Term Government Portfolio........................ .30%
Amended December 10, 1993
4
<PAGE>
CUSTODIAN AGREEMENT
This Agreement, dated as of the 15th day of July, 1982, by and between
Cash+Plus Trust (the "Fund"), a business trust operating as an open-end
investment company, duly organized under the laws of The Commonwealth of
Massachusetts and United States National Bank of Oregon, a national bank;
W I T N E S S E T H :
WHEREAS, the Fund desires to deposit part of its cash with United States
National Bank of Oregon as custodian; and
WHEREAS, United States National Bank of Oregon is qualified and authorized
to act as custodian for the cash of an open-end investment company and is
willing to act in such capacity upon the terms and conditions 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 United States National Bank of Oregon
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 (including
instructions received by means of computer terminals), telephone or telegraphic
instructions from 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
<PAGE>
not be liable for the Fund's or such investment adviser's failure to confirm
such instructions in writing.
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 part of the
Fund's 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 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.
SECTION 4. 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 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.
SECTION 5. The Custodian is hereby authorized and directed to disburse cash from
time to time upon receipt of proper instructions.
SECTION 6. The Custodian's compensation shall be as set forth in Schedule A
hereto attached, or as shall be set
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<PAGE>
forth in amendments to such schedule approved by the Fund and the Custodian.
SECTION 7. In connection with its functions under this Agreement, the Custodian
shall:
(a) render to the Fund a daily report of all monies received or paid on
behalf of the Fund.
(b) 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's activities in accordance with
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.
SECTION 8. No liability of any kind shall be attached to or incurred by the
Custodian by reason of its custody of the funds or assets 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 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 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)
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<PAGE>
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 9. 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 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 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
or any other jurisdiction, governmental authority, body, or board relating to
the sale, registration, qualification of shares of 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 9 shall indefinitely survive termination of
this Agreement.
SECTION 10. 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 11. 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 cash of a mutual fund. Upon receipt of written notice from the Fund of
the appointment
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<PAGE>
of such successor and upon receipt of Proper Instructions, the Custodian shall
deliver such cash as it may then be holding hereunder directly 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 therupon 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 12. This Agreement shall take effect when assets of the Fund are first
delivered to the Custodian.
SECTION 13. 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 constitue but one and the same instrument.
SECTION 14. 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 15. 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 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.
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<PAGE>
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 16. 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 17. 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/ Donald Putnam
---------------------------
President
UNITED STATES NATIONAL BANK
OF OREGON
By: /s/ C.E. BATEMAN, JR.
---------------------------
C.E. Bateman, Jr.
Vice President and Trust Officer
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<PAGE>
Schedule A
----------
Incoming Wires $ 2.00 per wire
Outgoing Wires 6.00 per wire
Clerical time to calculate
balances, call companies,
send wires, billing, etc.
($5.00 per day minimum) 25.00 per hour
Fees will be itemized and invoiced to the fund on a monthly basis and
payment will be made promptly. This quote is based on current fees and
is subject to change with a 30-day notification.
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<PAGE>
CUSTODIAN AGREEMENT
This Agreement, dated as of the 15th day of July, 1982 made by and between
Cash+Plus 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, N.A., a bank organized
under the laws of the United States;
WITNESSETH:
WHEREAS, the Fund desires to appoint First Interstate Bank of Oregon as
custodian of its Securities and part of its cash, and First Interstate Bank of
Oregon is willing to act in such capacity upon the terms and conditions herein
set forth; and
WHEREAS, First Interstate Bank of Oregon 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 First Interstate Bank of Oregon 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
<PAGE>
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 the 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.
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 Custodians 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 or may be held in accordance with
section 8 of this Agreement and shall 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.
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<PAGE>
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, except for such portion of such net asset
value of the Fund may from time to time keep in the custody of another bank.
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 the 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
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<PAGE>
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, any other banks which the Fund shall have appointed as a
custodian 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 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, fees for legal
purposes). Before making any such payment or disbursement, however, the
Custodian shall receive (and may conclusively rely upon) Proper Instruction
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;
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<PAGE>
(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 Instruction 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;
(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 depositary, 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
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<PAGE>
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.
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-
<PAGE>
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 of 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. The Custodian
shall make a best effort to notify the Fund with regard to call notices of
bearer bonds published in the principal trade journals, but shall not be liable
for any failure in respect thereof.
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,
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<PAGE>
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
periodic 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's activities in accordance with
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 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 Custodian
shall not be obliged to take legal action for collection except by its consent
and unless and until reasonably indemnified to its satisfaction.
-8-
<PAGE>
The Custodian shall also notify the Fund as soon as 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 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 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.
