As filed with the Securities and Exchange Commission
on March 7, 2000
Registration No. 811-09347
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 3 [X]
------------------------
NATIONS MASTER INVESTMENT TRUST
(Exact Name of Registrant as specified in Charter)
111 Center Street
Little Rock, Arkansas 72201
(Address of Principal Executive Offices, including Zip Code)
--------------------------
Registrant's Telephone Number, including Area Code: (800) 643-9691
Richard H. Blank, Jr.
c/o Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
(Name and Address of Agent for Service)
With a copy to:
Robert M. Kurucza, Esq.
Marco E. Adelfio, Esq.
Morrison & Foerster LLP
2000 Pennsylvania Ave., N.W.
Washington, D.C. 20006
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EXPLANATORY NOTE
This Registration Statement has been filed by the Registrant
pursuant to Section 8(b) of the Investment Company Act of 1940, as amended in
order to file all of the corporate documents and agreements. Part A and Part B
of the registration statement of hereby incorporated by reference to Amendment
No. 2, filed on February 11, 2000. However, beneficial interests in the
Registrant are not being registered under the Securities Act of 1933, as amended
(the "1933 Act"), since such interests will be issued solely in private
placement transactions which do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act. Investments in the Registrant may only
be made by the investment companies or certain other entities which are
"accredited investors" within the meaning of Regulation D under the 1933 Act.
This Registration Statement does not constitute an offer to sell, or the
solicitation of an offer to buy, any beneficial interests in the Registrant.
<PAGE>
NATIONS MASTER INVESTMENT TRUST
ONE BANK OF AMERICA PLAZA
33RD FLOOR
CHARLOTTE, NC 28255
1-800-626-2275
FORM N-1A
PART C
OTHER INFORMATION
ITEM 23. EXHIBITS
All references to the "Registration Statement" in the following
list of Exhibits refer to the Registrant's Registration Statement on Form N-1A
(File No. 811-09347).
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EXHIBIT LETTER DESCRIPTION
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(a) ARTICLES OF INCORPORATION:
(a)(1) Certificate of Trust dated January 13, 1999, filed herewith.
(a)(2) Declaration of Trust dated January 14, 1999, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(b) BYLAWS:
(b)(1) Amended and Restated Bylaws dated January 14, 1999, last
amended May 26, 1999, filed herewith.
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(c) INSTRUMENTS DEFINING RIGHTS OF SECURITIES HOLDERS:
Not Applicable
- ---------------------- -------------------------------------------------------------------------------------
(d) INVESTMENT ADVISORY CONTRACTS:
(d)(1) Investment Advisory Agreement between Banc of America Advisors, Inc. (formerly
NationsBanc Advisors, Inc.) ("BAAI") and Nations Master Investment Trust
("Registrant") dated May 21, 1999, Schedule I dated October 15, 1999, filed herewith.
(d)(2) Investment Advisory Agreement between BAAI and the Registrant dated February 14,
2000, filed herewith.
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EXHIBIT LETTER DESCRIPTION
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(d)(3) Sub-Advisory Agreement among BAAI, Banc of America Capital Management, Inc.
(formerly TradeStreet Investment Associates, Inc.) ("BACAP") and the Registrant
dated May 21, 1999, filed herewith.
(d)(4) Sub-Advisory Agreement among BAAI, Chicago Equity
Partners Corporation ("Chicago Equity") and the
Registrant dated May 21, 1999, filed herewith.
(d)(5) Sub-Advisory Agreement among BAAI, Gartmore Global
Partners ("Gartmore") and the Registrant dated August 19,
1999, filed herewith.
(d)(6) Sub-Advisory Agreement among BAAI, INVESCO Global Asset Management (N.A.), Inc.
("INVESCO") and the Registrant dated August 19, 1999, filed herewith.
(d)(7) Sub-Advisory Agreement among BAAI, Putnam Investment Management, Inc. ("Putnam")
and the Registrant dated August 19, 1999, filed herewith.
(d)(8) Sub-Advisory Agreement among BAAI, Marsico Capital
Management, LLC ("Marsico") and the Registrant dated
August 19, 1999, filed herewith.
(d)(9) Sub-Advisory Agreement among BAAI, Brandes Investment
Partners, L.P. ("Brandes") and the Registrant dated
October 15, 1999, filed herewith.
(d)(10) Sub-Advisory Agreement among BAAI, MacKay Shields LLC
("MacKay Shields") and the Registrant dated February 14,
2000, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(e) Not Applicable pursuant to General Instruction (B)(2)(b).
- ---------------------- -------------------------------------------------------------------------------------
(f) BONUS OR PROFIT SHARING CONTRACTS:
(f)(1) Deferred Compensation Plan dated February 24, 1999, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(g) CUSTODIAN AGREEMENT:
(g)(1) Custody Agreement between the Registrant and The Bank of New York ("BNY")
dated May 21, 1999, Schedule I dated February 14, 2000, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
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EXHIBIT LETTER DESCRIPTION
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(g)(2) Amendment to the Custody Agreement dated September 1, 1999, filed herewith.
(g)(3) Amendment to the Custody Agreement dated February 14, 2000, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(h) OTHER MATERIAL CONTRACTS:
(h)(1) Co-Administration Agreement among the Registrant, Stephens Inc.
("Stephens") and BAAI dated May 21, 1999,
Schedule I dated February 14, 2000, Schedule A dated
November 18, 1999, filed herewith.
(h)(2) Sub-Administration Agreement among the Registrant, BNY and BAAI
dated May 21, 1999, Schedule I dated February 14, 2000, filed
herewith.
(h)(3) Placement Agency Agreement between the Registrant and Stephens
dated May 21, 1999, Schedule I dated February 14, 2000, filed
herewith.
(h)(4) Cross Indemnification Agreement among Nations Fund Trust, Nations Fund, Inc.,
Nations Reserves, Nations Funds Trust and the Registrant dated February 14, 2000,
filed herewith.
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(i) Not Applicable pursuant to General Instruction (B)(2)(b).
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(j) Not Applicable pursuant to General Instruction (B)(2)(b).
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(k) Not Applicable pursuant to General Instruction (B)(2)(b).
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(l) INITIAL CAPITAL AGREEMENTS:
Not Applicable
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(m) RULE 12B-1 PLAN:
Not Applicable
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(n) FINANCIAL DATA SCHEDULE:
Not Applicable
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EXHIBIT LETTER DESCRIPTION
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(o) RULE 18F-3 PLAN:
Not Applicable
- ---------------------- -------------------------------------------------------------------------------------
(p) Powers of Attorney for Edmund L. Benson, Charles B. Walker, A. Max Walker, Thomas S.
Word, Jr., William H. Grigg, James Ermer, Thomas F. Keller, Carl E. Mundy, Jr.,
James B. Sommers, Cornelius J. Pings and William P. Carmichael, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
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ITEM 24. PERSONS CONTROLLED BY OF UNDER COMMON CONTROL WITH THE FUND
No person is controlled by or under common control with the
Registrant.
ITEM 25. INDEMNIFICATION
Article V, Section 5.3 of the Registrant's Declaration of Trust
provides for the indemnification of the Registrant's trustees, officers,
employees and other agents. Indemnification of the Registrant's administrators,
placement agent and custodian is provided for, respectively, in the
Registrant's:
1. Co-Administration Agreement with Stephens and BAAI;
2. Sub-Administration Agreement with BNY and BAAI;
3. Placement Agency Agreement with Stephens; and
4. Custody Agreement with BNY.
The Registrant has entered into a Cross Indemnification Agreement
with Nations Fund, Inc., (the "Company"), Nations Fund Trust (the "Trust"),
Nations Reserves ("Reserves") and Nations Funds Trust ("Funds Trust") dated
February 14, 2000. The Company, Trust, Reserves and/or Funds Trust will
indemnify and hold harmless the Registrant against any losses, claims, damages
or liabilities, to which the Registrant may become subject, under the Securities
Act of 1933, as amended (the "1933 Act") and the Investment Company Act of 1940,
as amended (the "1940 Act") or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any prospectuses, any preliminary prospectuses, the registration
statements, any other prospectuses relating to the securities, or any amendments
or supplements to the foregoing (hereinafter referred to collectively as the
"Offering Documents"), or arise out of or are based upon the omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in the Offering Documents in reliance upon and in
conformity with written information furnished to the Registrant by the Company,
Trust, Reserves and/or Funds Trust expressly for use therein; and will reimburse
the
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Registrant for any legal or other expenses reasonably incurred by the Registrant
in connection with investigating or defending any such action or claim;
provided, however, that the Company, Trust, Reserves and/or Funds Trust shall
not be liable in any such case to the extent that any such loss, claim, damage,
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Offering Documents
in reliance upon and in conformity with written information furnished to the
Company, Trust, Reserves and/or Funds Trust by the Registrant expressly for use
in the Offering Documents.
Promptly after receipt by an indemnified party above of notice of
the commencement of any action, such indemnified party shall, if a claim in
respect thereof is to be made against the indemnifying party under such
subsection, notify the indemnifying party in writing of the commencement
thereof; but the omission to so notify the indemnifying party shall not relieve
it from any liability which it may have to any indemnified party otherwise than
under such subsection. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, to assume the defense
thereof, with counsel satisfactory to such indemnified party, and, after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party shall not be liable to such
indemnified party under such subsection for any legal expenses of other counsel
or any other expenses, in such case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs of
investigation.
The Registrant has obtained from a major insurance carrier a
trustees' and officers' liability policy covering certain types of errors and
omissions. In no event will the Registrant indemnify any of its trustees,
officers, employees, or agents against any liability to which such person would
otherwise be subject by reason of his/her willful misfeasance, bad faith, gross
negligence in the performance of his/her duties, or by reason of his/her
reckless disregard of the duties involved in the conduct of his/her office or
arising under his agreement with the Registrant. The Registrant will comply with
Rule 484 under the 1933 Act and Release No. 11330 under the 1940 Act, in
connection with any indemnification.
Insofar as indemnification for liability arising under the 1933
Act may be permitted to trustees, officers, and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
("SEC") such indemnification is against public policy as expressed in the 1933
Act and is, therefore, 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 a trustee, officer, or controlling
person of the Registrant in the successful defense of any action, suit, or
proceeding) is asserted by such trustee, officer or controlling person in
connection with the securities 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
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it is against public policy as expressed in the 1933 Act and will be governed by
the final adjudication of such issue.
ITEM 26. BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT ADVISER
To the knowledge of the Registrant, none of the directors or officers
of BAAI, the adviser to the Registrant's portfolios, or BACAP, Chicago Equity,
Gartmore, INVESCO, Putnam, Marsico, Brandes or MacKay Shields, the investment
sub-advisers, except those set forth below, are or have been, at any time during
the past two calendar years, engaged in any other business, profession, vocation
or employment of a substantial nature, except that certain directors and
officers also hold various positions with, and engage in business for, the
company that owns all the outstanding stock (other than directors' qualifying
shares) of BAAI, BACAP, Chicago Equity, Gartmore or Marsico respectively, or
other subsidiaries of Bank of America Corporation.
(b) BAAI performs investment advisory services for the Registrant and
certain other customers. BAAI is a wholly-owned subsidiary of Bank of America,
N.A. ("Bank of America"), which in turn is a wholly-owned banking subsidiary of
Bank of America Corporation. Information with respect to each director and
officer of the investment adviser is incorporated by reference to Form ADV filed
by BAAI with the SEC pursuant to the Investment Advisers Act of 1940, as amended
(the "Advisers Act") (file no. 801-49874).
(c) BACAP performs investment sub-advisory services for the Registrant
and certain other customers. BACAP is a wholly-owned subsidiary of Bank of
America Corporation. Information with respect to each director and officer of
the investment sub-adviser is incorporated by reference to Form ADV filed by
BACAP (formerly TradeStreet Investment Associates, Inc.) with the SEC pursuant
to the Advisers Act (file no. 801-50372).
(d) Chicago Equity performs investment sub-advisory services for the
Registrant and certain other customers. Chicago Equity is a wholly-owned
subsidiary of Bank of America Corporation. Information with respect to each
director and officer of the investment sub-adviser is incorporated by reference
to Form ADV filed by Chicago Equity with the SEC pursuant to the Advisers Act
(file no. 801-55997).
(e) Gartmore performs investment sub-advisory services for the
Registrant and certain other customers. Gartmore is a joint venture structured
as a general partnership between NB Partner Corp., a wholly-owned subsidiary of
Bank of America, and Gartmore U.S. Limited, an indirect, wholly-owned subsidiary
of Gartmore Investment Management plc, a UK Company which is the holding company
for a leading UK based international fund management group of companies.
Information with respect to each director and officer of the investment
sub-adviser is incorporated by reference to Form ADV filed by Gartmore with the
SEC pursuant to the Advisers Act (file no. 801-48811).
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(f) INVESCO performs investment sub-advisory services for the
Registrant and certain other customers. INVESCO is a division of INVESCO Global,
a publicly traded investment management firm and a wholly-owned subsidiary of
AMVESCAP PLC, a publicly traded UK financial holding company that engages
through its subsidiaries in the business of international investment management.
Information with respect to each director and officer of the investment
sub-adviser is incorporated by reference to Form ADV filed by INVESCO with the
SEC pursuant to the Advisers Act (file no. 801-54192).
(g) Putnam performs investment sub-advisory services for the Registrant
and certain other customers. Putnam is a wholly-owned subsidiary of Putnam
Investments, Inc., an investment management firm which, except for shares held
by employees is owned by Marsh & McLennan Companies, a publicly traded
professional services firm that engages through its subsidiaries in the business
of investment management. Information with respect to each director and officer
of the investment sub-adviser is incorporated by reference to Form ADV filed by
Putnam with the SEC pursuant to the Advisers Act (file no. 801-7974).
(h) Marsico performs investment sub-advisory services for the
Registrant and certain other customers. Marsico Management Holdings, LLC, a
wholly-owned subsidiary of Bank of America, owns 50% of the equity of Marsico
Capital. Information with respect to each director and officer of the investment
sub-adviser is incorporated by reference to Form ADV filed by Marsico with the
SEC pursuant to the Advisers Act (file no. 801-54914).
(i) Brandes performs investment sub-advisory services for the
Registrant and certain other customers. Information with respect to each
director and officer of the investment sub-adviser is incorporated by reference
to Form ADV filed by Brandes with the SEC pursuant to the Advisers Act (file no.
801-24896).
(j) MacKay Shields performs investment sub-advisory services for the
Registrant and certain other customers. Information with respect to each
director and officer of the investment sub-adviser is incorporated by reference
to Form ADV filed by MacKay Shields with the SEC pursuant to the Advisers Act
(file no. 801-5594).
ITEM 27. PRINCIPAL UNDERWRITERS
(a) Stephens, placement agent for the Registrant, does not presently
act as investment adviser for any other registered investment companies, but
does act as distributor for Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Funds
Trust, Wells Fargo Funds Trust, Wells Fargo Variable Trust, and is the exclusive
placement agent for Master Investment Trust, Managed Series Investment Trust,
Wells Fargo Core Trust and Master Investment Portfolio, all of which are
registered open-end management investment companies, and has acted as principal
underwriter for the Liberty Term Trust, Inc., Nations Government Income Term
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Trust 2003, Inc., Nations Government Income Term Trust 2004, Inc. and the
Managed Balanced Target Maturity Fund, Inc., closed-end management investment
companies.
(b) Information with respect to each director and officer of the
placement agent is incorporated by reference to Form ADV filed by Stephens with
the SEC pursuant to the 1940 Act (file No. 501-15510).
(c) Not applicable.
ITEM 28. LOCATION OF ACCOUNTS AND RECORDS
(1) BAAI, One Bank of America Plaza, Charlotte, NC 28255 (records
relating to its function as investment adviser and
co-administrator).
(2) BACAP, One Bank of America Plaza, Charlotte, NC 28255 (records
relating to its function as investment sub-adviser).
(3) Chicago Equity, 231 South LaSalle, Chicago, IL 60697 (records
relating to its function as investment sub-advisor).
(4) Gartmore, One Bank of America Plaza, Charlotte, NC 28255
(records relating to its function as investment sub-adviser).
(5) INVESCO, 1315 Peachtree Street, N.E., Atlanta, GA 30309
(records relating to its function as investment sub-advisor).
(6) Putnam, One Post Office Square, Boston, MA 02109 (records
relating to its function as investment sub-advisor).
(7) Marsico, 1200 17th Street, Suite 1300, Denver, CO 80202
(records relating to its function as investment sub-advisor).
(8) Brandes, 12750 High Bluff Drive, San Diego, CA 92130 (records
relating to its function as investment sub-advisor).
(9) MacKay Shields, 9 West 57th Street, New York, New York, 10019
(records relating to its function as investment sub-advisor).
(10) Stephens, 111 Center Street, Little Rock, AR 72201 (records
relating to its function as placement agent and
co-administrator).
(11) BNY, 100 Church Street, New York, NY 10286 (records relating
to its function as custodian and sub-administrator).
ITEM 29. MANAGEMENT SERVICES
Not Applicable
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ITEM 30. Undertakings
Not Applicable
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Signatures
Pursuant to the requirements of the Investment Company Act of 1940, the
Registrant has duly caused this Amendment to its Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Little Rock, State of Arkansas on the 6th day of March, 2000.
NATIONS MASTER INVESTMENT TRUST
By: *
--------------------------------------
A. Max Walker
President and Chairman
of the Board of Trustees
By: /s/ Richard H. Blank, Jr.
--------------------------------------
Richard H. Blank, Jr.
*Attorney-in-Fact
<PAGE>
Nations Master Investment Trust
Exhibit Index
Exhibit No. Description
EX-99.A1 Certificate of Trust
EX-99.A2 Declaration of Trust
EX-99.B1 By-Laws
EX-99.D1 Investment Advisory Agreement
EX-99.D2 Investment Advisory Agreement
EX-99.D3 Sub-Advisory Agreement - TradeStreet Investment Associates, Inc.
EX-99.D4 Sub-Advisory Agreement - Chicago Equity Partners Corporation
EX-99.D5 Sub-Advisory Agreement - Gartmore Global Partners
EX-99.D6 Sub-Advisory Agreement - INVESCO Global Asset Management
EX-99.D7 Sub-Advisory Agreement - Putnam Investment Management
EX-99.D8 Sub-Advisory Agreement - Marsico Capital Management, LLC
EX-99.D9 Sub-Advisory Agreement - Brandes Investment Partners, L.P.
EX-99.D10 Sub-Advisory Agreement - MacKay Shields LLC
EX-99.F1 Form of Nations Funds Deferred Compensation Plan
EX-99.G1 Custody Agreement
EX-99.G2 Amendment to the Custody Agreement
EX-99.G3 Amendment No. 2 to the Custody Agreement
EX-99.H1 Co-Administration Agreement
EX-99.H2 Sub-Administration Agreement
EX-99.H3 Placement Agency Agreement
EX-99.H4 Cross Indemnification Agreement
EX-99.P Powers of Attorney
CERTIFICATE OF TRUST
OF
NATIONS MASTER INVESTMENT TRUST
The undersigned, constituting the entire Board of Trustees of Nations
Master Investment Trust (the "Trust"), in order to form a Delaware business
trust pursuant to Section 3810 of the Delaware Business Trust Act, do hereby
certify the following:
1. The name of the Delaware business trust is NATIONS MASTER INVESTMENT
TRUST, which is registered as an investment company under the Investment Company
Act of 1940, as amended.
2. The registered office of the Trust in Delaware is Corporation Trust
Center, 1209 Orange Street, Wilmington, DE 19801.
3. The registered agent for service of process on the Trust is The
Corporation Trust Company, 1209 Orange Street, Wilmington, DE 19801.
4. This certificate of trust shall be effective the date it is filed
with the Office of the Delaware Secretary of State.
5. Notice is hereby given that the Trust shall consist of one or more
series. The debts, liabilities, obligations and expenses incurred, contracted
for or otherwise existing with respect to a particular series of the Trust shall
be enforceable against the assets of such series only and not against the assets
of the Trust generally or any other series thereof, and, none of the debts,
liabilities, obligations and expenses incurred, contracted for or otherwise
existing with respect to the Trust generally or any other series thereof shall
be enforceable against the assets of such series.
<PAGE>
IN WITNESS WHEREOF, the undersigned Trustees of NATIONS MASTER
INVESTMENT TRUST have executed this certificate, which may be executed in
counterpart, as of this 13th day of January, 1999.
/s/ Edmund L. Benson, III
-------------------------
Edmund L. Benson, III
/s/ James Ermer
-------------------------
James Ermer
/s/ William H. Grigg
-------------------------
William H. Grigg
/s/ Thomas F. Keller
-------------------------
Thomas F. Keller
/s/ Carl E. Mundy, Jr.
-------------------------
Carl E. Mundy, Jr.
/s/ A. Max Walker
-------------------------
A. Max Walker
/s/ Charles B. Walker
-------------------------
Charles B. Walker
/s/ Thomas S. Word
-------------------------
Thomas S. Word
/s/ James B. Sommers
-------------------------
James B. Sommers
DECLARATION OF TRUST
OF
NATIONS MASTER INVESTMENT TRUST
a Delaware Business Trust
January 14, 1999
Principal Place of Business:
One Bank of America Plaza
33rd Floor
Charlotte, North Carolina 28255
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TABLE OF CONTENTS
ARTICLE I
The Trust
Section 1.1: Name....................................................... 1
Section 1.2: Trust Purpose.............................................. 1
Section 1.3: Definitions................................................ 2
ARTICLE II
Trustees
Section 2.1: Number and Qualification................................... 4
Section 2.2: Term and Election.......................................... 5
Section 2.3: Resignation and Removal.................................... 5
Section 2.4: Vacancies.................................................. 5
Section 2.5: Meetings................................................... 5
Section 2.6: Officers; Chairman of the Board............................ 6
Section 2.7: By-Laws.................................................... 6
ARTICLE III
Powers of Trustees
Section 3.1: General.................................................... 6
Section 3.2: Investments................................................ 7
Section 3.3: Legal Title................................................ 7
Section 3.4: Sale of Interests.......................................... 8
Section 3.5: Borrow Money............................................... 8
Section 3.6: Delegation; Committees..................................... 8
Section 3.7: Collection and Payment..................................... 8
Section 3.8: Expenses................................................... 8
Section 3.9: Miscellaneous Powers....................................... 8
Section 3.10: Further Powers............................................. 9
ARTICLE IV
Investment Advisory, Administrative Services
and Placement Agency Arrangements
Section 4.1: Investment Advisory and Other Arrangements................. 9
Section 4.2: Parties to Contract........................................ 9
ARTICLE V
Limitations of Liability
Section 5.1: No Personal Liability of Trustees, Officers or Employees;
Liability of Holders; Indemnification..................... 10
Section 5.2: Non-liability of Trustees, etc............................ 10
<PAGE>
Section 5.3: Mandatory Indemnification................................. 10
Section 5.4: No Bond Required of Trustees.............................. 11
Section 5.5: No Duty of Investigation; Notice in Trust Instruments..... 11
Section 5.6: Reliance on Experts, etc.................................. 11
ARTICLE VI
Interests in the Trust
Section 6.1: Interests................................................. 12
Section 6.2: Rights of Holders......................................... 12
Section 6.3: Purchase of or Increase in Interests...................... 12
Section 6.4: Register of Interests..................................... 12
Section 6.5: Notices................................................... 12
Section 6.6: Tax Matters............................................... 13
ARTICLE VII
Determination of Book Capital Account Balances and Allocations
Section 7.1: Book Capital Account Balances............................. 13
Section 7.2: Allocation of Net Profits and Losses...................... 13
Section 7.3: Power to Modify the Foregoing Procedures.................. 14
ARTICLE VIII
Distributions and Redemptions
Section 8.1: Distributions............................................. 15
Section 8.2: Determination of Net Income............................... 15
Section 8.3: Redemptions............................................... 15
Section 8.4 Determination of Net Asset Value.......................... 16
Section 8.5 Suspension of Right of Redemption......................... 16
ARTICLE IX
Holders
Section 9.1: Meetings of Holders....................................... 16
Section 9.2: Notice of Meetings........................................ 17
Section 9.3: Record Date for Meetings.................................. 17
Section 9.4: Proxies................................................... 17
Section 9.5: Reports................................................... 17
Section 9.6: Inspection of Records..................................... 18
Section 9.7: Voting Powers............................................. 18
Section 9.8: Series of Interests....................................... 18
Section 9.9: Holder Action by Written Consent.......................... 20
Section 9.10: No Pre-Emptive Rights; Derivative Suits................... 20
<PAGE>
ARTICLE X
Duration; Termination of Trust; Amendment; Mergers, etc.
Section 10.1: Duration.................................................. 20
Section 10.2: Termination of Trust...................................... 20
Section 10.3: Amendment Procedure....................................... 21
Section 10.4: Merger, Consolidation, Conversion and Sale of Assets...... 22
ARTICLE XI
Miscellaneous
Section 11.1: Certificate of Designation; Agent for Service of Process.. 22
Section 11.2: Governing Law............................................. 22
Section 11.3: Counterparts.............................................. 23
Section 11.4: Reliance by Third Parties................................. 23
Section 11.5: Provision in Conflict With Law or Regulations............. 23
Section 11.6: Trust Only................................................ 23
Section 11.7: Withholding............................................... 23
Section 11.8: Headings and Construction................................. 24
<PAGE>
DECLARATION OF TRUST
OF
NATIONS MASTER INVESTMENT TRUST
This DECLARATION OF TRUST of the NATIONS MASTER INVESTMENT TRUST is
made as of the 14th day of January, 1999, by the parties signatory hereto, as
trustees (such persons, so long as they shall continue in office in accordance
with the terms of this Declaration of Trust, and all other persons who at the
time in question have been duly elected or appointed as trustees in accordance
with the provisions of this Declaration of Trust and are then in office, in
their capacity as trustees hereunder, are hereinafter called the "Trustees").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Trustees desire to form a business trust under the laws of
Delaware for the investment and reinvestment of its assets; and
WHEREAS, it is proposed that the trust assets be composed of funds
contributed thereto by the holders of interests in the trust entitled to
ownership rights in the trust;
NOW, THEREFORE, the Trustees hereby declare that they will hold in
trust all cash, securities and other assets which they may from time to time
acquire in any manner as Trustees hereunder, and manage and dispose of the same
for the benefit of the holders of interests in the trust and subject to the
following terms and conditions.
ARTICLE I
The Trust
1.1 Name. The name of the trust created hereby (the "Trust") shall be
"Nations Master Investment Trust," and so far as may be practicable the Trustees
shall conduct the Trust's activities, execute all documents and sue or be sued
under that name, which name (and the word "Trust" wherever hereinafter used)
shall not refer to the Trustees in their individual capacities or to the
officers, agents, employees or holders of interest in the Trust. However, should
the Trustees determine that the use of the name of the Trust is not advisable,
they may select such other name for the Trust as they deem proper and the Trust
may hold its property and conduct its activities under such other name. Any name
change shall become effective upon the execution by a majority of the then
Trustees of an instrument setting forth the new name. Any such instrument shall
not require the approval of the holders of interests in the Trust, but shall
have the status of an amendment to this Declaration.
1.2 Trust Purpose. The purpose of the Trust is to conduct, operate and
carry on the business of an open-end management investment company registered
under the 1940 Act (defined below).
1.3 Definitions. As used in this Declaration, the following terms shall
have the following meanings:
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The "1940 Act" means the Investment Company Act of 1940, as amended
from time to time, and all terms and requirements that are defined herein by
reference to the 1940 Act shall be interpreted as that term or requirement has
been modified or interpreted by applicable orders of the Commission or any rules
or regulations adopted by, or interpretive releases of the Commission or its
staff, and staff no-action letters issued under the 1940 Act.
The terms "Affiliated Person", "Assignment" and "Interested Person"
shall have the meanings given them in the 1940 Act.
"Adjusted Book Capital Account Deficit" shall mean, with respect to any
Holder, the deficit balance, if any, in such Holder's Book Capital Account as of
the end of any fiscal year and after giving effect to the following adjustments:
(i) credit to such Book Capital Account any amounts which such Holder is
obligated or treated as obligated to restore with respect to any deficit balance
in such Book Capital Account pursuant to Treasury Regulations Section
1.704-1(b)(2)(ii)(c), or is deemed to be obligated to restore with respect to
any deficit balance pursuant to the penultimate sentences of Treasury
Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and (ii) debit to such
Book Capital Account the items described in Treasury Regulations Sections
1.704-1(b)(2)(ii)(d)(4), (5) and (6). The foregoing definition of Adjusted Book
Capital Account Deficit is intended to comply with the requirements of the
alternate test for economic effect contained in Treasury Regulations Section
1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.
"Administrator" shall mean any party furnishing services to the Trust
pursuant to any administrative services contract described in Section 4.1
hereof.
"Book Capital Account" means, with respect to any Holder, the Capital
Account maintained for such Holder on a daily basis in accordance with Article
VII of this Declaration of Trust.
"By-Laws" shall mean the By-Laws of the Trust as amended from time to
time.
"Class" or "Class of Interests" refers to the division of Interests
representing any Series into two or more classes.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, or any corresponding federal income tax statute enacted after the
date hereof. A reference to a specific Section of the Code refers not only to
such specific Section but also to any corresponding provision of any federal
income tax statute enacted after the date hereof.
"Commission" shall mean the U.S. Securities and Exchange Commission.
"Declaration" shall mean this Declaration of Trust as amended from time
to time. References in this Declaration to "Declaration", "hereof", "herein" and
"hereunder" shall be deemed to refer to the Declaration rather than the article
or section in which such words appear.
"DBTA" shall mean the Delaware Business Trust Act, Del. Code. Ann. tit.
12,ss.ss. 3801-3822, as amended from time to time.
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"Fiscal Year" shall mean an annual period as determined by the Trustees
unless otherwise provided by the Code or applicable regulations.
"Holders" shall mean, as of any particular time any or all holders of
record of Interests in the Trust or in Trust Property, as the case may be, at
such time.
"Interest(s)" shall mean the interest of a Holder in the Trust or in
Trust Property, as the case may be, including all rights, powers and privileges
accorded to Holders in this Declaration.
"Interested Person" shall have the same meaning as that described in
Section 2(a)(19) of the 1940 Act.
"Investment Adviser" shall mean any party furnishing services to the
Trust pursuant to any investment advisory contract described in Section 4.1
hereof.
"Majority Interests Vote" means "the vote of a majority of the
outstanding voting securities" as defined in the 1940 Act.
"Net Losses" of a Series for any given time period shall mean the
excess of the net asset value of the Series as of the opening of the business on
the first day of the period, after any additional contributions made on such
date, over the net asset value of the Series at the close of business on the
last day of such period, prior to any distribution being made; provided that
items allocated pursuant to Section 7.2(d) shall be excluded from the definition
of Net Losses.
"Net Profits" of a Series for any given time period shall mean the
excess of the net asset value of the Series as of the opening of business on the
first day of the period, after any distribution being made with respect to such
period, over the net asset value of the Series as of the opening of business on
the first day of such period, after any additional contributions made on such
date; provided that items allocated pursuant to Section 7.2(d) shall be excluded
from the definition of Net Profits.
"Outstanding Interests" means Interests shown in the books and records
of the Trust or its fund accountant as then issued and outstanding, but does not
include any Interests that have been repurchased or redeemed by the Trust and
are being held in the treasury of the Trust.
"Percentage Interest" shall mean, with respect to any Holder, as of any
day, the ratio (expressed as a percentage) of such Holder's Book Capital
Account, as of close of business on the preceding day to the aggregate Book
Capital Accounts of all Holders as of the close of business on such preceding
day, such Book Capital Accounts to be determined.
"Person" shall mean and include individuals, corporations,
partnerships, limited liability companies, trusts, associations, joint ventures
and other entities, whether or not legal entities, and governments and agencies
and political subdivisions thereof.
"Registration Statement" shall mean the currently effective
Registration Statement of the Trust under the 1940 Act.
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"Treasury Regulations" shall mean the Income Tax Regulations, including
temporary regulations, promulgated under the Code, as such regulations may be
amended from time to time (including corresponding provisions of succeeding
regulations).
"Trust Property" shall mean as of any particular time any and all
property, real or personal, tangible or intangible, which at such time is owned
or held by or for the account of the Trust or the Trustees. The Trustees may
authorize the division of Trust Property into two or more Series, in accordance
with the provisions of Section 9.8 hereof, in which case all references in this
Declaration to the Trust, Trust Property, Interests therein or Holders thereof
shall be deemed to refer to each such Series, as the case may be, except as the
context otherwise requires. Any Series of Trust Property shall be established
and designated, and the variations in the relative rights and preferences as
between the different Series shall be fixed and determined, by the Trustees. The
voting rights of Interests in the Trust Property shall be governed by Section
18(f)(2) of the 1940 Act and Rule 18f-2 thereunder, as amended from time to
time, or upon repeal thereof, in such other manner as the Trustees shall
establish in the Trust's By-Laws.
"Series" or "Series of Interest" refers to the one or more separate
investment portfolios of the Trust into which the assets and liabilities of the
Trust may be divided and the Interests of the Trust representing the beneficial
interest of Holders in such respective portfolios.
ARTICLE II
Trustees
2.1 Number and Qualification. The number of Trustees, if different from
the number of initial Trustees, shall be fixed from time to time by written
instrument signed by, or by a resolution approved by, a majority of the Trustees
so fixed then in office, provided, however, that the number of Trustees shall in
no event be less than three or more than fifteen. Any vacancy created by an
increase in Trustees may be filled by the appointment of an individual having
the qualifications described in this Article made by a written instrument signed
by, or by a resolution approved by, a majority of the Trustees then in office.
Any such appointment shall not become effective, however, until the individual
named in the written instrument of appointment shall have accepted in writing
such appointment and agreed in writing to be bound by the terms of this
Declaration. No reduction in the number of Trustees shall have the effect of
removing any Trustee from office. Whenever a vacancy in the number of Trustees
shall occur, until such vacancy is filled as provided in Section 2.4 hereof, the
Trustees in office, regardless of their number, shall have all the powers
granted to the Trustees and shall discharge all the duties imposed upon the
Trustees by this Declaration. A Trustee shall be an individual at least 21 years
of age who is not under legal disability.
2.2 Term and Election. Each Trustee named herein, or elected or
appointed prior to the first meeting of the Holders, shall (except in the event
of resignations or removals or vacancies pursuant to Section 2.3 or 2.4 hereof)
hold office until his or her successor has been elected at such meeting and has
qualified to serve as Trustee, as required under the 1940 Act. Beginning with
the Trustees elected at the first meeting of Holders, each Trustee shall hold
office during the lifetime of this Trust and until its termination as
hereinafter provided unless such Trustee resigns or is removed as provided in
Section 2.3 below.
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2.3 Resignation and Removal. Any Trustee may resign (without need for
prior or subsequent accounting) by an instrument in writing signed by him or her
and delivered or mailed to the Chairman, if any, the President or the Secretary
and such resignation shall be effective upon such delivery, or at a later date
according to the terms of the instrument. Any of the Trustees may be removed by
the affirmative vote of the Holders of two-thirds (2/3) of the Interests or
(provided the aggregate number of Trustees, after such removal and after giving
effect to any appointment made to fill the vacancy created by such removal,
shall not be less than the number required by Section 2.1 hereof) with cause, by
the action of two-thirds of the remaining Trustees. Removal with cause includes,
but is not limited to, the removal of a Trustee due to physical or mental
incapacity. Upon the resignation or removal of a Trustee, or his or her
otherwise ceasing to be a Trustee, he or she shall execute and deliver such
documents as the remaining Trustees shall require for the purpose of conveying
to the Trust or the remaining Trustees any Trust Property held in the name of
the resigning or removed Trustee. Upon the death of any Trustee or upon removal
or resignation due to any Trustee's incapacity to serve as Trustee, his or her
legal representative shall execute and deliver on his or her behalf such
documents as the remaining Trustees shall require as provided in the preceding
sentence.
2.4 Vacancies. The term of office of a Trustee shall terminate and a
vacancy shall occur in the event of the death, resignation, adjudicated
incompetence or other incapacity to perform the duties of the office, or
removal, of a Trustee. No such vacancy shall operate to annul this Declaration
or to revoke any existing agency created pursuant to the terms of this
Declaration. In the case of a vacancy, the Holders of at least a majority of the
Interests entitled to vote, acting at any meeting of the Holders held in
accordance with Section 9.1 hereof, or, to the extent permitted by the 1940 Act,
a majority vote of the Trustees continuing in office acting by written
instrument or instruments, may fill such vacancy, and any Trustee so elected by
the Trustees or the Holders shall hold office as provided in this Declaration.
2.5 Meetings. Meetings of the Trustees shall be held from time to time
upon the call of the Chairman, if any, the President, the Chief Operating
Officer, if any, the Secretary, an Assistant Secretary or any two Trustees.
Regular meetings of the Trustees may be held without call or notice at a time
and place fixed by the By-Laws or by resolution of the Trustees. Notice of any
other meeting shall be mailed or otherwise given not less than 24 hours before
the meeting but may be waived in writing by any Trustee either before or after
such meeting. The attendance of a Trustee at a meeting shall constitute a waiver
of notice of such meeting except where a Trustee attends a meeting for the
express purpose of objecting to the transaction of any business on the ground
that the meeting has not been lawfully called or convened. The Trustees may act
with or without a meeting. A quorum for all meetings of the Trustees shall be
one-third (1/3) of the total number of Trustees, but no less than two Trustees.
Unless provided otherwise in this Declaration, any action of the Trustees may be
taken at a meeting by vote of a majority of the Trustees present (a quorum being
present) or without a meeting by written consent of all the Trustees. If there
be less than a quorum present at any meeting of the Trustees, a majority of
those present may adjourn the meeting until a quorum shall have been obtained.
Any committee of the Trustees, including an executive committee, if
any, may act with or without a meeting. A quorum for all meetings of any such
committee shall be two or more of the members thereof, unless the Board of
Trustees shall provide otherwise. Unless provided otherwise in this Declaration,
any action of any such committee may be taken at a meeting by vote of a majority
of the members present (a quorum being present) or without a meeting by written
consent of all of the members.
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With respect to actions of the Trustees and any committee of the
Trustees, Trustees who are Interested Persons of the Trust or otherwise
interested in any action to be taken may be counted for quorum purposes under
this Section 2.5 and shall be entitled to vote to the extent permitted by the
1940 Act.
All or any one or more Trustees may participate in a meeting of the
Trustees or any committee thereof by means of a conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other and participating in a meeting pursuant to such
communications system shall constitute presence in person at such meeting,
unless the 1940 Act specifically requires the Trustees to act "in person," in
which case such term shall be construed consistent with Commission staff
releases or interpretations.
2.6 Officers; Chairman of the Board. The Trustees shall, from time to
time, elect a President, a Secretary and a Treasurer. The Trustees shall elect
or appoint, from time to time, a Chairman of the Board who shall preside at all
meetings of the Trustees and carry out such other duties as the Trustees shall
designate. The Trustees may elect or appoint or authorize the President to
appoint such other officers or agents with such powers as the Trustees may deem
to be advisable. The Chairman of the Board shall be and the President, Secretary
and Treasurer may, but need not, be a Trustee.
2.7 By-Laws. The Trustees may adopt and, from time to time, amend or
repeal the By-Laws for the conduct of the business of the Trust.
ARTICLE III
Powers of Trustees
3.1 General. The Trustees shall have exclusive and absolute control
over the Trust Property and over the business of the Trust to the same extent as
if the Trustees were the sole owners of the Trust Property and business in their
own right, but with such powers of delegation as may be permitted by this
Declaration. The Trustees may perform such acts as they deem, in their sole
discretion, to be proper, convenient or incidental for conducting the business
of the Trust. The enumeration of any specific power herein shall not be
construed as limiting the aforesaid power. Such powers of the Trustee may be
exercised without order of or recourse to any court.
3.2 Investments. The Trustees shall have power to:
(a) conduct, operate and carry on the business of an
investment company;
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(b) subscribe for, invest in, reinvest in, purchase or
otherwise acquire, hold, pledge, sell, assign, transfer, exchange, distribute or
otherwise deal in or dispose of United States and foreign currencies and related
instruments including forward contracts and securities, including common and
preferred stocks, warrants, bonds, debentures, time notes and all other
evidences of indebtedness, negotiable or non-negotiable instruments,
obligations, certificates of deposit or indebtedness, commercial paper,
repurchase agreements, reverse repurchase agreements, convertible securities,
options, futures contracts, and other securities, shares or interests,
including, without limitation, those issued, guaranteed or sponsored by any
state, territory or possession of the United States and the District of Columbia
and their political subdivisions, agencies and instrumentalities, or by the
United States Government, any foreign government, or any agency, instrumentality
or political subdivision of the United States Government or any foreign
government, or international instrumentalities, or by any bank, savings
institution, corporation or other business entity organized under the laws of
the United States or under foreign laws; and to exercise any and all rights,
powers and privileges of ownership or interest in respect of any and all such
investments of every kind and description, including, without limitation, the
right to consent and otherwise act with respect thereto, with power to designate
one or more persons, firms, associations, or corporations to exercise any of
said rights, powers and privileges in respect of any of said instruments; and
the Trustees shall be deemed to have the foregoing powers with respect to any
additional securities in which the Trustees may determine to invest.
The Trustees shall not be limited to investing in obligations
maturing before the possible termination of the Trust, nor shall the Trustees be
limited by any law limiting the investments which may be made by fiduciaries.
3.3 Legal Title. Legal title to all the Trust Property shall be vested
in the Trustees as joint tenants except that the Trustees shall have the power
to cause legal title to any Trust Property to be held by or in the name of one
or more of the Trustees, or in the name of the Trust, or in the name of any
other Person on behalf of the Trust on such terms as the Trustees may determine.
The right, title and interest of the Trustees in the Trust Property
shall vest automatically in each person who may hereafter become a Trustee upon
his or her due election and qualification. Upon the resignation, removal or
death of a Trustee, he or she shall automatically cease to have any right, title
or interest in any of the Trust Property, and the right, title and interest of
such Trustee in the Trust Property shall vest automatically in the remaining
Trustees. Such vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered.
3.4 Sale of Interests. Subject to the more detailed provisions set
forth in Articles VII and VIII, the Trustees shall have the power to issue,
sell, repurchase, redeem, retire, cancel, acquire, hold, resell, reissue,
dispose of, transfer, and otherwise deal in, Interests including Interests in
fractional denominations, and to apply to any such repurchase, redemption,
retirement, cancellation or acquisition of Interests any funds or other assets
of the appropriate Series or class of Interests, whether capital or surplus or
otherwise.
3.5 Borrow Money. The Trustees shall have power to borrow money or
otherwise obtain credit and to secure the same by mortgaging, pledging or
otherwise subjecting as security the assets of the Trust, including the lending
of portfolio securities, and to endorse, guarantee, or undertake the performance
of any obligation, contract or engagement of any other person, firm, association
or corporation.
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3.6 Delegation; Committees. The Trustees shall have the power,
consistent with their continuing exclusive authority over the management of the
Trust and the Trust Property, to delegate from time to time to such of their
number or to officers, employees or agents of the Trust the doing of such things
and the execution of such instruments either in the name of the Trust or the
names of the Trustees or otherwise as the Trustees may deem expedient.
3.7 Collection and Payment. The Trustees shall have power to collect
all property due to the Trust; and to pay all claims, including taxes, against
the Trust Property; to prosecute, defend, compromise or abandon any claims
relating to the Trust Property; to foreclose any security interest securing any
obligations, by virtue of which any property is owned to the Trust; and to enter
into releases, agreements and other instruments.
3.8 Expenses. The Trustees shall have the power to incur and pay any
expenses which in the opinion of the Trustees are necessary or incidental to
carry out any of the purposes of this Declaration, and to pay reasonable
compensation from the funds of the Trust to themselves as Trustees. The Trustees
shall fix the compensation of all officers, employees and Trustees. The Trustees
may pay themselves such compensation for special services, including legal and
brokerage services, as they in good faith may deem reasonable (and subject to
any limitations in the 1940 Act), and reimbursement for expenses reasonably
incurred by themselves on behalf of the Trust.
3.9 Miscellaneous Powers. The Trustees shall have the power to: (a)
employ or contract with such Persons as the Trustees may deem desirable for the
transaction of the business of the Trust and terminate such employees or
contractual relationships as they consider appropriate; (b) to cause the Trust
or any Series thereof to enter into joint ventures, partnerships, limited
liability companies and any other combinations or associations; (c) purchase,
and pay for out of Trust Property, insurance policies (including, but not
limited to, fidelity bonding and errors and omission) insuring the Investment
Adviser, Administrator, placement agent, Holders, Trustees, officers, employees,
agents, or independent contractors of the Trust against all claims arising by
reason of holding any such position or by reason of any action taken or omitted
by any such Person in such capacity, whether or not the Trust would have the
power to indemnify such Person against liability; (d) establish pension,
profit-sharing and other retirement, incentive and benefit plans for any
Trustees, officers, employees and agents of the Trust; (e) to the extent
permitted by law, indemnify any Person with whom the Trust has dealings,
including the Investment Adviser, Administrator, placement agent, Holders,
Trustees, officers, employees, agents or independent contractors of the Trust,
to such extent as the Trustees shall determine; (f) guarantee indebtedness or
contractual obligations of others; (g) determine and change the Fiscal Year of
the Trust, or any Series thereof, and the method by which its accounts shall be
kept; and (h) adopt a seal for the Trust, but the absence of such seal shall not
impair the validity of any instrument executed on behalf of the Trust.
3.10 Further Powers. The Trustees shall have power to conduct the
business of the Trust and carry on its operations in any and all of its branches
and maintain offices, whether within or without the State of Delaware, in any
and all states of the United States of America, in the District of Columbia, and
in any and all commonwealths, territories, dependencies, colonies, possessions,
agencies or instrumentalities of the United States of America and of foreign
countries, and to do all such other things and execute all such instruments as
they deem necessary, proper, desirable, convenient or incidental in order to
promote the interests of the Trust although such things are not herein
specifically mentioned. Any determination as to what is in the interests of the
Trust made by the Trustees in good faith shall be conclusive. In construing the
provisions of this Declaration, the presumption shall be in favor of a grant of
power to the Trustees. The Trustees will not be required to obtain any court
order to deal with Trust Property.
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ARTICLE IV
Investment Advisory, Administrative Services
and Placement Agency Arrangements
4.1 Investment Advisory and Other Arrangements. The Trustees may in
their discretion, from time to time, enter into investment advisory,
administrative services (including transfer and dividend disbursing agency
services), distribution, fiduciary (including custodian), placement agency
and/or other service contracts or agreements whereby the other party to such
contract or agreement shall undertake to furnish the Trustees such investment
advisory, administrative, distribution, fiduciary, placement agency and/or other
services as the Trustees shall, from time to time, consider desirable or
convenient and all upon such terms and conditions as the Trustees may in their
discretion determine. Notwithstanding any provisions of this Declaration, the
Trustees may authorize any Investment Adviser (subject to such general or
specific instructions as the Trustees may, from time to time, adopt) to effect
purchases, sales, loans or exchanges of Trust Property on behalf of the Trustees
or may authorize any officer, employee or Trustee to effect such purchases,
sales, loans or exchanges pursuant to recommendations of any such Investment
Adviser (and all without further action by the Trustees). Any such purchases,
sales, loans and exchanges shall be deemed to have been authorized by all of the
Trustees.
4.2 Parties to Contract. Any contract or agreement of the character
described in Section 4.1 of this Article IV or in the By-Laws of the Trust may
be entered into with any Person, although one or more of the Trustees or
officers of the Trust may be an employee, officer, director, trustee,
shareholder, or member of such other party to the contract or agreement, and no
such contract or agreement shall be invalidated or rendered voidable by reason
of the existence of any such relationship, nor shall any person holding such
relationship be liable merely by reason of such relationship for any loss or
expense to the Trust under or by reason of said contract or agreement or
accountable for any profit realized directly or indirectly therefrom, provided
that the contract or agreement when entered into was reasonable and fair and not
inconsistent with the provisions of this Article IV or the By-Laws.
ARTICLE V
Limitations of Liability
5.1 No Personal Liability of Trustees, Officers or Employees; Liability
of Holders; Indemnification. No Trustee, officer or employee of the Trust, when
acting in such capacity, shall be subject to any personal liability whatsoever,
in his or her official or individual capacity to any Person, other than the
Trust or its Holders, in connection with Trust Property or the affairs of the
Trust, save only that arising from his or her bad faith, willful misfeasance,
gross negligence or reckless disregard of his or her duty to such Person; and
all such Persons shall look solely to the Trust Property for satisfaction of
claims of any nature against a Trustee, officer or employee of the Trust arising
in connection with the affairs of the Trust.
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5.2 Non-liability of Trustees, etc. No Trustee, officer or employee of
the Trust shall be liable to the Trust, Holders of Interests therein, or to any
Trustee, officer or employee thereof for any action or failure to act
(including, without limitation, the failure to compel in any way any former or
acting Trustee to redress any breach of trust) except for his or her own bad
faith, willful misfeasance, gross negligence or reckless disregard of his or her
duties.
5.3 Mandatory Indemnification. The Trust shall indemnify each of its
Trustees, officers and employees (including Persons who serve at its request as
directors, officers or trustees of another organization in which it has any
interest, as a shareholder, creditor or otherwise) against all liabilities and
expenses (including amounts paid in satisfaction of judgments, in compromise, as
fines and penalties, and as counsel fees) reasonably incurred by him or her in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, in which he or she may be involved or
with which he or she may be threatened, while in office or thereafter, by reason
of his or her being or having been such a Trustee, officer or employee, except
with respect to any matter as to which he or she shall have been adjudicated to
have acted in bad faith, willful misfeasance, gross negligence or reckless
disregard of his or her duties; provided, however, that as to any matter
disposed of by a compromise payment by such Person, pursuant to a consent decree
or otherwise, no indemnification either for said payment or for any other
expenses shall be provided unless there has been a determination that such
Person did not engage in willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his or her office by
the court or other body approving the settlement or other disposition or by a
reasonable determination, based upon a review of readily available facts (as
opposed to a full trial type inquiry), that he or she did not engage in such
conduct by written opinion from independent legal counsel approved by the
Trustees. The rights accruing to any Person under these provisions shall not
exclude any other right to which he or she may be lawfully entitled; provided
that no Person may satisfy any right of indemnity or reimbursement granted
herein or in Section 5.1 or to which he or she may be otherwise entitled except
out of the Trust Property. The Trustees may make advance payments in connection
with indemnification under this Section 5.3, provided that the indemnified
Person shall have given a written undertaking to reimburse the Trust in the
event it is subsequently determined that he or she is not entitled to such
indemnification.
5.4 No Bond Required of Trustees. No Trustee shall, as such, be
obligated to give any bond or surety or other security for the performance of
any of his or her duties hereunder.
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5.5 No Duty of Investigation; Notice in Trust Instruments. No
purchaser, lender, or other Person dealing with the Trustees or any officer or
employee of the Trust shall be bound to make any inquiry concerning the validity
of any transaction purporting to be made by the Trustees or by said officer or
employee or be liable for the application of money or property paid, loaned, or
delivered to or on the order of the Trustees or of said officer, employee or
agent. Every obligation, contract, instrument, certificate or other interest or
undertaking of the Trust, and every other act or thing whatsoever executed in
connection with the Trust shall be conclusively taken to have been executed or
done by the executors thereof only in their capacity as Trustees, officers,
employees or agents of the Trust. Every written obligation, contract,
instrument, certificate or other interest or undertaking of the Trust made or
sold by the Trustees or by any officer, employee or agent of the Trust, in his
or her capacity as such, shall contain an appropriate recital to the effect that
the Trustee, officer, employee and agent of the Trust shall not personally be
bound by or liable thereunder, nor shall resort be had to their private property
for the satisfaction of any obligation or claim thereunder, and appropriate
references shall be made therein to the Declaration, and may contain any further
recital which they may deem appropriate, but the omission of such recital shall
not operate to impose personal liability on any of the Trustees, officers,
employees or agents of the Trust. The Trustees may maintain insurance for the
protection of the Trust Property, Holders, Trustees, officers, employees and
agents in such amount as the Trustees shall deem adequate to cover possible tort
liability, and such other insurance as the Trustees in their sole judgment shall
deem advisable.
5.6 Reliance on Experts, etc. Each Trustee and officer or employee of
the Trust shall, in the performance of his or her duties, be fully and
completely justified and protected with regard to any act or any failure to act
resulting from reliance in good faith upon the books of account or other records
of the Trust, upon an opinion of counsel, or upon reports made to the Trust by
any of its officers or employees or by any Investment Adviser, Administrator,
accountant, appraiser or other experts or consultants selected with reasonable
care by the Trustees, officers or employees of the Trust, regardless of whether
such counsel or expert may also be a Trustee.
ARTICLE VI
Interests in the Trust
6.1 Interests. The Interests of the Trust shall be issued in one or
more Series as the Trustees may, without Holder approval, authorize. Each Series
shall be preferred over all other Series in respect of the assets allocated to
that Series and shall represent a separate investment portfolio of the Trust.
The beneficial interest in each Series at all times shall be divided into
Interests, with or without par value as the Trustees may from time to time
determine, each of which shall, except as provided in the following sentence,
represent an equal proportionate interest in the Series with each other Interest
of the same Series, none having priority or preference over another. The
Trustees may, without Holder approval, divide Interests of any Series into two
or more classes, Interests of each such class having such preferences and
special or relative rights and privileges (including conversion right, if any)
as the Trustees may determine. The number of Interests authorized shall be
unlimited, and the Interests so authorized may be represented in part by
fractional Interests. From time to time, the Trustees may divide, without Holder
approval, or combine the Interests of any Series or class into a greater or
lesser number without thereby changing the proportionate beneficial interests in
the Series or class.
6.2 Rights of Holders. The ownership of the Trust Property of every
description and the right to conduct any business hereinbefore described are
vested exclusively in the Trustees, and the Holders shall have no right or title
therein other than the beneficial interest conferred by their Interests and they
shall have no right to call for any partition or division of any property,
profits or rights of the Trust. The Interests shall be personal property giving
only the rights in this Declaration specifically set forth.
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6.3 Purchase of or Increase in Interests. The Trustees, in their
discretion, may, from time to time, without a vote of the Holders, permit the
purchase of Interests by such party or parties (or increase in the Interest of a
Holder) and for such type of consideration, including cash or property, at such
time or times (including, without limitation, each business day), and on such
terms as the Trustees may determine in their sole discretion, and may in such
manner acquire other assets (including the acquisition of assets subject to, and
in connection with the assumption of, liabilities) and businesses.
6.4 Register of Interests. A register shall be kept at the Trust under
the direction of the Trustees which shall contain the names and addresses of the
Holders. Each such register shall be conclusive as to who are the Holders of
each Series of Interests in the Trust and who shall be entitled to payments of
distributions or otherwise to exercise or enjoy the rights of Holders. No Holder
shall be entitled to receive payment of any distribution, nor to have notice
given to it as herein provided, until it has given its address to such officer
or agent of the Trustees as shall keep the said register for entry thereon.
6.5 Notices. Any and all notices to which any Holder hereunder may be
entitled and any and all communications shall be deemed duly served or given if
mailed, postage prepaid, addressed to any Holder of record at its last known
address as recorded on the register of the Trust.
6.6 Tax Matters. It is the intention of the parties hereto that each
Series be treated for tax purposes as a partnership. The provisions hereof shall
be interpreted accordingly and no party hereto (and no Holder) shall take a
contrary position for tax purposes.
ARTICLE VII
Determination of Book Capital Account Balances
and Allocations
7.1 Book Capital Account Balances. A Book Capital Account shall be
maintained for each Holder of each Series. With respect to each Series, each
Book Capital Account shall be credited with the amounts of consideration paid by
the Holder to purchase or increase its interest in the Series and with its share
of the Series' Net Profits, shall be charged with such Holder's share of the
Series Net Losses, distributions and withholding taxes (if any) and shall
otherwise appropriately reflect transactions of the Series and the Holders. No
interest shall be paid on any amount of consideration paid to the Trust to
purchase or increase Interests.
(a) The Book Capital Account Balances of Holders of each
Series shall be determined periodically at such time or times as the Trustees
may determine. The power and duty to make such calculations may be delegated to
the custodian, fund accountant or any other person as the Trustees may
determine;
(b) Notwithstanding any other provision of this Declaration,
the Book Capital Accounts of the Holders and the shall at all times be
determined and maintained in compliance with Treasury Regulations Section
1.704-1(b)(2)(iv). The Trustees are authorized to prescribe in their absolute
discretion, such policies for the maintenance of such Accounts as they consider
comply with requirements of the Code.
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7.2 Allocation of Net Profits and Net Losses.
(a) Net Profits and Net Losses of each Series shall be
determined and allocated daily as of the close of business to and among Holders
of that Series in proportion to their respective interests in the Series,
determined as of the opening of business on such day.
(b) Except as otherwise provided in this Section, for each
fiscal year, items of income, deduction, gain, loss or credit that are
recognized by a Series for tax purposes shall be allocated pursuant to Treasury
Department Regulations ss. 1.704-1(b) in such manner as to equitably reflect
amounts credited or debited to the Book Capital Account of each Holder with
respect to that Series for such year. Allocations of such items also shall be
made, where appropriate, in accordance with Section 704(c) of the Code and the
regulations thereunder, as may be provided in any Policies adopted by the
Trustees.
(c) Expenses of a Series, if any, which are borne by any
Holder of that Series in its individual capacity shall be specially allocated to
that Holder;
(d) Notwithstanding the foregoing, the following shall apply:
(i) To the extent any losses or deduction otherwise
allocable to an Holder hereunder would cause such Holder (hereinafter, a
"Restricted Holder") to have an Adjusted Book Capital Account Deficit with
respect to its Book Capital Account as of the end of the fiscal year to which
such losses or deduction relate, such losses and deduction shall not be
allocated to such Restricted Holder and instead shall be allocated to the other
Holders in the same Series as the Restricted Holder pro rata in accordance with
their respective interests in such Series.
(ii) In the event any Holder unexpectedly receives
any adjustments, allocations or distributions described in Treasury Regulations
Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), and such Holder has an Adjusted
Book Capital Account Deficit, items of income and gain shall be specially
allocated to such Holder in an amount and manner sufficient to eliminate the
Adjusted Book Capital Account Deficit as quickly as possible. This clause is
intended to constitute a "qualified income offset" under Treasury Regulations
Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.
(iii) To the extent that Treasury Regulations Section
1.704-1(b)(2)(iv)(m) requires that Book Capital Accounts be adjusted with
respect to an adjustment to the basis of a Series' property pursuant to a Code
Section 754 election, such adjustment shall be treated as an item of income,
gain or loss and allocated to the Holders as appropriate.
(iv) To the extent necessary to avoid any economic
distortions which may result from application of the Regulatory Allocations,
future items of income, gain, loss, expense and deduction shall be allocated as
appropriate in the reasonable discretion of the Trustees in order to remedy any
economic distortions that the Regulatory Allocations might otherwise cause. For
purposes hereof, "Regulatory Allocations" shall mean the allocations provided
under Sections 7.2(d)(i) through 2(d)(ii).
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7.3 Power to Modify the Foregoing Procedures. Notwithstanding any other
provision of this Article, the Trustees may prescribe, in their absolute
discretion, such other bases and times for determining, for financial reporting
and/or tax accounting purposes, (a) the Net Profits, Net Losses, taxable income,
tax loss, and/or net assets of any Series (or, where appropriate in the
Trustee's judgment, the Trust as a whole), and/or (b) the allocations of the Net
Profits or Net Losses and taxable income or tax loss so determined among, or the
payment of distributions to, the Holders of any Series as they deem necessary or
desirable to enable the Trust or any Series to comply with any provision of the
1940 Act, the Code, or any rule or regulation thereunder, or any order of
exemption issued by the Commission, all as in effect now or hereafter amended or
modified.
ARTICLE VIII
Distributions and Redemptions
8.1 Distributions. The Trustees may distribute periodically to the
Holders of each Series of Interests an amount approximately equal to the net
income of that Series, as determined by the Trustees or as they may authorize in
their discretion. The Trustees also may distribute from time to time to the
Holders of any one or more Series an amount equal to all or part of the gain
realized on the sale or disposition of the assets of the Series or all or part
of the principal of the Trust or Series. The amount and payment of distributions
and their form, whether they are in cash, Interests or other Trust Property,
shall be determined by the Trustees in their discretion. Dividends and other
distributions may be paid pursuant to a standing resolution adopted once or more
often as the Trustees determine. All distributions on Interests of a particular
Series shall be distributed pro rata to the Holders of that Series in proportion
to the number of Interests of that Series they held on the record date
established for such payment, except that such dividends and distributions shall
appropriately reflect expenses allocated to a particular Class of such Series.
The Trustees may adopt and offer to Holders such dividend reinvestment plans,
cash dividend payout plans or similar plans as the Trustees deem appropriate.
8.2 Determination of Net Income. In determining the net income of each
Series or Class of Interests for any period, there shall be deducted from income
for that period (a) such portion of all charges, taxes, expenses and liabilities
due or accrued as the Trustees shall consider properly chargeable and fairly
applicable to income for that period or any earlier period and (b) whatever
reasonable reserves the Trustees shall consider advisable for possible future
charges, taxes, expenses and liabilities which the Trustees shall consider
fairly chargeable and fairly applicable to income for that period or any earlier
period. The net income of each Series or Class for any period may be adjusted
for amounts included on account of net income in the net asset value of
Interests issued or redeemed or repurchased during that period. In determining
the net income of a Series or Class for a period ending on a date other than the
end of its fiscal year, income may be estimated as the Trustees shall deem fair.
Gains on the sale or disposition of assets shall not be treated as income, and
losses shall not be charged against income unless appropriate under applicable
accounting principles, except in the exercise of the discretionary powers of the
Trustees. Any amount contributed to the Trust which is received as income
pursuant to a decree of any court of competent jurisdiction shall be applied as
required under such decree.
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8.3 Redemptions. As required under the 1940 Act, each Shareholder of a
Series shall have the right at such times as may be determined by the Trustees
to require the Series to redeem all or any part of his or her Interests at a
redemption price per Interest equal to the Net Asset Value per Share at such
time as the Trustees shall have prescribed by resolution, less any applicable
charges or sales loads. In the absence of such resolution, the redemption price
per Share shall be the Net Asset Value next determined after receipt by the
Series of a request for redemption in proper form less such charges as are
determined by the Trustees and described in the Trust's Registration Statement
for that Series under the Securities Act of 1933 and/or the 1940 Act. The
Trustees may specify conditions, prices, and places of redemption, and may
specify binding requirements for the proper form or forms of requests for
redemption. Payment of the redemption price may be wholly or partly in
securities or other assets at the value of such securities or assets used in
such determination of Net Asset Value, or may be in cash. Upon redemption,
Interests shall not be cancelled and may be reissued from time to time. The
Trustees may require Holders to redeem Interests for any reason under terms set
by the Trustees, including the failure of a Holder to supply a personal
identification number if required to do so, or to have the minimum investment
required, or to pay when due for the purchase of Interests issued to him. To the
extent permitted by law, the Trustees may retain the proceeds of any redemption
of Interests required by them for payment of amounts due and owing by a Holder
to the Trust or any Series or Class. Notwithstanding the foregoing, the Trustees
may postpone payment of the redemption price and may suspend the right of the
Holders to require any Series or Class to redeem Interests during any period of
time when and to the extent permissible under the 1940 Act.
8.4 Determination of Net Asset Value. The Trustees shall cause the Net
Asset Value of Interests of each Series or Class to be determined from time to
time in a manner consistent with the 1940 Act. The Trustees may delegate the
power and duty to determine Net Asset Value per Interest to one or more Trustees
or officers of the Trust or to a custodian, depository or other agent appointed
for such purpose. The Net Asset Value of Interests shall be determined
separately for each Series or Class at such times as may be prescribed by the
Trustees or, in the absence of action by the Trustees, as of the close of
regular trading on the New York Stock Exchange on each day such Exchange is open
for trading.
8.5 Suspension of Right of Redemption. If, as referred to in Section 2
of this Article, the Trustees postpone payment of the redemption price and
suspend the right of Holders to redeem their Interests, such suspension shall
take effect at the time the Trustees shall specify, but not later than the close
of business on the business day next following the declaration of suspension.
Thereafter Holders shall have no right of redemption or payment until the
Trustees declare the end of the suspension. If the right of redemption is
suspended, a Holder may either withdraw his or her request for redemption or
receive payment based on the Net Asset Value per Share next determined after the
suspension terminates.
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ARTICLE IX
Holders
9.1 Meetings of Holders. Meetings of the Holders may be called at any
time by a majority of the Trustees and shall be called by any Trustee upon
written request of Holders holding, in the aggregate, not less than 10% of the
Interests in the Trust, or, with respect to a Meeting of the Holders of one or
more Series, not less than 10% of the Interests of the affected Series, such
request specifying the purpose or purposes for which such meeting is to be
called. Any such meeting shall be held within or without the State of Delaware
on such day and at such time as the Trustees shall designate. Holders of
one-third of the Interests in the Trust, or with respect to a Meeting of the
Holders of one or more Series, holders of one-third of the Interests of that
Series, present in person or by proxy, shall constitute a quorum for the
transaction of any business, except as may otherwise be required by the 1940 Act
or other applicable law or by this Declaration or the By-Laws of the Trust. If a
quorum is present at a meeting, an affirmative vote by the Holders present, in
person or by proxy, holding more than 50% of the total Interests of the Holders
present, either in person or by proxy, at such meeting constitutes the action of
the Holders, unless the 1940 Act, other applicable law, this Declaration or the
By-Laws of the Trust require a greater number of affirmative votes.
9.2 Notice of Meetings. Written or printed notice of all meetings of
the Holders, stating the time, place and purposes of the meeting, shall be given
by the Trustees either by presenting it personally to a Holder, leaving it at
his or her residence or usual place of business, or by mailing it to a Holder,
at his or her registered address, at least 20 calendar days and not more than 90
calendar days before the meeting. If mailed, such notice shall be deemed to be
given when deposited in the United States mail addressed to the Holder at his or
her address as it is registered with the Trust, with postage thereon prepaid. At
any such meeting, any business properly before the meeting may be considered
whether or not stated in the notice of the meeting. Any adjourned meeting may be
held as adjourned without further notice.
9.3 Record Date for Meetings For the purpose of determining the Holders
who are entitled to notice of any to vote at any meeting, or to participate in
any distribution, or for the purpose of any other action, the Trustees may from
time to time fix a date, not more than 90 calendar days prior to the date of any
meeting of the Holders or payment of distributions or other action, as the case
may be, as a record date for the determination of the persons to be treated as
Holders of record for such purposes.
9.4 Proxies At any meeting of Holders, any Holder entitled to vote
thereat may vote by proxy, provided that no proxy shall be voted at any meeting
unless it shall have been placed on file with the Secretary, or with such other
officer or agent of the Trust as the Secretary may direct, for verification
prior to the time at which such vote shall be taken. Pursuant to a resolution of
a majority of the Trustees, proxies may be solicited in the name of one or more
Trustees or one or more of the officers of the Trust. Only Holders of record
shall be entitled to vote. Each Holder shall be entitled to a vote proportionate
to its Interest in the Trust. When Interests are held jointly by several
persons, any one of them may vote at any meeting in person or by proxy in
respect of such Interest, but if more than one of them shall be present at such
meeting in person or by proxy, and such joint owners or their proxies so present
disagree as to any vote to be cast, such vote shall not be received in respect
of such Interest. A proxy purporting to be executed by or on behalf of a Holder
shall be deemed valid unless challenged at or prior to its exercise, and the
burden of proving invalidity shall rest on the challenger. If the Holder is a
minor or a person of unsound mind, and subject to guardianship or to the legal
control of any other person regarding the charge or management of its Interest,
he or she may vote by his or her guardian or such other person appointed or
having such control, and such vote may be given in person or by proxy.
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9.5 Reports. The Trustees shall cause to be prepared, at least
annually, a report of operations containing a balance sheet and statement of
income and undistributed income of the Trust or each Series prepared in
conformity with generally accepted accounting principles and shall obtain an
opinion of an independent public accountant on such financial statements. The
Trustees shall, in addition, furnish to the Holders at least semi-annually,
interim reports containing an unaudited balance sheet as of the end of such
period and an unaudited statement of income and surplus for the period from the
beginning of the current Fiscal Year to the end of such period.
9.6 Inspection of Records. The records of the Trust shall be open to
inspection by Holders during normal business hours and for any purpose not
harmful to the Trust.
9.7 Voting Powers. The Holders shall have power to vote only (a) for
the election of Trustees as and to the extent required by the 1940 Act, (b) with
respect to any investment advisory contract as contemplated by Section 4.1
hereof, but only as and to the extent required by the 1940 Act, (c) with respect
to termination of the Trust as provided in Section 10.2 hereof, (d) with respect
to any amendment of the Declaration but only as and to the extent provided in
Section 10.3 hereof, (e) with respect to any merger, consolidation, conversion
or sale of assets but only as and to the extent provided in Section 10.4 hereof,
(f) with respect to incorporation of the Trust but only as and to the extent
provided in Section 10.4 hereof, and (g) with respect to such additional matters
relating to the Trust but only as and to the extent required by the 1940 Act,
DBTA, or any other applicable law, the Declaration, the By-Laws or any
registration of the Trust with the Commission (or any successor agency) or any
state, or as and when the Trustees may consider necessary or desirable. Each
Holder shall be entitled to vote based on the ratio its Interest bears to the
Interests of all Holders entitled to vote. Until Interests are issued, the
Trustees may exercise all rights of Holders and may take any action required by
law, the Declaration or the By-Laws to be taken by Holders. The By-Laws may
include further provisions for Holders' votes and meetings and related matters.
9.8 Series of Interests. If the Trustees shall divide the Trust
Property into two or more Series the following provisions shall be applicable:
(a) All consideration received by the Trust for the issue or
sale of Interests of a particular Series together with all Trust Property in
which such consideration is invested or reinvested, all income, earnings,
profits, and proceeds thereof, including any proceeds derived from the sale,
exchange or liquidation of such assets, and any funds or payments derived from
any reinvestment of such proceeds in whatever form the same may be, shall
irrevocably belong to that Series for all purposes, subject only to the rights
of creditors of such Series and except as may otherwise be required by
applicable tax laws, and shall be so recorded upon the books of account of the
Trust. In the event that there is any Trust Property, or any income, earnings,
profits, and proceeds thereof, funds, or payments which are not readily
identifiable as belonging to any particular Series, the Trustees shall allocate
them among any one or more of the Series established and designated from time to
time in such manner and on such basis as they, in their sole discretion, deem
fair and equitable. Each such allocation by the Trustees shall be conclusive and
binding upon the Holders of all Interests for all purposes.
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(b) The Trust Property belonging to each particular Series
shall be charged with the debts, liabilities and obligations of the Trust in
respect of that Series and all expenses, costs, charges and reserves
attributable to that Series, and any general liabilities, expenses, costs,
charges or reserves of the Trust which are not readily identifiable as belonging
to any particular Series shall be allocated and charged by the Trustees to and
among any one or more of the Series established and designated from time to time
in such manner and on such basis as the Trustees in their sole discretion deem
fair and equitable. Each allocation of liabilities, expenses, costs, charges and
reserves by the Trustees shall be conclusive and binding upon the Holders of all
Interests for all purposes. The Trustees shall have full discretion, to the
extent not inconsistent with the 1940 Act, to determine which items shall be
treated as income and which items as capital; and each such determination and
allocation shall be conclusive and binding upon the Holders. The assets of a
particular Series of the Trust shall, under no circumstances, be charged with
the debts, liabilities, obligations and expenses attributable to any other
Series of the Trust. All persons extending credit to, or contracting with or
having any claim against a particular Series of the Trust shall look only to the
assets of that particular Series for payment of such credit, contract or claim.
(c) The power of the Trustees to pay dividends and make
distributions shall be governed by Article VIII of this Declaration with respect
to the Interests in the Trust immediately prior to the establishment of two or
more Series. With respect to any Series, dividends and distributions on
Interests may be paid with such frequency as the Trustees may determine, which
may be daily or otherwise, pursuant to a standing resolution or resolution
adopted only once or with such frequency as the Trustees may determine, to the
Holders of Interests in that Series, from such of the income and capital gains,
accrued or realized, from the Trust Property belonging to that Series as the
Trustee may determine, after providing for actual and accrued liabilities
belonging to that Series. All dividends and distributions on Interests in a
particular Series shall be distributed pro rata to the Holders of Interests in
that Series in proportion to the total outstanding Interests in that Series held
by such Holders at the date and time of record establishment for the payment of
such dividends or distribution.
(d) The Interests in a Series of the Trust shall represent
beneficial interests in the Trust Property belonging to such Series. Each Holder
of Interests in a Series shall be entitled to receive its pro rata share of
distributions of income and capital gains made with respect to such Series. Upon
reduction or withdrawal of its Interests or indemnification for liabilities
incurred by reason of being or having been a Holder of Interests in a Series,
such Holder shall be paid solely out of the funds and property of such Series of
the Trust. Upon liquidation or termination of a Series of the Trust, Holders of
Interests in such Series shall be entitled to receive a pro rata share of the
Trust Property belonging to such Series. A Holder of Interests in a particular
Series of the Trust shall not be entitled to participate in a derivative or
class action lawsuit on behalf of any other Series or the Holders of Interests
in any other Series of the Trust.
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(e) Notwithstanding any other provision hereof, if the Trust
Property has been divided into two or more Series, then on any matter submitted
to a vote of Holders of Interests in the Trust, all Interests then entitled to
vote shall be voted by individual Series, except that (i) when required by the
1940 Act, Interests shall be voted in the aggregate and not by individual
Series, and (ii) when the Trustees have determined that the matter affects only
the interests of Holders of Interests in a limited number of Series, then only
the Holders of Interests in such Series shall be entitled to vote thereon.
Except as otherwise provided in this Article IX, the Trustees shall have the
power to determine the designations, preferences, privileges, limitations and
rights, including voting and dividend rights, of each Series of Interests.
(f) The establishment and designation of any Series of
Interests shall be effective upon the execution by a majority of the then
Trustees of an instrument, or by approval by a majority of the then Trustees of
a resolution, setting forth such establishment and designation and the relative
rights and preferences of such Series, or as otherwise provided in such
instrument or resolution. The Trustees may, in any such instrument or
resolution, designate a separate business purpose or investment objective for
any such Series. At any time that there are no Interests outstanding of any
particular Series previously established and designated, the Trustees may by an
instrument executed by a majority of their number terminate that Series and the
establishment and designation thereof. Each instrument or resolution referred to
in this paragraph shall have the status of an amendment to this Declaration.
(g) There shall initially be five Series of Interests
designated as "Nations Blue Chip Master Portfolio," "Nations Intermediate Bond
Master Portfolio," "Nations Marsico Focused Equities Master Portfolio," "Nations
Marsico Growth & Income Master Portfolio," "and Nations International Equity
Master Portfolio." Each such Series will consist of an unlimited number of
Interests, and shall have the rights and privileges as set forth herein.
9.9 Holder Action by Written Consent. Any action that may be taken by
Holders may be taken without a meeting if Holders holding more than 50% of the
total Interests entitled to vote (or such larger proportion thereof as may be
required by the 1940 Act, DBTA or any express provision of this Declaration)
shall consent to the action in writing and the written consents are filed with
the records of the meetings of Holders. Such consents shall be treated for all
purposes as a vote taken at a meeting of Holders.
9.10 No Pre-Emptive Rights; Derivative Suits. Holders shall have no
pre-emptive or other rights to subscribe for any additional Interests or other
securities issued by the Trust or any Series thereof. No action may be brought
by a Holder on behalf of the Trust unless Holders owning no less than 20% of the
then outstanding Interests join in the bringing of such action.
ARTICLE X
Duration; Termination of Trust;
Amendment; Mergers, Etc.
10.1 Duration. Subject to possible termination or dissolution in
accordance with the provision of Section 10.2, the Trust created hereby shall
continue perpetually pursuant to Section 3808 of the DBTA.
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10.2 Termination of Trust.
(a) The Trust may be terminated (i) by the affirmative vote of
more than 50% of the total Interests of the Holders present, in person or by
proxy, at a duly convened meeting or by an instrument in writing, without a
meeting, signed by a majority of the Trustees and consented to by the Holders of
more than 50% of such Interests, or (ii) by the Trustees by written notice to
the Holders. Upon any such termination:
(1) The Trust shall carry on no business except for
the purpose of winding up its affairs.
(2) The Trustees shall proceed to wind up the affairs
of the Trust and all of the powers of the Trustees under this Declaration shall
continue until the affairs of the Trust shall have been wound up, including the
power to fulfill or discharge the contracts of the Trust, collect its assets,
sell, convey, assign, exchange, or otherwise dispose of all or any part of the
remaining Trust Property to one or more Persons at public or private sale for
consideration which may consist in whole or in part of cash, securities or other
property of any kind, discharge or pay its liabilities, and do all other acts
appropriate to liquidate its business; provided that any sale, conveyance,
assignment, exchange, or other disposition of all or substantially all of the
Trust Property shall require approval of the principal terms of the transaction
and the nature and amount of the consideration by the vote of Holders holding
more than 50% of the total Interests entitled to vote.
(3) After paying or adequately providing for the
payment of all liabilities, and upon receipt of such releases, indemnities and
refunding agreements as they deem necessary for their protection, the Trustees
may distribute the remaining Trust Property, in cash or in kind or partly each,
among the Holders according to their respective rights.
(b) Upon termination of the Trust and distribution to the
Holders as herein provided, a majority of the Trustees shall (i) execute and
lodge among the records of the Trust an instrument in writing setting forth the
fact of such termination, and (ii) execute and file with the Delaware Secretary
of State a certificate of cancellation in accordance with the DBTA. Upon
termination of the Trust, the Trustees shall thereupon be discharged from all
further liabilities and duties hereunder, and the rights and interests of all
Holders shall thereupon cease.
(c) Notwithstanding anything herein to the contrary,
distributions in liquidation of a Series or of a Holder's interest therein shall
be made to the Holders whose interests are being liquidated in accordance with
their positive Book Capital Account balances after all other adjustments to such
Capital Accounts with respect to the year of liquidation. For purposes of this
provision, "liquidation" shall have the meaning ascribed to it in Treasury
Regulations Section 1.704-1(b)(2)(ii)(g). The timing of such liquidating
distributions shall comply with Treasury Regulations Sections 1.704-1 or any
similar regulation promulgated in the future, or if no such regulation exists,
as soon as possible.
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10.3 Amendment Procedure. This Declaration does not confer any
independent rights to Holders not expressly granted under the DBTA or 1940 Act.
Accordingly, this Declaration may be amended without Holder approval, and all
Holders purchase Interests with notice that this Declaration may be so amended
unless expressly required under the DBTA or 1940 Act. The Trustees may, without
any Holder vote, amend or otherwise supplement this Declaration by making an
amendment, a trust instrument supplemental hereto or an amended and restated
declaration of trust. Holders shall have the right to vote on any amendment but
only as and to the extent expressly required under the DBTA, the 1940 Act or
other applicable law, or submitted to them by the Trustees in their discretion.
10.4 Merger, Consolidation, Conversion and Sale of Assets. The Trust,
or any Series thereof, may (a) merge or consolidate with or into one or more
business trusts or other business entities (as defined in the DBTA) or another
Series thereof or any other organization formed or organized or existing under
the laws of the State of Delaware or any other state or the United States or any
foreign country or other foreign jurisdiction, (b) convert to a common-law
trust, a general partnership (including a registered limited liability
partnership), a limited partnership (including a registered limited liability
limited partnership) or a limited liability company organized, formed or created
under the laws of the State of Delaware, or (c) sell, assign, lease or exchange
all or substantially all of its property, including its good will, in each such
case, upon such terms and conditions and for such consideration when and as
authorized by no less than a majority of the Trustees. Such an action shall only
require a vote of Holders as and to the extent required by the DBTA or the 1940
Act. In accordance with Section 3815(f) of the DBTA, an agreement of merger or
consolidation may effect any amendment to the Declaration or By-Laws or effect
the adoption of a new declaration of trust or by-laws of the Trust if the Trust
is the surviving or resulting business trust.
ARTICLE XI
Miscellaneous
11.1 Certificate of Designation; Agent for Service of Process. The
Trust shall file, in accordance with Section 3812 of the DBTA, in the office of
the Secretary of State of the State of Delaware, a certificate of trust, in the
form and with such information required by Section 3810 by the DBTA and executed
in the manner specified in Section 3811 of the DBTA. In the event the Trust does
not have at least one Trustee qualified under Section 3807(a) of the DBTA, then
the Trust shall comply with Section 3807(b) of the DBTA by having and
maintaining a registered office in Delaware and by designating a registered
agent for service of process on the Trust, which agent shall have the same
business office as the Trust's registered office. The failure to file any such
certificate, to maintain a registered office, to designate a registered agent
for service of process, or to include such other information shall not affect
the validity of the establishment of the Trust, the Declaration, the By-Laws or
any action taken by the Trustees, the Trust officers or any other Person with
respect to the Trust except insofar as a provision of the DBTA would have
governed, in which case the Delaware common law governs.
11.2 Governing Law. This Declaration is executed by all of the Trustees
and delivered with reference to the DBTA and the laws of the State of Delaware,
and the rights of all parties and the validity and construction of every
provision hereof shall be subject to and construed according to DBTA and the
laws of the State of Delaware (unless and to the extent otherwise provided for
and/or preempted by the 1940 Act or other applicable federal securities laws).
Reference shall be specifically made to DBTA as to the construction of matters
not specifically covered herein or as to which an ambiguity exists (unless and
to the extent otherwise provided for and/or preempted by the 1940 Act or other
applicable Federal securities laws).
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11.3 Counterparts. This Declaration may be simultaneously executed in
several counterparts, each of which shall be deemed to be an original, and such
counterparts, together, shall constitute one and the same instrument, which
shall be sufficiently evidenced by any such original counterpart.
11.4 Reliance by Third Parties. Any certificate executed by an
individual who, according to the records of the Trust or of any recording office
in which this Declaration may be recorded, appears to be a Trustee hereunder,
certifying to: (a) the number or identity of Trustees or Holders, (b) the due
authorization of the execution of any instrument or writing, (c) the form of any
vote passed at a meeting of Trustees or Holders, (d) the fact that the number of
Trustees or Holders present at any meeting or executing any written instrument
satisfies the requirements of this Declaration, (e) the form of any By-Laws
adopted by or the identity of any officers elected by the Trustees, or (f) the
existence of any fact or facts which in any manner relate to the affairs of the
Trust, shall be conclusive evidence as to the matters so certified in favor of
any person dealing with the Trustees and their successors.
11.5 Provisions in Conflict With Law or Regulations.
(a) The provisions of this Declaration are severable, and if
the Trustees shall determine, with the advice of counsel, that any of such
provisions is in conflict with the 1940 Act, the DBTA, or with other applicable
laws and regulations, the conflicting provisions shall be deemed never to have
constituted a part of this Declaration; provided, however, that such
determination shall not affect any of the remaining provisions of this
Declaration or render invalid or improper any action taken or omitted prior to
such determination.
(b) If any provision of this Declaration shall be held invalid
or unenforceable in any jurisdiction, such invalidity or unenforceability shall
attach only to such provision in such jurisdiction and shall not in any manner
affect such provision in any other jurisdiction or any other provision of this
Declaration in any jurisdiction.
11.6 Trust Only. It is the intention of the Trustees to create only a
business trust under the DBTA with the relationship of Trustee and beneficial
owner between the Trustees and each Holder from time to time. It is not the
intention of the Trustees to create a general partnership, limited partnership,
joint stock association, corporation, bailment, or any form of legal
relationship other than a Delaware business trust. Nothing in this Declaration
of Trust shall be construed to make the Holders, either by themselves or with
the Trustees, partners or members of a joint stock association.
11.7 Withholding. Should any Holder be subject to withholding pursuant
to the Code, or any other provision of law, the Trust shall withhold all amounts
otherwise distributable to such Holder as shall be required by law and any
amounts so withheld shall be deemed to have been distributed to such Holder
under this Declaration of Trust. If any sums are withheld pursuant to this
provision, the Trust shall remit the sums so withheld to and file the required
forms with the Internal Revenue Service, or other applicable government agency.
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11.8 Headings and Construction. 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. Whenever the
singular number is used herein, the same shall include the plural; and the
neuter, masculine and feminine genders shall include each other, as applicable.
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the 14th day of January, 1999.
/s/ Edmund L. Benson, III
- -------------------------------
Edmund L. Benson, III, Trustee
/s/ James Ermer
- -------------------------------
James Ermer, Trustee
/s/ William H. Grigg
- -------------------------------
William H. Grigg, Trustee
/s/ Thomas F. Keller
- -------------------------------
Thomas F. Keller, Trustee
/s/ Carl E. Mundy, Jr.
- -------------------------------
Carl E. Mundy, Jr., Trustee
/s/ A. Max Walker
- -------------------------------
A. Max Walker, Trustee
/s/ Charles B. Walker
- -------------------------------
Charles B. Walker, Trustee
/s/ Thomas S. Word
- -------------------------------
Thomas S. Word, Trustee
/s/ James B. Sommers
- -------------------------------
James B. Sommers, Trustee
23
BY-LAWS
OF
NATIONS MASTER INVESTMENT TRUST
a Delaware Business Trust
January 14, 1999
Principal Place of Business:
One Bank of America Plaza
33rd Floor
Charlotte, North Carolina 28255
<PAGE>
BY-LAWS
OF
NATIONS MASTER INVESTMENT TRUST
These BY-LAWS are made as of the 14th day of January, 1999, and adopted
pursuant to Section 2.7 of the Declaration of Trust of NATIONS MASTER INVESTMENT
TRUST, dated as of January 14, 1999, as from time to time amended (hereinafter
called the "Declaration"). All words and terms capitalized in these By-Laws
shall have the meaning or meanings set forth for such words or terms in the
Declaration.
ARTICLE I
Meetings of Holders
Section 1.1 Annual Meeting. An annual meeting of the Holders of
Interests in the Trust, which may be held on such date and at such hour as may
from time to time be designated by the Board of Trustees (the "Trustees" or the
"Board") and stated in the notice of such meeting, is not required to be held
unless certain actions must be taken by the Holders as set forth in Section 9.7
of the Declaration, or except when the Trustees consider it necessary or
desirable.
Section 1.2 Chairman. The President or, in his absence, the Chief
Operating Officer shall act as chairman at all meetings of the Holders and, in
the absence of both of them, the Trustee or Trustees present at the meeting may
elect a temporary chairman for the meeting, who may be one of themselves or an
officer of the Trust.
Section 1.3 Proxies; Voting. Holders may vote either in person or by
duly executed proxy and each Holder shall be entitled to a vote proportionate to
his Interest in the Trust, all as provided in Article IX of the Declaration. No
proxy shall be valid after eleven (11) months from the date of its execution,
unless a longer period is expressly stated in such proxy.
Section 1.4 Fixing Record Dates. For the purpose of determining the
Holders who are entitled to notice of or to vote or act at a meeting, including
any adjournment thereof, or who are entitled to participate in any
distributions, or for any other proper purpose, the Trustees may from time to
time fix a record date in the manner provided in Section 9.3 of the Declaration.
If the Trustees do not, prior to any meeting of the Holders, so fix a record
date, then the date of mailing notice of the meeting shall be the record date.