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<PAGE>
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 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 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
or any other jurisdiction, governmental authority, body, or board relating to
the sale, registration, qualification of shares of 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 provision 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.
-10-
<PAGE>
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 Securities and cash as it may then be holding
hereunder directly 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) 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 Custodian may from
time to time direct, provided, however,
11
<PAGE>
that the appointment of such agent shall not relieve the Custodian of any of its
responsibilities under this Agreement.
SECTION 20. Whenever authorized by resolution of the Board of Trustees of the
Fund, the Custodian may employ one or more Sub-Custodians, provided that the
Custodian shall have no more responsibility or liability to the Fund on account
of any actions or omissions of any Sub-Custodian so employed than any such Sub-
Custodian has to the Custodian.
SECTION 21. 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 22. 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 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 23. 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 24. 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
-12-
<PAGE>
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.
Cash+Plus Trust
By: /s/ Donald Putnam
---------------------------
President
FIRST INTERSTATE BANK OF OREGON
By: /s/Signature Appears Here
---------------------------
-13-
<PAGE>
-4-
CUSTODIAL SERVICES
------------------
INITIAL FEE:
-----------
A reasonable fee may be charged for any unusual or extraordinary services
performed in setting up the account.
MINIMUM: $250.00
-------
ANNUAL FEE:
----------
STOCKS and Bonds: Based on Market Values
----------------
$ .30 per thousand per year on first 10 million
$ .20 per thousand per year on next 40 million
$ .15 per thousand per year on next 150 million
$ .10 per thousand per year on next 300 million
$ .05 per thousand per year on next 200 million
$ .035 per thousand per year on all above 700 million
MINIMUM ANNUAL FEE:
------------------
$1,500.00 per year
ACTIVITY CHARGES:
----------------
$15.00 per transaction. (Includes purchases and sales, calls, maturities,
tenders and exchanges and dated commercial paper.)
$5.00 per First Interstate Repo.
$1.00 per draft.
$3.50 per wire. - changed in '83
OUT-OF-POCKET EXPENSES:
----------------------
All such expenses will be charged to the account, including, but not
limited to: postage, insurance, telephone and telegraph, and correspondent
bank charges.
TERMINATION FEE:
---------------
A reasonable fee will be charged for the termination work in taking
receipts and reregistering securities in the name of the Principal for
accounts evidenced by formal agency agreements, with a minimum of
$1,500.00.
EXTRAORDINARY SERVICES:
----------------------
Reasonable compensation.
<PAGE>
First Interstate Bank
of Oregon, N.A.
[LOGO OF FIRST INTERSTATE BANK APPEARS HERE] Trust Division
1300 S.W. Fifth Avenue
P.O. Box 2971
Portland, OR 97208
OCTOBER 21, 1983
SEI CASH PLUS GOVERNMENT
RE: FIRST INTERSTATE BANK OF OREGON, NA CUSTODIAL FEE
SEPTEMBER 1, 1983 THROUGH SEPTEMBER 30, 1983
<TABLE>
<S> <C> <C>
TOTAL NET VALUE OF FUND SEPTEMBER 30, 1983 $17,348,468.20
$.30 per $1,000 on first $10,000,000.00 $3,000.00
$.20 per $1,000 on next $40,000,000.00 1,469.69
---------
TOTAL ANNUAL FEE $4,469.69
TOTAL MONTHLY FEE $ 372.47
</TABLE>
<TABLE>
<CAPTION>
MISCELLANEOUS:
<S> <C> <C> <C>
BUY/SELL SECURITIES.......... 3 @ $15.00...................... $ 45.00
FIOR REPOS................... 20 @ 5.00...................... 100.00
WIRES........................ 10 @ 5.00*..................... 50.00
=========
TOTAL FEE DUE SEPTEMBER 30, 1983 $ 567.47
</TABLE>
*REVISED FROM $3.50 TO $5.00 PER WIRE
FIRST INTERSTATE BANK OF OREGON, NA
/s/ BARBARA HARVEY
-------------------------------
BARBARA HARVEY
ASSISTANT TRUST OFFICER
<PAGE>
CUSTODIAN AGREEMENT
-------------------
This Agreement, dated as of the 22nd day of September, 1983 made by and between
Cash+Plus Trust (the "Fund"), a business trust operating as an open-end
investment company, duly organized under the laws of The Commonwealth of
Massachusetts and Manufacturers National Bank of Detroit, a national bank;
WITNESSETH:
-----------
WHEREAS, the Fund desires to appoint Manufacturers National Bank of Detroit as
custodian of the Securities and cash owned or held by the Fund's Money Market
Portfolio and such other Portfolios as the Trust and the Custodian may hereafter
agree on (the "Portfolios"), and Manufacturers National Bank of Detroit is
willing to act in such capacity upon the terms and conditions herein set forth;
and
WHEREAS, Manufacturers National Bank of Detroit 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 Manufacturers National Bank of Detroit
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 the Fund's or such investment adviser's
failure to confirm such instructions in writing.