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Section 1.5 Inspectors of Election. In advance of any meeting of the
Holders, the Trustees may appoint Inspectors of Election to act at the meeting
or any adjournment thereof. If Inspectors of Election are not so appointed, the
chairman, if any, of any meeting of the Holders may, and on the request of any
Holder or his proxy shall, appoint Inspectors of Election of the meeting. The
number of Inspectors shall be either one or three. If appointed at the meeting
on the request of one or more Holders or proxies, a Majority Interests Vote
shall determine whether one or three Inspectors are to be appointed, but failure
to allow such determination by the Holders shall not affect the validity of the
appointment of Inspectors of Election. In case any person appointed as Inspector
fails to appear or fails or refuses to act, the vacancy may be filled by
appointment made by the Trustees in advance of the convening of the meeting or
at the meeting by the person acting as chairman. The Inspectors of Election
shall determine the Interests owned by Holders, the Interests represented at the
meeting, the existence of a quorum, the authenticity, validity and effect of
proxies, shall receive votes, ballots or consents, shall hear and determine all
challenges and questions in any way arising in connection with the right to
vote, shall count and tabulate all votes or consents, determine the results, and
do such other acts as may be proper to conduct the election or vote with
fairness to all Holders. If there are three Inspectors of Election, the
decision, act or certificate of a majority is effective in all respects as the
decision, act or certificate of all. On request of the chairman, if any, of the
meeting, or of any Holder or his proxy, the Inspectors of Election shall make a
report in writing of any challenge or question or matter determined by them and
shall execute a certificate of any facts found by them.
Section 1.6 Records at Meetings of Holders. At each meeting of the
Holders, there shall be open for inspection the minutes of the last previous
meeting of Holders of the Trust and a list of the Holders of the Trust,
certified to be true and correct by the Secretary or other proper agent of the
Trust, as of the record date of the meeting. Such list of Holders shall contain
the name of each Holder in alphabetical order, the Holder's address and
Interests owned by such Holder. Holders shall have the right to inspect books
and records of the Trust during normal business hours and for any purpose not
harmful to the Trust.
ARTICLE II
Trustees
Section 2.1 Annual and Regular Meetings. Regular meetings of the
Trustees may be held without call or notice at such place or places and times as
the Trustees may by resolution provide from time to time.
Section 2.2 Special Meetings. Special Meetings of the Trustees shall be
held upon the call of the chairman, if any, the President, the Chief Operating
Officer, the Secretary, an Assistant Secretary or any two Trustees, at such
time, on such day and at such place, as shall be designated in the notice of the
meeting.
Section 2.3 Notice. Notice of a meeting shall be given by mail (which
term shall include overnight mail) or by telegram (which term shall include a
cablegram or telefacsimile) or delivered personally (which term shall include
notice by telephone). If notice is given by mail, it shall be mailed not later
than 72 hours preceding the meeting and if given by telegram or personally, such
notice shall be delivered not later than 24 hours preceding the meeting. Notice
of a meeting of Trustees may be waived before or after any meeting by signed
written waiver. Neither the business to be transacted at, nor the purpose of,
any meeting of the Board of Trustees need be stated in the notice or waiver of
notice of such meeting, and no notice need be given of action proposed to be
taken by written consent. The attendance of a Trustee at a meeting shall
constitute a waiver of notice of such meeting except where a Trustee attends a
meeting for the express purpose of objecting, at the commencement of such
meeting, to the transaction of any business on the ground that the meeting has
not been lawfully called or convened.
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Section 2.4 Chairman; Records. The Trustees may appoint a Chairman of
the Board from among their number. Such Chairman of the Board shall act as
chairman at all meetings of the Trustees; in his absence the President shall act
as chairman; and, in the absence of the Chairman of the Board and the President,
the Chief Operating Officer shall act as Chairman. In the absence of all of
them, the Trustees present shall elect one of their number to act as temporary
chairman. The results of all actions taken at a meeting of the Trustees, or by
written consent of the Trustees, shall be recorded by the Secretary.
Section 2.5 Qualifications of Trustees. Except as provided in the
following sentence, no person shall be qualified to stand for election or
appointment as a Trustee if such person has already reached the age of 70. Each
Trustee shall retire from service on the Board of Trustees no later than the end
of the calendar year in which such Trustee reaches age 70, provided that (i) any
Trustee who is a Trustee as of January 25, 1995 and who had reached the age of
70 prior to such date may continue to serve as a Trustee of the Company until
the end of the calendar year in which such Trustee reaches age 75 and may
continue to serve for successive annual periods thereafter upon the vote of a
majority of the other Trustees; and (ii) any person who has already reached the
age of 70 may stand for election or appointment, pursuant to a vote of the
Trustees, in connection with an investment company reorganization or merger, and
any such person may continue to serve for successive annual periods thereafter
upon the vote of a majority of the other Trustees.
Section 2.6 Audit Committee. The Trustees may, by the affirmative vote
of a majority of the entire Board, appoint from its members an Audit Committee
composed of two or more Trustees who are not "interested persons" (as defined in
the Investment Company Act of 1940, as amended (the "1940 Act")) of the Trust,
as the Board may from time to time determine. The Audit Committee shall: (a)
recommend independent public accountants for selection by the Board, (b) review
the scope of audit, accounting and financial internal controls and the quality
and adequacy of the Trust's accounting staff with the independent public
accountants and such other persons as may be deemed appropriate, (c) review with
the accounting staff and the independent public accountants the compliance of
transactions of the Trust with its investment adviser, administrator or any
other service provider with the financial terms of applicable contracts or
agreements, (d) review reports of the independent public accountants and comment
to the Board when warranted, (e) report to the Board at least once each year and
at such other times as the committee deems desirable, and (f) be directly
available at all times to independent public accountants and responsible
officers of the Trust for consultation on audit, accounting and related
financial matters.
Section 2.7 Nominating Committee of Trustees. The Trustees may, by the
affirmative vote of a majority of the entire Board, appoint from its members a
Trustee Nominating Committee composed of two or more Trustees. The Trustee
Nominating Committee shall recommend to the Board a slate of persons to be
nominated for election as Trustees by the Holders at a meeting of the Holders
and a person to be elected to fill any vacancy occurring for any reason in the
Board. Notwithstanding anything in this Section to the contrary, if the Trust
has in effect a plan pursuant to Rule 12b-1 under the 1940 Act, the selection
and nomination of those Trustees who are not "interested persons" (as defined in
the 1940 Act) shall be committed to the discretion of such disinterested
Trustees.
Section 2.8 Executive Committee. The Trustees may appoint from its
members an Executive Committee composed of those Trustees as the Board may from
time to time determine, of which committee the Chairman of the Board shall be a
member. In the intervals between meetings of the Board, the Executive Committee
shall have the power of the Board to: (a) determine the value of securities and
assets owned by the Trust, (b) elect or appoint officers of the Trust to serve
until the next meeting of the Board and (c) take such action as may be necessary
to manage the portfolio security loan business of the Trust. All action by the
Executive Committee shall be recorded and reported to the Board at its meeting
next succeeding such action.
Section 2.9 Other Committees. The Board may appoint from among its
members other committees composed of two or more of its Trustees which shall
have such powers as may be delegated or authorized by the resolution appointing
them.
Section 2.10 Committee Procedures. The Trustees may at any time change
the members of any committee, fill vacancies or discharge any committee. In the
absence of any member of any committee, the member or members thereof present at
any meeting, whether or not they constitute a quorum, may unanimously appoint to
act in the place of such absent member a member of the Board who, except in the
case of the Executive Committee, is not an "interested person" of the Trust as
the Board may from time to time determine. Each committee may fix its own rules
of procedure and may meet as and when provided by those rules. Copies of the
minutes of all meetings of committees other than the Nominating Committee and
the Executive Committee shall be distributed to the Board unless the Board shall
otherwise provide.
ARTICLE III
Officers
Section 3.1 Officers of the Trust; Compensation. The officers of the
Trust shall consist of the Chairman of the Board, if any, a President, a
Secretary, a Treasurer and such other officers or assistant officers, including
Chief Operating Officer, Vice Presidents and Assistant Secretaries, as may be
elected by the Trustees. Any two or more of the offices may be held by the same
person, except that the same person may not be both President and Secretary. The
Trustees may designate a Vice President as an Executive Vice President and may
designate the order in which the other Vice Presidents may act. The Chairman, if
any, shall be a Trustee, but no other officer of the Trust need be a Trustee.
The Board of Trustees may determine what, if any, compensation shall be paid to
officers of the Trust.
Section 3.2 Election and Tenure. At the initial organization meeting
the Trustees shall elect the Chairman of the Board, if any, President, Chief
Operating Officer, if any, Secretary, Treasurer and such other officers as the
Trustees shall deem necessary or appropriate in order to carry out the business
of the Trust. Such officers shall hold office until their successors have been
duly elected and qualified. The Trustees may fill any vacancy in office or add
any additional officers at any time.
4
<PAGE>
Section 3.3 Removal of Officers. Any officer may be removed at any
time, with or without cause, by action of a majority of the Trustees. This
provision shall not prevent the making of a contract of employment for a
definite term with any officer and shall have no effect upon any cause of action
which any officer may have as a result of removal in breach of a contract of
employment. Any officer may resign at any time by notice in writing signed by
such officer and delivered or mailed to the President, Chief Operating Officer,
if any, or Secretary, and such resignation shall take effect immediately, or at
a later date according to the terms of such notice in writing.
Section 3.4 Bonds and Surety. Any officer may be required by the
Trustees to be bonded for the faithful performance of his duties in such amount
and with such sureties as the Trustees may determine.
Section 3.5 President and Vice-Presidents. The President shall be the
chief executive officer of the Trust and, subject to the control of the
Trustees, shall have general supervision, direction and control of the business
of the Trust and of its employees and shall exercise such general powers of
management as are usually vested in the office of president of a corporation.
The President shall preside at all meetings of the Holders and, in the absence
of the Chairman of the Board, the President shall preside at all meetings of the
Trustees. Subject to direction of the Trustees, the President shall have the
power, in the name and on behalf of the Trust, to execute any and all loan
documents, contracts, agreements, deeds, mortgages, and other instruments in
writing, and to employ and discharge employees and agents of the Trust. Unless
otherwise directed by the Trustees, the President shall have full authority and
power, on behalf of all of the Trustees, to attend and to act and to vote, on
behalf of the Trust at any meetings of business organizations in which the Trust
holds an interest, or to confer such powers upon any other persons, by executing
any proxies duly authorizing such persons. The President shall have such further
authorities and duties as the Trustees shall from time to time determine. In the
absence or disability of the President, the Chief Operating Officer, if any, or,
in the absence or disability of both of them, the Vice Presidents in order of
their rank or the Vice President designated by the Trustees, shall perform all
of the duties of President, and when so acting shall have all the powers of and
be subject to all of the restrictions upon the President. Subject to the
direction of the President, the Chief Operating Officer, if any, the Treasurer
and each Vice President shall have the power in the name and on behalf of the
Trust to execute any and all loan documents, contracts, agreements, deeds,
mortgages and other instruments in writing, and, in addition, shall have such
other duties and powers as shall be designated from time to time by the
Trustees, the Chairman, or the President.
Section 3.6 Chief Operating Officer. The Chief Operating Officer, if
any, shall have the authority and duties that generally pertain to such office,
including, but not limited to, those delegated by the Chairman, if any, or the
President.
Section 3.7 Secretary. The Secretary shall keep the minutes of all
meetings of, and record all votes of, Holders, Trustees and any committees of
Trustees, provided that, in the absence or disability of the Secretary, the
Holders or Trustees or committee may appoint any other person to keep the
minutes of a meeting and record votes. The Secretary shall be custodian of the
seal of the Trust, if any, and he (and any other person so authorized by the
Trustees) shall affix the seal or, if permitted, a facsimile thereof, to any
instrument executed by the Trust which would be sealed by a Delaware corporation
executing the name or a similar instrument and shall attest the seal and the
signature or signatures of the officer or officers executing such instrument on
behalf of the Trust. The Secretary shall also perform any other duties commonly
incident to such office in a Delaware corporation, and shall have such other
authorities and duties as the Trustees shall from time to time determine.
5
<PAGE>
Section 3.8 Treasurer. Except as otherwise directed by the Trustees,
the Treasurer shall have the general supervision of the monies, funds,
securities, notes receivable and other valuable papers and documents of the
Trust, and shall have and exercise under the supervision of the Trustees and of
the Chairman, the President and the Chief Operating Officer all powers and
duties normally incident to his office. He or she may endorse for deposit or
collection all notes, checks and other instruments payable to the Trust or to
its order. He or she shall deposit all funds of the Trust as may be ordered by
the Trustees, the Chairman of the Board, the President or the Chief Operating
Officer. The Treasurer shall keep accurate account of the books of the Trust's
transactions which shall be the property of the Trust and which, together with
all other property of the Trust in his possession, shall be subject at all times
to the inspection and control of the Trustees. Unless the Trustees shall
otherwise determine, the Treasurer shall be the principal accounting officer of
the Trust and shall also be the principal financial officer of the Trust. He or
she shall have such other duties and authorities as the Trustees shall from time
to time determine. Notwithstanding anything to the contrary herein contained,
the Trustees may authorize any adviser or administrator to maintain bank
accounts and deposit and disburse funds on behalf of the Trust.
Section 3.9 Other Officers and Duties. The Trustees may elect such
other officers and assistant officers as they shall from time to time determine
to be necessary or desirable in order to conduct the business of the Trust.
Assistant officers shall act generally in the absence of the officer whom they
assist and shall assist that officer in the duties of his office. Each officer,
employee and agent of the Trust shall have such other duties and authority as
may be conferred upon him by the Trustees or delegated to him by the President
or by any other appropriate officers.
ARTICLE IV
Custodian
Section 4.1 Appointment and Duties. The Board of Trustees shall at all
times employ a custodian or custodians with authority as its agent, but subject
to such restrictions, limitations and other requirements, if any, as may be
contained in these By-Laws:
(a) to hold the securities owned by the Trust and deliver the
same upon written order;
(b) to receive and receipt for any moneys due to the Trust and
deposit the same in its own banking department or elsewhere as the Trustees may
direct;
(c) to disburse such funds upon orders or vouchers;
(d) if authorized by the Trustees, to keep the books and
accounts of the Trust and furnish clerical and accounting services; and
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<PAGE>
(e) if authorized to do so by the Trustees, to compute the net
income and net assets of the Trust; all upon such basis of compensation as may
be agreed upon between the Trustees and the custodian. The Trustees may also
authorize the custodian to employ one or more sub-custodians, from time to time,
to perform such of the acts and services of the custodian and upon such terms
and conditions as may be agreed upon between the custodian and such
sub-custodian and approved by the Trustees.
Section 4.2 Central Certificate System. Subject to such rules,
regulations and orders as the Securities and Exchange Commission (the
"Commission") may adopt, the Trustees may direct the custodian to deposit all or
any part of the securities owned by the Trust in a system for the central
handling of securities established by a national securities exchange or a
national securities association registered with the Commission under the
Securities Exchange Act of 1934, or any such other person or entity with which
the Trustees may authorize deposit in accordance with the 1940 Act, pursuant to
which system all securities of any particular class or series of any issuer
deposited within the system are treated as fungible and may be transferred or
pledged by bookkeeping entry without physical delivery of such securities. All
such deposits shall be subject to withdrawal only upon the order of the Trust.
ARTICLE V
Miscellaneous
Section 5.1 Depositories. In accordance with Article IV of these
By-Laws, the portfolios of the Trust shall be deposited in such depositories as
the Trustees shall designate and shall be drawn out on checks, drafts or other
orders signed by such officer, officers, agent or agents (including any adviser
or administrator), as the Trustees may from time to time authorize.
Section 5.2 Signatures. All contracts and other instruments shall be
executed on behalf of the Trust by such officer, officers, agent or agents, as
provided in these By-Laws or as the Trustees may from time to time by resolution
or authorization provide.
Section 5.3 Seal. The seal of the Trust, if any, may be affixed to any
document, and the seal and its attestation may be lithographed, engraved or
otherwise printed on any document with the same force and effect as if it had
been imprinted and attested manually in the same manner and with the same effect
as if done by a Delaware corporation.
Section 5.4 Fiscal Year. The fiscal year of the Trust shall end on such
date of each year as is determined from time to time by the Board.
ARTICLE VI
Interests
Section 6.1 Non-Transferability of Interests. Interests shall not be
transferable. Except as otherwise provided by law, the Trust shall be entitled
to recognize the exclusive right of a person in whose name Interests stand on
the record of Holders as the owners of such Interests for all purposes,
including, without limitation, the rights to receive distributions, and to vote
as such owner, and the Trust shall not be bound to recognize any equitable or
legal claim to or interest in any such Interests on the part of any other
person.
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Section 6.2 Regulations. The Trustees may make such additional rules
and regulations, not inconsistent with these By-Laws, as they may deem expedient
concerning the sale and purchase of Interests of the Trust.
Section 6.3 Distribution Disbursing Agents and the Like. The Trustees
shall have the power to employ and compensate such distribution disbursing
agents, warrant agents and agents for the reinvestment of distributions as they
shall deem necessary or desirable. Any of such agents shall have such power and
authority as is delegated to any of them by the Trustees.
Last Amended: May 26, 1999
8
INVESTMENT ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made as of this 21st day of May, 1999, by and between
NATIONS MASTER INVESTMENT TRUST, a Delaware business trust (the "Trust"), and
NATIONSBANC ADVISORS, INC., a North Carolina corporation (the "Adviser"), on
behalf of those portfolios of the Trust now or hereafter identified on Schedule
I hereto (each a "Master Portfolio" and collectively, the "Master Portfolios").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "Commission") as an open-end management investment company under
the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Adviser is registered with the Commission under the
Investment Advisers Act of 1940, as amended (the "Advisers Act") as an
investment adviser;
WHEREAS, the Trust and the Adviser desire to enter into an agreement to
provide for investment advisory services to the Trust upon the terms and
conditions hereinafter set forth; and
WHEREAS, the Trust and the Adviser contemplate that certain duties of the
Adviser under this Agreement will be delegated to one or more investment
sub-adviser(s) (the "Sub-Adviser(s)") pursuant to separate sub-advisory
agreement(s) (the "Sub-Advisory Agreement(s)");
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
it is agreed between the parties hereto as follows:
1. APPOINTMENT. The Trust hereby appoints the Adviser to act as investment
adviser to each Master Portfolio for the period and on the terms set forth in
this Agreement. The Adviser accepts such appointment and agrees to furnish the
services herein set forth for the compensation herein provided. In the event
that the Trust establishes one or more portfolios other than the Master
Portfolios with respect to which it desires to retain the Adviser to act as
investment adviser hereunder, it shall notify the Adviser in writing. If the
Adviser is willing to render such services under this Agreement it shall notify
the Trust in writing whereupon such portfolio shall become a Master Portfolio
hereunder and shall be subject to the provisions of this Agreement except to the
extent that said provisions (including those relating to the compensation
payable by the Master Portfolio to the Adviser) are modified with respect to
such Master Portfolio in writing by the Trust and the Adviser at the time.
2. DELEGATION OF RESPONSIBILITIES. Subject to the approval of the Trust's
Board of Trustees and, if required, the interestholders of the Master
Portfolios, the Adviser may, pursuant to the Sub-Advisory Agreement(s), delegate
to the Sub-Adviser(s) those of its duties hereunder identified in the
Sub-Advisory Agreement(s), provided that the Adviser shall continue to supervise
and monitor the performance of the duties delegated to the Sub-Adviser(s) and
any such delegation shall not relieve the Adviser of its duties and obligations
under this Agreement. The Adviser shall be solely responsible for compensating
the Sub-Adviser(s) for services rendered under the Sub-Advisory Agreement(s).
1
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3. DELIVERY OF DOCUMENTS. The Trust has furnished the Adviser with
copies, properly certified or authenticated, of each of the following:
(a) the Trust's Certificate of Trust, as filed with the
Secretary of State of Delaware on January 14, 1999, and Declaration of Trust and
all amendments thereto (such Declaration of Trust, as presently in effect and as
it shall from time to time be amended, is herein called the "Declaration of
Trust");
(b) the Trust's By-Laws and amendments thereto (such By-Laws,
as presently in effect and as it shall from time to time be amended, is herein
called the "By-Laws");
(c) votes of the Trust's Board of Trustees authorizing the
appointment of the Adviser and approving this Agreement;
(d) the Trust's Registration Statement, as amended, on Form
N-1A under the 1940 Act (File No. 811-09347); and
(e) the most recent prospectus of the Trust relating to each
Master Portfolio (such prospectus together with the related statement of
additional information, as presently in effect and all amendments and
supplements thereto, are herein called the "Prospectus").
The Trust will furnish the Adviser from time to time with copies of all
amendments of or supplements to the foregoing, if any.
4. MANAGEMENT. Subject to the supervision of the Trust's Board of
Trustees, the Adviser will provide a continuous investment program for each
Master Portfolio, including investment research and management with respect to
all securities, investments, cash and cash equivalents in each Master Portfolio.
The Adviser will determine from time to time what securities and other
investments will be purchased, retained or sold by the Master Portfolios and
will place the daily orders for the purchase or sale of securities. The Adviser
will provide the services rendered by it under this Agreement in accordance with
each Master Portfolio's investment objective, policies and restrictions as
stated in the Prospectus and votes of the Trust's Board of Trustees. The Adviser
further agrees that it will:
(a) update each Master Portfolio's cash availability
throughout the day as required;
(b) maintain historical tax lots for each portfolio security
held by each Master Portfolio;
(c) transmit trades to the Trust's custodian for proper
settlement;
(d) maintain all books and records with respect to each Master
Portfolio's securities and transactions;
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(e) supply the Trust and its Board of Trustees with reports
and statistical data as requested; and
(f) prepare a quarterly broker security transaction summary
and monthly security transaction listing for each Master Portfolio.
5. OTHER COVENANTS. The Adviser agrees that it:
(a) will comply with all applicable Rules and Regulations of
the Commission and will in addition conduct its activities under this Agreement
in accordance with other applicable law, including but not limited to the 1940
Act and the Advisers Act;
(b) will use the same skill and care in providing such
services as it uses in providing services to fiduciary accounts for which it has
investment responsibilities;
(c) will not make loans to any person to purchase or carry
Master Portfolio shares;
(d) will place orders pursuant to its investment
determinations for the Master Portfolios either directly with the issuer or with
any broker or dealer. Subject to the other provisions of this paragraph, in
executing portfolio transactions and selecting brokers or dealers, the Adviser
will use its best efforts to seek on behalf of each Master Portfolio the best
overall terms available. In assessing the best overall terms available for any
transaction, the Adviser shall consider all factors that it deems relevant,
including the breadth of the market in the security, the price of the security,
the financial condition and execution capability of the broker or dealer, and
the reasonableness of the commission, if any, both for the specific transaction
and on a continuing basis. In evaluating the best overall terms available, and
in selecting the broker/dealer to execute a particular transaction, the Adviser
may also consider the brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934, as amended)
provided to the Master Portfolio(s) and/or other accounts over which the Adviser
or an affiliate of the Adviser exercises investment discretion. The Adviser is
authorized, subject to the prior approval of the Trust's Board of Trustees, to
pay to a broker or dealer who provides such brokerage and research services a
commission for executing a portfolio transaction for any Master Portfolio which
is in excess of the amount of commission another broker or dealer would have
charged for effecting that transaction if, but only if, the Adviser determines
in good faith that such commission was reasonable in relation to the value of
the brokerage and research services provided by such broker or dealer, viewed in
terms of that particular transaction or in terms of the overall responsibilities
of the Adviser to the particular Master Portfolio and to the Trust. In addition,
the Adviser is authorized to take into account the sale of shares of the Trust
in allocating purchase and sale orders for portfolio securities to brokers or
dealers (including brokers and dealers that are affiliated with the Adviser or
the Trust's principal underwriter), provided that the Adviser believes that the
quality of the transaction and the commission are comparable to what they would
be with other qualified firms. In no instance, however, will portfolio
securities be purchased from or sold to the Adviser or the Trust's principal
underwriter for the Master Portfolios or an affiliated person of either acting
as principal or broker, except as permitted by the Commission or applicable law;
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(e) will maintain a policy and practice of conducting its
investment advisory services hereunder independently of the commercial banking
operations of its affiliates. In making investment recommendations for a Master
Portfolio, its investment advisory personnel will not inquire or take into
consideration whether the issuer (or related supporting institution) of
securities proposed for purchase or sale for the Master Portfolio's account are
customers of the commercial departments of its affiliates. In dealing with
commercial customers, such commercial departments will not inquire or take into
consideration whether securities of those customers are held by the Master
Portfolio; and
(f) will treat confidentially, and as proprietary information
of the Trust, all records and other information relative to the Trust and prior,
present or potential interestholders, and will not use such records and
information for any purpose other than performance of its responsibilities and
duties hereunder (except after prior notification to and approval in writing by
the Trust, which approval shall not be unreasonably withheld and may not be
withheld and will be deemed granted where the Adviser may be exposed to civil or
criminal contempt proceedings for failure to comply, when requested to divulge
such information by duly constituted authorities, or when so requested by the
Trust).
6. SERVICES NOT EXCLUSIVE. The services furnished by the Adviser
hereunder are deemed not to be exclusive, and the Adviser shall be free to
furnish similar services to others so long as its services under this Agreement
are not impaired thereby. To the extent that the purchase or sale of securities
or other investments of the same issuer may be deemed by the Adviser to be
suitable for two or more accounts managed by the Adviser, the available
securities or investments may be allocated in a manner believed by the Adviser
to be equitable to each account. It is recognized that in some cases this
procedure may adversely affect the price paid or received by a Master Portfolio
or the size of the position obtainable for or disposed of by a Master Portfolio.
7. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Adviser hereby agrees that all records which it
maintains for each Master Portfolio are the property of the Trust and further
agrees to surrender promptly to the Trust any of such records upon the Trust's
request. The Adviser further agrees to preserve for the periods prescribed by
Rule 31a-2 under the 1940 Act the records required to be maintained by Rule
31a-1 under the 1940 Act.
8. EXPENSES. During the term of this Agreement, the Adviser will pay
all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments
(including brokerage commissions and other transaction charges, if any)
purchased or sold for the Master Portfolios. In addition, if the aggregate
expenses borne by any Master Portfolio in any fiscal year exceed the applicable
expense limitations imposed by the securities regulations of any state in which
its shares are registered or qualified for sale to the public, the Adviser
together with the Master Portfolio's administrator(s) shall reimburse such
Master Portfolio for such excess in proportion to the fees otherwise payable to
them for such year. The obligation of the Adviser to reimburse the Trust
hereunder is limited in any fiscal year to the amount of its fee hereunder for
such fiscal year, provided, however, that notwithstanding the foregoing, the
Adviser shall reimburse the Trust for the full amount of its share of any such
excess expenses regardless of the fees paid to it during such fiscal year to the
extent that the securities regulations of any state having jurisdiction over the
Trust so require. Such expense reimbursement, if any, will be estimated,
reconciled and paid on a monthly basis.
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9. COMPENSATION. For the services provided to each Master Portfolio and
the expenses assumed pursuant to this Agreement, the Trust will pay the Adviser
and the Adviser will accept as full compensation therefor a fee for that Master
Portfolio determined in accordance with Schedule I attached hereto. The fee
attributable to each Master Portfolio shall be a separate charge to such Master
Portfolio and shall be the several (and not joint or joint and several)
obligation of each such Master Portfolio. The Trust and the Adviser may, from
time to time, agree to reduce, limit or waive the amounts payable hereunder with
respect to one or more Master Portfolios for such period or periods they deem
advisable.
10. LIMITATION OF LIABILITY. The Adviser 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 performance of this Agreement, except a loss resulting from
a breach of fiduciary duty with respect to the receipt of compensation for
services or a loss resulting from willful misfeasance, bad faith or gross
negligence on the part of the Adviser or any of its officers, directors,
employees or agents, in the performance of its duties or from reckless disregard
by it of its obligations and duties under this Agreement.
11. TERM AND APPROVAL. This Agreement shall become effective when
approved, and shall continue in effect until the second anniversary of its
effective date. Thereafter, if not terminated, this Agreement shall continue in
effect for successive annual periods ending on January 1, provided that the
continuation of the Agreement is specifically approved at least annually:
(a)(i) by the Trust's Board of Trustees or (ii) by the vote
of "a majority of the outstanding voting securities" of the Master
Portfolio (as defined in Section 2(a)(42) of the 1940 Act); and
(b) by the affirmative vote of a majority of the Trustees
of the Trust who are not parties to this Agreement or "interested
persons" (as defined in the 1940 Act) of a party to this Agreement
(other than as Trustees of the Trust), by votes cast in person at
a meeting specifically called for such purpose.
12. TERMINATION. This Agreement may be terminated at any time with
respect to:
(a) a Master Portfolio, without the payment of any penalty,
by vote of the Trust's Board of Trustees or by vote of a majority
of a Master Portfolio's outstanding voting securities, or by the
Adviser, upon written notice to the other parties to this
Agreement; or
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(b) by the Adviser on sixty (60) days' written notice to
the other parties to this Agreement.
Any party entitled to notice may waive the notice provided for
herein. This Agreement shall automatically terminate in the event of its
assignment, the term "assignment" for purposes of this paragraph having the
meaning defined in Section 2(a)(4) of the 1940 Act.
13. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No amendment of this Agreement affecting a
Master Portfolio shall be effective until approved by vote of a majority of the
outstanding voting securities of such Master Portfolio. However, this shall not
prevent the Adviser from reducing, limiting or waiving its fee.
14. RELEASE. The names "Nations Master Investment Trust" and "Trustees
of Nations Master Investment Trust" refer respectively to the Trust created and
the Trustees, as trustees but not individually or personally, acting from time
to time under a Declaration of Trust and the Certificate of Trust dated January
14, 1999, which is hereby referred to and a copy of which is on file at the
principal office of the Trust. The obligations of "Nations Master Investment
Trust" entered into in the name or on behalf thereof by any of the Trustees,
representatives or agents are made not individually, but in such capacities, and
are not binding upon any of the Trustees, interestholders, or representatives of
the Trust personally, but bind only the Trust Property (as defined in the
Declaration of Trust) and all persons dealing with any class of shares of the
Trust must look solely to the Trust Property belonging to such class for the
enforcement of any claims against the Trust.
15. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. 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. This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and shall be
governed by Delaware law.
16. COUNTERPARTS. This Agreement may be executed in any manner of
counterparts, each of which shall be deemed an original.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ A. Max Walker
-----------------------------
A. Max Walker
President and Chairman of the
Board of Trustees
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
-----------------------------
Robert H. Gordon
President
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SCHEDULE I
The Trust shall pay the Adviser as full compensation for services
provided and expenses assumed hereunder an advisory fee for each Master
Portfolio, computed daily and payable monthly at the annual rates listed below
as a percentage of the average daily net assets of the Master Portfolio:
RATE OF
MASTER PORTFOLIO COMPENSATION
- ------------------------------------------------------------------------------
Nations Blue Chip Master Portfolio 0.65%
- ------------------------------------------------------------------------------
Nations Intermediate Bond Master Portfolio 0.40%
- ------------------------------------------------------------------------------
Nations International Equity Master Portfolio 0.80%
- ------------------------------------------------------------------------------
Nations Marsico Focused Equities Master Portfolio 0.75%
- ------------------------------------------------------------------------------
Nations Marsico Growth & Income Master Portfolio 0.75%
- ------------------------------------------------------------------------------
Nations International Value Master Portfolio 0.90%
- ------------------------------------------------------------------------------
Nations Marsico 21st Century Master Portfolio 0.75%
- ------------------------------------------------------------------------------
Approved: December 2, 1998
Last Amended: March 2, 2000
IN WITNESS WHEREOF, the parties hereto have caused this amended Schedule I
to be executed by their officers designated below as of the 2nd day of March,
2000.
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ James E. Banks, Jr.
-----------------------
James E. Banks, Jr.
Assistant Secretary
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
Robert H. Gordon
-----------------------
President
8
INVESTMENT ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made as of February 14, 2000, by and between NATIONS
MASTER INVESTMENT TRUST, a Delaware business trust (the "Master Trust"), and
BANC OF AMERICA ADVISORS, INC., a North Carolina corporation (the "Adviser"), on
behalf of those series of the Master Trust now or hereafter identified on
Schedule I (each, a "Master Portfolio" and collectively, the "Master
Portfolios").
WHEREAS, the Master Trust is registered with the Securities and Exchange
Commission (the "Commission") as an open-end management investment company under
the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Adviser is registered with the Commission as an investment
adviser under the Investment Advisers Act of 1940, as amended (the "Advisers
Act");
WHEREAS, the Master Trust desires that the Adviser manage the investment
operations of the Master Portfolios and the Adviser desires to manage said
operations; and
WHEREAS, the Board of Trustees of the Master Trust (the "Board"),
including a majority of the Trustees who are not "interested persons" (as
defined herein) of any party to this Agreement, have approved this arrangement;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT OF ADVISER. The Master Trust hereby appoints the Adviser
and the Adviser hereby agrees to manage the investment operations of each Master
Portfolio subject to the terms of this Agreement and subject to the supervision
of the Board. The Master Trust and the Adviser contemplate that certain duties
of the Adviser under this Agreement may be delegated to one or more investment
sub-adviser(s) (the "Sub-Adviser(s)") pursuant to separate investment
sub-advisory agreement(s) (the "Sub-Advisory Agreement(s)"). The Adviser may, in
its discretion, provide services under this Agreement through its own employees
or through one or more affiliated companies that are qualified to act as
investment advisers under applicable law and are under common control of Bank of
America Corporation.
2. SERVICES OF ADVISER. The Adviser shall perform, or arrange for the
performance of, the management services necessary for the investment operations
of each Master Portfolio, including but not limited to:
(a) Managing the investment and reinvestment of all assets, now or
hereafter acquired by each Master Portfolio, including
determining what securities and other investments are to be
purchased or sold for each Master Portfolio and executing
transactions accordingly;
(b) Transmitting trades to each Master Portfolio's custodian for
settlement in accordance with each Master Portfolio's
procedures and as may be directed by the Master Trust;
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(c) Assisting in the preparation of all shareholder
communications, including shareholder reports, and
participating in shareholder relations;
(d) Making recommendations as to the manner in which voting
rights, rights to consent to Master Portfolio action and any
other rights pertaining to each Master Portfolio's portfolio
securities shall be exercised;
(e) Making recommendations to the Board with respect to Master
Portfolio investment policies and procedures, and carrying out
such investment policies and procedures as are adopted by the
Board;
(f) Supplying reports, evaluations, analyses, statistical data and
information to the Board or to the Master Portfolios' officers
and other service providers as the Board may reasonably
request from time to time or as may be necessary or
appropriate for the operation of the Master Trust as an
open-end investment company or as necessary to comply with
Section 3(a) of this Agreement;
(g) Maintaining all required books and records with respect to the
investment decisions and securities transactions for each
Master Portfolio;
(h) Furnishing any and all other services, subject to review by
the Board, that the Adviser from time to time determines to be
necessary or useful to perform its obligations under this
Agreement or as the Board may reasonably request from time to
time.
3. RESPONSIBILITIES OF ADVISER. In carrying out its obligations under
this Agreement, the Adviser agrees that it will:
(a) Comply with all applicable law, including but not limited to
the 1940 Act and the Advisers Act, the rules and regulations
of the Commission thereunder, and the conditions of any order
affecting the Master Trust or a Master Portfolio issued
thereunder;
(b) Use the same skill and care in providing such services as it
uses in providing services to other fiduciary accounts for
which it has investment responsibilities;
(c) Not make loans to any person for the purpose of purchasing or
carrying Master Portfolio shares;
(d) Place, or arrange for the placement of, all orders pursuant to
its investment determinations for the Master Portfolios either
directly with the issuer or with any broker or dealer
(including any affiliated broker or dealer). In executing
portfolio transactions and selecting brokers or dealers, the
Adviser will use its best efforts to seek on behalf of each
Master Portfolio the best overall terms available. In
assessing the best overall terms available for any
transaction, the Adviser shall consider all factors that it
deems relevant, including the breadth of the market in the
security, the price of the security, the financial condition
and execution capability of the broker or dealer, and the
reasonableness of the commission, if any, both for the
specific transaction and on a continuing basis. In evaluating
the best overall terms available, and in selecting the broker
or dealer to execute a particular transaction, the Adviser may
also consider whether such broker or dealer furnishes research
and other information or services to the Adviser;
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(e) Adhere to the investment objective, strategies and policies
and procedures of the Master Trust adopted on behalf of each
Master Portfolio; and
(f) Maintain a policy and practice of conducting its investment
advisory services hereunder independently of the commercial
banking operations of its affiliates. In making investment
recommendations for a Master Portfolio, the Adviser's
investment advisory personnel will not inquire or take into
consideration whether the issuers (or related supporting
institutions) of securities proposed for purchase or sale for
the Master Portfolio's account are customers of the commercial
departments of its affiliates. In dealing with commercial
customers, such commercial departments will not inquire or
take into consideration whether securities of those customers
are held by the Master Portfolio.
4. CONFIDENTIALITY OF INFORMATION. Each party agrees that it will treat
confidentially all information provided by the other party regarding such other
party's business and operations, including without limitation the investment
activities or holdings of a Master Portfolio. All confidential information
provided by a party hereto shall not be disclosed to any unaffiliated third
party without the prior consent of the providing party. The foregoing shall not
apply to any information that is public when provided or thereafter becomes
public or which is required to be disclosed by any regulatory authority in the
lawful and appropriate exercise of its jurisdiction over a party, by any auditor
of the parties hereto, by judicial or administrative process or otherwise by
applicable law or regulation.
5. DELEGATION OF DUTIES. Subject to the approval of the Board and, if
required, the shareholders of the Master Portfolios, the Adviser may delegate to
one or more Sub-Adviser(s) any or all of its duties hereunder, provided that the
Adviser shall continue to supervise and monitor the performance of the duties
delegated to the Sub-Adviser(s) and any such delegation shall not relieve the
Adviser of its duties and obligations under this Agreement. The Adviser shall be
solely responsible for compensating the Sub-Adviser(s) for performing any of the
duties delegated to them. The Adviser may request that the Master Trust pay
directly to the Sub-Adviser(s) the portion of the Adviser's compensation that
the Adviser is obligated to pay to the Sub-Adviser(s). If the Master Trust
agrees to such request, it will pay such portion to the Sub-Adviser(s) on behalf
of the Adviser, thereby reducing the compensation paid to the Adviser by the
amount paid directly to the Sub-Adviser(s). However, such an arrangement will
not relieve the Adviser of its responsibility for compensating the
Sub-Adviser(s). In the event that any Sub-Adviser appointed hereunder is
terminated, the Adviser may provide investment advisory services pursuant to
this Agreement through its own employees or through one or more affiliated
companies that are qualified to act as investment advisers under applicable law
and are under common control of Bank of America Corporation or through other
Sub-Adviser(s) as approved by the Master Trust in accordance with applicable
law.
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6. SERVICES NOT EXCLUSIVE. The services furnished by the Adviser
hereunder are deemed not to be exclusive, and the Adviser shall be free to
furnish similar services to others so long as its provision of services under
this Agreement is not impaired thereby. To the extent that the purchase or sale
of securities or other investments of the same issuer may be deemed by the
Adviser to be suitable for two or more accounts managed by the Adviser, the
available securities or investments may be allocated in a manner believed by the
Adviser to be equitable to each account. It is recognized that in some cases
this procedure may adversely affect the price paid or received by a Master
Portfolio or the size of the position obtainable for or disposed of by a Master
Portfolio. Nothing in this Agreement shall limit or restrict the right of any of
the Adviser's partners, officers or employees to engage in any other business or
to devote his or her time and attention in part to the management or other
aspects of any business, whether of a similar or dissimilar nature, nor limit or
restrict the Adviser's right to engage in any other business or to render
services of any kind to any other corporation, firm, individual or association.
7. DELIVERY OF DOCUMENTS. The Master Trust has furnished the Adviser
with copies, properly certified or authenticated, of each of the following:
(a) the Master Trust's Certificate of Trust, as filed with the
Secretary of State of Delaware, and Declaration of Trust (such
Declaration of Trust, as presently in effect and as from time
to time amended, is herein called the "Declaration of Trust");
(b) The Master Trust's Bylaws, if any;
(c) the most recent prospectus(es) and statement(s) of additional
information relating to each Master Portfolio (such
prospectus(es) together with the related statement(s) of
additional information, as presently in effect and all
amendments and supplements thereto, are herein called the
"Prospectus"); and
(d) any and all applicable policies and procedures approved by the
Board.
The Master Trust will promptly furnish the Adviser with copies of any
and all amendments of or additions or supplements to the foregoing.
8. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Adviser hereby agrees that all records that it maintains
for each Master Portfolio under this Agreement are the property of the Master
Trust and further agrees to surrender promptly to the Master Trust any of such
records upon request. The Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
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9. EXPENSES OF THE MASTER PORTFOLIOS. Except to the extent expressly
assumed by the Adviser and except to any extent required by law to be paid or
reimbursed by the Adviser, the Adviser shall have no duty to pay any ordinary
operating expenses incurred in the organization and operation of the Master
Portfolios. Ordinary operating expenses include, but are not limited to,
brokerage commissions and other transaction charges, taxes, legal, auditing,
printing, or governmental fees, other service providers' fees and expenses,
expenses of issue, sale, redemption and repurchase of shares, expenses of
registering and qualifying shares for sale, expenses relating to Board and
shareholder meetings, the cost of preparing and distributing reports and notices
to shareholders and interest payments and other fees or charges associated with
any credit facilities established by or on behalf of the Master Portfolios.
10. COMPENSATION. Except as otherwise provided herein, for the services
provided to each Master Portfolio and the expenses assumed pursuant to this
Agreement, the Master Trust will pay the Adviser and the Adviser will accept as
full compensation therefor a fee determined in accordance with Schedule I
attached hereto; provided, however, that the compensation paid to the Adviser
shall be reduced by any amount paid by the Master Trust directly to the
Sub-Advisor(s) pursuant to Section 5 of this Agreement. In addition, BAAI or its
affiliated persons may receive compensation or reimbursement of recordkeeping,
bookkeeping, accounting, administrative and transactional fees or charges
incurred in connection with any credit facilities established by or on behalf of
the Master Portfolios. The fees or charges attributable to each Master Portfolio
shall be a separate charge to such Master Portfolio and shall be the several
(and not joint or joint and several) obligation of each such Master Portfolio.
The Master Trust and the Adviser may, from time to time, agree to reduce, limit
or waive the amounts payable hereunder with respect to one or more Master
Portfolios for such period or periods they deem advisable.
11. LIABILITY OF ADVISER. The Adviser shall not be liable for any error
of judgment or mistake of law or for any loss suffered by the Master Trust in
connection with the performance of its duties under this Agreement, except a
loss resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services, or a loss resulting from willful misfeasance, bad
faith or negligence on the part of the Adviser or any of its officers,
directors, employees or agents, in the performance of their duties under this
Agreement, or from reckless disregard by it or obligations and duties under this
Agreement. 12. TERM AND APPROVAL. This Agreement will become effective as of the
date set forth herein above, and shall continue in effect until the second
anniversary of its effective date. This Agreement will become effective with
respect to each additional Master Portfolio as of the date set forth on Schedule
I when each such Master Portfolio is added thereto. The Agreement shall continue
in effect for a Master Portfolio after the second anniversary of the effective
date for successive annual periods ending on each anniversary of such date,
provided that the continuation of the Agreement is specifically approved for the
Master Portfolio at least annually:
(a)(i) by the Board or (ii) by the vote of "a majority of the
outstanding voting securities" of the Master Portfolio (as
defined in Section 2(a)(42) of the 1940 Act); and
(b) by the affirmative vote of a majority of the Trustees of the
Master Trust who are not parties to this Agreement or
"interested persons" (as defined in the 1940 Act) of a party
to this Agreement (other than as Trustees of the Master
Trust), by votes cast in person at a meeting specifically
called for such purpose.
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13. TERMINATION. This Agreement may be terminated without payment of
any penalty at any time by:
(a) the Master Trust with respect to a Master Portfolio, by vote
of the Board or by vote of a majority of a Master
Portfolio's outstanding voting securities, upon sixty (60)
days' written notice to the Adviser; or
(b) the Adviser with respect to a Master Portfolio, upon sixty
(60) days' written notice to the Master Trust.
Any party entitled to notice may waive the notice provided for herein.
This Agreement shall automatically terminate in the event of its assignment,
unless an order is issued by the Commission conditionally or unconditionally
exempting such assignment from the provisions of Section 15(a) of the 1940 Act,
in which event this Agreement shall remain in full force and effect subject to
the terms of such order. For the purposes of this paragraph, the definitions
contained in Section 2(a) of the 1940 Act and the applicable rules under the
1940 Act shall apply.
14. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement may be
changed, waived, discharged or terminated orally, except by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
15. NOTICES. Any notices under this Agreement shall be in writing,
addressed and delivered or mailed postage paid to such address as may be
designated for the receipt of such notice. Until further notice, it is agreed
that the address of the Master Trust shall be c/o Stephens Inc., 111 Center
Street, Little Rock, Arkansas 72201, Attention: Secretary, and that of the
Adviser shall be One Bank of America Plaza, 33rd Floor, 101 South Tryon Street,
Charlotte, North Carolina 28255, Attention: President.
16. RELEASE. The names "Nations Master Investment Trust" and "Trustees
of Nations Master Investment Trust" refer respectively to the Master Trust
created by the Declaration of Trust and the Trustees as Trustees but not
individually or personally. All parties hereto acknowledge and agree that any
and all liabilities of the Master Trust arising, directly or indirectly, under
this Agreement will be satisfied solely out of the assets of the Master Trust
and that no Trustee, officer or shareholder shall be personally liable for any
such liabilities. All persons dealing with any Master Portfolio of the Master
Trust must look solely to the property belonging to such Master Portfolio for
the enforcement of any claims against the Master Trust.
17. MISCELLANEOUS. This Agreement contains the entire understanding of
the parties hereto. Each provision of this Agreement is intended to be
severable. 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.
6
<PAGE>
18. GOVERNING LAW. This Agreement shall be governed by, and construed
in accordance with, Delaware law and the federal securities laws, including the
1940 Act and the Advisers Act.
19. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
7
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ A. Max Walker
--------------------------------
A. Max Walker
President and Chairman of the
Board of Master Trustees
BANC OF AMERICA ADVISORS, INC.
By: /s/ Robert H. Gordon
--------------------------------
Robert H. Gordon
President
8
<PAGE>
SCHEDULE I
The Master Trust shall pay the Adviser, as full compensation for
services provided and expenses assumed hereunder, an advisory fee for each
Master Portfolio, computed daily and payable monthly at the annual rates listed
below as a percentage of the average daily net assets of the Master Portfolio:
RATE OF
MASTER PORTFOLIO COMPENSATION EFFECTIVE DATE
Nations High Yield Bond Master Portfolio 0.55% 2/14/00
Approved: December 9, 1999
9
SUB-ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made as of this 21st day of May, 1999, by and among
NATIONSBANC ADVISORS, INC., a North Carolina corporation (the "Adviser"),
TRADESTREET INVESTMENT ASSOCIATES, INC., a Maryland corporation (the
"Sub-Adviser"), and NATIONS MASTER INVESTMENT TRUST, a Delaware business trust
(the "Trust"), on behalf of those portfolios of the Trust now or hereafter
identified on Schedule I hereto (each a "Master Portfolio" and collectively, the
"Master Portfolios").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "Commission") as an open-end, management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Adviser is registered with the Commission under the
Investment Advisers Act of 1940, as amended (the "Advisers Act") as an
investment adviser;
WHEREAS, the Sub-Adviser also is registered with the Commission under
the Advisers Act as an investment adviser;
WHEREAS, the Adviser and the Trust have entered into an Investment
Advisory Agreement (the "Investment Advisory Agreement"), pursuant to which the
Adviser shall act as investment adviser with respect to the Master Portfolios;
and
WHEREAS, pursuant to such Investment Advisory Agreement, the Adviser,
with the approval of the Trust, wishes to retain the Sub-Adviser for purposes of
rendering advisory services to the Adviser and the Trust in connection with the
Master Portfolios upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT OF SUB-ADVISER. The Adviser hereby appoints, and the
Trust hereby approves, the Sub-Adviser to render investment research and
advisory services to the Adviser and the Trust with respect to the Master
Portfolios, under the supervision of the Adviser and subject to the policies and
control of the Trust's Board of Trustees, and the Sub-Adviser hereby accepts
such appointment, all subject to the terms and conditions contained herein.
2. INVESTMENT SERVICES. Subject to the supervision of the Adviser and
the Trust's Board of Trustees, the Sub-Adviser will provide a continuous
investment program for each Master Portfolio, including investment research and
management with respect to all securities, investments, cash and cash
equivalents in each Master Portfolio. The Sub-Adviser will determine from time
to time what securities and other investments will be purchased, retained or
sold by the Master Portfolios and will place the daily orders for the purchase
or sale of securities. The Sub-Adviser will provide the services rendered by it
under this Agreement in accordance with each Master Portfolio's investment
objective, policies and restrictions as stated in the Prospectus and votes of
the Trust's Board of Trustees. The Sub-Adviser shall provide such additional
services related to the continuous investment program, including recordkeeping
services, as may reasonably be requested from time to time by the Trust or the
Adviser.
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<PAGE>
3. CONTROL BY BOARD OF TRUSTEES. As is the case with respect to the
Adviser under the Investment Advisory Agreement, any investment activities
undertaken by the Sub-Adviser pursuant to this Agreement, as well as any other
activities undertaken by the Sub-Adviser with respect to the Trust, shall at all
times be subject to any directives of the Board of Trustees of the Trust.
4. OTHER COVENANTS. In carrying out its obligations under this
Agreement, the Sub-Adviser agrees that it:
(a) will comply with all applicable Rules and Regulations of
the Commission and will in addition conduct its activities under this Agreement
in accordance with other applicable law, including but not limited to the 1940
Act and the Advisers Act;
(b) will use the same skill and care in providing such
services as it uses in providing services to fiduciary accounts for which it has
investment responsibilities;
(c) will not make loans to any person to purchase or carry
Master Portfolio shares;
(d) will place orders pursuant to its investment
determinations for the Master Portfolios either directly with the issuer or with
any broker or dealer. Subject to the other provisions of this paragraph, in
executing portfolio transactions and selecting brokers or dealers, the
Sub-Adviser will use its best efforts to seek on behalf of each Master Portfolio
the best overall terms available. In assessing the best overall terms available
for any transaction, the Sub-Adviser shall consider all factors that it deems
relevant, including the breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer, and the reasonableness of the commission, if any, both for the specific
transaction and on a continuing basis. In evaluating the best overall terms
available, and in selecting the broker/dealer to execute a particular
transaction, the Sub-Adviser may also consider the brokerage and research
services (as those terms are defined in Section 28(e) of the Securities Exchange
Act of 1934, as amended) provided to the Master Portfolio(s) and/or other
accounts over which the Sub-Adviser or an affiliate of the Sub-Adviser exercises
investment discretion. The Sub-Adviser is authorized, subject to the prior
approval of the Trust's Board of Trustees, to pay to a broker or dealer who
provides such brokerage and research services a commission for executing a
portfolio transaction for any Master Portfolio which is in excess of the amount
of commission another broker or dealer would have charged for effecting that
transaction if, but only if, the Sub-Adviser determines in good faith that such
commission was reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer, viewed in terms of that particular
transaction or in terms of the overall responsibilities of the Sub-Adviser to
the particular Master Portfolio and to the Trust. In addition, the Sub-Adviser
is authorized to take into account the sale of shares of the Trust in allocating
purchase and sale orders for portfolio securities to brokers or dealers
(including brokers and dealers that are affiliated with the Sub-Adviser or the
Trust's principal underwriter), provided that the Sub-Adviser believes that the
quality of the transaction and the commission are comparable to what they would
be with other qualified firms. In no instance, however, will portfolio
securities be purchased from or sold to the Sub-Adviser or the Trust's principal
underwriter for the Master Portfolios or an affiliated person of either acting
as principal or broker, except as permitted by the Commission or applicable law;
2
<PAGE>
(e) will maintain a policy and practice of conducting its
investment advisory services hereunder independently of the commercial banking
operations of its affiliates. In making investment recommendations for a Master
Portfolio, its investment advisory personnel will not inquire or take into
consideration whether the issuer (or related supporting institution) of
securities proposed for purchase or sale for the Master Portfolio's account are
customers of the commercial departments of its affiliates. In dealing with
commercial customers, such commercial departments will not inquire or take into
consideration whether securities of those customers are held by the Master
Portfolio; and
(f) will treat confidentially, and as proprietary information
of the Trust, all records and other information relative to the Trust and prior,
present or potential interestholders, and will not use such records and
information for any purpose other than performance of its responsibilities and
duties hereunder (except after prior notification to and approval in writing by
the Trust, which approval shall not be unreasonably withheld and may not be
withheld and will be deemed granted where the Sub-Adviser may be exposed to
civil or criminal contempt proceedings for failure to comply, when requested to
divulge such information by duly constituted authorities, or when so requested
by the Trust).
5. SERVICES NOT EXCLUSIVE. The services furnished by the Sub-Adviser
hereunder are deemed not to be exclusive, and the Sub-Adviser shall be free to
furnish similar services to others so long as its services under this Agreement
are not impaired thereby. To the extent that the purchase or sale of securities
or other investments of the same issuer may be deemed by the Sub-Adviser to be
suitable for two or more accounts managed by the Sub-Adviser, the available
securities or investments may be allocated in a manner believed by the
Sub-Adviser to be equitable to each account. It is recognized that in some cases
this procedure may adversely affect the price paid or received by a Master
Portfolio or the size of the position obtainable for or disposed of by a Master
Portfolio.
6. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Adviser hereby agrees that all records which it
maintains for each Master Portfolio are the property of the Trust and further
agrees to surrender promptly to the Adviser or the Trust any of such records
upon request. The Sub-Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
3
<PAGE>
7. EXPENSES. During the term of this Agreement, the Sub-Adviser will
pay all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments
(including brokerage commissions and other transaction charges, if any)
purchased or sold for the Master Portfolios. In addition, the Sub-Adviser
acknowledges that the Adviser has agreed, pursuant to the Investment Advisory
Agreement, that, if the aggregate expenses borne by any Master Portfolio in any
fiscal year exceed the applicable expense limitations imposed by the securities
regulations of any state in which its shares are registered or qualified for
sale to the public, the Adviser together with the Master Portfolio's
administrator(s) shall reimburse such Master Portfolio for such excess in
proportion to the fees otherwise payable to them for such year. If, for any
fiscal year of a Master Portfolio, the amount of the aggregate advisory fee
which the Trust would otherwise be obligated to pay is reduced pursuant to
expense limitation provisions of the Investment Advisory Agreement, the fee
which the Sub-Adviser would otherwise receive pursuant to this Agreement shall
be reduced proportionately.
8. COMPENSATION. For the services provided to each Master Portfolio and
the expenses assumed pursuant to this Agreement, the Adviser will pay the
Sub-Adviser and the Sub-Adviser will accept as full compensation therefor a fee
for that Master Portfolio determined in accordance with Schedule I attached
hereto. The Adviser and the Sub-Adviser may, from time to time, agree to reduce,
limit or waive the amounts payable hereunder with respect to one or more Master
Portfolios for such period or periods they deem advisable. It is understood that
the Adviser shall be responsible for the Sub-Adviser's fee for its services
hereunder, and the Sub-Adviser agrees that it shall have no claim against the
Trust or the Master Portfolio with respect to compensation under this Agreement.
9. LIABILITY OF SUB-ADVISER. The Sub-Adviser shall not be liable for
any error of judgment or mistake of law or for any loss suffered by the Adviser
or the Trust in connection with the performance of this Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or gross negligence on the part of the Sub-Adviser in the performance of
its duties, or from reckless disregard by it of its obligations and duties under
this Agreement.
10. DURATION AND TERMINATION. This Agreement shall become effective
when approved, and shall continue in effect until the second anniversary of its
effective date. Thereafter, if not terminated, this Agreement shall continue in
effect for successive annual periods ending on January 1, provided that the
continuation of the Agreement is specifically approved at least annually:
(a)(i) by the Trust's Board of Trustees or (ii) by the vote
of "a majority of the outstanding voting securities" of the Master
Portfolio (as defined in Section 2(a)(42) of the 1940 Act); and
(b) by the affirmative vote of a majority of the Trustees
of the Trust who are not parties to this Agreement or "interested
persons" (as defined in the 1940 Act) of a party to this Agreement
(other than as Trustees of the Trust), by votes cast in person at
a meeting specifically called for such purpose.
4
<PAGE>
Notwithstanding the foregoing, this Agreement may be terminated as to any Master
Portfolio at any time, without the payment of any penalty, by the Trust (by vote
of the Trust's Board of Trustees or by vote of a majority of the outstanding
voting securities of the particular Master Portfolio), or by the Sub-Adviser or
Adviser on sixty (60) days' written notice to the other parties to this
Agreement. The notice provided for herein may be waived by the party entitled to
receipt thereof. This Agreement will immediately terminate in the event of its
assignment. As used in this Agreement, the terms "majority of the outstanding
voting securities," "interested persons" and "assignment" shall have the same
meanings as such terms have in the 1940 Act.
11. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No amendment of this Agreement affecting a
Master Portfolio shall be effective until approved by vote of a majority of the
outstanding voting securities of such Master Portfolio. However, this shall not
prevent the Sub-Adviser from reducing, limiting or waiving its fee.
12. RELEASE. The names "Nations Master Investment Trust" and "Trustees
of Nations Master Investment Trust" refer respectively to the Trust created and
the Trustees, as trustees but not individually or personally, acting from time
to time under a Declaration of Trust and the Certificate of Trust, dated January
14, 1999, which is hereby referred to and a copy of which is on file at the
principal office of the Trust. The obligations of "Nations Master Investment
Trust" entered into in the name or on behalf thereof by any of the Trustees,
representatives or agents are made not individually, but in such capacities, and
are not binding upon any of the Trustees, interestholders, or representatives of
the Trust personally, but bind only the Trust Property (as defined in the
Declaration of Trust) and all persons dealing with any class of shares of the
Trust must look solely to the property belonging to such class for the
enforcement of any claims against the Trust.
13. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. 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. This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and shall be
governed by Delaware law.
14. COUNTERPARTS. This Agreement may be executed in any manner of
counterparts, each of which shall be deemed an original.
5
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ A. Max Walker
------------------------------
A. Max Walker
President and Chairman of the
Board of Trustees
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
------------------------------
Robert H. Gordon
President
TRADESTREET INVESTMENT ASSOCIATES, INC.
By: /s/ Holly Deem
------------------------------
Holly Deem
President
6
<PAGE>
SCHEDULE I
The Adviser shall pay the Sub-Adviser, as full compensation for
services provided and expenses assumed hereunder, a sub-advisory fee for each
Master Portfolio, computed daily and payable monthly at the annual rates listed
below as a percentage of the average daily net assets of the Master Portfolio:
- --------------------------------------------------------------------------
RATE OF
MASTER PORTFOLIO COMPENSATION
- --------------------------------------------------------------------------
Nations Intermediate Bond Master Portfolio 0.15%
- --------------------------------------------------------------------------
Approved: December 2, 1998
7
SUB-ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made as of this 21st day of May, 1999, by and between
NATIONSBANC ADVISORS, INC., a North Carolina corporation (the "Adviser"),
CHICAGO EQUITY PARTNERS CORPORATION, a Delaware corporation (the "Sub-Adviser"),
and NATIONS MASTER INVESTMENT TRUST, a Delaware business trust (the "Trust"), on
behalf of those portfolios of the Trust now or hereafter identified on Schedule
I hereto (each a "Master Portfolio" and collectively, the "Master Portfolios").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission ("Commission") under the Investment Company Act of 1940, as amended
("1940 Act") as an open-end, management investment company;
WHEREAS, the Adviser is registered with the Commission under the
Investment Advisers Act of 1940, as amended (the "Advisers Act") and engages in
the business of acting as an investment adviser;
WHEREAS, the Sub-Adviser is also registered with the Commission under
the Advisers Act as an investment adviser and engages in the business of acting
as an investment adviser;
WHEREAS, the Adviser and the Trust have entered into an Investment
Advisory Agreement (the "Investment Advisory Agreement"), pursuant to which the
Adviser acts as investment adviser with respect to the Master Portfolios; and
WHEREAS, pursuant to such Investment Advisory Agreement, the Adviser,
with the approval of the Trust, wishes to retain the Sub-Adviser for purposes of
rendering advisory services to the Adviser and the Trust in connection with the
Master Portfolios upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and other good and valuable consideration, the receipt of which is
hereby acknowledged, it is agreed between the parties hereto as follows:
1. APPOINTMENT OF SUB-ADVISER. The Adviser hereby appoints the
Sub-Adviser to act as investment sub-adviser or co-investment sub-adviser with
respect to the Master Portfolios, under the supervision of the Adviser and
subject to the policies and control of the Trust's Board of Trustees, and the
Sub-Adviser hereby accepts such appointment, all subject to the terms and
conditions contained herein.
2. SERVICES OF SUB-ADVISER. Subject to the oversight and supervision of
the Adviser and the Trust's Board of Trustees, the Sub-Adviser will provide a
continuous investment program for the Master Portfolios, including investment
research and management with respect to all equity securities and investments.
Pursuant to the foregoing, the Sub-Adviser will determine from time to time what
securities and other investments will be purchased, retained or sold by the
Master Portfolios. The Sub-Adviser will provide the services rendered by it
under this Agreement in accordance with the investment criteria and policies
established from time to time for the Master Portfolios by the Adviser, the
Master Portfolios' investment objectives, strategies and restrictions as stated
in the Master Portfolios' Prospectuses and Statement of Additional Information,
the operating policies and procedures of the Master Portfolios, and resolutions
of the Trust's Board of Trustees.
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<PAGE>
The Sub-Adviser further agrees that it will:
(a) Provide information to the Master Portfolios' accountant for the
purpose of updating the Master Portfolios' cash availability
throughout the day as required;
(b) Maintain historical tax lots for each portfolio security held by
the Master Portfolios;
(c) Transmit trades to the Trust's custodian for proper settlement in
accordance with the Trust's procedures and as may be directed by
the Trust or the Adviser;
(d) Maintain all books and records with respect to the Master
Portfolios that are required to be maintained under Rule 31a-l(f)
under the 1940 Act;
(e) Supply the Adviser, the Trust and the Trust's Board of Trustees
with reports, statistical data and economic information as
requested; and
(f) Prepare a quarterly broker security transaction summary and, if
requested in advance, monthly security transaction listing for
the Master Portfolios.
3. CONTROL BY BOARD OF TRUSTEES. As is the case with respect to the
Adviser under the Investment Advisory Agreement, any investment activities
undertaken by the Sub-Adviser pursuant to this Agreement, as well as any other
activities undertaken by the Sub-Adviser with respect to the Trust, shall at all
times be subject to any directives of the Board of Trustees of the Trust.
4. OTHER COVENANTS. In carrying out its obligations under this
Agreement, the Sub-Adviser agrees that it:
(a) will comply with all applicable Rules and Regulations of the
Commission and will in addition conduct its activities under this
Agreement in accordance with other applicable law, including but
not limited to the 1940 Act and the Advisers Act;
(b) will use the same skill and care in providing such services as it
uses in providing services to fiduciary accounts for which it has
investment responsibilities;
(c) will not make loans to any person to purchase or carry Master
Portfolio shares;
2
<PAGE>
(d) will place orders pursuant to its investment determinations for
the Master Portfolios either directly with the issuer or with any
broker or dealer. Subject to the other provisions of this
paragraph, in executing portfolio transactions and selecting
brokers or dealers, the Sub-Adviser will use its best efforts to
seek on behalf of each Master Portfolio the best overall terms
available. In assessing the best overall terms available for any
transaction, the Sub-Adviser shall consider all factors that it
deems relevant, including the breadth of the market in the
security, the price of the security, the financial condition and
execution capability of the broker or dealer, and the
reasonableness of the commission, if any, both for the specific
transaction and on a continuing basis. In evaluating the best
overall terms available, and in selecting the broker/dealer to
execute a particular transaction, the Sub-Adviser may also
consider any brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934,
as amended) provided to the Master Portfolio and/or other
accounts over which the Sub-Adviser or an affiliate of the
Sub-Adviser exercises investment discretion. The Sub-Adviser is
authorized, subject to prior approval of the Trust's Board of
Trustees, to pay to a broker or dealer who provides such
brokerage and research services a commission for executing a
portfolio transaction for any Master Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if, but only if, the
Sub-Adviser determines in good faith that such commission was
reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer -- viewed in terms of
that particular transaction or in terms of the overall
responsibilities of the Sub-Adviser to its clients, including the
particular Master Portfolio and to the Trust. In addition, the
Sub-Adviser is authorized to take into account the sale of shares
of the Trust in allocating purchase and sale orders for portfolio
securities to brokers or dealers (including brokers and dealers
that are affiliated with the Sub-Adviser or the Trust's principal
underwriter), provided that the Sub-Adviser believes that the
quality of the transaction and the commission are comparable to
what they would be with other qualified firms. In no instance,
however, will portfolio securities be purchased from or sold to
the Adviser, Sub-Adviser or the Trust's principal underwriter for
the Master Portfolios or an affiliated person of either acting as
principal or broker, except as permitted by the Commission or
applicable law;
(e) will adhere to the policies and procedures of the Trust adopted
on behalf of the Master Portfolios;
(f) will maintain a policy and practice of conducting its investment
advisory services hereunder independently of the commercial
banking operations of its affiliates. In making investment
recommendations for a Master Portfolio, its investment advisory
personnel will not inquire or take into consideration whether the
issuer (or related supporting institution) of securities proposed
for purchase or sale for the Master Portfolio's account are
customers of the commercial departments of its affiliates;
3
<PAGE>
(g) will use reasonable efforts to perform its duties and obligations
under this Agreement without: (a) any failure of its computer
systems, or those used by it in the performance of its duties
hereunder, properly to record, store, process, calculate or
present calendar dates falling on and after, and time spans
including, September 9, 1999, January 1, 2000 or February 29,
2000 (the "Subject Dates") as a result of the occurrence, or use
of data containing, any such Subject Dates; (b) any failure of
its computer systems, or those used by it in the performance of
its duties hereunder, to calculate any information dependent on
or relating to dates on or after the Subject Dates; or (c) any
loss of functionality or performance with respect to the
maintenance of records or processing of data containing dates
falling on or after the Subject Dates ((a), (b), and (c) above
shall be referred to as "Y2K Failures"). Notwithstanding the
above, the Sub-Adviser shall not be liable for any Y2K Failures
caused by Y2K Failures in a third party system with which the
Sub-Adviser interfaces or from which the Sub-Adviser receives
data in connection with the performance of its duties hereunder;
and
(h) will treat confidentially and as proprietary information of the
Trust all records and other information relative to the Trust and
prior, present or potential interestholders, and will not use
such records and information for any purpose other than
performance of its responsibilities and duties hereunder (except
after prior notification to and approval in writing by the Trust,
which approval shall not be unreasonably withheld and may not be
withheld and will be deemed granted where the Sub-Adviser may be
exposed to civil or criminal contempt proceedings for failure to
comply, when requested to divulge such information by duly
constituted authorities, or when so requested by the Trust).
5. SERVICES NOT EXCLUSIVE. The services furnished by the Sub-Adviser
hereunder are deemed not to be exclusive, and the Sub-Adviser shall be free to
furnish similar services to others so long as its services under this Agreement
are not impaired thereby. To the extent that the purchase or sale of securities
or other investments of the same issuer may be deemed by the Sub-Adviser to be
suitable for two more accounts managed by the Sub-Adviser, the available
securities or investments may be allocated in a manner believed by the
Sub-Adviser to be equitable to each account. It is recognized that in some cases
this procedure may adversely affect the price paid or received by a Master
Portfolio or the size of the position obtainable for or disposed of by a Master
Portfolio.
6. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Adviser hereby agrees that all records which it
maintains for each Master Portfolio are the property of the Trust and further
agrees to surrender promptly to the Adviser or the Trust any of such records
upon request. The Sub-Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
4
<PAGE>
7. EXPENSES. During the term of this Agreement, the Sub-Adviser will
pay all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments
(including brokerage commissions and other transaction charges, if any)
purchased or sold for the Master Portfolios.
8. COMPENSATION. For the services provided to each Master Portfolio and
the expenses assumed pursuant to this Agreement, the Adviser will pay the
Sub-Adviser and the Sub-Adviser will accept as full compensation therefor a fee
for that Master Portfolio determined in accordance with Schedule I attached
hereto. The Adviser and the Sub-Adviser may, from time to time, agree to reduce,
limit or waive the amounts payable hereunder with respect to one or more Master
Portfolios for such period or periods they deem advisable. It is understood that
the Adviser shall be responsible for the Sub-Adviser's fee for its services
hereunder, and the Sub-Adviser agrees that it shall have no claim against the
Trust or the Master Portfolio with respect to compensation under this Agreement.
9. LIABILITY OF SUB-ADVISER. The Sub-Adviser shall not be liable for
any error of judgment or mistake of law or for any loss suffered by the Adviser
or the Company in connection with the performance of this Agreement, except a
loss resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or negligence on the part of the Sub-Adviser in the performance of its
duties or from reckless disregard by it of its obligations and duties under this
Agreement.
10. DURATION AND TERMINATION. This Agreement shall become effective
when approved, and shall continue in effect until the second anniversary of its
effective date. Thereafter, if not terminated, this Agreement shall continue in
effect for successive annual periods ending on January 1, provided that the
continuation of the Agreement is specifically approved at least annually:
(a)(i) by the Trust's Board of Trustees or (ii) by the vote of "a
majority of the outstanding voting securities" of the Master
Portfolio (as defined in Section 2(a)(42) of the 1940 Act);
and
(b) by the affirmative vote of a majority of the Trustees of the
Trust who are not parties to this Agreement or "interested
persons" (as defined in the 1940 Act) of a party to this
Agreement (other than as Trustees of the Trust), by votes cast
in person at a meeting specifically called for such purpose.
Notwithstanding the foregoing, this Agreement may be terminated as to any Master
Portfolio at any time, without the payment of any penalty, by the Trust (by vote
of the Trust's Board of Trustees or by vote of a majority of the outstanding
voting securities of the particular Master Portfolio), or by the Sub-Adviser or
Adviser on sixty (60) days' written notice to the other parties to this
Agreement. The notice provided for herein may be waived by the party entitled to
receipt thereof. This Agreement will immediately terminate in the event of its
assignment. As used in this Agreement, the terms "majority of the outstanding
voting securities," "interested persons" and "assignment" shall have the same
meanings as such terms have in the 1940 Act.
5
<PAGE>
11. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No amendment of this Agreement affecting a
Master Portfolio shall be effective until approved by vote of a majority of the
outstanding voting securities of such Master Portfolio. However, this shall not
prevent the Sub-Adviser from reducing, limiting or waiving its fee.
12. RELEASE. The names "Nations Master Investment Trust" and "Trustees
of Nations Master Investment Trust" refer respectively to the Trust created and
the Trustees, as trustees but not individually or personally, acting from time
to time under a Declaration of Trust dated as of January 14, 1999, which is
hereby referred to and a copy of which is on file at the principal office of the
Trust. The obligations of "Nations Master Investment Trust" entered into in the
name or on behalf thereof by any of the Trustees, representatives or agents are
made not individually, but in such capacities, and are not binding upon any of
the Trustees, interestholders, or representatives of the Trust personally, but
bind only the Trust property, and all persons dealing with any class of shares
of the Trust must look solely to the property belonging to such class for the
enforcement of any claims against the Trust.
13. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. 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. This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and shall be
governed by Delaware law.
14. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
6
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ A. Max Walker
-------------------------
A. Max Walker
President and Chairman of
the Board of Trustees
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
-------------------------
Robert H. Gordon
President
CHICAGO EQUITY PARTNERS CORPORATION
By: /s/ James D. Miller
-------------------------
James D. Miller
President
7
<PAGE>
SCHEDULE I
The Adviser shall pay the Sub-Adviser, as full compensation for
services provided and expenses assumed hereunder, a sub-advisory fee for each
Master Portfolio, computed daily and payable monthly at the annual rates listed
below as a percentage of the average daily net assets of the Master Portfolio:
Master Portfolio Rate of Compensation
---------------- --------------------
Nations Blue Chip Master Portfolio 0.25%
Approved: December 2, 1998
8
SUB-ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made this 19th day of August, 1999, by and among
NATIONSBANC ADVISORS, INC., a North Carolina corporation (the "Adviser"),
GARTMORE GLOBAL PARTNERS, a general partnership organized under the laws of the
State of Delaware (the "Sub-Adviser"), and NATIONS MASTER INVESTMENT TRUST (the
"Trust"), on behalf of the portfolio or portfolios of the Trust as now or
hereafter may be identified on Schedule I hereto (each a "Master Portfolio" and
collectively, the "Master Portfolios").
RECITALS
WHEREAS, the Trust is a Delaware business trust registered under the
Investment Trust Act of 1940, as amended (the "1940 Act") as an open-end, series
management investment company; and
WHEREAS, the Adviser is a national bank that serves as investment
adviser to other registered investment companies and various investment
accounts; and
WHEREAS, the Sub-Adviser is registered under the Investment Advisers
Act of 1940, as amended (the "Advisers Act"), as an investment adviser and
engages in the business of acting as an investment adviser, and is regulated by
the Investment Management Regulatory Organization Limited ("IMRO") of the United
Kingdom in the conduct of its investment business and is a member of IMRO; and
WHEREAS, the Adviser and the Trust have entered into an Investment
Advisory Agreement (the "Investment Advisory Agreement"), pursuant to which the
Adviser shall act as investment adviser with respect to the Master Portfolios;
and
WHEREAS, pursuant to such Investment Advisory Agreement, the Adviser,
with the approval of the Trust, wishes to retain the Sub-Adviser for purposes of
rendering advisory services to the Adviser and the Trust in connection with the
Master Portfolios upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt whereof is
hereby acknowledged, the parties hereto agree as follows:
1. APPOINTMENT OF SUB-ADVISER. The Adviser hereby appoints, and the
Trust hereby approves, the Sub-Adviser to render investment research and
advisory services to the Adviser and the Trust with respect to some portion or
all of the assets of the Master Portfolios as the Adviser may determine from
time to time, under the supervision of the Adviser and subject to the policies
and control of the Trust's Board of Trustees, and the Sub-Adviser hereby accepts
such appointment, all subject to the terms and conditions contained herein.
<PAGE>
2. INVESTMENT SERVICES. The specific duties of the Adviser delegated to
the Sub-Adviser shall be the following:
(a) obtaining and evaluating pertinent information about
significant developments and economic, statistical and financial data,
domestic, foreign or otherwise, whether affecting the economy generally
or the Master Portfolios specifically, and whether concerning the
individual issuers whose securities are included in the Master
Portfolios or the activities in which such issuers engage, or with
respect to securities which the Adviser or Sub-Adviser considers
desirable for inclusion in the Master Portfolios;
(b) investing and reinvesting, on an ongoing basis, assets
held in the Master Portfolios in strict accordance with the investment
policies of the Master Portfolios as set forth in the registration
statement of the Trust with respect to the Master Portfolios, as the
same may be amended from time to time;
(c) in accordance with policies and procedures established by
the Board of Trustees of the Trust and the Adviser, selecting brokers
and dealers to execute portfolio transactions for the Master Portfolios
and selecting the markets on or in which the transactions will be
executed;
(d) voting, either in person or by general or limited proxy,
or refraining from voting, any securities held in the Master Portfolios
for any purposes; exercising or selling any subscription or conversion
rights; consenting to and joining in or opposing any voting trusts,
reorganizations, consolidations, mergers, foreclosures and liquidations
and in connection therewith, depositing securities, and accepting and
holding other property received therefor, all as may be considered
appropriate by the Sub-Adviser; and
(e) performing other acts necessary or appropriate in
connection with the proper management of the Master Portfolios,
consistent with its obligations hereunder, and as may be directed by
the Adviser and/or the Trust's Board of Trustees.
In carrying out its obligations under clauses (b) to (e), inclusive, of
this Paragraph 2, the Sub-Adviser shall act only as agent of the Trust and/or
the Master Portfolio and shall not act as principal. The Sub-Adviser shall not
be responsible for the administration of the Master Portfolio, for the execution
and settlement of transactions in securities or derivative instruments nor for
the custody of any such securities or instruments or documents of title and the
Sub-Adviser shall not hold any money or other assets of the Master Portfolio or
the Trust.
3. CONTROL BY BOARD OF TRUSTEES. As is the case with respect to the
Adviser under the Investment Advisory Agreement, any investment activities
undertaken by the Sub-Adviser pursuant to this Agreement, as well as any other
activities undertaken by the Sub-Adviser with respect to the Master Portfolios,
shall at all times be subject to any directives of the Board of Trustees of the
Trust. Without limiting the right of the Board of Trustees of the Trust to issue
directives, the Board of Trustees shall take into consideration any views or
opinions that may be expressed by the Adviser of Sub-Adviser in formulating
policies, procedures and directives. The Sub-Adviser shall not be obligated to
conform its activities to any directive of the Board of Trustees of the Trust to
the extent that compliance with such directive would be in contravention of any
law, rule or regulation applicable to the Sub-Adviser.
2
<PAGE>
4. COMPLIANCE WITH APPLICABLE REQUIREMENTS. In carrying out its
obligations under this Agreement, the Sub-Adviser shall at all times conform to:
(a) all applicable provisions of the 1940 Act and any rules
and regulations adopted thereunder;
(b) the provisions of the registration statement of the Trust
applicable to the Master Portfolios, as the same may be amended from
time to time, under the Securities Act of 1933 and the 1940 Act;
(c) the Conduct of Business Rules of IMRO ("IMRO Rules") to
the extent that the IMRO Rules are not inconsistent with any applicable
requirements under the 1940 Act, the Advisers Act or other United
States federal or state law; and
(d) such policies and procedures that may be established by
the Board of Trustees of the Trust and communicated to the Sub-Adviser
from time to time.
In addition, any code of ethics adopted by the Sub-Adviser pursuant to Rule
17j-1 under the 1940 Act shall include policies, prohibitions and procedures
which substantially conform to the recommendations regarding personal investing
approved by the Board of Governors of the Investment Company Institute on June
30, 1994, as such recommendations may be amended from time to time.
5. COMPENSATION. The Adviser shall pay the Sub-Adviser, as compensation
for services rendered hereunder, fees, payable monthly, at the annual rates
indicated on Schedule I hereto, as such Schedule may be supplemented and amended
from time to time. It is understood that the Adviser shall be responsible for
the Sub-Adviser's fee for its services hereunder, and the Sub-Adviser agrees
that it shall have no claim against the Trust or the Master Portfolio with
respect to compensation under this Agreement. The Sub-Adviser's fees shall be
pro-rated for portions of months in which sub-advisory services are provided.
The average daily net asset value of the Master Portfolios shall be
determined in the manner set forth in the Articles of Incorporation and
registration statement of the Trust, as amended from time to time.
6. EXPENSES OF THE MASTER PORTFOLIOS. All of the ordinary business
expenses incurred by the Sub-Adviser in the operations of the Master Portfolios
and the offering of their shares shall be borne by the Master Portfolios unless
specifically provided otherwise in this Agreement. These expenses borne by the
Master Portfolios include but are not limited to brokerage commissions, taxes,
legal, auditing, or governmental fees, the cost of preparing share certificates,
custodian, transfer agent and shareholder service agent costs, expenses of
issue, sale, redemption and repurchase of shares, Trustees and shareholder
meetings, the cost of preparing and distributing reports and notices to
shareholders, the fees and other expenses incurred by the Master Portfolios in
connection with membership in investment company organizations and the cost of
printing copies of prospectuses and statements of additional information
distributed to the Master Portfolios' shareholders.
3
<PAGE>
7. EXPENSE LIMITATION. If, for any fiscal year a Master Portfolio, the
amount of the aggregate advisory fee which the Trust would otherwise be
obligated to pay with respect to the Master Portfolio is reduced pursuant to
expense limitation provisions of the Investment Advisory Agreement, the fee
which the Sub-Adviser would otherwise receive pursuant to this Agreement shall
be reduced proportionately.
8. NON-EXCLUSIVITY. The services of the Sub-Adviser to the Adviser and
the Trust with respect to the Master Portfolio are not to be deemed to be
exclusive, and the Sub-Adviser shall be free to render investment advisory and
administrative or other services to others (including other investment
companies) and to engage in other activities. It is understood and agreed that
the officers and directors of the Sub-Adviser are not prohibited from engaging
in any other business activity or from rendering services to any other person,
or from serving as partners, officers, directors or trustees of any other firm
or trust, including other investment advisory companies.
9. RECORDS. The Sub-Adviser shall provide to the Adviser, with respect
to the orders the Sub-Adviser places for the purchases and sales of portfolio
securities of the Master Portfolios, the documents and records required pursuant
to Rule 31a-1 under the 1940 Act as well as such records as the Master
Portfolios' administrator reasonably requests to be maintained, including, but
not limited to, trade tickets and confirmations for portfolio trades. All such
records shall be maintained in a form acceptable to the Master Portfolios and in
compliance with the provisions of Rule 31a-1. All such records will be the
property of the Master Portfolios and will be available for inspection and use
by the Master Portfolios. The Sub-Adviser will promptly notify the Adviser and
the Master Portfolio's administrator if it experiences any difficulty in
providing the records in an accurate and complete manner.
10. TERM AND APPROVAL. This Agreement shall become effective when
approved, and shall continue in effect until the second anniversary of its
effective date. Thereafter, if not terminated, this Agreement shall continue in
effect for successive annual periods ending on January 1, provided that the
continuation of the Agreement is specifically approved at least annually:
(a)(i) by the Trust's Board of Trustees or (ii) by the vote of
"a majority of the outstanding voting securities" of the Master
Portfolio (as defined in Section 2(a)(42) of the 1940 Act); and
(b) by the affirmative vote of a majority of the Trustees of
the Trust who are not parties to this Agreement or "interested persons"
(as defined in the 1940 Act) of a party to this Agreement (other than
as Trustees of the Trust), by votes cast in person at a meeting
specifically called for such purpose.
4
<PAGE>
11. TERMINATION. This Agreement may be terminated at any time with
respect to a Master Portfolio, without the payment of any penalty, by vote of
the Trust's Board of Trustees or by vote of a majority of the Master Portfolio's
outstanding voting securities, or by the Adviser, or by the Sub-Adviser on sixty
(60) days' written notice to the other parties to this Agreement. Any party
entitled to notice may waive the notice provided for herein. This Agreement
shall automatically terminate in the event of its assignment, the term
"assignment" for purposes of this paragraph having the meaning defined in
Section 2(a)(4) of the 1940 Act. This Agreement shall automatically terminate
120 days after its effectiveness if the Master Portfolio's shareholders have not
ratified and approved it within such period. The Agreement shall automatically
terminate upon the effectiveness of a Sub-Advisory Agreement between the Trust
on behalf of the Master Portfolio and Gartmore Global Partners.
12. LIABILITY OF SUB-ADVISER. In the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Sub-Adviser or any of its officers, directors,
employees or agents, the Sub-Adviser shall not be subject to liability to the
Adviser or to the Trust for any act or omission in the course of, or connected
with, rendering services hereunder or for any losses that may be sustained in
the purchase, holding or sale of any security. For purposes of this paragraph
and paragraph 13, brokers or dealers selected to execute portfolio transactions
for the Master Portfolio in accordance with Paragraph 2(c) hereof shall not be
considered agents of the Sub-Adviser.
13. INDEMNIFICATION. In the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of duties hereunder on the part of the
Sub-Adviser, or any officers, directors, employees or agents thereof, the Trust
hereby agrees to indemnify and hold harmless the Sub-Adviser against all claims,
actions, suits or proceedings at law or in equity whether brought by a private
party or a governmental department, commission, board, bureau, agency or
instrumentality of any kind, (a) arising from the advertising, solicitation,
sale, purchase or pledge of securities, whether of the Master Portfolios or
other securities, undertaken by the Master Portfolios or the Trust's officers,
Trustees, employees, agents or affiliates, or (b) resulting from any violations
of the securities laws, rules, regulations, statutes and codes, whether federal
or of any state, by the Master Portfolios, or the Trust's officers, Trustees,
employees or affiliates.
14. NOTICES. Any notices under this Agreement shall be in writing and
shall be duly given if delivered, mailed (postage prepaid, effective upon
receipt) or telegraphed, telexed or transmitted by similar telecommunications
device (effective upon completion of transmission, with a confirming copy
delivered or mailed postage prepaid) to such address or number as may be
designated for the receipt of such notice, with a copy to the Trust. Until
further notice, it is agreed that the address and telefax number of the Trust
shall be 111 Center Street, Little Rock, Arkansas 72201, Fax No. (501) 377-2331;
that of the Sub-Adviser shall be Gartmore House, 16-18 Monument Street, London
EC3R 8AJ, England, Fax No. 71-782-2075; and that of the Adviser shall be c/o
Mutual Fund Group, 33rd Floor, One Bank of America Plaza, Charlotte, North
Carolina 28255, Fax No. (704) 388-2187.
5
<PAGE>
15. QUESTIONS OF INTERPRETATION. Any question of interpretation of any
term or provision of this Agreement having a counterpart in or otherwise derived
from a term or provision of the 1940 Act shall be resolved by reference to such
term or provision of the 1940 Act and to interpretations thereof, if any, by the
United States courts or in the absence of any controlling decision of any such
court, by rules, regulations or orders of the Securities and Exchange Commission
issued pursuant to the 1940 Act. In addition, where the effect of a requirement
of the 1940 Act reflected in any provision of this Agreement is revised by rule,
regulation or order of the Securities and Exchange Commission, such provision
shall be deemed to incorporate the effect of such rule, regulation or order.
16. IMRO RULES. Addendum A attached hereto sets forth certain
requirements under the IMRO Rules which are applicable to the Sub-Adviser, that
are expressly incorporated herein and made a part hereof, but only to the extent
that such requirements are not inconsistent with any applicable requirements
under the 1940 Act, the Advisers Act or other United States federal or state
law.
6
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in triplicate by their respective officers on the day and year first written
above.
NATIONS MASTER INVESTMENT TRUST,
on behalf of the Master Portfolios
By: /s/ A. Max Walker
-------------------------------
A. Max Walker
President and Chairman of the
Board of Trustees
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
-------------------------------
Robert H. Gordon
President
GARTMORE GLOBAL PARTNERS
By: /s/ Chris Russell
-------------------------------
Chris Russell
Member of Management Committee
7
<PAGE>
SCHEDULE I
The Adviser shall pay the Sub-Adviser as full compensation for services
provided and expenses assumed hereunder, a sub-advisory fee for each Master
Portfolio, computed daily and payable monthly at the annual rates listed below
as a percentage of the average daily net assets of the Master Portfolio under
the Sub-Adviser's management:
Master Portfolio Rate of Compensation
1. Nations International Equity Master 0.70% of average daily net assets
Portfolio
Approved March 31, 1999
8
<PAGE>
ADDENDUM A
1. To the extent that the Sub-Adviser receives any commissions or other forms
of remuneration, directly or indirectly, in connection with Master
Portfolio transactions, no portion of the Sub-Adviser's accrued investment
advisory fee shall be abated thereby.
2. Subject to the supervision of the Adviser and the policies and ultimate
control of the Trust's Board of Trustees, the Sub-Adviser shall advise the
Trust and the Adviser on the management of the Master Portfolios'
investments in accordance with the terms of this Agreement and in
accordance with the investment parameters (including, inter alia,
percentage limitations, quality standards, investment selection criteria
and types of permissible investments and investment techniques, such as
borrowing, options and futures transactions, portfolio securities lending,
etc.) established pursuant to the investment objectives, policies and
restrictions specifically embodied in the Trust's Registration Statement
on Form N-1A, and any amendments thereto, under the Securities Act of 1933
and the 1940 Act (the "Master Portfolio's Registration Statement").
3. The Sub-Adviser shall not have or maintain custody of any securities, cash
or other assets of the Master Portfolios. Custody of the Master
Portfolios' assets will be maintained by the custodian bank pursuant to an
agreement approved by the Master Portfolios' Board of Trustees. It is
expected that such custodian, or any successor thereto, will not be an
"Associate" of the Sub-Adviser as that term is defined under IMRO Rules.