-1-
<PAGE>
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 Portfolios.
UNITHOLDERS: The term Unitholders shall mean the registered owners from time to
time of the Units of the Portfolios in accordance with the registry records
maintained by the Fund or agents on its behalf.
UNITS: The term Units shall mean the units of beneficial interest of the
Portfolios.
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. These documents shall constitute conclusive evidence of the authority of
the officers and signatories designated therein to act and shall by 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 Portfolios 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 Portfolios, 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 Portfolio 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.
-2-
<PAGE>
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 Units sold from time to time whether
representing initial issue, other stock, or reinvestments of dividends and/or
distributions payable to Unitholders, except for such portion of such net asset
value as the Fund may from time to time keep in the custody of another bank.
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
Portfolios' accounts. The Custodian is authorized to advance or pay out of said
accounts 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 the 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 taxes, if any upon
receipt of Proper Instructions;
(d) for the purpose of completing the purchase of Securities purchased by
the Portfolios: (i) upon receipt of 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;
-3-
<PAGE>
(e) for the purpose of redeeming or purchasing Units upon receipt of
Proper Instructions stating the applicable redemption amounts
payable to the Transfer Agent, any other banks which the Fund shall
have appointed as a custodian, 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 increases in values of the Securities
as the Fund may determine to include in dividends and/or
distributions on the Units;
(g) for the purpose of paying in whole or in part any loan of the
Portfolios 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, 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
Portfolios upon receipt of: (i) the net proceeds of sales 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 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;
-4-
<PAGE>
(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;
(e) for the purpose of delivery of Securities upon redemption of Units 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 Portfolios 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
Portfolios 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 Portfolios 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
Portfolios which are maintained in a Securities System shall identify
by book-entry those Securities belonging to the Portfolios.
-5-
<PAGE>
3. The Custodian shall pay for Securities purchased for the account of the
portfolios 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 Portfolios. The Custodian shall transfer Securities
sold for the account of the Portfolios 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
Portfolios. Copies of all advices from the Securities System of transfers
of Securities for the account of the Portfolios shall identify the
Portfolios, be maintained for the Portfolios 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 Portfolios 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 Portfolios on the next business day.
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.
-6-
<PAGE>
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 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 Custodian. Upon actual receipt by the Custodian of
warrants or rights issued in connection with the assets of the Portfolios, the
Custodian shall enter on its ledgers appropriate notations, indicating such
receipt, and shall forward notice thereof to the Fund. The Custodian 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. The Custodian shall make a best
effort to notify the Fund with regard to call notices of bearer bonds published
in the principal trade journals but shall not be liable for any failure in
respect thereof.
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 Portfolios 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.
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 Portfolios and such listings of Securities held by the
Custodian for the account of the Portfolios 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;
-7-
<PAGE>
(e) monitor and record the collection of funds in accounts maintained
by the Custodian in the name of the Portfolios 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's activities in
accordance with 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 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 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 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 tax, assessment of charge and reimburse itself out of the monies of
the Portfolios 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 Units held by it
from time to time under this Agreement, or otherwise by reasons 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 if counsel, who may be counsel for the Fund
or for the Custodian, and upon statements of accountants, brokers and
other persons believed by it in good faith to be expert in the manners
upon which they are consulted; and for any action taken or suffered in
good faith based upon such advice or statements the
-8-
<PAGE>
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 the Board
of Trustees or Unitholders 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 of 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, forward 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 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 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
or any other jurisdiction, governmental authority, body or board relating to the
sale, registration, qualification of Units of beneficial interest in the
Portfolios, 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.
-9-
<PAGE>
SECTION 14. The Custodian shall provide the Fund, at such times as the Fund may
reasonably require, with accountant's 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 provision 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 Unitholders 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 Securities and cash as it may then be holding
hereunder directly 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.
-10-
<PAGE>
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) any other bank or trust company which is itself qualified under the
Investment Company Act of 1940, as amended, to act as 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. Whenever authorized by resolution of the Board of Trustees of the
Fund, the Custodian may employ one or more Sub-Custodians, provided that the
Custodian shall have no more responsibility or liability to the Fund on account
of any actions or omissions of any Sub-Custodian so employed than any such
Sub-Custodian has to the Custodian.