4. In the event the Master Portfolios or the Adviser has a significant
complaint regarding the services provided by the Sub-Adviser under the
Sub-Advisory Agreement by and among the Trust, the Adviser and the
Sub-Adviser, a Master Portfolio officer should communicate such complaint
to the Sub-Adviser, whereupon such complaint will be recorded on a
standard form prepared by the Sub-Adviser for such purposes. The
Sub-Adviser's complaints procedure requires that if a complaint has not
been cleared within twenty-one (21) days, the Sub-Adviser must so advise
IMRO and the Master Portfolio also must be advised that it has the right
to issue its complaint directly with a referee appointed by IMRO.
5. The Sub-Adviser will provide to the Master Portfolios' Board of Trustees
written financial reports and analyses on the Master Portfolios'
securities transactions and the operations of comparable investment
companies on a quarterly basis or more frequently as requested by the
Board of Trustees. Such reports and analyses shall include information as
at the last day of an applicable reporting period.
6. The Master Portfolios may from time to time request or instruct the
Sub-Adviser, directly or through the Adviser, to act or not to act
regarding certain Master Portfolio-related investment and/or operational
matters. Such request or instructions will be communicated orally or in
writing to the Sub-Adviser, directly or through the Adviser and will be
acknowledged in the same manner in which they are communicated. To the
extent that a particular request or instruction is, or may be, refused
(i.e., because it (a) is in contravention of (i) a law or regulation, (ii)
an investment policy of the Master Portfolio, or (iii) a provision of this
Agreement or (b) is not operationally feasible), such refusal shall be
communicated by the Sub-Adviser, including through the Adviser, and the
Master Portfolio and the Sub-Adviser, upon advice of counsel, shall
discuss alternatives and determine an appropriate course of action which
will be reported to the full Board at the next meeting of the Master
Portfolio's Board of Trustees for its approval.
1
<PAGE>
7. Notwithstanding that all required disclosure concerning the risks
associated with the Master Portfolios' permissible investments and
investment techniques is included in the Master Portfolios' Registration
Statement, which Statement is intended for review by the investors in the
Master Portfolios and to be retained by them for future reference, with
respect to the Master Portfolios' specified use of options and futures
transactions, the following shall be specifically noted herein:
"Options and futures markets can be highly volatile and transactions of
this type carry a high risk of loss. Moreover, a relatively small
adverse market movement with respect to these types of transactions may
result not only in loss of the original investment but also in
unquantifiable further loss exceeding any margin deposited."
Further, in managing the Master Portfolios' assets, the Sub-Adviser shall
consider the risks associated with the Master Portfolio's permissible
investments and investment techniques.
8. The Sub-Adviser or its representatives may from time to time recommend to
the Master Portfolios or effect on behalf of the Master Portfolios with
respect to Master Portfolio transactions in securities the subject of a
recent new issue, the price of which transactions may have been influenced
by bids made or transactions effected for the purpose of stabilizing the
price of those securities. Such transactions would at all times be
effected in accordance with the provisions of IMRO Rule 14 and, in
particular, with the conditions of the IMRO Rule 14.02, including the
requirement that the Sub-Adviser, with respect to any specific
transaction, communicate to the Master Portfolio orally or in writing a
statement in a form substantially similar to that which is set forth in
IMRO Rule 14.02(c). In addition, with respect to these transactions, it is
understood when executing this Agreement and thereafter when approving the
continuance of this Agreement in accordance with its terms, that
management of the Master Portfolio has carefully read the following
paragraphs in order to enable Master Portfolio management to judge whether
it wishes a Master Portfolio's assets to be invested at all in such
securities or, if so, whether it wishes to authorize the Sub-Adviser
generally to effect transactions in such securities on behalf of the
Master Portfolio without further reference to Master Portfolio management
or whether Master Portfolio management wishes to be consulted before any
particular transaction is effected on behalf of the Master Portfolio.
Stabilization is a process whereby the market price of a security is
pegged or fixed during the period in which a new issue of securities is
sold to the public. Stabilization may take place in the new issue or in
other securities related to the new issue in such a way that the price of
the other securities may affect the price of the new issue or vice versa.
The reason stabilization is permitted is that when a new issue is brought
to market the sudden glut will sometimes force the price lower for a
period of time before buyers are found for the securities on offer.
2
<PAGE>
As long as it obeys a strict set of rules, the "stabilizing manager,"
normally the issuing house chiefly responsible for bringing a new issue to
market, is entitled to buy securities in the market that it has previously
sold to investors or allotted to institutions who were included in the new
issue but who have decided not to continue participating. The effect of
this may be to keep the price at a higher level than would otherwise be
the case during the period of stabilizing.
The rules referred to above in the immediately preceding paragraph limit
the period in which the stabilizing manager may stabilize, fix the price
at which it may stabilize (in the case of shares and warrants but not
bonds), and require the stabilizing manager to disclose that it may be
(but not that it is) stabilizing. The fact that a new issue or a related
security is being stabilized does not in itself mean that investors are
not interested in the issue, but neither should the existence of
transactions in an issue where the stabilizing may take place be relied
upon as an indication that investors are interested in the new issue or
interested in purchasing at the price at which transactions are taking
place.
9. A report containing the Master Portfolios' financial statements (including
the contents and valuation of the Master Portfolios) shall be submitted to
shareholders and to the Securities and Exchange Commission at least
semi-annually. Such reports shall include information as at the last day
of any semi-annual period for which such reports relate. To the extent
that any performance information is included in such report, it shall
conform to the standards set forth in the Master Portfolios' Registration
Statement.
10. Except as permitted by or pursuant to Section 17 of the 1940 Act and the
Rules promulgated thereunder, the Sub-Adviser, or an "affiliate" thereof
(as that term is defined in the 1940 Act), may not effect transactions:
(i) with or for the Master Portfolios in which the Sub-Adviser or such
affiliate has directly or indirectly a material interest or a relationship
of any kind with another party which may involve a conflict with the
Sub-Adviser's responsibilities to the Master Portfolios as a
sub-investment adviser; or (ii) with or through the agency or another
person with whom the Sub-Adviser or such affiliate maintains an
arrangement as described in Rule 6.01 of Chapter IV of the IMRO Rules.
11. Upon termination of the Sub-Advisory Agreement by and among the Trust, the
Adviser and the Sub-Adviser, unless otherwise directed by the Master
Portfolio's Board of Trustees, all securities positions and other
portfolio transactions then in progress shall be transferred to the
successor investment adviser selected by the Board of Trustees.
12. The Sub-Adviser shall be entitled at its discretion to disclose any
information known to it relating to the Master Portfolio's business or
affairs to the Securities and Investment Board or to IMRO on the terms
that the information so disclosed shall not without its consent be further
disclosed otherwise than is permitted in respect of Restricted Information
under the provisions of Part VIII of the Financial Services Act of 1986.
3
SUB-ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made as of August 19, 1999 among NATIONSBANC
ADVISORS, INC., a North Carolina corporation (herein called the "Adviser"),
INVESCO Global Asset Management (N.A.), Inc., a Delaware corporation (herein
called the "Sub-Adviser") and NATIONS MASTER INVESTMENT TRUST (the "Trust"), on
behalf of the portfolio(s) of the Trust as now or hereafter may be identified on
Schedule I hereto (each a "Master Portfolio" and collectively, the "Master
Portfolios").
RECITALS
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "Commission") under the Investment Company Act of 1940, as
amended (the "1940 Act"), as an open-end series management investment company;
and
WHEREAS, the Adviser is registered with the Commission under the
Investment Advisers Act of 1940, as amended (the "Advisers Act"), and engages in
the business of acting as an investment adviser; and
WHEREAS, the Sub-Adviser is also registered under the Advisers Act, as
an investment adviser and engages in the business of acting as an investment
adviser; and
WHEREAS, the Adviser and the Trust have entered into an Investment
Advisory Agreement (the "Investment Advisory Agreement"), pursuant to which the
Adviser shall act as investment adviser with respect to the Master Portfolios;
and
WHEREAS, pursuant to such Investment Advisory Agreement, the Adviser,
with the approval of the Trust, wishes to retain the Sub-Adviser for purposes of
rendering advisory services to the Adviser and the Trust in connection with the
Master Portfolios upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt whereof is
hereby acknowledged, the parties hereto agree as follows:
1. Appointment.
The Adviser hereby appoints the Sub-Adviser to act as investment
sub-adviser to the Master Portfolios for the period and on the terms set forth
in this Agreement. The Sub-Adviser accepts such appointment and agrees to
furnish the services herein set forth for the compensation herein provided.
2. Services of Sub-Adviser.
Subject to the oversight and supervision of the Adviser and the Trust's
Board of Trustees, the Sub-Adviser will provide a continuous investment program
for all of the assets of the Master Portfolios, or for such portion of the
assets of the Master Portfolios as the Adviser may determine from time to time,
including investment research and management with respect to all securities and
investments, and except for such cash balances of the Master Portfolios as may,
from time to time, be managed by the Adviser. Subject to the terms of this
Agreement, the Sub-Adviser will determine from time to time what securities and
other investments will be purchased, retained or sold by the Master Portfolios.
The Sub-Adviser will provide the services rendered by it under this Agreement in
accordance with the investment criteria and policies established from time to
time for the Master Portfolios by the Adviser, the Master Portfolios' investment
objectives, policies and restrictions as stated in the Prospectus(es) and
Statement(s) of Additional Information for the Master Portfolios, the operating
policies and procedures of the Master Portfolios, and resolutions of the Master
Portfolios' Board of Trustees.
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The Sub-Adviser further agrees that it will:
(a) Provide information to the Master Portfolios'
accountant for the purpose of updating the Master
Portfolios' cash availability throughout the day as
required;
(b) Maintain historical tax lots for each portfolio
security held by the Master Portfolios;
(c) Transmit trades to the Trust's custodian for proper
settlement in accordance with the Trust's procedures;
(d) Maintain all books and records with respect to the
Master Portfolios that are required to be maintained
under Rule 31a-l(f) under the 1940 Act;
(e) Supply the Adviser, the Trust and the Trust's Board
of Trustees with reports, statistical data and
economic information as requested; and
(f) Prepare a quarterly broker security transaction
summary and, if requested in advance, monthly
security transaction listing for the Master
Portfolios.
3. Other Covenants.
The Sub-Adviser agrees that it will:
(a) Comply with all applicable laws, rules and
regulations, including all applicable Rules and
Regulations of the Commission;
(b) Use the same skill and care in providing such
services as it uses in providing services to
fiduciary accounts for which it has investment
responsibilities;
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(c) Place orders pursuant to its investment
determinations for the Master Portfolios either
directly with the issuer or with any broker or
dealer. In executing portfolio transactions and
selecting brokers or dealers, the Sub-Adviser will
use its best efforts to seek on behalf of the Master
Portfolios the best overall terms available. In
assessing the best overall terms available for any
transaction, the Sub-Adviser shall consider all
factors that it deems relevant, including the breadth
of the market in the security, the price of the
security, the financial condition and execution
capability of the broker or dealer, and the
reasonableness of the commission, if any, both for
the specific transaction and on a continuing basis.
In evaluating the best overall terms available, and
in selecting the broker-dealer to execute a
particular transaction, the Sub-Adviser may also
consider the brokerage and research services (as
those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) provided to the
Master Portfolios or other accounts over which the
Sub-Adviser or an affiliate of the Sub-Adviser
exercises investment discretion. The Sub-Adviser is
authorized, subject to the prior approval of the
Adviser and the Trust's Board of Trustees, to pay to
a broker or dealer who provides such brokerage and
research services a commission for executing a
portfolio transaction for the Master Portfolios which
is in excess of the amount of commission another
broker or dealer would have charged for effecting
that transaction if, but only if, the Sub-Adviser
determines in good faith that such commission was
reasonable in relation to the value of the brokerage
and research services provided by such broker or
dealer -- viewed in terms of that particular
transaction or in terms of the overall
responsibilities of the Sub-Adviser to the Master
Portfolios. In addition, the Sub-Adviser is
authorized to take into account the sale of shares of
the Trust in allocating purchase and sale orders for
portfolio securities to brokers or dealers (including
brokers and dealers that are affiliated with the
Adviser, Sub-Adviser or the Trust's principal
underwriter), provided that the Sub-Adviser believes
that the quality of the transaction and the
commission are comparable to what they would be with
other qualified firms. In no instance, however, will
portfolio securities be purchased from or sold to the
Adviser, Sub-Adviser, the Trust's principal
underwriter or any affiliated person of either the
Trust, the Adviser, Sub-Adviser, or the Trust's
principal underwriter, acting as principal in the
transaction, except to the extent permitted by the
Commission;
(d) Adhere to the policies and procedures of the Trust
adopted on behalf of the Master Portfolios;
(e) Use its best efforts to perform its duties and
obligations under this Agreement without: (a) any
failure of its computer systems, or those used by it
in the performance of its duties hereunder, properly
to record, store, process, calculate or present
calendar dates falling on and after, and time spans
including, September 9, 1999, January 1, 2000 or
February 29, 2000 (the "Subject Dates") as a result
of the occurrence, or use of data containing any such
Subject Dates; (b) any failure of its computer
systems, or those used by it in the performance of
its duties hereunder, to calculate any information
dependent on or relating to dates on or after the
Subject Dates; or (c) any loss of functionality or
performance with respect to the maintenance of
records or processing of data containing dates
falling on or after the Subject Dates; and
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(f) Treat confidentially and as proprietary information
of the Trust, all records and other information
relative to the Trust maintained by the Sub-Adviser,
and will not use such records and information for any
purpose other than performance of its
responsibilities and duties hereunder, except after
prior notification to and approval in writing by the
Trust, which approval shall not be unreasonably
withheld and may not be withheld where the
Sub-Adviser may be exposed to civil or criminal
contempt proceedings for failure to comply, when
requested to divulge such information by duly
constituted authorities, or when so requested by the
Trust.
4. Services Not Exclusive.
The services furnished by the Sub-Adviser hereunder are deemed not to
be exclusive, and the Sub-Adviser shall be free to furnish similar services to
others so long as its services under this Agreement are not impaired thereby. To
the extent that the purchase or sale of securities or other investments of the
same issuer may be deemed by the Sub-Adviser to be suitable for two or more
accounts managed by the Sub-Adviser, the available securities or investments may
be allocated in a manner believed by the Sub-Adviser to be equitable to each
account. It is recognized that in some cases this procedure may adversely affect
the price paid or received by the Master Portfolios or the size of the position
obtainable for or disposed of by the Master Portfolios.
5. Books and Records.
In compliance with the requirements of Rule 31a-3 under the 1940 Act,
the Sub-Adviser hereby agrees that all records which it maintains for the Master
Portfolios are the property of the Trust and further agrees to surrender
promptly to the Trust any of such records upon the Trust's request. The
Sub-Adviser further agrees to preserve for the periods prescribed by Rule 31a-2
under the 1940 Act, the records required to be maintained by it under this
Agreement.
6. Expenses.
During the term of this Agreement, the Sub-Adviser will pay all
expenses incurred by it in connection with its activities under this Agreement
other than the cost of securities, commodities and other investments (including
brokerage commissions, custodial charges and other transaction costs, if any)
purchased or sold for the Master Portfolios.
7. Expense Limitation.
If, for any fiscal year of a Master Portfolio, the amount of the
aggregate advisory fee which the Trust would otherwise be obligated to pay with
respect to the Master Portfolio is reduced pursuant to expense limitation
provisions of the Investment Advisory Agreement, the fee which the Sub-Adviser
would otherwise receive pursuant to this Agreement shall be reduced
proportionately.
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<PAGE>
8. Compensation.
The Adviser shall pay the Sub-Adviser, as compensation for services
rendered hereunder, fees, payable monthly, at the annual rates indicated on
Schedule I hereto, as such Schedule may be supplemented and amended from time to
time. It is understood that the Adviser shall be responsible for the
Sub-Adviser's fee for its services hereunder, and the Sub-Adviser agrees that it
shall have no claim against the Trust or the Master Portfolios with respect to
compensation under this Agreement.
For purposes of this Section, the average daily net asset value of the
Master Portfolios shall be determined in the manner set forth in the Articles of
Incorporation and registration statement of the Trust, as amended from time to
time, which shall be promptly provided by the Trust to the Sub-Adviser and to
which the Sub-Adviser will be bound to adhere to upon receipt.
9. Limitation of Liability.
The Sub-Adviser 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
performance of this Agreement, except that the Sub-Adviser shall be liable to
the Trust for any loss resulting from a breach of fiduciary duty with respect to
the receipt of compensation for services or any loss resulting from willful
misfeasance, bad faith or negligence on the part of the Sub-Adviser in the
performance of its duties or from reckless disregard by it of its obligations
and duties under this Agreement.
10. Indemnification.
The Sub-Adviser shall indemnify and hold harmless the Master Portfolios
and the Adviser from and against any and all claims, losses, liabilities or
damages (including reasonable attorney's fees and other related expenses)
howsoever arising from or in connection with the performance by the Sub-Adviser
of its duties under this Agreement, provided, however, that the Sub-Adviser
shall not be required to indemnify or otherwise hold the Adviser harmless under
this Section 10 where the claim against, or the loss, liability or damage
experienced by the Master Portfolios or the Adviser, is caused by or is
otherwise directly related to the Master Portfolios' or the Adviser's own
willful misfeasance, bad faith or negligence, or to the reckless disregard by
the Adviser of its duties under this Agreement.
11. Duration and Termination.
This Agreement will become effective as of the later of (a) the date
first written above, (b) the date on which it is approved by a majority of the
outstanding voting securities of the Master Portfolio(s), or (c) the date(s) on
which the Master Portfolio(s) commence(s) operations. Unless sooner terminated
as provided herein, this Agreement shall continue in effect until the second
anniversary of its effective date. Thereafter, if not terminated, this Agreement
shall continue in effect for successive annual periods ending on January 1,
provided such continuance is specifically approved at least annually (a) by the
vote of a majority of those members of the Trust's Board of Trustees who are not
interested persons of any party to this Agreement, cast in person at a meeting
called for the purpose of voting such approval, and (b) by the vote of a
majority of the Trust's Board of Trustees or by the vote of a majority of the
outstanding voting securities of the Master Portfolios. Notwithstanding the
foregoing, this Agreement may be terminated as to the Master Portfolios at any
time, without the payment of any penalty, by the Adviser or by the Trust (by
vote of the Trust's Board of Trustees or by vote of a majority of the
outstanding voting securities of the Master Portfolios), on sixty days' written
notice to the Sub-Adviser, or by the Sub-Adviser, on ninety days' written notice
to the Trust, provided that in each such case, notice shall be given
simultaneously to the Adviser. In addition, notwithstanding anything herein to
the contrary, in the event of the termination of the Investment Advisory
Agreement with respect to the Master Portfolios for any reason (whether by the
Trust, by the Adviser or by operation of law) this Agreement shall terminate
upon the effective date of such termination of the Investment Advisory
Agreement. This Agreement will also immediately terminate in the event of its
assignment. (As used in this Agreement, the terms "majority of the outstanding
voting securities," "interested persons" and "assignment" shall have the same
meaning as such terms have in the 1940 Act.)
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<PAGE>
12. Amendment of This Agreement.
No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against which enforcement of the change, waiver, discharge or termination is
sought. To the extent required by the 1940 Act, no amendment of this Agreement
shall be effective until approved by vote of a majority of the outstanding
voting securities of the Master Portfolio(s).
13. Miscellaneous.
The captions in this Agreement are included for convenience of
reference only, and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect. 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. This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and shall be governed by Delaware law.
14. Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers of the day and year first written above.
NATIONS MASTER INVESTMENT TRUST,
on behalf of the Master Portfolios
By: /s/ A. Max Walker
-----------------------------
A. Max Walker
President and Chairman of the
Board of Trustees
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
-----------------------------
Robert H. Gordon
President
INVESCO Global Asset Management (N.A.), Inc.
By: /s/ Kirk F. Holland
-----------------------------
Kirk F. Holland
Global Partner
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<PAGE>
SCHEDULE I
The Adviser shall pay the Sub-Adviser as full compensation for services
provided and expenses assumed hereunder, a sub-advisory fee for each Master
Portfolio, computed daily and payable monthly at the annual rates listed below
as a percentage of the average daily net assets of the Master Portfolio under
the Sub-Adviser's management:
MASTER PORTFOLIO RATE OF COMPENSATION
Nations International Equity Master Portfolio 0.65% of the first $60,000,000
of the Master Portfolio's
average daily net assets;
plus, 0.55% of the next
$130,000,000 of the Master
Portfolio's average daily net
assets; plus 0.45% of the next
$200,000,000 of the Master
Portfolio's average daily net
assets; plus 0.40% of the
Master Portfolio's average
daily net assets in excess of
$390,000,000.
Approved: March 31, 1999
8
SUB-ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made as of August 19, 1999 among NATIONSBANC
ADVISORS, INC., a North Carolina corporation (herein called the "Adviser"),
PUTNAM INVESTMENT MANAGEMENT, INC., a Massachusetts corporation (herein called
the "Sub-Adviser") and NATIONS MASTER INVESTMENT TRUST (the "Trust"), on behalf
of the portfolio(s) of the Trust as now or hereafter may be identified on
Schedule I hereto (each a "Master Portfolio" and collectively, the "Master
Portfolios").
RECITALS
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "Commission") under the Investment Company Act of 1940, as
amended (the "1940 Act"), as an open-end series management investment company;
and
WHEREAS, the Adviser is registered with the Commission under the
Investment Advisers Act of 1940, as amended (the "Advisers Act"), and engages in
the business of acting as an investment adviser; and
WHEREAS, the Sub-Adviser is also registered under the Advisers Act, as
an investment adviser and engages in the business of acting as an investment
adviser; and
WHEREAS, the Adviser and the Trust have entered into an Investment
Advisory Agreement (the "Investment Advisory Agreement"), pursuant to which the
Adviser shall act as investment adviser with respect to the Master Portfolios;
and
WHEREAS, pursuant to such Investment Advisory Agreement, the Adviser,
with the approval of the Trust, wishes to retain the Sub-Adviser for purposes of
rendering advisory services to the Adviser and the Trust in connection with the
Master Portfolios upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt whereof is
hereby acknowledged, the parties hereto agree as follows:
1. Appointment.
The Adviser hereby appoints the Sub-Adviser to act as investment
sub-adviser to the Master Portfolios for the period and on the terms set forth
in this Agreement. The Sub-Adviser accepts such appointment and agrees to
furnish the services herein set forth for the compensation herein provided.
2. Services of Sub-Adviser.
Subject to the oversight and supervision of the Adviser and the Trust's
Board of Trustees, the Sub-Adviser will provide a continuous investment program
for all of the assets of the Master Portfolios, or for such portion of the
assets of the Master Portfolios as the Adviser may determine from time to time,
including investment research and management with respect to all securities and
investments, and except for such cash balances of the Master Portfolios as may,
from time to time, be managed by the Adviser. Subject to the terms of this
Agreement, the Sub-Adviser will determine from time to time what securities and
other investments will be purchased, retained or sold by the Master Portfolios.
The Sub-Adviser will provide the services rendered by it under this Agreement in
accordance with the investment criteria and policies established from time to
time for the Master Portfolios by the Adviser, the Master Portfolios' investment
objectives, policies and restrictions as stated in the Prospectus(es) and
Statement(s) of Additional Information for the Master Portfolios, the operating
policies and procedures of the Master Portfolios, and resolutions of the Master
Portfolios' Board of Trustees (in each such case, to the extent such items are
delivered in writing to the Sub-Adviser). The Sub-Adviser shall not be
responsible for the administrative affairs of the Trust including, but not
limited to, portfolio accounting and pricing of the Trust's shares.
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The Sub-Adviser further agrees that it will:
(a) Provide information to the Master Portfolios' accountant for
the purpose of updating the Master Portfolios' cash
availability once a day at a mutually agreed upon time;
(b) Maintain historical tax lots for each portfolio security held
by the Master Portfolios under procedures agreed between the
parties hereto;
(c) Transmit trades to the Trust's custodian for proper settlement
in accordance with agreed procedures;
(d) Maintain all books and records with respect to the Master
Portfolios that are required to be maintained under Rule
31a-l(f) under the 1940 Act;
(e) Supply the Adviser, the Trust and the Trust's Board of
Trustees with reports, statistical data and economic
information as requested; and
(f) Prepare a quarterly broker security transaction summary and,
if requested in advance, monthly security transaction listing
for the Master Portfolios.
3. Other Covenants.
The Sub-Adviser agrees that it will:
(a) Comply with all applicable laws, rules and regulations,
including all applicable Rules and Regulations of the
Commission;
(b) Use the same skill and care in providing such services as it
uses in providing services to fiduciary accounts for which it
has investment responsibilities;
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<PAGE>
(c) Place orders pursuant to its investment determinations for the
Master Portfolios either directly with the issuer or with any
broker or dealer. In executing portfolio transactions and
selecting brokers or dealers, the Sub-Adviser will use its
best efforts to seek on behalf of the Master Portfolios the
best overall terms available. In assessing the best overall
terms available for any transaction, the Sub-Adviser shall
consider all factors that it deems relevant, including the
breadth of the market in the security, the price of the
security, the financial condition and execution capability of
the broker or dealer, and the reasonableness of the
commission, if any, both for the specific transaction and on a
continuing basis. In evaluating the best overall terms
available, and in selecting the broker-dealer to execute a
particular transaction, the Sub-Adviser may also consider the
brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) provided
to the Master Portfolios or other accounts over which the
Sub-Adviser or an affiliate of the Sub-Adviser exercises
investment discretion. The Sub-Adviser is authorized, subject
to the prior approval of the Adviser and the Trust's Board of
Trustees, to pay to a broker or dealer who provides such
brokerage and research services a commission for executing a
portfolio transaction for the Master Portfolios which is in
excess of the amount of commission another broker or dealer
would have charged for effecting that transaction if, but only
if, the Sub-Adviser determines in good faith that such
commission was reasonable in relation to the value of the
brokerage and research services provided by such broker or
dealer -- viewed in terms of that particular transaction or in
terms of the overall responsibilities of the Sub-Adviser to
the Master Portfolios. In addition, the Sub-Adviser is
authorized to take into account the sale of shares of the
Trust in allocating purchase and sale orders for portfolio
securities to brokers or dealers (including brokers and
dealers that are affiliated with the Adviser, Sub-Adviser or
the Trust's principal underwriter), provided that the
Sub-Adviser believes that the quality of the transaction and
the commission are comparable to what they would be with other
qualified firms. In no instance, however, will portfolio
securities be purchased from or sold to the Adviser,
Sub-Adviser, the Trust's principal underwriter, any affiliated
person of the Sub-Adviser, or to any affiliated person of
either the Trust, the Adviser or the Trust's principal
underwriter, acting as principal in the transaction identified
to the Sub-Adviser as such an affiliate, except to the extent
permitted by the Commission;
(d) Adhere to the policies and procedures of the Trust adopted on
behalf of the Master Portfolios and delivered to the
Sub-Adviser;
(e) Use its best efforts to perform its duties and obligations
under this Agreement without: (a) any failure of its computer
systems, or those used by it in the performance of its duties
hereunder, properly to record, store, process, calculate or
present calendar dates falling on and after, and time spans
including, September 9, 1999, January 1, 2000 or February 29,
2000 (the "Subject Dates") as a result of the occurrence, or
use of data containing any such Subject Dates; (b) any failure
of its computer systems, or those used by it in the
performance of its duties hereunder, to calculate any
information dependent on or relating to dates on or after the
Subject Dates; or (c) any loss of functionality or performance
with respect to the maintenance of records or processing of
data containing dates falling on or after the Subject Dates;
and
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(f) Treat confidentially and as proprietary information of the
Trust, all records and other information relative to the Trust
maintained by the Sub-Adviser, and will not use such records
and information for any purpose other than performance of its
responsibilities and duties hereunder, except after prior
notification to and approval in writing by the Trust, which
approval shall not be unreasonably withheld and may not be
withheld where the Sub-Adviser may be exposed to civil or
criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted
authorities, or when so requested by the Trust.
4. Services Not Exclusive.
The services furnished by the Sub-Adviser hereunder are deemed not to
be exclusive, and the Sub-Adviser shall be free to furnish similar services to
others so long as its services under this Agreement are not impaired thereby. To
the extent that the purchase or sale of securities or other investments of the
same issuer may be deemed by the Sub-Adviser to be suitable for two or more
accounts managed by the Sub-Adviser, the available securities or investments may
be allocated in a manner believed by the Sub-Adviser to be equitable to each
account. It is recognized that in some cases this procedure may adversely affect
the price paid or received by the Master Portfolios or the size of the position
obtainable for or disposed of by the Master Portfolios.
5. Books and Records.
In compliance with the requirements of Rule 31a-3 under the 1940 Act,
the Sub-Adviser hereby agrees that all records which it maintains for the Master
Portfolios are the property of the Trust and further agrees to surrender
promptly to the Trust any of such records upon the Trust's request. The
Sub-Adviser further agrees to preserve for the periods prescribed by Rule 31a-2
under the 1940 Act, the records required to be maintained by it under this
Agreement.
6. Expenses.
During the term of this Agreement, the Sub-Adviser will pay all
expenses incurred by it in connection with its activities under this Agreement
other than the cost of securities, commodities and other investments (including
brokerage commissions, custodial charges and other transaction costs, if any)
purchased or sold for the Master Portfolios.
7. Expense Limitation.
If, for any fiscal year of a Master Portfolio, the amount of the
aggregate advisory fee which the Trust would otherwise be obligated to pay with
respect to the Master Portfolio is reduced pursuant to expense limitation
provisions of the Investment Advisory Agreement, the fee which the Sub-Adviser
would otherwise receive pursuant to this Agreement shall be reduced
proportionately.
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<PAGE>
8. Compensation.
The Adviser shall pay the Sub-Adviser, as compensation for services
rendered hereunder, fees, payable monthly, at the annual rates indicated on
Schedule I hereto, as such Schedule may be supplemented and amended from time to
time. It is understood that the Adviser shall be responsible for the
Sub-Adviser's fee for its services hereunder, and the Sub-Adviser agrees that it
shall have no claim against the Trust or the Master Portfolios with respect to
compensation under this Agreement.
For purposes of this Section, the average daily net asset value of the
Master Portfolios shall be determined in the manner set forth in the Articles of
Incorporation and registration statement of the Trust, as amended from time to
time.
9. Limitation of Liability.
The Sub-Adviser 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
performance of this Agreement, except that the Sub-Adviser shall be liable to
the Trust for any loss resulting from a breach of fiduciary duty, if any, with
respect to the receipt of compensation for services or for any loss resulting
from willful misfeasance, bad faith or negligence on the part of the Sub-Adviser
in the performance of its duties or from reckless disregard by it of its
obligations and duties under this Agreement.
10. Indemnification.
The Sub-Adviser shall indemnify and hold harmless the Master Portfolios
and the Adviser from and against any and all claims, losses, liabilities or
damages (including reasonable attorney's fees and other related expenses)
resulting from willful misfeasance, bad faith or negligence on the part of the
Sub-Adviser in connection with the performance of its duties under this
Agreement or resulting from any violations of securities laws, rules,
regulations, statutes and codes, whether federal or of any state, by the
Sub-Adviser.
11. Duration and Termination.
This Agreement will become effective as of the later of (a) the date
first written above, (b) the date on which it is approved by a majority of the
outstanding voting securities of the Master Portfolio(s), or (c) the date(s) on
which the Master Portfolio(s) commence(s) operations. Unless sooner terminated
as provided herein, this Agreement shall continue in effect until the second
anniversary of its effective date. Thereafter, if not terminated, this Agreement
shall continue in effect for successive annual periods ending on January 1,
provided such continuance is specifically approved at least annually (a) by the
vote of a majority of those members of the Trust's Board of Trustees who are not
interested persons of any party to this Agreement, cast in person at a meeting
called for the purpose of voting such approval, and (b) by the vote of a
majority of the Trust's Board of Trustees or by the vote of a majority of the
outstanding voting securities of the Master Portfolios. Notwithstanding the
foregoing, this Agreement may be terminated as to the Master Portfolios at any
time, without the payment of any penalty, by the Adviser or by the Trust (by
vote of the Trust's Board of Trustees or by vote of a majority of the
outstanding voting securities of the Master Portfolios), on sixty days' written
notice to the Sub-Adviser, or by the Sub-Adviser, on ninety days' written notice
to the Trust, provided that in each such case, notice shall be given
simultaneously to the Adviser. In addition, notwithstanding anything herein to
the contrary, in the event of the termination of the Investment Advisory
Agreement with respect to the Master Portfolios for any reason (whether by the
Trust, by the Adviser or by operation of law) this Agreement shall terminate
upon the effective date of such termination of the Investment Advisory
Agreement. This Agreement will also immediately terminate in the event of its
assignment. (As used in this Agreement, the terms "majority of the outstanding
voting securities," "interested persons" and "assignment" shall have the same
meaning as such terms have in the 1940 Act.)
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12. Amendment of This Agreement.
No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against which enforcement of the change, waiver, discharge or termination is
sought. To the extent required by the 1940 Act, no amendment of this Agreement
shall be effective until approved by vote of a majority of the outstanding
voting securities of the Master Portfolio(s).
13. Miscellaneous.
The captions in this Agreement are included for convenience of
reference only, and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect. 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. This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and shall be governed by Delaware law.
14. Name of Sub-Adviser.
The Trust and the Adviser hereby agree not to use the name "Putnam
Investment Management, Inc." or any derivative thereof or any description of the
Sub-Adviser or any affiliates, in the Trust's Registration Statement, or in any
sales literature, advertisement or other document distributed to the public
without the consent of the Sub-Adviser; provided, however, the consent of the
Sub-Adviser shall not be required for any use of its name which merely refers in
accurate and factual terms to its appointment and/or its services hereunder or
which is required by the Securities and Exchange Commission or over state
securities authority or any other appropriate regulatory, governmental or
judicial authorities.
15. Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
6
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers of the day and year first written above.
NATIONS MASTER INVESTMENT TRUST,
on behalf of the Master Portfolios
By: /s/ A. Max Walker
-----------------------------
A. Max Walker
President and Chairman of the
Board of Trustees
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
-----------------------------
Robert H. Gordon
President
Putnam Investment Management, Inc.
By: /s/ Thomas M. Turpin
-----------------------------
Thomas M. Turpin
Managing Director
7
<PAGE>
SCHEDULE I
The Adviser shall pay the Sub-Adviser as full compensation for services
provided and expenses assumed hereunder, a sub-advisory fee for each Master
Portfolio, computed daily and payable monthly at the annual rates listed below
as a percentage of the average daily net assets of the Master Portfolio under
the Sub-Adviser's management:
MASTER PORTFOLIO RATE OF COMPENSATION
Nations International Equity Master Portfolio 0.65% of the first
$60,000,000 of the Master
Portfolio's average daily
net assets; plus, 0.55% of
the next $130,000,000 of
the Master Portfolio's
average daily net assets;
plus 0.45% of the next
$200,000,000 of the Master
Portfolio's average daily
net assets; plus 0.40% of
the Master Portfolio's
average daily net assets
in excess of $390,000,000.
Approved: March 31, 1999
8
SUB-ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made as of this 19th day of August, 1999, by and
between NATIONSBANC ADVISORS, INC., a North Carolina corporation (the
"Adviser"), MARSICO CAPITAL MANAGEMENT, LLC, a Delaware limited liability
corporation (the "Sub-Adviser"), and NATIONS MASTER INVESTMENT TRUST, a Delaware
business trust (the "Trust"), on behalf of those portfolios of the Trust now or
hereafter identified on Schedule I hereto (each a "Master Portfolio" and
collectively, the "Master Portfolios").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "Commission") as an open-end, management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Adviser is registered with the Commission under the
Investment Advisers Act of 1940, as amended (the "Advisers Act") as an
investment adviser; and
WHEREAS, the Sub-Adviser also is registered with the Commission under
the Advisers Act as an investment adviser; and
WHEREAS, the Adviser and the Trust have entered into an Investment
Advisory Agreement (the "Investment Advisory Agreement"), pursuant to which the
Adviser shall act as investment adviser with respect to the Master Portfolios;
and
WHEREAS, pursuant to such Investment Advisory Agreement, the Adviser,
with the approval of the Trust, wishes to retain the Sub-Adviser for purposes of
rendering advisory services to the Adviser and the Trust in connection with the
Master Portfolios upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT OF SUB-ADVISER. The Adviser hereby appoints, and the
Trust hereby approves, the Sub-Adviser to render investment research and
advisory services to the Adviser and the Trust with respect to the Master
Portfolios, under the supervision of the Adviser and subject to the policies and
control of the Trust's Board of Trustees, and the Sub-Adviser hereby accepts
such appointment, all subject to the terms and conditions contained herein.
2. INVESTMENT SERVICES. Subject to the supervision of the Adviser and
the Trust's Board of Trustees, the Sub-Adviser will provide a continuous
investment program for each Master Portfolio, including investment research and
management with respect to all securities, investments, cash and cash
equivalents in each Master Portfolio. The Sub-Adviser will determine from time
to time what securities and other investments will be purchased, retained or
sold by the Master Portfolios and will place the daily orders for the purchase
or sale of securities. The Sub-Adviser will provide the services rendered by it
under this Agreement in accordance with each Master Portfolio's investment
objective, policies and restrictions as stated in the Prospectus and votes of
the Trust's Board of Trustees. The Sub-Adviser shall provide such additional
services related to the continuous investment program, including recordkeeping
services, as may reasonably be requested from time to time by the Trust or the
Adviser.
1
<PAGE>
3. CONTROL BY BOARD OF TRUSTEES. As is the case with respect to the
Adviser under the Investment Advisory Agreement, any investment activities
undertaken by the Sub-Adviser pursuant to this Agreement, as well as any other
activities undertaken by the Sub-Adviser with respect to the Trust, shall at all
times be subject to any directives of the Board of Trustees of the Trust.
4. OTHER COVENANTS. In carrying out its obligations under this
Agreement, the Sub-Adviser agrees that it:
(a) will comply with all applicable Rules and Regulations of
the Commission and will in addition conduct its activities under this Agreement
in accordance with other applicable law, including but not limited to the 1940
Act and the Advisers Act;
(b) will use the same skill and care in providing such
services as it uses in providing services to fiduciary accounts for which it has
investment responsibilities;
(c) will not make loans to any person to purchase or carry
Master Portfolio shares;
(d) will place orders pursuant to its investment
determinations for the Master Portfolios either directly with the issuer or with
any broker or dealer. Subject to the other provisions of this paragraph, in
executing portfolio transactions and selecting brokers or dealers, the
Sub-Adviser will use its best efforts to seek on behalf of each Master Portfolio
the best overall terms available. In assessing the best overall terms available
for any transaction, the Sub-Adviser shall consider all factors that it deems
relevant, including the breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer, and the reasonableness of the commission, if any, both for the specific
transaction and on a continuing basis. In evaluating the best overall terms
available, and in selecting the broker/dealer to execute a particular
transaction, the Sub-Adviser may also consider the brokerage and research
services (as those terms are defined in Section 28(e) of the Securities Exchange
Act of 1934, as amended) provided to the Master Portfolio and/or other accounts
over which the Sub-Adviser or an affiliate of the Sub-Adviser exercises
investment discretion. The Sub-Adviser is authorized, subject to the prior
approval of the Trust's Board of Trustees, to pay to a broker or dealer who
provides such brokerage and research services a commission for executing a
portfolio transaction for any Master Portfolio which is in excess of the amount
of commission another broker or dealer would have charged for effecting that
transaction if, but only if, the Sub-Adviser determines in good faith that such
commission was reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer-viewed in terms of that particular
transaction or in terms of the overall responsibilities of the Sub-Adviser to
the particular Master Portfolio and to the Trust. In addition, the Sub-Adviser
is authorized to take into account the sale of shares of the Trust in allocating
purchase and sale orders for portfolio securities to brokers or dealers
(including brokers and dealers that are affiliated with the Sub-Adviser or the
Trust's principal underwriter), provided that the Sub-Adviser believes that the
quality of the transaction and the commission are comparable to what they would
be with other qualified firms. In no instance, however, will portfolio
securities be purchased from or sold to the Sub-Adviser or the Trust's principal
underwriter for the Master Portfolios or an affiliated person of either acting
as principal or broker, except as permitted by the Commission or applicable law;
2
<PAGE>
(e) will maintain a policy and practice of conducting its
investment advisory services hereunder independently of the commercial banking
operations of its affiliates, if any. In making investment recommendations for a
Master Portfolio, its investment advisory personnel will not inquire or take
into consideration whether the issuer (or related supporting institution) of
securities proposed for purchase or sale for the Master Portfolio's account are
customers of the commercial departments of its affiliates. In dealing with
commercial customers, such commercial departments will not inquire or take into
consideration whether securities of those customers are held by the Master
Portfolio;
(f) will treat confidentially and as proprietary information
of the Trust all records and other information relative to the Trust and prior,
present or potential shareholders, and will not use such records and information
for any purpose other than performance of its responsibilities and duties
hereunder (except after prior notification to and approval in writing by the
Trust, which approval shall not be unreasonably withheld and may not be withheld
and will be deemed granted where the Sub-Adviser may be exposed to civil or
criminal contempt proceedings for failure to comply, when requested to divulge
such information by duly constituted authorities, or when so requested by the
Trust).
5. SERVICES NOT EXCLUSIVE. The services furnished by the Sub-Adviser
hereunder are deemed not to be exclusive, and the Sub-Adviser shall be free to
furnish similar services to others so long as its services under this Agreement
are not impaired thereby. To the extent that the purchase or sale of securities
or other investments of the same issuer may be deemed by the Sub-Adviser to be
suitable for two or more accounts managed by the Sub-Adviser, the available
securities or investments may be allocated in a manner believed by the
Sub-Adviser to be equitable to each account. It is recognized that in some cases
this procedure may adversely affect the price paid or received by a Master
Portfolio or the size of the position obtainable for or disposed of by a Master
Portfolio.
6. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Adviser hereby agrees that all records which it
maintains for each Master Portfolio are the property of the Trust and further
agrees to surrender promptly to the Adviser or the Trust any of such records
upon request. The Sub-Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
7. EXPENSES. During the term of this Agreement, the Sub-Adviser will
pay all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments
(including brokerage commissions and other transaction charges, if any)
purchased or sold for the Master Portfolios. In addition, the Sub-Adviser
acknowledges that the Adviser has agreed, pursuant to the Investment Advisory
Agreement, that, if the aggregate expenses borne by any Master Portfolio in any
fiscal year exceed the applicable expense limitations imposed by the securities
regulations of any state in which its shares are registered or qualified for
sale to the public, the Adviser together with the Master Portfolio's
administrator(s) shall reimburse such Master Portfolio for such excess in
proportion to the fees otherwise payable to them for such year.
3
<PAGE>
8. COMPENSATION. For the services provided to each Master Portfolio and
the expenses assumed pursuant to this Agreement, the Adviser will pay the
Sub-Adviser and the Sub-Adviser will accept as full compensation therefor a fee
for that Master Portfolio determined in accordance with Schedule I attached
hereto. The Adviser and the Sub-Adviser may, from time to time, agree to reduce,
limit or waive the amounts payable hereunder with respect to one or more Master
Portfolios for such period or periods they deem advisable. It is understood that
the Adviser shall be responsible for the Sub-Adviser's fee for its services
hereunder, and the Sub-Adviser agrees that it shall have no claim against the
Trust or the Master Portfolio with respect to compensation under this Agreement.
9. LIABILITY OF SUB-ADVISER. The Sub-Adviser shall not be liable for
any error of judgment or mistake of law or for any loss suffered by the Adviser
or the Trust in connection with the performance of this Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or gross negligence on the part of the Sub-Adviser in the performance of
its duties or from reckless disregard by it of its obligations and duties under
this Agreement.
10. TERM AND APPROVAL. This Agreement shall become effective with
respect to each Master Portfolio when approved in accordance with the
requirements of the 1940 Act, and shall thereafter continue in force and effect
for two years, and may be continued from year to year with respect to each
Master Portfolio thereafter, provided that the continuation of the Agreement is
specifically approved at least annually:
(a) (i) by the Trust's Board of Trustees or (ii) by
the vote of "a majority of the outstanding voting securities"
of a Master Portfolio (as defined in Section 2(a)(42) of the
1940 Act); and
(b) by the affirmative vote of a majority of the
Trustees of the Trust who are not parties to this Agreement or
"interested persons" (as defined in the 1940 Act) of a party
to this Agreement (other than as Trustees of the Trust), by
votes cast in person at a meeting specifically called for such
purpose.
11. TERMINATION. This Agreement may be terminated at any time with
respect to:
(a) a Master Portfolio, without the payment of any
penalty, by vote of the Trust's Board of Trustees or by vote
of a majority of a Master Portfolio's outstanding voting
securities, or by the Adviser, upon sixty (60) days' written
notice to the other parties to this Agreement.
(b) by the Sub-Adviser on sixty (60) days' written
notice to the other parties to this Agreement.
4
<PAGE>
Any party entitled to notice may waive the notice provided for herein.
This Agreement shall automatically terminate in the event of its assignment, the
term "assignment" for purposes of this paragraph having the meaning defined in
Section 2(a)(4) of the 1940 Act.
12. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No amendment of this Agreement affecting a
Master Portfolio shall be effective until approved by vote of a majority of the
outstanding voting securities of such Master Portfolio. However, this shall not
prevent the Sub-Adviser from reducing, limiting or waiving its fee.
13. RELEASE. The names "Nations Master Investment Trust" and "Trustees
of Nations Master Investment Trust" refer respectively to the Trust created and
the Trustees, as trustees but not individually or personally, acting from time
to time under a Declaration of Trust dated January 14, 1999, which is hereby
referred to and a copy of which is on file at the principal office of the Trust.
The obligations of "Nations Master Investment Trust" entered into in the name or
on behalf thereof by any of the Trustees, representatives or agents are made not
individually, but in such capacities, and are not binding upon any of the
Trustees, shareholders, or representatives of the Trust personally, but bind
only the Trust property, and all persons dealing with any class of shares of the
Trust must look solely to the property belonging to such class for the
enforcement of any claims against the Trust.
14. USE OF THE NAME "MARSICO". Sub-Adviser hereby consents to and
grants a non-exclusive license for the use by the Trust to the phrase "Marsico
Capital," the identifying word "Marsico" in the name of the Master Portfolios
and any logo or symbol authorized by the Sub-Adviser. Such consent is
conditioned upon the Trust's employment of Sub-Adviser or its affiliates as
sub-investment adviser to the Master Portfolios. Sub-Adviser may from time to
time use the phrase "Marsico Capital" or the identifying word "Marsico" or logos
or symbols used by Sub-Adviser in other connections and for other purposes,
including without limitation in the names of other investment companies,
corporations or businesses that it may manage, advise, sponsor or own or in
which it may have a financial interest. Sub-Adviser may require the Trust to
cease using the phrase "Marsico Capital" or the identifying word "Marsico" in
the name of the Master Portfolios or any logo or symbol authorized by
Sub-Adviser if the Trust ceases to employ Sub-Adviser or an affiliate thereof as
sub-investment adviser.
15. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. 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. This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and shall be
governed by Delaware law.
16. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
5
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ A. Max Walker
------------------------------
A. Max Walker
President and Chairman of the
Board of Trustees
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
------------------------------
Robert H. Gordon
President
MARSICO CAPITAL MANAGEMENT, LLC
By: /s/ Barbara M. Japha
------------------------------
Barbara M. Japha
President and General Counsel
6
<PAGE>
SCHEDULE I
The Adviser shall pay the Sub-Adviser as full compensation for services
provided and expenses assumed hereunder a sub-advisory fee for each Master
Portfolio, computed daily and payable monthly at the annual rates listed below
as a percentage of the average daily net assets of the Master Portfolio:
RATE OF
MASTER PORTFOLIO COMPENSATION
Nations Marsico Focused Equities Master Portfolio 0.45%
Nations Marsico Growth & Income Master Portfolio 0.45%
Approved: March 31, 1999
7
SUB-ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
AGREEMENT made as of October 15, 1999 among BANC OF AMERICA ADVISORS,
INC., a North Carolina corporation (herein called the "Adviser"), BRANDES
INVESTMENT PARTNERS, L.P., a California limited partnership (herein called the
"Sub-Adviser") and NATIONS MASTER INVESTMENT TRUST (the "Trust"), a Delaware
business trust, on behalf of the portfolios of the Trust as now or hereafter may
be identified on Schedule I hereto (each a "Master Portfolio" and collectively,
the "Master Portfolios").
RECITALS
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "Commission") under the Investment Company Act of 1940, as
amended (the "1940 Act"), as an open-end series management investment company;
and
WHEREAS, the Adviser is registered with the Commission under the
Investment Advisers Act of 1940, as amended (the "Advisers Act"), and engages in
the business of acting as an investment adviser; and
WHEREAS, the Sub-Adviser is also registered under the Advisers Act, as
an investment adviser and engages in the business of acting as an investment
adviser; and
WHEREAS, the Adviser and the Trust have entered into an Investment
Advisory Agreement (the "Investment Advisory Agreement"), pursuant to which the
Adviser shall act as investment adviser with respect to the Master Portfolios;
and
WHEREAS, pursuant to such Investment Advisory Agreement, the Adviser,
with the approval of the Trust, wishes to retain the Sub-Adviser for purposes of
rendering advisory services to the Adviser and the Trust in connection with the
Master Portfolios upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt whereof is
hereby acknowledged, the parties hereto agree as follows:
1. Appointment.
The Adviser hereby appoints the Sub-Adviser to act as
investment sub-adviser to the Master Portfolios for the period and on the terms
set forth in this Agreement. The Sub-Adviser accepts such appointment and agrees
to furnish the services herein set forth for the compensation herein provided.
<PAGE>
2. Services of Sub-Adviser.
Subject to the oversight and supervision of the Adviser and
the Trust's Board of Trustees, the Sub-Adviser will provide a continuous
investment program for the Master Portfolios, including investment research and
management with respect to all securities and investments, except for such cash
balances of the Master Portfolios as may, from time to time, be managed by the
Adviser. Pursuant to the foregoing, the Sub-Adviser will determine from time to
time what securities and other investments will be purchased, retained or sold
by the Master Portfolios. The Sub-Adviser will provide the services rendered by
it under this Agreement in accordance with the investment criteria and policies
established from time to time for the Master Portfolios by the Adviser, the
Master Portfolios' investment objectives, policies and restrictions as stated in
the Master Portfolios' Prospectuses and Statement of Additional Information, the
operating policies and procedures of the Master Portfolios, and resolutions of
the Master Portfolios' Board of Trustees.
The Sub-Adviser further agrees that it will:
(a) Provide information to the Master Portfolios' accountant
for the purpose of updating the Master Portfolios' cash
availability throughout the day as required;
(b) Maintain historical tax lots for each portfolio security
held by the Master Portfolios;
(c) Transmit trades to the Trust's custodian for proper
settlement;
(d) Maintain all books and records with respect to the Master
Portfolios that are required to be maintained under Rule
31a-l(f) under the 1940 Act;
(e) Supply the Adviser, the Trust and the Trust's Board of
Trustees with reports, statistical data and economic
information as requested; and
(f) Prepare a quarterly broker security transaction summary
and, if requested in advance, monthly security transaction
listing for the Master Portfolios.
3. Other Covenants.
The Sub-Adviser agrees that it will:
(a) Comply with all applicable Rules and Regulations of the
Commission and will in addition conduct its activities under
this Agreement in accordance with other applicable law;
(b) Use the same skill and care in providing such services as
it uses in providing services to fiduciary accounts for which
it has investment responsibilities;
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<PAGE>
(c) Place orders pursuant to its investment determinations for
the Master Portfolios either directly with the issuer or with
any broker or dealer. In executing portfolio transactions and
selecting brokers or dealers, the Sub-Adviser will use its
best efforts to seek on behalf of the Master Portfolios the
best overall terms available. In assessing the best overall
terms available for any transaction, the Sub-Adviser shall
consider all factors that it deems relevant, including the
breadth of the market in the security, the price of the
security, the financial condition and execution capability of
the broker or dealer, and the reasonableness of the
commission, if any, both for the specific transaction and on a
continuing basis. In evaluating the best overall terms
available, and in selecting the broker-dealer to execute a
particular transaction, the Sub-Adviser may also consider the
brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) provided
to the Master Portfolios or other accounts over which the
Sub-Adviser or an affiliate of the Sub-Adviser exercises
investment discretion. The Sub-Adviser is authorized, subject
to the prior approval of the Adviser and the Trust's Board of
Trustees, to pay to a broker or dealer who provides such
brokerage and research services a commission for executing a
portfolio transaction for the Master Portfolios which is in
excess of the amount of commission another broker or dealer
would have charged for effecting that transaction if, but only
if, the Sub-Adviser determines in good faith that such
commission was reasonable in relation to the value of the
brokerage and research services provided by such broker or
dealer -- viewed in terms of that particular transaction or in
terms of the overall responsibilities of the Sub-Adviser to
the Master Portfolios. In addition, the Sub-Adviser is
authorized to take into account the sale of shares of the
Trust in allocating purchase and sale orders for portfolio
securities to brokers or dealers (including brokers and
dealers that are affiliated with the Adviser, Sub-Adviser or
the Trust's principal underwriter), provided that the
Sub-Adviser believes that the quality of the transaction and
the commission are comparable to what they would be with other
qualified firms. In no instance, however, will portfolio
securities be purchased from or sold to the Adviser,
Sub-Adviser, the Trust's principal underwriter or any
affiliated person of either the Trust, the Adviser,
Sub-Adviser, or the Trust's principal underwriter, acting as
principal in the transaction, except to the extent permitted
by the Commission;
(d) Treat confidentially and as proprietary information of the
Trust, all records and other information relative to the Trust
maintained by the Sub-Adviser, and will not use such records
and information for any purpose other than performance of its
responsibilities and duties hereunder, except after prior
notification to and approval in writing by the Trust, which
approval shall not be unreasonably withheld and may not be
withheld where the Sub-Adviser may be exposed to civil or
criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted
authorities, or when so requested by the Trust;
(e) Adhere to the policies and procedures of the Trust adopted
on behalf of the Master Portfolios and delivered to the
Sub-Adviser; and
3
<PAGE>
(f) Maintain a policy and practice of conducting its
sub-investment advisory services hereunder independently of
its, and any of its affiliates', commercial banking
operations. When the Sub-Adviser makes investment
recommendations for the Master Portfolios, its investment
advisory personnel will not inquire or take into consideration
whether the issuers of securities proposed for purchase or
sale for the Master Portfolios' accounts are customers of its,
or any of its affiliates', commercial department. In dealing
with commercial customers, the commercial department of the
Sub-Adviser, or any of its affiliates, will not inquire or
take into consideration whether securities of those customers
are held by the Master Portfolios.
4. Services Not Exclusive.
The services furnished by the Sub-Adviser hereunder are deemed
not to be exclusive, and the Sub-Adviser shall be free to furnish similar
services to others so long as its services under this Agreement are not impaired
thereby. To the extent that the purchase or sale of securities or other
investments of the same issuer may be deemed by the Sub-Adviser to be suitable
for two or more accounts managed by the Sub-Adviser, the available securities or
investments may be allocated in a manner believed by the Sub-Adviser to be
equitable to each account. It is recognized that in some cases this procedure
may adversely affect the price paid or received by the Master Portfolios or the
size of the position obtainable for or disposed of by the Master Portfolios.
5. Books and Records.
In compliance with the requirements of Rule 31a-3 under the
1940 Act, the Sub-Adviser hereby agrees that all records which it maintains for
the Master Portfolios are the property of the Trust and further agrees to
surrender promptly to the Trust any of such records upon the Trust's request.
The Sub-Adviser further agrees to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act, the records required to be maintained by it under this
Agreement.
6. Expenses.
During the term of this Agreement, the Sub-Adviser will pay
all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments
(including brokerage commissions, custodial charges and other transaction costs,
if any) purchased or sold for the Master Portfolios.
7. Compensation.
The Adviser shall pay the Sub-Adviser, as compensation for
services rendered hereunder, fees, payable monthly, at the annual rates
indicated on Schedule I hereto, as such Schedule may be supplemented and amended
from time to time. It is understood that the Adviser shall be responsible for
the Sub-Adviser's fee for its services hereunder, and the Sub-Adviser agrees
that it shall have no claim against the Trust or the Master Portfolios with
respect to compensation under this Agreement.
4
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The average daily net asset value of the Master Portfolios
shall be determined in the manner set forth in the Declaration of Trust and
registration statement of the Trust, as amended from time to time.
8. Limitation of Liability.
The Sub-Adviser 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
performance of this Agreement, except that the Sub-Adviser shall be liable to
the Trust for any loss resulting from a breach of fiduciary duty with respect to
the receipt of compensation for services or any loss resulting from willful
misfeasance, bad faith or negligence on the part of the Sub-Adviser in the
performance of its duties or from reckless disregard by it of its obligations
and duties under this Agreement.
9. Term and Approval.
This Agreement shall become effective when approved, and shall
continue in effect until the second anniversary of its effective date.
Thereafter, if not terminated, this Agreement shall continue in effect for
successive annual periods ending on January 1, provided that the continuation of
the Agreement is specifically approved at least annually:
(a)(i) by the Trust's Board of Trustees or (ii) by the vote
of "a majority of the outstanding voting securities" of the Master
Portfolio (as defined in Section 2(a)(42) of the 1940 Act); and
(b) by the affirmative vote of a majority of the Trustees
of the Trust who are not parties to this Agreement or "interested
persons" (as defined in the 1940 Act) of a party to this Agreement
(other than as Trustees of the Trust), by votes cast in person at
a meeting specifically called for such purpose.
10. Termination.
This Agreement may be terminated at any time with respect to:
(a) a Master Portfolio, without the payment of any penalty,
by vote of the Trust's Board of Trustees or by vote of a majority
of a Master Portfolio's outstanding voting securities, or by the
Adviser, upon sixty (60) days' written notice to the other parties
to this Agreement.
(b) by the Sub-Adviser on sixty (60) days' written notice
to the other parties to this Agreement.
Any party entitled to notice may waive the notice provided for
herein. This Agreement shall automatically terminate in the event of its
assignment, the term "assignment" for purposes of this paragraph having the
meaning defined in Section 2(a)(4) of the 1940 Act.
11. Amendment of This Agreement.
5
<PAGE>
No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, waiver, discharge or
termination is sought. To the extent required by the 1940 Act, no amendment of
this Agreement shall be effective until approved by vote of a majority of the
outstanding voting securities of the Master Portfolios.
12. Miscellaneous.
The captions in this Agreement are included for convenience of
reference only, and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect. 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. This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and shall be governed by Delaware law.
13. Counterparts.
This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original.
6
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers of the day and year first
written above.
NATIONS MASTER INVESTMENT TRUST,
on behalf of the Master Portfolios
By: /s/ A. Max Walker
---------------------------------
A. Max Walker
President and Chairman of the
Board of Trustees
BANC OF AMERICA ADVISORS, INC.
By: /s/ Robert H. Gordon
---------------------------------
Robert H. Gordon
President
BRANDES INVESTMENT
PARTNERS, L.P.
By: /s/ Jeffrey A. Busby
---------------------------------
Jeffrey A. Busby
Managing Partner
7
<PAGE>
SCHEDULE I
The Adviser shall pay the Sub-Adviser as full compensation for services
provided and expenses assumed hereunder, a sub-advisory fee for each Master
Portfolio, computed daily and payable monthly at the annual rates listed below
as a percentage of the average daily net assets of the Master Portfolio:
MASTER PORTFOLIO RATE OF COMPENSATION
---------------- --------------------
Nations International Value Master Portfolio .50% of average daily net assets
8
INVESTMENT SUB-ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made as of February 14, 2000, by and between BANC OF
AMERICA ADVISORS, INC., a North Carolina corporation (the "Adviser"), MACKAY
SHIELDS, LLC, a Delaware limited liability company (the "Sub-Adviser"), and
NATIONS MASTER INVESTMENT TRUST, a Delaware business trust (the "Trust"), on
behalf of those series of the Trust now or hereafter identified on Schedule I
(each a "Master Portfolio" and collectively, the "Master Portfolios").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "Commission") as an open-end management investment company under
the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Adviser is registered with the Commission as an investment
adviser under the Investment Advisers Act of 1940, as amended (the "Advisers
Act");
WHEREAS, the Sub-Adviser is also registered with the Commission as an
investment adviser under the Advisers Act;
WHEREAS, the Adviser and the Trust have entered into an investment
advisory agreement (the "Investment Advisory Agreement"), pursuant to which the
Adviser manages the investment operations of each Master Portfolio and may
delegate certain duties of the Adviser to one or more investment sub-adviser(s);
and
WHEREAS, the Adviser, with the approval of the Board of Trustees of the
Trust (the "Board"), including a majority of the Trustees who are not
"interested persons" (defined herein) of any party to this Agreement, desires to
delegate to the Sub-Adviser the duty to manage the portfolio investments of the
Master Portfolios;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT OF SUB-ADVISER. The Adviser hereby appoints the
Sub-Adviser and the Sub-Adviser hereby agrees to manage the portfolio
investments of each Master Portfolio subject to the terms of this Agreement and
subject to the supervision of the Adviser and the Board.
2. SERVICES OF SUB-ADVISER. The Sub-Adviser shall perform all services
necessary for the management of the portfolio investments of each Master
Portfolio, including but not limited to:
(a) Managing the investment and reinvestment of all assets, now
or hereafter acquired by each Master Portfolio, including
determining what securities and other investments are to be
purchased or sold for each Master Portfolio and executing
transactions accordingly;
-1-
<PAGE>
(b) Transmitting trades to each Master Portfolio's custodian for
settlement in accordance with each Master Portfolio's
procedures and as may be directed by the Trust;
(c) Assisting in the preparation of all shareholder
communications, including shareholder reports, and
participating in shareholder relations;
(d) Making recommendations as to the manner in which voting
rights, rights to consent to Master Portfolio action and any
other rights pertaining to each Master Portfolio's portfolio
securities shall be exercised;
(e) Making recommendations to the Adviser and the Board with
respect to Master Portfolio investment policies and
procedures, and carrying out such investment policies and
procedures as are approved by the Board or by the Adviser
under authority delegated by the Board to the Adviser;
(f) Supplying reports, evaluations, analyses, statistical data
and information to the Adviser, the Board or to the Master
Portfolios' officers and other service providers as the
Adviser or the Board may reasonably request from time to
time or as may be necessary or appropriate for the operation
of the Trust as an open-end investment company or as
necessary to comply with Section 3(a) of this Agreement;
(g) Maintaining all books and records with respect to the
investment decisions and securities transactions for each
Master Portfolio required by applicable law;
(h) Furnishing any and all other services, subject to review by
the Board, that the Adviser from time to time determines to
be necessary or useful to perform its obligations under the
Investment Advisory Agreement or as the Board may reasonably
request from time to time.
3. RESPONSIBILITIES OF SUB-ADVISER. In carrying out its obligations
under this Agreement, the Sub-Adviser agrees that it will:
(a) Comply with all applicable law, including but not limited to
the 1940 Act and the Advisers Act, the rules and regulations
of the Commission thereunder, and the conditions of any
order affecting the Trust or a Master Portfolio issued
thereunder;
(b) Use the same skill and care in providing such services as it
uses in providing services to other fiduciary accounts for
which it has investment responsibilities;
(c) Not make loans to any person for the purpose of purchasing
or carrying Master Portfolio shares;
-2-
<PAGE>
(d) Place, or arrange for the placement of, all orders pursuant
to its investment determinations for the Master Portfolios
either directly with the issuer or with any broker or dealer
(including any affiliated broker or dealer). In executing
portfolio transactions and selecting brokers or dealers, the
Sub-Adviser will use its best efforts to seek on behalf of
each Master Portfolio the best overall terms available. In
assessing the best overall terms available for any
transaction, the Sub-Adviser shall consider all factors that
it deems relevant, including the breadth of the market in
the security, the price of the security, the financial
condition and execution capability of the broker or dealer,
and the reasonableness of the commission, if any, both for
the specific transaction and on a continuing basis. In
evaluating the best overall terms available, and in
selecting the broker or dealer to execute a particular
transaction, the Sub-Adviser may also consider whether such
broker or dealer furnishes research and other information or
services to the Sub-Adviser;
(e) Adhere to the investment objective, strategies and policies
and procedures of the Trust adopted on behalf of each Master
Portfolio; and
(f) Meet the service level performance standards that the
parties may agree to from time to time.
4. CONFIDENTIALITY OF INFORMATION. Each party agrees that it will treat
confidentially all information provided by another party regarding such other
party's business and operations, including without limitation the investment
activities or holdings of a Master Portfolio. All confidential information
provided by a party hereto shall not be disclosed to any unaffiliated third
party without the prior consent of the providing party. The foregoing shall not
apply to any information that is public when provided or thereafter becomes
public or which is required to be disclosed by any regulatory authority in the
lawful and appropriate exercise of its jurisdiction over a party, by any auditor
of the parties hereto, by judicial or administrative process or otherwise by
applicable law or regulation.
5. SERVICES NOT EXCLUSIVE. The services furnished by the Sub-Adviser
hereunder are deemed not to be exclusive, and the Sub-Adviser shall be free to
furnish similar services to others so long as its provision of services under
this Agreement is not impaired thereby. To the extent that the purchase or sale
of securities or other investments of the same issuer may be deemed by the
Sub-Adviser to be suitable for two or more accounts managed by the Sub-Adviser,
the available securities or investments may be allocated in a manner believed by
the Sub-Adviser to be equitable to each account. It is recognized that in some
cases this procedure may adversely affect the price paid or received by a Master
Portfolio or the size of the position obtainable for or disposed of by a Master
Portfolio.
6. DELIVERY OF DOCUMENTS. The Trust will provide the Sub-Adviser with
copies, properly certified or authenticated, of each of the following:
(a) the Trust's Certificate of Trust, as filed with the
Secretary of State of Delaware, and Declaration of Trust
(such Declaration of Trust, as
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<PAGE>
presently in effect and as from time to time amended, is
herein called the "Declaration of Trust");
(b) the most recent prospectus(es) and statement(s) of
additional information relating to each Master Portfolio
(such prospectus(es) together with the related statement(s)
of additional information, as presently in effect and all
amendments and supplements thereto, are herein called the
"Prospectus"); and
(c) any and all applicable policies and procedures approved by
the Board.
The Trust will promptly furnish the Sub-Adviser with copies of any and
all amendments of or additions or supplements to the foregoing.
7. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Adviser hereby agrees that all records that it
maintains for each Master Portfolio under this Agreement are the property of the
Trust and further agrees to surrender promptly to the Trust or the Adviser any
of such records upon request. The Sub-Adviser further agrees to preserve for the
periods prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
8. EXPENSES OF THE MASTER PORTFOLIOS. Except to the extent expressly
assumed by the Sub-Adviser and except to any extent required by law to be paid
or reimbursed by the Sub-Adviser, the Sub-Adviser shall have no duty to pay any
ordinary operating expenses incurred in the organization and operation of the
Master Portfolios. Ordinary operating expenses include, but are not limited to,
brokerage commissions and other transaction charges, taxes, legal, auditing,
printing, or governmental fees, other Master Portfolio service providers' fees
and expenses, including those related to third party pricing of portfolio
securities, expenses of issue, sale, redemption and repurchase of shares,
expenses of registering and qualifying shares for sale, expenses relating to
Board and shareholder meetings, and the cost of preparing and distributing
reports and notices to shareholders. The Sub-Adviser shall pay all other
expenses directly incurred by it in connection with its services under this
Agreement.
9. COMPENSATION. Except as otherwise provided herein, for the services
provided to each Master Portfolio and the expenses assumed pursuant to this
Agreement, the Adviser will pay the Sub-Adviser and the Sub-Adviser will accept
as full compensation therefor a fee determined in accordance with Schedule I
attached hereto. It is understood that the Adviser shall be solely responsible
for compensating the Sub-Adviser for performing any of the duties delegated to
the Sub-Adviser and the Sub-Adviser agrees that it shall have no claim against
the Trust or any Master Portfolio with respect to compensation under this
Agreement. To the extent that the advisory fee that the Trust would be obligated
to pay to the Adviser with respect to a Master Portfolio pursuant to the
Investment Advisory Agreement is reduced or reimbursed, the fee that the
Sub-Adviser would otherwise receive pursuant to this Agreement shall be reduced
or reimbursed proportionately.
10. LIABILITY OF SUB-ADVISER. The Sub-Adviser shall not be liable for
any error of judgment or mistake of law or for any loss suffered by the Adviser
or the Trust in connection
-4-
<PAGE>
with the performance of its duties under this Agreement, except a loss resulting
from a breach of fiduciary duty with respect to the receipt of compensation for
services, from willful misfeasance, bad faith or negligence on the part of the
Sub-Adviser or any of its officers, directors or employees, in connection with
the performance of their duties under this Agreement, from reckless disregard by
it or its officers, directors or employees of any of their obligations and
duties under this Agreement, or from any violations of securities laws, rules,
regulations, statutes and codes, whether federal or state, by the Sub-Adviser or
any of its officers, directors or employees.
11. INDEMNIFICATION. The Sub-Adviser shall indemnify and hold harmless
the Master Portfolios and the Adviser from and against any and all direct or
indirect claims, losses, liabilities or damages (including reasonable attorney's
fees and other related expenses) resulting from a breach of fiduciary duty with
respect to the receipt of compensation for services, from willful misfeasance,
bad faith or negligence on the part of the Sub-Adviser or any of its officers,
directors or employees, in connection with the performance of their duties under
this Agreement, from reckless disregard by it or its officers, directors or
employees of any of their obligations and duties under this Agreement, or
resulting from any violations of securities laws, rules, regulations, statutes
and codes, whether federal or state, by the Sub-Adviser or any of its officers,
directors or employees; provided, however, that the Sub-Adviser shall not be
required to indemnify or otherwise hold the Master Portfolios or the Adviser
harmless under this Section 11 where the claim against, or the loss, liability
or damage experienced by the Master Portfolios or the Adviser, is caused by or
is otherwise directly related to the Master Portfolios' or the Adviser's own
willful misfeasance, bad faith or negligence, or to the reckless disregard by
the Master Portfolios or the Adviser of their duties under this Agreement.
12. TERM AND APPROVAL. This Agreement will become effective as of the
date set forth herein above, and shall continue in effect until the second
anniversary of its effective date. This Agreement will become effective with
respect to each additional Master Portfolio as of the date set forth on Schedule
I when each such Master Portfolio is added thereto. The Agreement shall continue
in effect for a Master Portfolio after the second anniversary of the effective
date for successive annual periods ending on each anniversary of such date,
provided that the continuation of the Agreement is specifically approved for the
Master Portfolio at least annually:
(a)(i) by the Board or (ii) by the vote of "a majority of
the outstanding voting securities" of the Master
Portfolio (as defined in Section 2(a)(42) of the 1940
Act); and
(b) by the affirmative vote of a majority of the Trustees
of the Trust who are not parties to this Agreement or
"interested persons" (as defined in the 1940 Act) of
a party to this Agreement (other than as Trustees of
the Trust), by votes cast in person at a meeting
specifically called for such purpose.
13. TERMINATION. This Agreement may be terminated without payment of
any penalty at any time by:
-5-
<PAGE>
(a) the Trust with respect to a Master Portfolio, by vote
of the Board or by vote of a majority of a Master
Portfolio's outstanding voting securities, upon sixty
(60) days' written notice to the other parties to
this Agreement; or
(b) the Adviser or the Sub-Adviser with respect to a
Master Portfolio, upon sixty (60) days' written
notice to the other parties to this Agreement.
Any party entitled to notice may waive the notice provided for herein.
This Agreement shall automatically terminate in the event of its assignment,
unless an order is issued by the Commission conditionally or unconditionally
exempting such assignment from the provisions of Section 15(a) of the 1940 Act,
in which event this Agreement shall remain in full force and effect subject to
the terms of such order. For the purposes of this paragraph, the definitions
contained in Section 2(a) of the 1940 Act and the applicable rules under the
1940 Act shall apply.
14. CODE OF ETHICS. The Sub-Adviser represents that it has adopted a
written code of ethics complying with the requirements of Rule 17j-1 under the
1940 Act and will provide the Adviser or the Trust with a copy of such code, any
amendments or supplements thereto and its policies and/or procedures implemented
to ensure compliance therewith.
15. INSURANCE. The Sub-Adviser shall maintain for the term of this
Agreement and provide evidence thereof to the Trust or the Adviser a blanket
bond and professional liability (error and omissions) insurance in an amount
reasonably acceptable to Adviser.
16. REPRESENTATIONS AND WARRANTIES. Each party to this Agreement
represents and warrants that the execution, delivery and performance of its
obligations under this Agreement are within its powers, have been duly
authorized by all necessary actions and that this Agreement constitutes a legal,
valid and binding obligation enforceable against it in accordance with its
terms. The Sub-Adviser further represents and warrants that it is duly
registered as an investment adviser under the Advisers Act.
17. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement may be
changed, waived, discharged or terminated orally, except by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
18. NOTICES. Any notices under this Agreement shall be in writing,
addressed and delivered or mailed postage paid to such address as may be
designated for the receipt of such notice. Until further notice, it is agreed
that the address of the Trust shall be c/o Stephens Inc., 111 Center Street,
Little Rock, Arkansas 72201, Attention: Secretary, that of the Adviser shall be
One Bank of America Plaza, 33rd Floor, 101 South Tryon Street, Charlotte, North
Carolina 28255, Attention: President and that of the Sub-Adviser shall be MacKay
Shields, LLC, 9 West 57th Street, New York, New York 10019, Attention: Robert
Nisi, Esq. The Sub-Adviser agrees to promptly notify the Adviser and the Trust
in writing of the occurrence of any event which could have a material impact on
the performance of its duties under this Agreement, including but not limited to
(i) the occurrence of any event which could disqualify the Sub-Adviser from
serving as an investment adviser pursuant to Section 9 of the 1940 Act; (ii) any
material change in the Sub-Adviser's business activities; (iii) any event that
would constitute a change in control
-6-
<PAGE>
of the Sub-Adviser; (iv) any change in the portfolio manager or portfolio
management team of a Master Portfolio; (v) the existence of any pending or
threatened audit, investigation, examination, complaint or other inquiry (other
than routine audits or regulatory examinations or inspections) relating to any
Master Portfolio; and (vi) any material violation of the Sub-Adviser's code of
ethics.
19. RELEASE. The names "Nations Master Investment Trust" and "Trustees
of Nations Master Investment Trust" refer respectively to the Trust created by
the Declaration of Trust and the Trustees as Trustees but not individually or
personally. All parties hereto acknowledge and agree that any and all
liabilities of the Trust arising, directly or indirectly, under this Agreement
will be satisfied solely out of the assets of the Trust and that no Trustee,
officer or shareholder shall be personally liable for any such liabilities. All
persons dealing with any Master Portfolio of the Trust must look solely to the
property belonging to such Master Portfolio for the enforcement of any claims
against the Trust.
20. MISCELLANEOUS. This Agreement contains the entire understanding of
the parties hereto. Each provision of this Agreement is intended to be
severable. 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.
21. GOVERNING LAW. This Agreement shall be governed by, and construed
in accordance with, Delaware law and the federal securities laws, including the
1940 Act and the Advisers Act.
22. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
23. USE OF THE NAME "NATIONS FUNDS". The Sub-Adviser agrees that it
will not use the name "Nations Funds", any derivative thereof, or the name of
the Adviser, the Trust or any Master Portfolio except in accordance with such
policies and procedures as may be mutually agreed to in writing.
-7-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ James E. Banks, Jr.
---------------------------------
James E. Banks, Jr.
Assistant Secretary
BANC OF AMERICA ADVISORS, INC.
By: /s/ Robert H. Gordon
---------------------------------
Robert H. Gordon
President
MACKAY SHIELDS, LLC
By: /s/ Robert A. Nisi
---------------------------------
Name: Robert A. Nisi
Title: General Counsel
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<PAGE>
SCHEDULE I
The Adviser shall pay the Sub-Adviser, as full compensation for
services provided and expenses assumed hereunder, a sub-advisory fee for each
Master Portfolio, computed daily and payable monthly at the annual rates listed
below as a percentage of the average daily net assets of the Master Portfolio:
<TABLE>
<CAPTION>
RATE OF
MASTER PORTFOLIO COMPENSATION EFFECTIVE DATE
---------------- ------------ --------------
<S> <C> <C>
Nations High Yield Bond Master Portfolio 0.40% of average daily net 2/14/00
assets up to and including
$100 million; 0.375% of
average daily net assets in
excess of $100 million and
up to and including $200
million; and 0.35% of
average daily net assets in
excess of $200 million
Approved: December 9, 1999
</TABLE>
-9-
NATIONS FUNDS
RETIREMENT PLAN FOR ELIGIBLE
DIRECTORS/TRUSTEES
PREAMBLE
Effective on or before January 26, 1995, the regulated investment
companies advised by NationsBank, N.A. (Carolinas) or its affiliates (the
"Nations Funds") have adopted THE NATIONS FUNDS RETIREMENT PLAN FOR ELIGIBLE
DIRECTORS/TRUSTEES (the "Plan") for the benefit of each of the directors and
trustees of each of the Nations Funds who is not an employee of any of the
Nations Funds, or their distributor, administrator or advisor, or any of their
affiliates. As the Plan does not benefit any employees of the Nations Funds, it
is not intended to be classified as an employee benefit plan within the meaning
of Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended.
ARTICLE I
DEFINITION OF TERMS AND CONSTRUCTION
1.1 Definitions.
Unless a different meaning is plainly implied by the context; the
following terms as used in this Plan shall have the following meanings;
(a) "Accrued Benefit" shall mean, as of any date prior to a
Participant's Normal Retirement Date, his Retirement Benefit, determined as of,
and commencing on, his Normal Retirement Date, but based upon his Compensation
and Years of Service computed as of such date of determination.
(b) "Administrator" shall mean the administrative committee
provided for in Article VI.
(c) "Board of Directors" shall mean the Board of Directors of each
of the Nations Funds.
(d) "Compensation" shall mean, for any Director, the aggregate
amount of director's fees paid or accrued by the Nations Funds for such Director
during the calendar year during which the Director's Retirement occurs,
including amounts of director's fees deferred during such fiscal year under a
separate agreement between the Nations Funds and the Director. In addition, for
purposes of this Plan, "Compensation" shall include fees which would have been
paid or accrued by the Nations Funds for such Director during the calendar year
during which the Director's Retirement occurs but for the execution of a waiver
of such fees by the Director. In the
1
<PAGE>
event the Director's Retirement occurs on other than the last day of the
calendar year, his Compensation for such calendar year shall be annualized, if
necessary, to reflect the amount he would have received (including deferred
amounts) had his Retirement occurred on the last day of such calendar year. The
amount of such annualized Compensation shall be determined by the Administrator.
(e) "Deferred Retirement Date" shall mean the first day of the
month coincident with or next following the date on which a Participant
terminated Service after his Normal Retirement Date.
(f) "Director" shall mean an individual who is a director or
trustee of one or more of the Nations Funds which have adopted the Plan but who
is not an employee of any of the Nations Funds, or their distributor,
administrator or advisor, or any of their affiliates. A director or trustee
shall not be considered to be an employee of any of the Nations Funds for
purposes of this Plan solely by reason of holding a position as an officer of a
Fund, provided the director or trustee receives no compensation from the Fund
other than director's or trustee's fees.
(g) "Disability" shall mean the inability of the Participant to
participate in meetings of the Board of Directors, either in person or by
telephone, for a period of at least nine (9) consecutive months.
(h) "Effective Date" shall mean, with respect to each of the
Nations Funds, the date on which this Plan was adopted (as shown on the last
page hereof).
(i) "Fund" shall mean a Nations Fund which has adopted this Plan.
(j) "Nations Funds" shall mean the regulated investment companies
advised by NationsBank, N.A. (Carolinas), or its affiliates.
(k) "Normal Retirement Date" shall mean the date on which a
Participant has both attained age 65 and has completed at least five continuous
and non-forfeited Years of Service with one or more of the Nations Funds.
(l) "Participant" shall mean a Director who has met all of the
eligibility requirements of the Plan and who is currently included in the Plan
as provided in Article II hereof.
(m) "Plan" shall mean the "Nations Funds Retirement Plan for
Eligible Directors/ Trustees" as described herein or as hereafter amended from
time to time.
(n) "Plan Year" shall mean a calendar year.
(o) "Retirement" shall mean a Director's termination of his active
Service with the Nations Funds on or after his Normal Retirement Date, due to
his death, Disability, or voluntary or involuntary termination of his Service.
2
<PAGE>
(p) "Retirement Benefit" shall mean the benefit described under
Sections 3.1 or 3.2 hereof to which a Participant is entitled on or after his
Normal or Deferred Retirement Date.
(q) "Service" shall mean an individual's serving as a Director of
one or more of the Nations Funds.
(r) "Year of Service" shall mean each complete calendar year
during which the Director was a Director for the entirety of such calendar year,
including years of unbroken service prior to the Effective Date. For all
purposes of this Plan, in the event a Director ceases to serve as a Director
prior to his Normal Retirement Date, he shall forfeit credit for all Years of
Service completed prior to such cessation even if he subsequently again becomes
a Director. Furthermore, any unbroken service provided by a Participant (i) to a
Nations Fund immediately prior to its being advised by NationsBank, N.A.
(Carolinas) (or any of its affiliates) or (ii) to a predecessor of a Nations
Fund immediately prior to its being merged into such Nations Fund, will be taken
into account in determining such Participant's Years of Service, subject to all
restrictions and other forfeiture provisions contained herein.
1.2 Plurals and Gender.
Where appearing in the Plan, the masculine gender shall include
the feminine and neuter genders, and the singular shall include the plural, and
vice versa, unless the context clearly indicates a different meaning.
1.3 Directors/Trustees.
Where appropriate, the term "director" shall also refer to
"trustee," "directorship" shall also refer to "trusteeship" and "Board of
Directors" shall also refer to "Board of Trustees."
1.4 Headings.
The headings and sub-headings in this Plan are inserted for the
convenience of reference only and are to be ignored in any construction of the
provisions hereof.
1.5 Severability.
In case any provision of this Plan shall be held illegal or void,
such illegality or invalidity shall not affect the remaining provisions of this
Plan, but shall be fully severable, and the Plan shall be construed and enforced
as if said illegal or invalid provisions had never been inserted herein.
ARTICLE II
PARTICIPATION
3
<PAGE>
2.1 Commencement of Participation.
Each Director shall become a Participant hereunder on the later of
the Effective Date or the date his directorship of one or more of the Nations
Funds commences.
2.2 Termination of Participation.
After commencement or resumption of his participation, a Director
shall remain a Participant until the earliest of the following dates:
(a) His actual Retirement date;
(b) His date of death;
(c) The date on which he otherwise incurs a termination of
Service; or
(d) The effective date of the termination of the Plan.
2.3 Resumption of Participation.
Any Participant whose Service terminates and who thereafter again
becomes a Director shall resume participation immediately upon again becoming a
Director except that, as provided in Section 1.1(t) hereof, if his Service is
terminated prior to his Normal Retirement Date, for all purposes of this Plan he
shall forfeit credit for all Years of Service completed prior to such
termination of his Service.
2.4 Determination of Eligibility.
The Administrator shall determine the eligibility of Directors in
accordance with the provisions of this Article.
ARTICLE III
BENEFITS UPON RETIREMENT
AND OTHER TERMINATION OF SERVICE
3.1 Normal Retirement.
Upon Retirement a Participant shall be entitled to receive an
annual benefit from the Nations Fund commencing on the first day of the calendar
quarter coincident with or next following his date of Retirement, payable in
quarterly installments for a period of no more than five (5) years (thus
equaling no more than twenty (20) quarterly installments) equal to five
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percent (5%) of his Compensation paid by the Nations Fund multiplied by the
number of his non-forfeited Years of Service (not in excess of ten (10) Years of
Service) completed with respect to any of the Nations Funds.
3.2 Deferred Retirement.
In the event that a Participant remains in Service with the
Nations Funds after his Normal Retirement Date, he shall not be entitled to any
benefits hereunder until his Deferred Retirement Date. Commencing on the first
day of the calendar quarter following his Deferred Retirement Date, a
Participant shall be entitled to receive a Retirement Benefit from the Nations
Funds paid in twenty (20) quarterly installments in an amount equal to the
quarterly Retirement Benefit he would have received from the Nations Funds under
Section 3.1 hereof had his Retirement occurred on his Normal Retirement Date,
except that such quarterly benefit shall be computed by including the number of
any additional Years of Service which have accrued since his Normal Retirement
Date (subject to the ten (10) Years of Service limitation set forth under
Section 3.1 hereof) and by taking into account any increases in Compensation
received since his Normal Retirement Date.
3.3 Other Termination of Service.
Upon termination of his participation in this Plan for any reason
prior to his Normal Retirement Date, a Participant shall not be entitled to any
benefit hereunder.
3.4 Benefits Calculated in the Aggregate for all of the Nations Funds.
With respect to each Participant, the benefits payable hereunder
shall be based on the aggregate Compensation paid by the Nations Funds and on
the Participant's non-forfeited Years of Service. Each Fund's share of the
obligation to provide such benefits shall be determined by use of accounting
methods adopted by the Administrator.
ARTICLE IV
DEATH BENEFITS
4.1 Death Prior to Commencement of Benefits.
In the event of a Participant's death on or after his Normal
Retirement Date, but prior to the commencement of his Retirement Benefits under
Article III hereof, the surviving spouse (if any) of such Participant shall be
entitled to receive a quarterly survivor's benefit for no more than five (5)
years (thus, not exceeding twenty (20) quarterly installments) beginning on the
first day of the calendar quarter next following the date of the Participant's
death equal to fifty percent (50%) of the amount of the quarterly installments
of Retirement Benefits that would have been paid to the Participant under
Sections 3.1 or 3.2 hereof based upon the Participant's Compensation and Years
of Service as of his date of death.
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4.2 Death Subsequent to Commencement of Benefits.
In the event a Participant dies after the commencement of his
Retirement Benefit under Article III, but prior to the cessation of the payment
of such Retirement Benefits, the surviving spouse (if any) of such Participant
shall be entitled to receive survivor's benefits equal to fifty percent (50%) of
the amount of the annual Retirement Benefits payable to the Participant under
Article III hereunder, paid at such times, and for such period, as such
Retirement Benefits would have continued to have been paid to the Participant
had he not died.
4.3 Death of Spouse.
(a) In the event a Participant is not survived by a spouse, no
benefits will be paid hereunder upon the Participant's death.
(b) If a deceased Participant's surviving spouse dies while
receiving survivor's benefits hereunder, any installments not paid at the time
of the surviving spouse's death shall be forfeited.
ARTICLE V
SUSPENSION OF BENEFITS
5.1 Suspension of Benefits Upon Resumption of Service.
In the case of a Participant who, at a time when he is receiving
Retirement Benefits under Article III of this Plan, resumes Service with any
Nations Fund, such Retirement Benefits shall be suspended until his subsequent
Retirement, termination of Service, or death. Subject to the Years of Service
limitations of Section 3.1 hereof, in the event of his Retirement or termination
of Service following such a suspension, the quarterly amount of his remaining
Retirement Benefits shall thereafter be adjusted to reflect any additional Years
of Service completed by, or a higher rate of Compensation received by, such
Participant.
ARTICLE VI
ADMINISTRATOR
6.1 Appointment of Administrator.
This plan shall be administered by the Nominating and Compensation
Committees of the Boards of Directors of the Nations Funds. The members of such
committees are not "interested persons" (within the meaning of Section 2(a)(19)
of the Investment Company Act of 1940, as amended) of any of the Nations Funds.
The term "Administrator" as used in this Plan shall refer to the members of such
committees, either individually or collectively, as appropriate.