SECTION 21. 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 unitholders of the Fund individually, but
binding only upon the assets and property of the Fund.
SECTION 22. 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 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 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 23. 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 24. 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.
CASH+PLUS TRUST
BY: /s/ David B. Robb, Jr.
------------------------
David B. Robb, Jr.
President
MANUFACTURERS NATIONAL BANK OF DETROIT
By: /s/ Robert R. Schoonbeck
------------------------
Robert R. Schoonbeck
First Vice President
-12-
<PAGE>
SCHEDULE A
----------
INITIAL FEE
-----------
A reasonable fee may be charged for any unusual or extraordinary services
performed in setting up the account.
FIXED FEE
---------
The net asset value fee will be charged monthly based on the average book value
of the aggregate portfolio(s) during the month, at the following annual rates:
<TABLE>
<CAPTION>
RATE NET ASSETS
<C> <S>
.030% $ 0 Million to $ 10 Million
.020% $ 10 Million to $ 50 Million
.015% $ 50 Million to $200 Million
.010% $200 Million to $500 Million
.005% $500 Million to $700 Million
.0035% Over $700 Million
</TABLE>
TRANSACTION FEE
---------------
A transaction is defined as a purchase, a sale, or a maturity of a Portfolio
security holding.
<TABLE>
<S> <C>
Security Purchase $15.00
Security Sale $15.00
Security Maturity No Charge
Repo (Manufacturers) Purchase $ 5.00
Repo (Manufacturers) Maturity $ 5.00
Wires Received No Charge
Wires Sent $ 3.50
</TABLE>
OUT-OF-POCKET EXPENSES:
----------------------
All such expenses will be charged to the account, including, but not limited to:
postage, insurance, telephone and telegraph, and correspondent bank charges.
TERMINATION FEE:
---------------
A reasonable fee will be charged for the termination work in taking receipts and
reregistering securities in the name of the Principal for accounts evidenced
by formal agency agreements, with a maximum of $1,500.00.
EXTRAORDINARY SERVICES:
---------------------
Reasonable compensation.
These fees will be in effect for a period of not less than two (2) years from
the date of the original document.
-13-
<PAGE>
CUSTODIAN AGREEMENT
-------------------
This Agreement, dated as of the 30th day of August, 1985 made by and between
Cash+Plus Trust (the "Fund"), a business trust operating as an open-end
investment company, duly organized under the laws of The Commonwealth of
Massachusetts and Philadelphia National Bank, a national bank;
WITNESSETH:
-----------
WHEREAS, the Fund desires to appoint Philadelphia National Bank as custodian of
the Securities and cash owned or held by the Fund's Government Portfolio, Prime
Obligation Portfolio, and such other Portfolios as the Trust and the Custodian
may hereafter agree on ( the "Portfolios"), and Philadelphia National Bank is
willing to act in such capacity upon the terms and conditions herein set forth;
and
WHEREAS, 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 are 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 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 questions. The Custodian may act
upon telephone or telegraphic instructions without awaiting receipt of written
confirmation and shall not be liable for the Fund's or such investment adviser's
failure to confirm such instructions in writing.
<PAGE>
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 Portfolios.
UNITHOLDERS: The term Unitholders shall mean the registered owners from time to
time of the Units of the Portfolios in accordance with the registry records
maintained by the Fund or agents on its behalf.
UNITS: The term Units shall mean the units of beneficial interest of the
Portfolios.
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. These documents 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 Portfolios 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 Portfolios, 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 Portfolio 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.
-2-
<PAGE>
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 Units sold from time to time whether
representing initial issue, other stock, or reinvestments of dividends and/or
distributions payable to Unitholders, except for such portion of such net asset
value as the Fund may from time to time keep in the custody of another bank.
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
Portfolio's accounts. The Custodian is authorized to advance or pay out of said
accounts 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 the 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 taxes, if any upon
receipt of Proper Instructions;
(d) for the purpose of completing the purchase of Securities purchased by
the Portfolios: (i) upon receipt of 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;
-3-
<PAGE>
(e) for the purpose of redeeming or purchasing Units upon receipt of Proper
Instructions stating the applicable redemption amounts payable to the
Transfer Agent, any other banks which the Fund shall have appointed as
a custodian, 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 increases in values of the Securities as the Fund may
determine to include in dividends and/or distributions on the Units;
(g) for the purpose of paying in whole or in part any loan of the
Portfolios 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 nd transfer agency fees and costs,
compensation of personnel, or operating expenses (including, without
limitation, 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
Portfolios upon receipt of: (i) the net proceeds of sales 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 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;
-4-
<PAGE>
(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 considerations is to
be paid to the Custodian;
(e) for the purpose of delivery of Securities upon redemption of Units 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 Portfolios 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
Portfolios 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 Portfolios 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
Portfolios which are maintained in a Securities System shall identify by
book-entry those Securities belonging to the Portfolios.