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6.2 Powers and Duties of Administrator.
Except as provided below, the Administrator shall be authorized in
connection with the administration of this Plan:
(a) To promulgate and enforce such rules, regulations and
procedures as shall be proper for the efficient administration of the Plan;
(b) To determine all questions arising in the administration,
interpretation and application of the Plan, including questions of eligibility
and of the status and rights of the Participants and any other persons
hereunder;
(c) To decide any dispute arising hereunder; provided, however,
that no Administrator shall participate in any matter involving any questions
relating solely to his own participation or benefits under this Plan;
(d) To advise the Boards of Directors of the Nations Funds
regarding the known future need for funds to be available for distribution;
(e) To correct defects, supply omissions and reconcile
inconsistencies to the extent necessary to effectuate the Plan;
(f) To compute the amount of benefits and other payments which
shall be payable to any Participant or surviving spouse in accordance with the
provisions of the Plan and to determine the person or persons to whom such
benefits shall be paid;
(g) To make recommendations to the Boards of Directors of the
Nations Funds with respect to proposed amendments to the Plan;
(h) To file all reports with government agencies; Participants and
other parties as may be required by law, whether such reports are initially the
obligation of the Nations Funds, or the Plan;
(i) To engage an independent actuary on behalf of the Plan and to
cause the liabilities of the Plan to be evaluated by the actuary; and
(j) To have all such other powers as may be necessary to discharge
its duties hereunder.
6.3 Action by Administrator.
The Administrator may elect a Chairman and Secretary from among
its members and may adopt rules for the conduct of its business. A majority of
the members then serving shall constitute a quorum for the transaction of
business. All resolutions or other action taken by the Administrator shall be by
vote of a majority of those present at such meeting and entitled to vote.
Resolutions may be adopted or other action taken without a meeting upon written
consent signed
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by at least a majority of the members. All documents, instruments, orders,
requests, directions, instructions and other papers shall be executed on behalf
of the Administrator by either the Chairman or the Secretary of the
Administrator, if any, or by any member or agent of the Administrator duly
authorized to act on the Administrator's behalf.
6.4 Participation by Administrators.
No Administrator shall be precluded from becoming a Participant in
the Plan if he would be otherwise eligible, but he shall not be entitled to vote
or act upon matters or to sign any documents relating specifically to his own
participation under the Plan, except when such matters or documents relate to
benefits generally. If this disqualification results in the lack of a quorum,
then the Boards of Directors, by majority vote of the members of a majority of
such Boards of Directors (a "Majority Vote"), shall appoint a sufficient number
of temporary Administrators, who shall serve for the sole purpose of determining
such a question.
6.5 Agents and Expenses.
The Administrator may employ agents and provide for such clerical,
legal, actuarial, accounting, medical, advisory or other services as it deems
necessary to perform its duties under this Plan. The cost of such services and
all other expenses incurred by the Administrator in connection with the
administration of the Plan shall be allocated to each Fund pursuant to the
method utilized under Section 3.4 hereof with respect to costs related to
benefit accruals. For purposes of the preceding sentence, if an individual
serves as a Director for more than one Fund, he shall be deemed to be a separate
Director for each such Fund in determining the aggregate number of Directors of
the Nations Funds.
6.6 Allocation of Duties.
The duties, powers and responsibilities reserved to the
Administrator may be allocated among its members so long as such allocation is
pursuant to written procedures adopted by the Administrator, in which case no
Administrator shall have any liability, with respect to any duties, powers or
responsibilities not allocated to him, for the acts or omissions of any other
Administrator.
6.7 Delegation of Duties.
The Administrator may delegate any of its duties to employees of
the Nations Funds' distributor, administrator or adviser, or any of their
affiliates, or to any other person or firm, provided that the Administrator
shall prudently choose such agents and rely in good faith on their actions.
6.8 Records and Reports.
The Administrator shall maintain adequate records of its actions
and proceedings in administering this Plan and shall file all reports and take
all other actions as it deems appropriate in order to comply with any federal or
state law.
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6.9 Information from the Nations Funds.
The Nations Funds shall promptly furnish all necessary information
to the Administrator to permit it to perform its duties under this Plan. The
Administrator shall be entitled to rely upon the accuracy and completeness of
all information furnished to it by the Nations Funds, unless it knows or should
have know that such information is erroneous.
6.10 Reservation of Rights by Boards of Directors.
When rights are reserved in this plan to the Boards of Directors,
such rights shall be exercised only by Majority Vote of the Boards of Directors,
except where the Boards of Directors, by unanimous written resolution, delegate
any such rights to one or more persons or to the Administrator. Subject to the
rights reserved to the Boards of Directors as set forth in this Plan, no member
of the Boards of Directors shall have any duties or responsibilities under this
Plan, except to the extent he shall be acting in the capacity of an
Administrator.
6.11 Liability and Indemnification.
(a) The Administrator shall perform all duties required of it
under this Plan in a prudent manner. The Administrator shall not be responsible
in any way for any action or omission of the Nations Funds or any other
fiduciaries in the performance of their duties and obligations as set forth in
this Plan. The Administrator also shall not be responsible for any act or
omission of any of its agents provided that such agents were prudently chosen by
the Administrator and that the Administrator relied in good faith upon the
action of such agents.
(b) The Administrator shall not be relieved from responsibility or
liability for any responsibility, obligation or duty imposed upon it under this
Plan. Except for its own gross negligence, willful misconduct or willful breach
of the terms of this Plan, the Administrator shall be indemnified and held
harmless by the Nations Funds against liability or losses occurring by reason of
any act or omission of the Administrator.
ARTICLE VII
AMENDMENTS AND TERMINATION
7.1 Amendments.
The Boards of Directors reserve the right at any time and from
time to time, and retroactively, if deemed necessary or appropriate by them, to
amend in whole or in part by Majority Vote any or all of the provisions of this
Plan, provided that:
(a) No amendment shall make it possible for any part of a
Participant's Accrued Benefit or Retirement Benefit to be used for, or diverted
to, purposes other than for the exclusive
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benefit of Participants or their surviving spouses, except to the extent
otherwise provided in this Plan;
(b) No amendment may reduce any Participant's Accrued Benefit as
of the effective date of the amendment;
Amendments may be made in the form of Board of Directors'
resolutions or separate written document.
7.2 Termination.
Except as provided below, the Boards of Directors reserve the
right to terminate this Plan at any time by Majority Vote by giving to the
Administrator notice in writing of such desire to terminate. The Plan shall
terminate upon the date of receipt of such notice and the rights of all
Participants to their Accrued Benefits (determined as of the date the Plan is
terminated) shall become payable upon the earlier of the effective date of the
termination of the Plan, or, with respect to each Participant, upon his Normal
Retirement Date in quarterly installments or in an actuarially equivalent lump
sump as determined by the Administrator.
7.3 Change in Control.
In the event of the voluntary resignation of, or a vote or action
to replace, or a decision not to stand for re-election by, two or more of the
directors of a Nations Fund, in connection with a transaction that involves a
change in control or management of a Nations Fund or an affiliated person of a
Nations Fund, the Plan shall terminate with respect to the directors of the
Nations Fund who have resigned, been replaced or declined to stand for
re-election, on the date they cease being directors and the rights of all such
directors to their Accrued Benefits (determined as of the date of termination of
the Plan) shall become payable in quarterly installments or in an actuarially
equivalent lump sum as determined by the Administrator.
ARTICLE VIII
MISCELLANEOUS
8.1 Rights of Creditors.
(a) The Plan is unfunded. Neither the Participant nor any other
persons shall have any interest in any fund or in any specific asset or assets
of any of the Nations Funds by reason of any Accrued Benefit or Retirement
Benefit hereunder, nor any rights to receive distribution of any Retirement
Benefit except as and to the extent expressly provided hereunder.
(b) The Accrued Benefits and Retirement Benefits of each
Participant are unsecured and shall be subject to the claims of the general
creditors of the Nations Funds.
8.2 Liability Limited.
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Neither the Nations Funds, the Administrator, nor any agents,
employees, officers, directors or shareholders of any of them, nor any other
person shall have any liability or responsibility with respect to this Plan,
except as expressly provided herein.
8.3 Incapacity.
If the Administrator shall receive evidence satisfactory to it
that a Participant or surviving spouse entitled to any benefit under the Plan
is, at the time when such benefit becomes payable, physically or mentally
incompetent to give a valid release therefor, and that another person or an
institution is then maintaining or has custody of such Participant or surviving
spouse and that no guardian, committee or other representative of the estate of
such Participant or surviving spouse shall have been duly appointed, the
Administrator may make payment of such benefit otherwise payable to such
Participant or surviving spouse to such other person or institution, and the
release of such other person or institution shall be a valid and complete
discharge for the payment of such benefit.
8.4 Cooperation of Parties.
All parties to this Plan and any person claiming any interest
hereunder agree to perform any and all acts and execute any and all documents
and papers which are necessary or desirable for carrying out this Plan or any of
its provisions.
8.5 Governing Law.
This Plan has been adopted in the State of North Carolina and all
questions pertaining to its validity, construction and administration shall be
determined in accordance with the laws of that State.
8.6 No Guarantee of Directorship.
Nothing contained in this Plan shall be construed as a guaranty or
right of any Participant to be continued as a Director of one or more of the
Nations Funds (or of a right of a Director to any specific level of
Compensation) or as a limitation of the right of any of the Nations Funds, by
shareholder action or otherwise, to remove any of its directors.
8.7 Counsel.
The Administrator may consult with legal counsel, who may be
counsel for one or more of the Board of Directors of the Nations Funds and for
the Administrator, with respect to the meaning or construction of this Plan, its
obligations or duties hereunder or with respect to any action or proceeding or
any question of law, and they shall be fully protected with respect to any
action taken or omitted by them in good faith pursuant to the advice of legal
counsel.
8.8 Spendthrift Provision.
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A Participant's interest in his Accrued Benefit or Retirement
Benefit and the interest of a surviving spouse of a Participant in any benefit
payable under Article IV hereof shall not be subject to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, or charges and any
attempt so to anticipate, alienate, sell, transfer, assign, pledge, encumber or
charge the same shall be void; nor shall any portion of any such right hereunder
be in any manner payable to any assignee, receiver or trustee, or be liable for
such person's debts, contracts, liabilities, engagements or torts, or be subject
to any legal process to levy upon or attach.
8.9 Forfeiture for Cause.
Notwithstanding any other provision of this Plan to the contrary,
any benefits to which a Participant (or his surviving spouse) may otherwise be
entitled hereunder will be forfeited in the event the Administrator, in its sole
discretion, determines that a Participant's termination of Service is due to
such Participant's willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of the office of Director.
ARTICLE IX
CLAIMS PROCEDURE
9.1 Notice of Denial.
If a Participant is denied any Retirement Benefit (or a surviving
spouse is denied a survivor's benefit) under this Plan, either in total or in an
amount less than the full Retirement Benefit to which he would normally be
entitled, the Administrator shall advise the Participant (or surviving spouse)
in writing of the amount of his Retirement Benefit (or survivor's benefit), if
any, and the specific reasons for the denial. The Administrator shall also
furnish the Participant (or surviving spouse) at that time with a written notice
containing:
(a) A specific reason with reference to pertinent Plan provisions.
(b) A description of any additional material or information
necessary for the Participant (or surviving spouse) to perfect his claim, if
possible, and an explanation of why such material or information is needed.
(c) An explanation of the Plan's claim review procedure.
9.2 Right to Reconsideration.
Within 60 days of receipt of the information stated in Section 9.1
above, the Participant (or surviving spouse) shall, if he desires further
review, file a written request for reconsideration with the Administrator.
9.3 Review of Documents.
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So long as the Participant's (or surviving spouse's) request for
review is pending (including the 60-day period in 9.2 above), the Participant
(or surviving spouse) or his duly authorized representative may review pertinent
Plan documents and may submit issues and comments in writing to the
Administrator.
9.4 Decision by Administrator.
A final and binding decision shall be made by the Administrator
within 60 days of the filing by the Participant (or surviving spouse) of his
request for reconsideration, provided, however, that if the Administrator, in
its discretion, feels that a hearing with the Participant (or surviving spouse)
or his representative present is necessary or desirable, this period shall be
extended an additional 60 days.
9.5 Notice by Administrator.
The Administrator's decision shall be conveyed to the Participant
(or surviving spouse) in writing and shall include specific reasons for the
decision and the provisions of the Plan on which the decision is based.
Adopted on January 26, 1995 by:
Nations Fund, Inc.
Nations Fund Trust
The Capitol Mutual Funds
Adopted on January 25, 1995 by:
Nations Fund Portfolios, Inc.
Amended on July 13, 1995 by:
Nations Fund, Inc.
Nations Fund Trust
The Capitol Mutual Funds
Nations Fund Portfolios, Inc.
Adopted on August 6, 1997 by:
Nations Annuity Trust
Adopted on February 24, 1999 by:
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Nations Master Investment Trust
Adopted on December 9, 1999 by:
Nations Funds Trust
14
CUSTODY AGREEMENT
THIS AGREEMENT is made as of the 21st day of May, 1999 by and
between The Bank of New York, a New York corporation authorized to do a banking
business ("Custodian"), and Nations Master Investment Trust, a Delaware business
trust (the "Trust").
W I T N E S S E T H
WHEREAS, the Trust is a registered open-end management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Trust desires to retain Custodian to serve as
custodian for the Trust, on behalf of its portfolios listed on Schedule I
(individually a "Master Portfolio" and collectively the "Master Portfolios") and
to provide the services described herein, and Custodian is willing to serve and
to provide such services; and
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, the Trust and Custodian hereby agree as follows:
1. Appointment. The Trust hereby appoints Custodian to act as custodian
of its portfolio securities, cash and other property on the terms set forth in
this Agreement. Custodian accepts such appointment and agrees to furnish the
services herein set forth in return for the compensation as provided in
Paragraph 23 hereof. Custodian agrees to comply with all relevant provisions of
the 1940 Act and applicable rules and regulations thereunder.
The Trust may from time to time issue separate series or classes, and
classify and reclassify shares of any such series or class. The Trust shall
promptly specify to Custodian in writing such series or classes, or any
reclassification and thereafter Custodian shall identify to each such series or
class Property, as hereinafter defined, belonging to such series or class, and
such reports, confirmations and notices to the Trust as are called for under
this Agreement shall identify the series or class to which such report,
confirmation or notice pertains.
2. Delivery of Documents. The Trust has furnished Custodian with copies
properly certified or authenticated of each of the following:
(a) votes of the Trust's Board of Trustees authorizing the
appointment of Custodian as custodian of portfolio securities, cash and other
property of the Trust, respectively, and approving and consenting to this
Agreement;
(b) schedules identifying and containing the signatures of all
of the Trust's officers and any other persons authorized to issue Oral
Instructions and to sign Written Instructions, as hereinafter defined, on behalf
of the Master Portfolios of the Trust;
(c) the Trust's current Registration Statement on Form N-1A
under the 1940 Act, as filed with the Securities and Exchange Commission (the
"SEC"), relating to shares of beneficial interest of the Trust, without par
value (the "Shares");
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(d) the current prospectuses and statement of additional
information of each of the Master Portfolios, including all amendments and
supplements thereto (the "Prospectuses"); and
(e) a copy of the opinion of counsel for the Trust, filed with
the SEC as part of the Trust's current registration statement.
The Trust will furnish Custodian from time to time with
copies, properly certified or authenticated, of all amendments of or supplements
to any of the foregoing, if any.
3. Definitions.
(a) "Authorized Person". As used in this Agreement, the term
"Authorized Person" means any of the Trust's officers, and any other person,
whether or not any such person is an officer or employee of the Trust, duly
authorized by the Board of Trustees of the Trust to give Oral and Written
Instructions to Custodian on behalf of the Trust and listed on a schedule
provided to Custodian pursuant to Section 2 of this Agreement. Authorized
Persons duly authorized by the Board of Trustees of the Trust to buy and sell
foreign currency on a spot and forward basis and options to buy and sell foreign
currency are denoted by an asterisk thereon.
(b) "Book-Entry System". As used in this Agreement, the term
"Book-Entry System" means the Federal Reserve/Treasury book-entry system for
United States and federal agency securities, its successor or successors and its
nominee or nominees and any book-entry system maintained by a clearing agency
registered with the SEC under Section 17A of the Securities Exchange Act of 1934
(the "1934 Act").
(c) "Composite Currency Unit". Shall mean the European
Currency Unit or any other composite unit consisting of the aggregate of
specified amounts of specified Currencies as such unit may be constituted from
time to time.
(d) "Currency". Shall mean money denominated in a lawful
currency of any country or the European Currency Unit.
(e) "FX Transaction". Shall mean any transaction for the
purchase by one party of an agreed amount in one Currency against the sale by it
to the other party of an agreed amount in another Currency.
(f) "Instructions". Shall mean instruction communications
transmitted by appropriately safeguarded (whether by password protection or
other means) electronic or telecommunications media including but not limited to
S.W.I.F.T., LASER, computer-to-computer interface, dedicated transmission line
and tested telex.
(g) "Oral Instructions". As used in this Agreement, the term
"Oral Instructions" means oral instructions actually received by Custodian from
an Authorized Person or from a person reasonably believed by Custodian to be an
Authorized Person.
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(h) "Officer's Certificate". The term "Officer's Certificate"
as used in this Agreement means instructions delivered by hand, mail, tested
telegram, cable, telex, or facsimile sending device, and actually received by
Custodian signed or reasonably believed by Custodian to be signed by two
officers of the Trust listed on a schedule provided to Custodian pursuant to
Section 2 of this Agreement.
(i) "Property". The term "Property", as used in this
Agreement, means:
(i) any and all securities and other property of the Trust
which the Trust may from time to time deliver to Custodian, as applicable, or
which Custodian may from time to time hold for the Trust;
(ii) all income in respect of any securities or other
property described in immediately preceding clause (i);
(iii) all proceeds of sales of any of such securities or
other property described in preceding clause (i) actually received by Custodian;
and
(iv) proceeds of the sale of Shares received by Custodian
from time to time from or on behalf of the Trust.
(j) "Securities Depository". As used in this Agreement, the
term "Securities Depository" shall mean The Depository Trust Company, a clearing
agency registered with the SEC or its successor or successors and its nominee or
nominees; and shall also mean any other registered clearing agency, its
successor or successors specifically identified in a certified copy of a
resolution of the Trust's Board of Trustees approving deposits by Custodian
therein.
(k) "Written Instructions". As used in this Agreement,
"Written Instructions" means instructions delivered by hand, mail, tested
telegram, cable, telex, or facsimile sending device, and actually received by
Custodian, signed or reasonably believed by Custodian to be signed by an
appropriate number of Authorized Person(s), and the term Written Instructions
shall also include Instructions, except that Instructions need not be signed or
reasonably believed to be signed by any Authorized Person(s) where such
Instructions are transmitted by Software pursuant to Paragraph 26A. A fax
receipt or comparable confirmation of transmission of any Written Instructions
shall be deemed evidence of actual receipt by Custodian.
4. Delivery and Registration of the Property. The Trust shall deliver
or cause to be delivered to Custodian all securities and all monies owned by the
Master Portfolios, including cash received for the issuance of Shares, at any
time during the period of this Agreement, except for securities and monies to be
delivered to any sub-custodian appointed, with approval of the Trust, by
Custodian pursuant to Paragraphs 7, 27, or 28(g) hereof. Custodian will not be
responsible for such securities and such monies until actually received by it.
All securities delivered to Custodian or any such sub-custodian (other than in
bearer form) shall be registered in the name of the Master Portfolio or in the
name of a nominee of a Master Portfolio or in the name of Custodian or any
nominee of Custodian (with or without indication of fiduciary status) or in the
name of any sub-custodian or any nominee of such sub-custodian appointed, with
approval of the Trust, pursuant to Paragraphs 7, 27, or 28(g) hereof or shall be
properly endorsed and in form for transfer satisfactory to Custodian.
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5. Voting and Other Rights. With respect to all securities, however
registered, it is understood that the voting and other rights and powers shall
be exercised by the Trust. Custodian's only duty with respect to such rights
shall be to mail to the Trust within two (2) business days following receipt by
Custodian any documents received by Custodian as custodian, including notices of
corporate action, proxies, proxy soliciting materials and offering circulars,
with any elections or proxies for securities registered in a nominee name
executed by such nominee. In addition, Custodian shall provide notice of
Custodian's receipt of such documents by electronic means (e.g., posting notice
on LASER), as agreed between the parties. Where warrants, options, tenders or
other securities have fixed expiration dates, the Trust understands that in
order for Custodian to act, Custodian must receive the Trust's instructions at
its offices in New York, addressed as Custodian may from time to time request,
by no later than noon (New York City time) at least one (1) business day prior
to the last scheduled date to act with respect thereto (or such earlier date or
time as Custodian may reasonably notify the Trust). Absent Custodian's timely
receipt of such instructions, such instructions will expire without liability to
Custodian. Custodian shall have no duty to forward to the Trust any annual,
quarterly or special reports issued by companies whose securities are held by
Custodian hereunder.
6. Receipt and Disbursement of Money.
(a) Custodian shall open and maintain a custody account for
each Master Portfolio of the Trust, subject only to draft or order by Custodian
acting pursuant to the terms of this Agreement, and, subject to Paragraphs 7,
27, or 28(g) hereof, shall hold in such account, subject to the provisions
hereof, all cash received by it from or for the Master Portfolios. Custodian
shall make payments of cash to, or for the account of, each Master Portfolio
from such cash only: (i) for the purchase of securities for the Master
Portfolios as provided in Paragraph 14 hereof; (ii) upon receipt of an Officer's
Certificate for the payment of dividends or other distributions on or with
respect to Shares, or for the payment of interest, taxes, administration,
distribution or advisory fees or expenses which are to be borne by the Master
Portfolios under the terms of this Agreement and, with respect to each Master
Portfolio, and under the terms of any investment advisory agreements,
administration agreements or distribution agreements; (iii) upon receipt of
Written Instructions for payments in connection with the conversion, exchange or
surrender of securities owned or subscribed to by the Master Portfolios and held
by or to be delivered to Custodian; (iv) to a sub-custodian pursuant to
Paragraphs 7, 27, or 28(g) hereof; (v) for the redemption of Shares; or (vi)
upon receipt of an Officer's Certificate for other corporate purposes.
(b) Custodian is hereby authorized to endorse and collect all
checks, drafts or other orders for the payment of money received as Custodian
for the Master Portfolios.
7. Receipt of Securities.
(a) Except as provided by Paragraphs 7(c), 8, 27, or 28(g)
hereof, and except as otherwise directed by Oral or Written Instructions
described in Paragraph 11 hereof, Custodian shall hold and physically segregate
in a separate account with respect to each Master Portfolio, identifiable from
those of any other person, all securities and non-cash property received by it
for the Master Portfolios. All such securities and non-cash property are to be
held or disposed of by Custodian for each Master Portfolio pursuant to the terms
of this Agreement. In the absence of Written Instructions accompanied by a
certified resolution authorizing the
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specific transaction by the Trust's Board of Trustees, and subject to Paragraph
25 hereof, Custodian shall have no power or authority to withdraw, deliver,
assign, hypothecate, pledge or otherwise dispose of any such securities and
investments, except in accordance with the express terms provided for in this
Agreement. In no case may any trustee, officer, employee or agent of the Trust
withdraw any securities. In connection with its duties under this Paragraph
7(a), Custodian may enter into sub-custodian agreements with other banks or
trust companies for the receipt of certain securities and cash to be held by
Custodian for the account of a Master Portfolio pursuant to this Agreement,
provided Custodian obtains the prior written approval of the Trust to any such
sub-custody arrangement. Custodian will provide the Trust with a copy of each
sub-custodian agreement it executes pursuant to this Paragraph 7(a). Custodian
shall be liable for acts or omissions of any such sub-custodian selected by it
pursuant to this Paragraph 7(a), under the standards of care provided for
herein, except for any such sub-custodian engaged at the specific direction of
the Master Portfolios. Notwithstanding anything herein to the contrary, this
Paragraph 7(a) shall not apply to Custodian's engagement of foreign
sub-custodians, which shall instead be governed by Paragraph 27 hereof.
(b) Promptly after the close of business on each day,
Custodian shall furnish the Trust with confirmations and a summary of all
transfers to or from the account of each Master Portfolio during said day. Where
securities are transferred to the account of any Master Portfolio established at
a Securities Depository or the Book Entry System pursuant to Paragraph 8 herein,
Custodian shall also, by book-entry or otherwise, identify as belonging to such
Master Portfolio the quantity of securities in a fungible bulk of securities
registered in the name of Custodian (or its nominee) or shown in Custodian's
account on the books of a Securities Depository or the Book-Entry System. At
least monthly and from time to time, Custodian shall furnish the Trust with a
detailed statement of the Property held for each Master Portfolio under this
Agreement.
(c) Notwithstanding any provision elsewhere contained herein,
Custodian shall not be required to obtain possession of any instrument or
certificate representing any futures contract, any option, or any futures
contract option until after it shall have determined, or shall have received an
Officer's Certificate from the Trust stating that any such instruments or
certificates are available. The Trust shall deliver to Custodian such an
Officer's Certificate no later than the business day preceding the availability
of any such instrument or certificate. Prior to such availability, Custodian
shall comply with the 1940 Act in connection with the purchase, sale,
settlement, closing out or writing of futures contracts, options, or futures
contract options by making payments or deliveries specified in such Officer's
Certificates or Written Instructions received by Custodian in connection with
any such purchase, sale, writing, settlement or closing out upon its receipt
from a broker, dealer, or futures commission merchant of a statement or
confirmation reasonably believed by Custodian to be in the form customarily used
by brokers, dealers, or future commission merchants with respect to such futures
contracts, options, or futures contract options, as the case may be, confirming
that the same is held by such broker, dealer or futures commission merchant, in
book-entry form or otherwise, in the name of Custodian (or any nominee of
Custodian) as Custodian for the Master Portfolio, provided, however, that
notwithstanding the foregoing, and subject to Paragraph 13(b) hereof, payments
to or deliveries from any margin account, and payments with respect to future
contracts, options, or future contract options to which a margin account
relates, shall be made in accordance with the terms and conditions of the
Trust's relevant margin account agreement. Whenever any such instruments or
certificates are available, Custodian shall, notwithstanding any provision in
this
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Agreement to the contrary, make payment for any futures contract, option,
or futures contract option for which such instruments or such certificates are
available against the delivery to Custodian of such instrument or such
certificate, and deliver any futures contract, option or futures contract option
for which such instruments or such certificates are available only against
receipt by Custodian of payment therefor. Any such instrument or certificate
delivered to Custodian shall be held by Custodian hereunder in accordance with,
and subject to, the provisions of this Agreement.
8. Use of Securities Depository or the Book-Entry System. The Trust
shall deliver to Custodian a certified vote of the Board of Trustees of the
Trust approving, authorizing and instructing Custodian on a continuous and
ongoing basis until instructed to the contrary by Written Instructions: (i) to
deposit in a Securities Depository or the Book-Entry System all securities of
the Master Portfolios held hereunder eligible for deposit therein, and (ii) to
utilize a Securities Depository or the Book-Entry System to the extent possible
in connection with the performance of its duties hereunder, including without
limitation, settlements of purchases and sales of securities by the Master
Portfolios, and deliveries and returns of securities loaned, subject to
repurchase agreements or used as collateral in connection with borrowings.
Without limiting the generality of such use, the following provisions shall
apply thereto:
(a) Securities and any cash of the Master Portfolios deposited
by Custodian in a Securities Depository or the Book-Entry System will at all
times be segregated from any assets and cash controlled by Custodian in other
than a fiduciary or custodian capacity. Subject to Paragraph 28(m) hereof,
Custodian and its sub-custodians, if any, will pay out money only upon receipt
of securities and will deliver securities only upon receipt of money, absent
Written Instructions to the contrary.
(b) All books and records maintained by Custodian that relate
to the Master Portfolios' participation in a Securities Depository or the
Book-Entry System will at all times during Custodian's regular business hours be
open to inspection by the Trust's duly authorized employees or agents and the
Trust's independent auditors in accordance with applicable regulations, it being
understood, however, that such records may be kept in an off-site Custodian
storage location and the Trust will be furnished with all information in respect
of the services rendered to it as it may require.
(c) Custodian will provide the Trust with copies of any report
obtained by Custodian on the system of internal accounting control of the
Securities Depository or Book-Entry System promptly after receipt of such a
report by Custodian. Custodian will also provide the Trust with such reports on
its own system of internal control as the Trust may reasonably request from time
to time.
9. Instructions Consistent With the Charter, Etc. Unless otherwise
provided in this Agreement, Custodian shall act only upon Officer's
Certificates, Oral Instructions and/or Written Instructions. Custodian may
assume that any Officer's Certificate, Oral Instructions or Written Instructions
received hereunder are not in any way inconsistent with any provision of the
Declaration of Trust or By-Laws or any vote of the Trust's Board of Trustees, or
any committee thereof. Custodian shall be entitled to rely upon any Oral
Instructions or Written Instructions actually received by Custodian pursuant to
this Agreement, and upon any certificate, oral instructions, or written
instructions reasonably believed by Custodian to be an Officer's
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Certificate, Oral Instructions or Written Instructions. The Trust agrees to
forward to Custodian, Written Instructions confirming Oral Instructions in such
manner that the Written Instructions are received by Custodian at the close of
business of the same day that such Oral Instructions are given to Custodian. The
Trust agrees that the fact that such confirming Written Instructions are not
received by Custodian shall in no way affect the validity of any of the
transactions authorized by the Trust by giving Oral Instructions, and that
Custodian's records with respect to the content of Oral Instructions shall be
controlling.
10. Transactions Not Requiring Instructions. Custodian is authorized to
take the following action without Oral Instructions, Written Instructions, or an
Officer's Certificate:
(a) Collection of Income and Other Payments. Custodian shall
subject to Paragraph 28(f) hereof:
(i) Collect and receive for the account of any Master
Portfolio, all income and other payments and distributions, including (without
limitation) stock dividends, rights, warrants and similar items, included or to
be included in the Property of any Master Portfolio, and promptly advise the
Trust of such receipt and shall credit such income, as collected, to such Master
Portfolio of the Trust. From time to time, Custodian may elect, but shall not be
so obligated, to credit the account with interest, dividends or principal
payments on the payable or contractual settlement date, in anticipation of
receiving same from a payor, central depository, Securities Depository, broker
or other agent employed by the Trust or Custodian. Any such crediting and
posting shall be at the Trust's sole risk, and Custodian shall be authorized to
reverse (A) any such advance posting in the event it does not receive good funds
from any such payor, central depository, Securities Depository, broker or agent,
and (B) any other payment or crediting, including, without limitation, payments
made by check or draft, in the event it does not receive good funds or final
payment;
(ii) With respect to securities of foreign issue, and
subject to Paragraph 27 hereof, effect collection of dividends, interest and
other income, and to promptly transmit to the Trust all reports, written
information or notices actually received by Custodian as Custodian, including
notices of any call for redemption, offer of exchange, right of subscription,
reorganization, or other proceedings affecting such securities, or any default
in payments due thereon. It is understood, however, that Custodian shall be
under no responsibility for any failure or delay in effecting such collections
or giving such notice with respect to securities of foreign issue, regardless of
whether or not the relevant information is published in any financial service
available to it unless such failure or delay is due to Custodian's own
negligence. Collections of income in foreign currency are, to the extent
possible, to be converted into United States dollars unless otherwise instructed
in writing, and in effecting such conversion Custodian may use such methods or
agencies as it may see fit, including the facilities of its own foreign division
at customary rates. All risk and expenses incident to such collection and
conversion are for the account of the Master Portfolios and Custodian shall have
no responsibility for fluctuations in exchange rates affecting any such
conversions;
(iii) Endorse and deposit for collection in the name of the
Trust and each of its Master Portfolios, checks, drafts, or other orders for the
payment of money on the same day as received;
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(iv) Receive and hold for the account of each of the Master
Portfolio's securities received by the Master Portfolios as a result of a stock
dividend, share split-up or reorganization, recapitalization, readjustment or
other rearrangement or distribution of rights or similar securities issued with
respect to any portfolio securities of the Master Portfolios held by Custodian
hereunder;
(v) Present for payment and collect the amount payable upon
all securities which may mature or be called, redeemed or retired, or otherwise
become payable on the date such securities become payable, but, with respect to
calls, early redemptions, or early retirements, only if Custodian either: (i)
receives a written notice of the same, or (ii) notice of the same appears in one
or more of the publications then listed in Appendix A hereto, which Appendix may
be amended to add other publications at any time by Custodian without prior
notice to or consent from the Trust and which may be amended to delete a
publication with the prior notice and consent from the Trust;
(vi) Subject to Paragraphs 28(e) and (f) hereof, take any
action which may be necessary and proper in connection with the collection and
receipt of such income and other payments and the endorsement for collection of
checks, drafts and other negotiable instructions; and
(vii) With respect to domestic securities, to exchange
securities in temporary form for securities in definitive form, to effect an
exchange of the shares where the par value of stock is changed, and to surrender
securities at maturity or when advised by the Trust or the investment adviser to
the Trust of an earlier call for redemption, against payment therefor in
accordance with accepted industry practice. When fractional shares of stock of a
declaring corporation are received as a stock distribution, Custodian is
authorized to sell the fraction received and credit the Trust's account. Unless
specifically instructed to the contrary in writing, Custodian is authorized to
exchange securities in bearer form for securities in registered form. If any
Property registered in the name of a nominee of Custodian is called for partial
redemption by the issuer of such Property, Custodian is authorized to allot the
called portion to the respective beneficial holders of the Property in such
manner deemed to be fair and equitable by Custodian in its reasonable
discretion.
(b) Miscellaneous Transactions. Custodian is authorized to
deliver or cause to be delivered Property against payment or other consideration
or written receipt therefor in the following cases:
(i) for examination by a broker selling for the account of
the Trust in accordance with street delivery custom;
(ii) for the exchange for interim receipts or temporary
securities for definitive securities;
(iii) for transfer of securities into the name of the Master
Portfolios or Custodian or a nominee of either, or for exchange of securities
for a different number of bonds, certificates, or other evidence, representing
the same aggregate face amount or number of units bearing the same interest
rate, maturity date and call provisions, if any; provided that, in any such
case, the new securities are to be delivered to Custodian.
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11. Transactions Requiring Instructions. Upon receipt of Oral or
Written Instructions, and not otherwise, Custodian, directly or through the use
of a Securities Depository or the Book-Entry System, shall:
(a) execute and deliver to such persons as may be designated in
such Oral or Written Instructions, proxies, consents, authorizations, and any
other instruments whereby the authority of the Master Portfolios as owners of
any securities may be exercised;
(b) deliver any securities held for any Master Portfolio against
receipt of other securities or cash issued or paid in connection with the
liquidation, reorganization, refinancing, merger, consolidation or
recapitalization of any corporation, or the exercise of any conversion
privilege;
(c) deliver any securities held for any Master Portfolio to any
protective committee, reorganization committee or other person in connection
with the reorganization, refinancing, merger, consolidation, recapitalization or
sale of assets of any corporation, against receipt of such certificates or
deposit, interim receipts or other instruments or documents as may be issued to
it to evidence such delivery;
(d) make such transfers or exchanges of the assets of any Master
Portfolio and take such other steps as shall be stated in said instructions to
be for the purposes of effectuating any duly authorized plan of liquidation,
reorganization, merger, consolidation or recapitalization of the Master
Portfolios;
(e) subject to Paragraph 25(b) hereof, release securities
belonging to any Master Portfolio to any bank or trust company for the purpose
of pledge or hypothecation to secure any loan incurred by such Master Portfolio;
provided, however, that securities shall be released only upon payment to
Custodian of the monies borrowed, except that in cases where additional
collateral is required to secure a borrowing already made, subject to proper
prior authorization, further securities may be released for that purpose; and
pay such loan upon redelivery to it of the securities pledged or hypothecated
therefor and upon surrender of the note or notes evidencing the loan;
(f) deliver any securities held for any Master Portfolio upon the
exercise of a covered call option written by such Master Portfolio on such
securities;
(g) release and deliver securities owned by a Master Portfolio in
connection with any repurchase agreement entered into on behalf of such Master
Portfolio, but subject to Paragraph 28(m) hereof, only on receipt of payment
therefor; and pay out monies of such Master Portfolio in connection with such
repurchase agreements, but only upon the delivery of the securities;
(h) otherwise transfer, exchange or deliver securities in
accordance with Oral or Written Instructions specifying the purpose of such
transfer, including without limitation, loans of securities, short sales, or
reverse repurchase agreements, and subject to Paragraph 7(a) hereof.
12. Segregated Accounts. Custodian shall upon receipt of Written or
Oral Instructions establish and maintain a segregated account or accounts on its
records for and on
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behalf of any Master Portfolio, into which account or accounts shall be
credited, but only pursuant to an Officer's Certificate or Written Instructions
specifying the particular securities and/or amount of cash, cash and/or
securities, including securities in the Book-Entry System: (i) for the purposes
of compliance by the Master Portfolios and the Trust with the procedures
required by a securities or option exchange, (ii) for the purpose of compliance
by the Master Portfolios and the Trust with the 1940 Act and Release No. 10666
or any subsequent release or releases of the SEC relating to the maintenance of
segregated accounts by registered investment companies, and (iii) for other
proper corporate purposes.
13. Dividends and Distributions.
(a) The Trust shall furnish Custodian with appropriate evidence
of action by the Trust's Board of Trustees declaring and authorizing the payment
of any dividends and distributions. Upon receipt by Custodian of an Officer's
Certificate with respect to dividends and distributions declared by the Trust's
Board of Trustees and payable to interestholders of any Master Portfolio who are
entitled to receive cash for fractional shares and those who have elected in the
proper manner to receive their distributions on dividends in cash, and in
conformance with procedures mutually agreed upon by Custodian and the Trust, and
the Trust's administrator or transfer agent, Custodian shall pay to the Master
Portfolio's transfer agent, as agent for the interestholders, an amount equal to
the amount indicated in said Officer's Certificate as payable by the Master
Portfolio to such interestholders for distribution in cash by the transfer agent
to such interestholders.
(b) Custodian may enter into separate custodial agreements with
various futures commission merchants ("FCMs") that the Trust uses (each an "FCM
Agreement"), pursuant to which the Master Portfolios' margin deposits in any
transactions involving futures contracts and options on futures contracts will
be held by Custodian in accounts (each an "FCM Account") subject to the
disposition by the FCM involved in such contracts in accordance with the
customer contract between the FCM and the Trust ("FCM Contract"), SEC rules
governing such segregated accounts, Commodity Futures Trading Commission
("CFTC") rules and the rules of the applicable commodities exchange. Such FCM
Agreements shall only be entered into by Custodian upon receipt by Custodian of
Written Instructions from the Trust which state that: (i) an FCM Contract has
been entered into; (ii) the Trust is in compliance with all the rules and
regulations of the CFTC; and (iii) the FCM Agreement is acceptable to the Trust.
Transfers of initial margin shall be made into an FCM Account only upon Written
Instructions; transfers of premium and variation margin may be made into an FCM
Account pursuant to Oral Instructions. Transfers of funds from an FCM Account to
the FCM for which Custodian holds such an account may only occur in accordance
with the terms of the FCM Agreement.
14. Purchase of Securities. Promptly after each purchase of securities
by the Trust on behalf of any Master Portfolio, the Trust shall deliver to
Custodian Oral or Written Instructions specifying with respect to each such
purchase: (a) the name of the issuer and the title of the securities; (b) the
number of shares of the principal amount purchased and accrued interest, if any;
(c) the dates of purchase and settlement; (d) the purchase price per unit; (e)
the total amount payable upon such purchase; (f) the name of the person from
whom or the broker
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through whom the purchase was made; and (g) the Master Portfolio for which the
purchase was made. Custodian shall upon receipt of securities purchased by or
for the Trust pay out of the monies held for the account of the Trust the total
amount payable to the person from whom or the broker through whom the purchase
was made, provided that the same conforms to the total amount payable as set
forth in such Oral or Written Instructions.
15. Sales of Securities. Promptly after each sale of securities by the
Master Portfolios or the Trust shall deliver to Custodian Oral or Written
Instructions, specifying with respect to each such sale: (a) the name of the
issuer and the title of the security; (b) the number of shares or principal
amount sold, and accrued interest, if any; (c) the dates of sale; (d) the sale
price per unit; (e) the total amount payable to the Trust upon such sale; (f)
the name of the broker through whom or the person to whom the sale was made; and
(g) the Master Portfolio for which the sale was made. Custodian shall, subject
to Paragraph 28(m) hereof, deliver the securities against payment of the total
amount payable to the Trust upon such sale, provided that the same conforms to
the total amount payable as set forth in such Oral and Written Instructions.
16. Records. The books and records pertaining to the Master Portfolios
and the Trust which are in the possession of Custodian shall be the property of
the Trust. Such books and records shall be prepared and maintained as required
by the 1940 Act and other applicable securities laws, rules and regulations. The
SEC, the Trust, or the Trust's authorized representatives, shall have access to
such books and records at all times during Custodian's normal business hours.
Upon the reasonable request of the Trust, copies of any such books and records
shall be provided by Custodian to the Trust or the Trust's authorized
representative, and the Trust shall reimburse Custodian reasonable expenses for
providing such copies. Upon reasonable request of the Trust, Custodian shall
provide in hard copy, tape or on micro-film, or such other medium as agreed to
among the Trust and Custodian, and any books and records maintained by
Custodian.
17. Reports.
(a) Custodian shall furnish the Trust the following reports:
(i) such periodic and special reports as the Trust may
reasonably request from time to time;
(ii) a monthly statement summarizing all transactions and
entries for the account of each Master Portfolio;
(iii) a monthly report of portfolio securities belonging to
each Master Portfolio showing the adjusted average cost of each issue
and market value at the end of such month;
(iv) a monthly report of the cash account of each Master
Portfolio showing disbursements;
(v) the reports to be furnished to the Trust pursuant to
Rule 17f-4 under the 1940 Act; and
(vi) such other information as may be agreed upon from time
to time between the Trust and Custodian.
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(b) Subject to Paragraphs 5 and 27(g) hereof, Custodian shall
transmit promptly to the Trust any proxy statement, proxy materials, notice of a
call or conversion or similar communications actually received by Custodian as
custodian of the Property.
(c) Custodian shall report as the market value at the end of each
month the last closing bid, offer or sale price to the extent, and as the same,
is furnished to Custodian by a pricing or similar service utilized or subscribed
to by Custodian. Custodian shall not be responsible for, have any liability with
respect to, or be under any duty to inquire into, nor deemed to make any
assurances with respect to, the accuracy or completeness of such information,
even if The Bank of New York in performing services for others, including
services similar to those performed hereunder, receives different valuations of
the same or different securities of the same issuer.
18. Cooperation with Accountants. Custodian shall cooperate with the
Trust's independent certified public accountants and shall take all reasonable
action in the performance of its obligations under this Agreement, to assure
that the necessary information is made available to such accountants.
19. Confidentiality. Custodian agrees on behalf of itself and its
employees to treat all record and other information relative to the Trust, its
prior, present or potential interestholders, its service providers and its
prior, present or potential customers, as confidential information, and to
protect and safeguard the same to the extent required by applicable law,
provided, however, that Custodian may make such disclosure as required by
applicable law, regulation, court order, decrees or legal process and upon
receipt of any of the foregoing requiring such disclosure, Custodian's only
obligation shall be to notify the Trust thereof. Custodian further agrees not to
otherwise use such records and information for any purpose other than
performance of its responsibilities and duties hereunder, except after prior
notification to and approval in writing by the Trust.
20. Equipment Failures. In the event of equipment failures beyond
Custodian's control, Custodian shall take reasonable steps to minimize service
interruptions but shall not have any further liability with respect thereto.
Notwithstanding the foregoing, Custodian shall maintain sufficient back up
electronic data processing equipment to enable Custodian to fulfill its
obligations under this Agreement consistent with standard industry practices.