-5-
<PAGE>
3. The Custodian shall pay for Securities purchased for the account of the
Portfolios upon: (1) 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 Portfolios. The Custodian shall transfer Securities
sold for the account of the Portfolios 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 Portfolios. Copies of all advices from the Securities System
of transfers of Securities for the account of the Portfolios shall
identify the Portfolios, be maintained for the Portfolios 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 Portfolios 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 Portfolios on the
next business day.
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.
<PAGE>
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 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 Custodian. Upon actual receipt by the Custodian of
warrants or rights issued in connection with the assets of the Portfolios, the
Custodian shall enter on its ledgers appropriate notations, indicating such
receipt, and shall forward notice thereof to the Fund. The Custodian 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 warrants or rights. The Custodian shall make a best effort
to notify the Fund with regard to call notices of bearer bonds published in the
principal trade journals but shall not be liable for any failure in respect
thereof.
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 Portfolios 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.
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 Portfolios and such listings of Securities held by the
Custodian for the account of the Portfolios 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;
-7-
<PAGE>
(e) monitor and record the collection of funds in accounts maintained
by the Custodian in the name of the Portfolios 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 in
and obligations under this Agreement in such manner as will meet the
obligations of the Fund with respect to said Custodian's activities in
accordance with 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 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 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 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 tax, assessment or charge and reimburse itself out of the monies of
the Portfolios 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 Units held by it
from time to time under this Agreement, or otherwise by reasons 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 relay upon the advice of counsel, who may be counsel for the Fund
or for the 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
-8-
<PAGE>
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 Unitholders 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 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 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
or any other jurisdiction, governmental authority, body or board relating to the
sale, registration, qualification of Units of beneficial interest in the
Portfolios, 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.
-9-
<PAGE>
SECTION 14. The Custodian shall provide the Fund, at such times as the Fund may
reasonably require, with accountant's 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 provision 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 Unitholders 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 Securities and cash as it may then be holding
hereunder directly 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.
-10-
<PAGE>
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) any other bank or trust company which is itself qualified under the
Investment Company Act of 1940, as amended, to act as 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. Whenever authorized by resolution of the Board of Trustees of the
Fund, the Custodian may employ one or more Sub-Custodians, provided that the
Custodian shall have no more responsibility or liability to the Fund on account
of any actions or omissions of any Sub-Custodian so employed than any such
Sub-Custodian has to the Custodian.
SECTION 21. 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 unitholders of the Fund individually, but
binding only upon the assets and property of the Fund.
SECTION 22. 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 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>
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, subject to the
Custodian's own security requirements applicable to employee access to records.
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.
CASH+PLUS TRUST
By: /s/ David B. Robb, Jr.
-----------------------
David B. Robb, Jr.
President
PHILADELPHIA NATIONAL BANK
By: /s/ Frank Barone
-----------------------
Vice President
Frank Barone
<PAGE>
LETTERHEAD OF ARTHUR ANDERSEN LLP
Exhibit 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our
report dated February 8, 1995 and to all references to our firm included
in or made part of Post-Effective Amendment No. 33 to Registration Statement
File No. 2-77048.
/s/ Arthur Andersen LLP
Philadelphia, PA
March 22, 1995
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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: March 8, 1995
------------------- -------------
James M. Storey
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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: March 9, 1995
-------------------- -------------
Robert A. Nesher
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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/ Edward W. Binshadler Date: March 8, 1995
----------------------- -------------
Edward W. Binshadler
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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: March 8, 1995
------------------------ -------------
Richard F. Blanchard
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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: March 7, 1995
-------------------- -------------
William M. Doran
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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: March 8, 1995
-------------------- -------------
F. Wendell Gooch
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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: March 9, 1995
------------------- -------------
Frank E. Morris
Trustee
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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: March 9, 1995
------------------- -------------
Jeffrey A. Cohen
Controller &
Assistant Secretary
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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/David G. Lee Date: March 14, 1995
--------------- --------------
David G. Lee
President & Chief Executive
Officer
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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 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/ Kevin P. Robins Date: March 8, 1995
------------------- -------------
Kevin P. Robins
Vice President &
Assistant Secretary
<PAGE>
SEI LIQUID ASSET TRUST
SEI TAX EXEMPT TRUST
SEI DAILY INCOME 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: March 8, 1995
------------------- -------------
Carmen V. Romeo
Treasurer