21. Right to Receive Advice.
(a) Advice of Master Portfolio. If Custodian shall be in doubt as
to any action to be taken or omitted by it, either may request, and shall
receive, from the Trust clarification or advice, including Oral or Written
Instructions.
(b) Advice of Counsel. If Custodian shall be in doubt as to any
question of law involved in any action to be taken or omitted by Custodian, it
may request at its option advice from its own counsel, at its own expense, or
advice from the Trust's counsel.
(c) Conflicting Advice. In case of conflict between directions,
advice or Oral or Written Instructions received by Custodian pursuant to
subparagraph (a) of this paragraph and advice received by Custodian pursuant to
subparagraph (b) of this paragraph, Custodian shall be entitled to rely on and
follow the advice received pursuant to subparagraph (b) alone.
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(d) Protection of Custodian. Custodian shall be protected in any
action or inaction which it takes or omits to take in reliance on any
directions, advice or Oral or Written Instructions received pursuant to
subparagraphs (a) or (b) of this section which it, after receipt of any such
directions, advice or Oral or Written Instructions, in good faith reasonably
believes to be consistent with such directions, advice or Oral or Written
Instructions, as the case may be. Nothing in this Paragraph 21 shall be
construed as imposing upon Custodian any obligation: (i) to seek such
directions, advice or Oral or Written Instructions, or (ii) to act in accordance
with such directions, advice or Oral or Written Instructions when received,
unless, under the terms or another provision of this Agreement, the same is a
condition to Custodian's properly taking or omitting to take such action.
Nothing in this Paragraph 21(d) shall excuse Custodian when an action or
omission on the part of Custodian constitutes willful misfeasance or bad faith,
or negligence or reckless disregard by Custodian of its duties under this
Agreement.
22. Compliance with Governmental Rules and Regulations. Custodian
undertakes to comply with the laws, rules and regulations of governmental
authorities having jurisdiction over Custodian and its express duties hereunder.
23. Compensation. As compensation for the services rendered by
Custodian during the term of this Agreement, the Trust shall pay to Custodian,
in addition to reimbursement of its out-of-pocket expenses, such compensation as
may be agreed upon from time to time in writing by the Trust and Custodian as
set forth in Schedule III.
24. Indemnification. The Trust agrees to indemnify Custodian against,
and hold harmless from all taxes, charges, expenses (including reasonable fees
and expenses of counsel), assessments, claims, losses, demands and liabilities
whatsoever (including, without limitation, liabilities arising under the 1933
Act, the 1934 Act and the 1940 Act, and any state and foreign securities laws,
all as currently in effect or as may be amended from time to time) and expenses,
including without limitation, reasonable attorney's fees and disbursements,
howsoever arising or incurred because of or in connection with this Agreement,
except for such liability, claim, loss, demand, charge, expense, tax or
assessment arising out of Custodian's, or such nominees', willful misconduct or
negligence or reckless disregard of its duties under this Agreement. For the
purposes of this Agreement, including, without limitation, for purposes of
Paragraphs 24 and 28, neither Custodian's acceptance of Instructions in
accordance with Paragraph 26A nor Custodian's use of Foreign Sub-Custodians
pursuant to agreements that do not permit actual examination by independent
public accountants, nor the denial of examination by any Foreign Sub-Custodian,
as defined in Paragraph 27, shall, in and of itself, constitute, or be deemed to
constitute, a breach by Custodian of this Agreement or negligence, willful
misconduct, or reckless disregard of its duties by Custodian, provided the
relevant agreement between Custodian and a Foreign Sub-Custodian satisfies the
requirements of Rule 17f-5.
25. Overdrafts or Indebtedness.
(a) Custodian shall advance funds under this Agreement with
respect to any Master Portfolio which results in an overdraft because the moneys
held by Custodian in the separate account for such Master Portfolio shall be
insufficient to pay the total amount payable upon a purchase of securities by
such Master Portfolio, as set forth in an Officer's Certificate or Oral or
Written Instructions, or which results in an overdraft in the separate account
of such Master Portfolio for some other reason, or if the Trust is for any other
reason indebted to
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Custodian, including any indebtedness to The Bank of New York under the Trust's
Cash Management and Related Services Agreement, (except a borrowing for
investment or for temporary or emergency purposes using securities as collateral
pursuant to a separate agreement and subject to the provisions of Paragraph
25(b) hereof), such overdraft or indebtedness shall be deemed to be a loan made
by Custodian to the Trust for such Master Portfolio payable on demand and shall
bear interest from the date incurred at a rate per annum (based on a 360-day
year for the actual number of days involved) equal to the overdraft rate
specified in Schedule III to this Agreement. In addition, the Trust hereby
agrees that Custodian shall have a continuing lien, security entitlement and
security interest in and to any property at any time held by it for the benefit
of such Master Portfolio or in which the Master Portfolio may have an interest
which is then in Custodian's possession or control or in possession or control
of any third party acting on Custodian's behalf. The Trust authorizes Custodian,
in its sole discretion, at any time to charge any such overdraft or indebtedness
together with interest due thereon against any balance of account standing to
such Master Portfolio's credit on Custodian's books. In addition, the Trust
hereby covenants that on each Business Day on which either it intends to enter a
Reverse Repurchase Agreement and/or otherwise borrow from a third party, or
which next succeeds a Business Day on which at the close of business the Trust
had outstanding a Reverse Repurchase Agreement or such a borrowing, it shall
prior to 1:00 p.m., New York City time, advise Custodian, in writing, of each
such borrowing, shall specify the Master Portfolio to which the same relates,
and shall not incur any indebtedness not so specified other than from Custodian.
(b) The Trust will cause to be delivered to Custodian by any bank
(including, if the borrowing is pursuant to a separate agreement, Custodian)
from which it borrows money for investment or for temporary or emergency
purposes using securities held by Custodian hereunder as collateral for such
borrowings, a notice or undertaking in the form currently employed by such bank
setting forth the amount which such bank will loan to the Trust against delivery
of a stated amount of collateral. The Trust shall promptly deliver to Custodian
Written Instructions specifying with respect to each such borrowing: (a) the
Master Portfolio to which such borrowing relates; (b) the name of the bank; (c)
the amount and terms of the borrowing, which may be set forth by incorporating
by reference an attached promissory note, duly endorsed by the Master Portfolio,
or other loan agreement; (d) the time and date, if known, on which the loan is
to be entered into; (e) the date on which the loan becomes due and payable; (f)
the total amount payable to the Master Portfolio on the borrowing date; (g) the
market value of securities to be delivered as collateral for such loan,
including the name of the issuer, the title and the number of shares or the
principal amount of any particular securities and (h) a statement specifying
whether such loan is for investment purposes or for temporary or emergency
purposes and that such loan is in conformance with the 1940 Act and the Master
Portfolio's prospectus. Custodian shall deliver on the borrowing date specified
in Written Instructions the specified collateral and the executed promissory
note, if any, against delivery by the lending bank of the total amount of the
loan payable, provided that the same conforms to the total amount payable as set
forth in such Written Instructions. Custodian may, at the option of the lending
bank, keep such collateral in its possession, but such collateral shall be
subject to all rights therein given the lending bank by virtue of any promissory
note or loan agreement. Custodian shall deliver such securities as additional
collateral as may be specified in Written Instructions to collateralize further
any transaction described in this Paragraph 25(b). The Trust shall cause all
securities released from collateral status to be returned directly to Custodian,
and Custodian shall receive from time to time such return of collateral as may
be tendered to it. In the event that the Trust fails to specify in Written
Instructions the Master Portfolio, the name of the issuer, the title
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and number of shares or the principal amount of any particular securities to be
delivered as collateral by Custodian, Custodian shall not be under any
obligation to deliver any securities.
26A. Instructions.
(a) It is understood and agreed that Custodian may, from time to
time, provide software to the Trust for purposes of enabling a Master Portfolio
to transmit Instructions to Custodian (the "Software"). Such Software has been
designed to include password protection or other features to restrict the use of
the Software to Authorized Persons; provided, however, that the Custodian makes
no warranty or representations of any kind with respect to such protections or
features, express or implied, including, but not limited to, any implied
warranties of merchantability or fitness for a particular purpose. The Trust and
the Custodian shall use commercially reasonable efforts to develop other
mechanisms (i) to enable the Trust to restrict the use of the Software to
Authorized Persons, (ii) to identify transmissions from a terminal other than an
authorized terminal, and (iii) for the prompt and accurate transmission of
Instructions by Authorized Persons to Custodian. It is further understood and
agreed that Custodian may provide specialized hardware or other equipment to
enable the Trust and the Master Portfolios to utilize the Software. With respect
to any such Software, Custodian grants to the Trust and its service providers a
personal, nontransferable and nonexclusive license to use the Software solely
for the purpose of transmitting Instructions to, and receiving communications
from, Custodian in connection with its account(s). The Trust and its service
providers agree not to sell, reproduce, lease or otherwise provide, directly or
indirectly, the Software or any portion thereof to any third party without the
prior written consent of Custodian. At no time shall the Trust be obligated to
use the Software to transmit Instructions to Custodian.
(b) The Trust shall obtain and maintain at its own cost and
expense all equipment and services, including but not limited to communications
services, necessary for it to utilize the Software and transmit Instructions to
Custodian; provided, however, that the parties acknowledge and agree that if any
specialized equipment is necessary to enable the Trust to utilize the Software,
Custodian shall, at its own expense, provide and maintain such equipment.
(c) The Trust acknowledges that the Software, all databases made
available to the Trust by utilizing the Software (other than databases relating
solely to the assets of the Master Portfolios and transactions with respect
thereto), and any proprietary data, processes, information and documentation
(other than those which are or become part of the public domain or are legally
required to be made available to the public) (collectively, the "Information"),
are the exclusive and confidential property of Custodian. The Trust shall keep
the Information confidential by using the same care and discretion that the
Trust uses with respect to its own confidential property and trade secrets and
shall neither make nor permit any disclosure without the prior written consent
of Custodian. Upon termination of this Agreement or the Software license granted
hereunder for any reason, the Trust shall return to Custodian all copies of the
Information which are in its possession or under its control or which the Trust
distributed to third parties.
(d) Custodian reserves the right to modify the Software from time
to time upon reasonable prior notice and the Trust shall, if it desires in its
sole discretion to continue to use the Software, install new releases of the
Software as Custodian may direct. The Trust agrees not to modify or attempt to
modify the Software without Custodian's prior written consent. The
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Trust acknowledges that any modifications to the Software, whether by the Trust
or Custodian and whether with or without Custodian's consent, shall become the
property of Custodian.
(e) Where the method for transmitting Instructions by the Trust
involves an automatic systems acknowledgment to the Trust by Custodian of its
receipt of such Instructions, including any transmission of Instructions using
the Software, then (i) if an acknowledgment is not actually received by the
Trust, Custodian shall not be deemed to have received any such Instructions, and
(ii) if an acknowledgment is actually received by the Trust, the Custodian shall
be deemed to have received such Instructions and shall be responsible for any
error, omission, interruption or delay in connection with the transmission of
such Instructions; provided, however, that the Trust shall promptly review all
acknowledgments actually received and notify the Custodian in the event of any
apparent discrepancy.
(f) (i) The Trust agrees that where it delivers to Custodian
Instructions hereunder using the Software, it shall be the Trust's sole
responsibility to ensure that only persons duly authorized by the Trust and the
correct number of such persons transmit such Instructions to Custodian and the
Trust will cause all such persons to treat applicable use and authorization
codes, passwords and authentication keys with extreme care, and authorizes
Custodian to act in accordance with and rely upon Instructions received by it
pursuant hereto using the Software. (ii) The Trust hereby represents,
acknowledges and agrees that it is fully informed of the protections and risks
associated with the various methods of transmitting Instructions to Custodian
and that there may be more secure methods of transmitting Instructions to
Custodian than the method(s) selected by the Trust. (iii) With respect to all
Oral Instructions and all Written Instructions other than Instructions delivered
to Custodian using the Software provided by Custodian, Custodian shall exercise
all commercially reasonable efforts to form a reasonable belief that each such
instruction has been given by an Authorized Person and, where required, signed
by an appropriate number of Authorized Person(s).
(g) The Trust shall notify Custodian of any errors, omissions or
interruptions in, or delay or unavailability of, its ability to send
Instructions using the Software provided by Custodian as promptly as
practicable, and in any event within 24 hours after the earliest of (i)
discovery thereof, (ii) the business day on which discovery should have occurred
through the exercise of reasonable care and (iii) in the case of any error, the
date of actual receipt of the earliest notice which reflects such error, it
being agreed that discovery and receipt of notice may only occur on a business
day. Custodian shall, as promptly as practicable, and in any event within 24
hours after the earliest of (i) discovery thereof, (ii) the business day on
which discovery should have occurred through the exercise of reasonable care and
(iii) in the case of any error, the date of actual receipt of the earliest
notice which reflects such error, it being agreed that discovery and receipt of
notice may only occur on a business day, advise the Trust whenever Custodian
learns or reasonably should have learned, of any errors, omissions or
interruption in, or delay or unavailability of, the Trust's ability to send
Instructions using the Software provided by Custodian.
26B. FX Transactions
(a) Whenever a Master Portfolio shall enter into an FX
Transaction, the Master Portfolio shall promptly deliver to Custodian a
Certificate or Oral Instructions specifying with respect to such FX Transaction:
(i) the Series to which such FX Transaction is specifically
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allocated; (ii) the type and amount of Currency to be purchased by the Master
Portfolio; (iii) the type and amount of Currency to be sold by the Master
Portfolio; (iv) the date on which the Currency to be purchased is to be
delivered; (v) the date on which the Currency to be sold is to be delivered; and
(vi) the name of the person from whom or through whom such Currencies are to be
purchased and sold. Unless otherwise instructed by a Certificate or Oral
Instructions, Custodian shall deliver, or shall instruct a Foreign Sub-Custodian
to deliver, the Currency to be sold on the date on which such delivery is to be
made, as set forth in the Certificate, and shall receive, or instruct a Foreign
Sub-Custodian to receive, the Currency to be purchased on the date as set forth
in the Certificate.
(b) Where the Currency to be sold is to be delivered on the same
day as the Currency to be purchased, as specified in the Certificate or Oral
Instructions, Custodian or a Foreign Sub-Custodian may arrange for such
deliveries and receipts to be made in accordance with the customs prevailing
from time to time among brokers or dealers in Currencies, and such receipt and
delivery may not be completed simultaneously. The Master Portfolio assumes all
responsibility and liability for all credit risks involved in connection with
such receipts and deliveries, which responsibility and liability shall continue
until the Currency to be received by the Master Portfolio has been received in
full.
(c) Any foreign exchange transaction effected by Custodian in
connection with this Agreement may be entered with Custodian, any office, branch
or subsidiary of The Bank of New York, or any Foreign Sub-Custodian (as defined
below) acting as principal or otherwise through customary banking channels. The
Master Portfolio may issue a standing Certificate with respect to foreign
exchange transactions but Custodian may establish rules or limitations
concerning any foreign exchange facility made available to the Master Portfolio.
The Master Portfolio shall bear all risks of investing in securities or holding
Currency. Without limiting the foregoing, the Master Portfolio shall bear the
risks that rules or procedures imposed by a Foreign Sub-Custodian or foreign
depositories, exchange controls, asset freezes or other laws, rules, regulations
or orders shall prohibit or impose burdens or costs on the transfer to, by or
for the account of the Master Portfolio of securities or any cash held outside
the Master Portfolio's jurisdiction or denominated in Currency other than its
home jurisdiction or the conversion of cash from one Currency into another
Currency. Custodian shall not be obligated to substitute another Currency for a
Currency (including a Currency that is a component of a Composite Currency Unit)
whose transferability, convertibility or availability has been affected by such
law, regulation, rule or procedure. Neither Custodian nor any Foreign
Sub-Custodian shall be liable to the Master Portfolio for any loss resulting
from any of the foregoing events.
27. Duties of Custodian with Respect to Property of any Master
Portfolio Held Outside of the United States.
(a) Custodian is authorized and instructed to employ, as
sub-custodian for each Master Portfolio's foreign securities and other assets,
the foreign banking institutions and foreign securities depositories and
clearing agencies selected from time to time by Custodian as the Foreign Custody
Manager appointed by the Trust's Board of Trustees ("Foreign Sub-Custodians") to
carry out their respective responsibilities in accordance with the terms of the
sub-custodian agreement between each such Foreign Sub-Custodian and Custodian
(each such agreement, a "Foreign Sub-Custodian Agreement"). Upon receipt of an
Officer's Certificate, the Trust may designate any additional foreign
sub-custodian with which Custodian has an
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agreement for such entity to act as Custodian's agent, as its sub-custodian and
any such additional foreign sub-custodian shall be deemed a Foreign
Sub-Custodian hereunder. Upon receipt of an Officer's Certificate, Custodian
shall cease using any one or more Foreign Sub-Custodians for the Master
Portfolio's assets.
(b) Each Foreign Sub-Custodian Agreement shall be substantially
in the form delivered to the Trust herewith and will not be amended in a way
that materially or adversely affects the Trust without the Trust's prior written
consent.
(c) Custodian shall identify on its books as belonging to each
Master Portfolio the Foreign Securities of such Master Portfolio held by each
Foreign Sub-Custodian. At the election of the Trust, it shall be entitled to be
subrogated to any claims by the Trust or any Master Portfolio against a Foreign
Sub-Custodian as a consequence of any loss, damage, cost, expense, liability or
claim sustained or incurred by the Trust or any Master Portfolio if and to the
extent that the Trust or such Master Portfolio has been made whole by Custodian
for any such loss, damage, cost, expense, liability or claim.
(d) Upon request of the Trust, Custodian will, consistent with
the terms of the applicable Foreign Sub-Custodian Agreement, use reasonable
efforts to arrange for the independent accountants of the Trust to be afforded
access to the books and records of any Foreign Sub-Custodian insofar as such
books and records relate to the performance of such Foreign Sub-Custodian under
its agreement with Custodian on behalf of the Trust.
(e) Custodian will supply to the Trust from time to time, as
mutually agreed upon, statements in respect of the securities and other assets
of each Master Portfolio held by Foreign Sub-Custodians, including but not
limited to, an identification of entities having possession of each Master
Portfolio's Foreign Securities and other assets, and advices or notifications of
any transfers of Foreign Securities to or from each custodial account maintained
by a Foreign Sub-Custodian for Custodian on behalf of the Master Portfolio.
(f) Custodian agrees that it will use reasonable care in
monitoring compliance by each Foreign Sub-Custodian with the terms of the
relevant Foreign Sub-Custodian Agreement and that if it learns of any breach of
such Foreign Sub-Custodian Agreement believed by Custodian to have a material
adverse effect on the Trust or any Master Portfolio it will promptly notify the
Trust in writing of such breach. Custodian also agrees to use reasonable and
diligent efforts to enforce its rights under the relevant Foreign Sub-Custodian
Agreement.
(g) Custodian shall transmit promptly to the Trust all notices,
reports or other written information received pertaining to the Master
Portfolios' Foreign Securities, including without limitation, notices of
corporate action, proxies and proxy solicitation materials.
(h) Notwithstanding any provision of this Agreement to the
contrary, settlement and payment for securities received for the account of the
Trust or any Master Portfolio and delivery of securities maintained for the
account of the Trust or any Master Portfolio may be effected in accordance with
the customary or established securities trading or securities processing
practices and procedures in the jurisdiction or market in which the transaction
occurs, including, without limitation, delivery of securities to the purchaser
thereof or
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to a dealer therefor (or an agent for such purchaser or dealer) against a
receipt with the expectation of receiving later payment for such securities from
such purchaser or dealer.
(i) With respect to any losses or damages arising out of or
relating to any actions or omissions of any Foreign Sub-Custodian, the sole
responsibility and liability of Custodian shall be to take all appropriate and
reasonable action at the Trust's expense to recover such loss or damage from the
Foreign Sub-Custodian. It is expressly understood and agreed that Custodian's
sole responsibility and liability shall be limited to amounts so recovered from
the Foreign Sub-Custodian.
28. Concerning Custodian.
(a) (i) Custodian shall exercise care and diligence and act in
good faith and use all commercially reasonable efforts in the performance of its
duties hereunder. Custodian shall be responsible to the Trust for its own
failure or the failure of any sub-custodian that it shall appoint (other than a
foreign sub-custodian referred to in Paragraph 27 or a sub-custodian appointed
by Custodian at the specific direction of the Trust) or that of its employees or
agents, to perform its duties, obligations or responsibilities in accordance
with this Agreement, but only to the extent that such failure results from acts
or omissions that constitute willful misfeasance, bad faith or negligence on the
part of Custodian, or on the part of its employees or agents, or reckless
disregard of such duties, obligations and responsibilities.
(ii) Without limiting the generality of the foregoing or any
other provision of this Agreement, in no event shall Custodian be liable to the
Master Portfolio or any third party nor, except as otherwise provided in this
subparagraph for special, indirect or consequential damages or lost profits or
loss of business, arising under or in connection with this Agreement, even if
previously informed of the possibility of such damages and regardless of the
form of action. Custodian may, with respect to questions of law arising under
any FCM Agreement, apply for and obtain the advice and opinion of counsel to the
Trust at the expense of the Trust, or of its own counsel at its own expense, and
shall be fully protected with respect to anything done or omitted by it in good
faith in conformity with such advice or opinion. Custodian shall be liable to
the Trust for any loss or damage resulting from the use of the Book-Entry System
or any Securities Depository arising by reason of any negligence or willful
misconduct on the part of Custodian or any of its employees or agents.
(iii) Custodian's liability pursuant to the last sentence of
subparagraph (a)(i) shall include, but not be limited to, reimbursing the Trust
for court-ordered damage awards, fines, penalties, and judicially-approved
settlements (and attorney's fees and disbursements relating thereto) arising out
of or in connection with the conduct giving rise to such liability.
(iv) If the Trust receives notice of the commencement of any
action, suit, or proceeding (an "Action"), or notice that any Action may be
commenced, for which Custodian may be liable to the Trust pursuant to this
Paragraph 28, the Trust shall give notice to Custodian of the commencement of
the Action or of the possibility that an Action will be commenced. Any omission
to notify Custodian will not relieve Custodian from any liability which it may
have under this Paragraph, except to the extent the failure to notify Custodian
prejudices the rights of Custodian. Custodian will be entitled at its sole
expense and liability, to
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exercise full control of the defense, compromise or settlement of any such
Action, provided that Custodian: (1) notifies the Trust in writing of
Custodian's intention to assume such defense; and (2) retains legal counsel
reasonably satisfactory to the Trust to conduct the defense of such Action. If
Custodian advises the Trust that it does not wish to exercise full control of
any defense, compromise or settlement of any Action, Custodian shall be
responsible for the fees and expenses of counsel selected by the Trust, in
addition to any other amounts for which Custodian may be liable pursuant to this
Paragraph 28. The other person will cooperate with the person assuming the
defense, compromise or settlement of any Action in accordance with this
Paragraph in any manner that such person reasonably may request. If Custodian so
assumes the defense of any such Action, the Trust will have the right to employ
a separate counsel and to participate in (but not control) the defense,
compromise or settlement of the Action, but the fees and expenses of such
counsel will be at the expense of the Trust unless: (a) Custodian has agreed to
pay such fees and expenses, (b) any relief other than the payment of money
damages is sought against the Trust, or (c) the Trust has been advised by its
counsel that there may be one or more defenses available to it which are
different from or additional to those available to Custodian and that a conflict
of interest therefore exists, and in any such case that portion of the fees and
expenses of such separate counsel that are reasonably related to matters for
which Custodian is liable pursuant to this Paragraph will be paid by Custodian.
The Trust will not settle or compromise any such Action for which Custodian is
liable pursuant to this Paragraph without the prior written consent of
Custodian, unless Custodian has failed, after reasonable notice, to undertake
control of such Action in the manner provided in this Paragraph. Custodian will
not settle or compromise any such Action in which any relief other than the
payment of money damages is sought against the Trust without the consent of the
Trust, such consent not to be unreasonably withheld. In the event that Custodian
intends to settle or compromise any Action in which solely money damages are
sought, Custodian shall give the Trust fifteen (15) business days prior written
notice.
(b) Without limiting the generality of the foregoing, Custodian
shall be under no obligation to inquire into, and shall not be liable for:
(i) the validity of the issue of any securities purchased,
sold, or written by or for the Trust or any Master Portfolio, the legality of
the purchase, sale or writing thereof, or the propriety of the amount paid or
received therefor;
(ii) the legality of the sale or redemption of any Shares,
or the propriety of the amount to be received or paid therefor;
(iii) the legality of the declaration or payment of any
dividend by the Trust;
(iv) the legality of any borrowing by the Trust using
securities as collateral;
(v) the legality of any loan of portfolio securities, or
under any duty or obligation to see to it that any cash collateral delivered to
it by a broker, dealer, or financial institution or held by it at any time as a
result of such loan of portfolio securities is adequate collateral for or
against any loss Custodian, the Trust or any Master Portfolio might sustain as a
result of such loan. Custodian specifically, but not by way of limitation, shall
not be under any
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duty or obligation periodically to check or notify the Trust or any Master
Portfolio that the amount of such cash collateral held by Custodian for the
Trust is sufficient collateral for the Trust, but such duty or obligation shall
be the sole responsibility of the Trust. In addition, Custodian shall be under
no duty or obligation to see that any broker, dealer or financial institution to
which portfolio securities are lent makes payment to it of any dividends or
interest which are payable to or for the account of the Trust during the period
of such loan or at the termination of such loan, provided, however, that
Custodian shall promptly notify the Trust in the event that such dividends or
interest are not paid and received when due; or
(vi) the sufficiency or value of any amounts of money and/or
securities held in any segregated account described in Paragraph 12(a) hereof in
connection with transactions by the Master Portfolios, or whether such
segregated account provides the compliance intended to be achieved. In addition,
Custodian shall not be under any duty or obligation to see that any broker,
dealer, FCM or Clearing Member makes payment to the Master Portfolio of any
variation margin payment or similar payment which the Master Portfolio may be
entitled to receive from such broker, dealer, FCM or Clearing Member, to see
that any payment received by Custodian from any broker, dealer, FCM or Clearing
Member is the amount the Trust is entitled to receive, or to notify the Trust or
a Master Portfolio of Custodian's receipt or non-receipt of any such payment.
(c) Custodian shall not be liable for, or considered to be
sub-custodian or custodian of, any money, whether or not represented by any
check, draft, or other instrument for the payment of money, received by
Custodian on behalf of the Trust until Custodian actually receives and collects
such money directly or by the final crediting of the account representing the
Master Portfolio's interest at the Book-Entry System or a Securities Depository.
(d) Custodian shall not have any responsibility or be liable for
ascertaining or acting upon any calls, conversions, exchange offers, tenders,
interest rate changes or similar matters relating to securities held in a
Securities Depository, unless Custodian shall have actually received timely
notice from such Securities Depository. In no event shall Custodian have any
responsibility or liability for the failure of any Securities Depository to
collect, or for the late collection or late crediting by a Securities Depository
of any amount payable upon securities deposited in a Securities Depository which
may mature or be redeemed, retired, called or otherwise become payable. Upon
receipt of Written Instructions from the Trust of an overdue amount on
securities held in a Securities Depository, Custodian shall make a claim against
a Securities Depository on behalf of the Trust, except that Custodian shall not
be under any obligation to appear in, prosecute or defend any action suit or
proceeding in respect to any securities held by a Securities Depository which in
its opinion may involve it in expense or liability, unless indemnity
satisfactory to it against all expense and liability be furnished as often as
may be required.
(e) Custodian shall not be under any duty or obligation to take
action to effect collection of any amount due to the Trust from a transfer agent
of the Trust nor to take any action to effect payment or distribution by the
transfer agent of the Trust of any amount paid by Custodian to the transfer
agent of the Trust in accordance with this Agreement.
(f) Custodian shall not be under any duty or obligation to take
action to effect collection of any amount, if the securities upon which such
amount is payable are in default, or if
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payment is refused after due demand or presentation, unless and until: (i) it
shall be directed to take such action by Written Instructions, and (ii) it shall
be assured to its reasonable satisfaction of reimbursement of its costs and
expenses in connection with any such action.
(g) Custodian may in addition to the employment of Foreign
Sub-Custodians pursuant to Paragraphs 7 and 27, hereof appoint one or more
banking institutions as Depository or Depositories, as a sub-custodian or as
sub-custodians, or as a co-custodian or as co-custodians, including, but not
limited to, banking institutions located in foreign countries, of securities and
moneys at any time owned by the Master Portfolios, upon such terms and
conditions as may be approved in an Officer's Certificate or contained in an
agreement executed by Custodian and the Trust and the appointed institution.
(h) Custodian shall not be under any duty or obligation: (i) to
ascertain whether any securities at any time delivered to, or held by it or by
any Foreign Sub-Custodian, for the account of the Trust and specifically
allocated to a Master Portfolio are such as properly may be held by the Trust or
such Master Portfolio under the provisions of its Prospectus, or (ii) to
ascertain whether any transactions by the Master Portfolio, whether or not
involving Custodian, are such transactions as may properly be engaged in by the
Master Portfolio.
(i) Custodian shall charge its compensation and any expenses with
respect to the Master Portfolios of the Trust incurred by Custodian in the
performance of its duties under this Agreement only against the money of the
Master Portfolio or Master Portfolios of the Trust from which such compensation
or expenses is actually due and payable, and under no circumstances shall any
compensation or expenses due to Custodian be considered to be a joint, or joint
and several, obligation of the Master Portfolios of the Trust. To the extent
that Custodian is entitled to recover from the Trust any loss, damage, liability
or expense (including counsel fees) under this Agreement, Custodian shall charge
the amount due in respect of such loss, damage, liability or expense (including
counsel fees) only against the money held by it for the Master Portfolio or
Master Portfolios of the Trust that is/are identified by the Trust in an
Officer's Certificate, unless and until the Trust instructs Custodian by an
Officer's Certificate to charge against money held by it for the account of a
Master Portfolio such Master Portfolio's pro rata share (based on such Master
Portfolio's net asset value at the time of the charge in proportion to the
aggregate net asset value of all Master Portfolios at that time) of the amount
of such loss, damage, liability or expense (including counsel fees).
(j) Custodian shall be entitled to rely upon any Officer's
Certificate, Written Instructions, notice or other instrument in writing
received by Custodian and reasonably believed by Custodian, to be an Officer's
Certificate or Written Instructions. Custodian shall be entitled to rely upon
any Oral Instructions actually received by Custodian. The Trust agrees to
forward to Custodian Written Instructions confirming such Oral Instructions in
such manner so that such Written Instructions are received by Custodian, whether
by hand delivery, telecopier or other similar device, or otherwise, by the close
of business of the same day that such Oral Instructions are received by
Custodian. The Trust agrees that the fact that such confirming instructions are
not received, or that contrary instructions are received, by Custodian shall in
no way affect the validity of the transactions or enforceability of the
transactions hereby authorized by the Trust. The Trust agrees that Custodian
shall not incur any liability to the Trust in acting upon Oral Instructions
given to Custodian hereunder concerning such transactions provided such
instructions reasonably appear to have been received from an Authorized Person.
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(k) Custodian shall be entitled to rely upon any instrument,
instruction or notice received by it and reasonably believed by it to be given
in accordance with the terms and conditions of any FCM Agreement. Without
limiting the generality of the foregoing, Custodian shall not be under any duty
to inquire into, and Custodian shall not be liable for, the accuracy of any
statements or representations contained in any such instrument or other notice
including, without limitation, any specification of any amount to be paid to a
broker, dealer, futures commission merchant or clearing member.
(l) Custodian shall provide the Trust with any report obtained by
Custodian on the system of internal accounting control of the Book-Entry System,
any Securities Depository utilized hereunder the Depository or the Options
Clearing Corporation, and with such reports on its own systems of internal
accounting control as the Trust may reasonably request from time to time.
(m) Subject to the foregoing provisions of this Agreement,
including, without limitation, those contained in Paragraph 27 hereof, Custodian
may deliver and receive securities, and receipts with respect to such
securities, and arrange for payments to be made and received by Custodian in
accordance with the customs prevailing from time to time among brokers or
dealers in such securities. When Custodian is instructed to deliver securities
against payment, delivery of such securities and receipt of payment therefor may
not be completed simultaneously. The Master Portfolio assumes all responsibility
and liability for all credit risks involved in connection with Custodian's
delivery of securities pursuant to proper instructions of the Master Portfolio,
which responsibility and liability shall continue until final payment in full
has been received by Custodian.
(n) Custodian shall not have any duties or responsibilities
whatsoever except such duties and responsibilities as are specifically set forth
in this Agreement, and no covenant or obligation shall be implied in this
Agreement against Custodian.
29. Termination. Any of the parties hereto may terminate this Agreement
by giving to the other parties a notice in writing specifying the date of such
termination, which shall be not less than ninety (90) days after the date of
giving of such notice. Upon the date set forth in such notice this Agreement
shall terminate, and Custodian shall on that date deliver directly to the Trust
or a successor custodian designated by the Trust all securities and moneys then
owned by the Trust and held by Custodian, after deducting all fees, expenses and
other amounts for the payment or reimbursement of which it shall then be
entitled; provided, however, that transaction fees and expenses payable by the
Trust in connection with a deconversion to a successor custodian shall be
limited to Custodian's actual direct cost.
30. Notices. All notices and other communications (collectively
referred to as "Notice" or "Notices" in this paragraph) hereunder shall be in
writing or by confirm in telegram, cable, telex, or facsimile sending device.
Notices shall be addressed: (a) if to Custodian, at Custodian's address, 90
Washington Street, 22nd Floor, New York, New York 10286, Attention: Frank Ajosa;
(b) if to the Trust, at the address of the Trust, 111 Center Street, Little
Rock, Arkansas 72201, Attention: Richard H. Blank, Jr., Secretary; or (c) if to
none of the foregoing, at such other address as shall have been notified to the
sender of any such Notice or other communication. Notice shall be deemed to have
been given when actually received by the
23
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other party. All postage, cable, telegram, telex and facsimile sending device
charges arising from the sending of a Notice hereunder shall be paid by the
sender.
31. Further Actions. Each party agrees to perform such further acts and
execute such further documents as it deems necessary to effectuate the purposes
hereof.
32. Amendments. This Agreement or any part hereof may be changed or
waived only by an instrument in writing signed by the party against which
enforcement of such change or waiver is sought.
33. Miscellaneous.
(a) The Trust agrees that Custodian may be a counterparty in any
purchase or sale of foreign currency by or for the Trust on a spot or forward
basis, and on any option to buy or sell foreign currency.
(b) This Agreement embodies the entire Agreement and
understanding between the parties hereto, and supersedes all prior agreements
and understandings relating to the subject matter hereof. The captions in this
Agreement are included for convenience of reference only and in no way define or
delimit any of the provisions hereof or otherwise affect their construction or
effect. This Agreement shall be deemed to be a contract made in New York and
governed by New York law. 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. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors.
34. Release. The names "Nations Master Investment Trust" and "Trustees
of Nations Master Investment Trust" refer respectively to the Trust created and
the Trustees, as trustees but not individually or personally, acting from time
to time under a Declaration of Trust and Certificate of Trust dated January 14,
1999, which is hereby referred to and a copy of which is on file at the
principal office of the Trust. The obligations of "Nations Master Investment
Trust" entered into in the name or on behalf thereof by any of the Trustees,
representatives or agents are made not individually, but in such capacities, and
are not binding upon any of the Trustees, Interestholders, or representatives of
the Trust personally, but bind only the Trust Property (as defined in the
Declaration of Trust), and all persons dealing with any class of Shares of the
Trust Property, and all persons dealing with any class of Shares of the Trust
must look solely to the Trust Property belonging to such class for the
enforcement of any claims against the Trust.
35. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
24
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below as of the day and year first above
written.
NATIONS MASTER INVESTMENT TRUST
By: /s/ James E. Banks, Jr.
-------------------------
James E. Banks, Jr.
Assistant Secretary
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
-------------------------
Stephen E. Grunston
Vice President
25
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SCHEDULE I
The Custody Agreement between Nations Master Investment Trust, and
Sub-Custodian applies to the following Master Portfolios of the Trust:
Nations Intermediate Bond Master Portfolio
Nations Blue Chip Master Portfolio
Nations International Equity Master Portfolio
Nations Marsico Focused Equities Master Portfolio
Nations Marsico Growth & Income Master Portfolio
Nations International Value Master Portfolio
Nations High Yield Bond Master Portfolio
Adopted: December 2, 1998
Last Amended: February 14, 2000
IN WITNESS WHEREOF, the parties hereto have caused this
amended Schedule I to be executed by their duly authorized officers designated
below as of the 14th day of February, 2000.
NATIONS MASTER INVESTMENT TRUST
By: /s/ James E. Banks, Jr.
-----------------------
James E. Banks, Jr.
Assistant Secretary
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
-----------------------
Stephen E. Grunston
Vice President
26
<PAGE>
SCHEDULE II
I, Ira Rosner, a Vice President with THE BANK OF NEW YORK do hereby designate
the following publications:
The Bond Buyer
Depository Trust Company Services
Financial Daily Card Service
JJ Kenney Municipal Bond Service
London Financial Times
Standard & Poor's Called Bond Record
Wall Street Journal
27
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SCHEDULE III
DOMESTIC CUSTODIAN FEE SCHEDULE
FOR
NATIONS MASTER INVESTMENT TRUST
SAFEKEEPING/INCOME COLLECTION/REPORTING DTC-ID AFFIRMATION
ALL SYSTEMS DEVELOPMENT AND USAGE CHARGES
3/4ths of one basis point per annum on the aggregate net assets of all
Nations' Non-Money Market Funds up to $10 billion.
1/2 of a basis point on the excess.
SECURITY TRANSACTION CHARGES/PAYDOWNS
$ 5 Paydowns
$ 7 DTC/FRB/PTC
$15 Physicals, options and futures
$40 Euro C/D's
OTHER CHARGES
$ 5 Bank official checks
$ 2 Money transfers in/out of the Fund's custodian account not
related to securities transactions.
EARNINGS CREDITS ON BALANCES/INTEREST ON OVERDRAFTS
Earnings credits are provided to each Fund on 80% of the daily balance in the
domestic custodian account computed at the 90-day T-bill rate on the day of the
balance.
Overdrafts, excluding bank errors, will cause a reduction of earnings credits
daily, computed at 1% above the average Federal Funds rate on the day of the
overdraft.
Credits and debits will be accumulated daily and offset monthly against the
Bank's domestic custodian fees. To the extent a net debit is accumulated, each
Fund will be billed for the expense. To the extent a net earnings credit is
generated, such excess earnings credit can be carried forward to the next
succeeding month. However, no earnings credit will be carried forward after
year-end.
OUT-OF-POCKET EXPENSES
28
<PAGE>
None.
BILLING CYCLE
The above fees are billed monthly.
29
<PAGE>
SCHEDULE IV
OVERDRAFT RATE
30
AMENDMENT TO THE
CUSTODY AGREEMENT
THIS AMENDMENT is made as of September 1, 1999, to the Custody
Agreement dated as of May 21, 1999 (the "Agreement"), by and between The Bank of
New York ("Custodian") and Nations Master Investment Trust (the "Master Trust"),
on behalf of its respective portfolios listed on Schedule I attached thereto.
RECITALS
WHEREAS, the parties hereto desire to amend certain schedules
underlying the provisions of the Agreement.
NOW THEREFORE, the Custodian and the Trust agree that the Agreement
shall be amended as follows:
1. Pursuant to Paragraph 23 of the Agreement, the underlying Schedule III to the
Custody Agreement for the Master Trust is revised. The revised Schedule III
reflects a modification in fees that the Master Trust will pay for the
Custodian's services as they relate to securities of foreign issue.
Specifically, Schedule III is amended by the addition of the Global Fee Schedule
attached hereto, which may be amended from time to time by mutual consent of the
parties hereto.
The terms and provisions of this Amendment shall be deemed a part of
the Agreement for all purposes. To the extent that any provisions of the
Amendment modify or are otherwise inconsistent with any provisions of the
Agreement, the terms of this Amendment shall control. In all other respects, the
Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized officers, as of the day and year first written
above.
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
-----------------------
Stephen E. Grunston
Vice President
NATIONS MASTER INVESTMENT TRUST
By: /s/ James E. Banks, Jr.
-----------------------
James E. Banks, Jr.
Assistant Secretary
AMENDMENT TO THE
CUSTODY AGREEMENT
THIS AMENDMENT is made as of February 14, 2000, to the Custody
Agreement dated as of May 21, 1999 (the "Agreement"), by and between The Bank of
New York ("Custodian") and Nations Master Investment Trust (the "Trust"), on
behalf of its respective portfolios listed on Schedule I attached thereto.
RECITALS
WHEREAS, the parties hereto desire to amend certain provisions of the
Agreement.
NOW THEREFORE, the Custodian and the Trust agree that the Agreement
shall be amended as follows:
1. Paragraph 25 is hereby amended by deleting subsection (a) in its entirety and
inserting the following:
"(a) Custodian shall advance funds under this Agreement with
respect to any Fund which results in an overdraft because the moneys
held by Custodian in the separate account for such Fund shall be
insufficient to pay the total amount payable upon a purchase of
securities by such Fund, as set forth in an Officer's Certificate or
Oral or Written Instructions, or which results in an overdraft in the
separate account of such Fund for some other reason, or if the Trust is
for any other reason indebted to Custodian, including any indebtedness
to The Bank of New York under the Trust's Cash Management and Related
Services Agreement, (except a borrowing for investment or for temporary
or emergency purposes using securities as collateral pursuant to a
separate agreement and subject to the provisions of Paragraph 25(b)
hereof), such overdraft or indebtedness shall be deemed to be a loan
made by Custodian to the Trust for such Fund payable on demand and
shall bear interest from the date incurred at a rate per annum (based
on a 360-day year for the actual number of days involved) equal to the
overdraft rate specified in Schedule III to this Agreement. In
addition, the Trust hereby agrees that to the extent of such overdraft
or indebtedness, Custodian shall have a continuing lien, security
entitlement and security interest in and to any property at any time
held by it for the benefit of such Fund or in which the Fund may have
an interest which is then in Custodian's possession or control or in
possession or control of any third party acting on Custodian's behalf.
The Trust authorizes Custodian, in its sole discretion, at any time to
charge any such overdraft or indebtedness together with interest due
thereon against any balance of account standing to such Fund's credit
on Custodian's books. In addition, the Trust hereby covenants that on
each Business Day on which either it intends to enter a Reverse
Repurchase Agreement and/or otherwise borrow from a third party, or
which next succeeds a Business Day on which at the close of business
the Trust had outstanding a Reverse Repurchase Agreement or such a
borrowing, it shall
<PAGE>
prior to 1:00 p.m., New York City time, advise Custodian, in writing,
of each such borrowing, shall specify the Fund to which the same
relates, and shall not incur any indebtedness not so specified other
than from Custodian."
The terms and provisions of this Amendment shall be deemed a part of
the Agreement for all purposes. To the extent that any provisions of the
Amendment modify or are otherwise inconsistent with any provisions of the
Agreement, the terms of this Amendment shall control. In all other respects, the
Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized officers, as of the day and year first written
above.
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
-----------------------
Stephen E. Grunston
Vice President
NATIONS MASTER INVESTMENT TRUST
By: James E. Banks, Jr.
------------------------
James E. Banks, Jr.
Assistant Secretary
CO-ADMINISTRATION AGREEMENT
This CO-ADMINISTRATION AGREEMENT (the "Agreement") is made as of May
21, 1999 by and among STEPHENS INC. ("Stephens"), NATIONSBANC ADVISORS, INC.
("NBAI") and NATIONS MASTER INVESTMENT TRUST (the "Master Trust").
WHEREAS, the Master Trust is registered as an open-end management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Master Trust desires to retain Stephens and NBAI to render
certain administrative and other services for the investment portfolios of the
Master Trust listed on Schedule I (individually, a "Master Portfolio" and
collectively, the "Master Portfolios"), and Stephens and NBAI are willing to
render such services.
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed among the parties hereto as follows:
1. Appointment.
(a) The Master Trust hereby appoints Stephens to act as
Co-Administrator of the Master Portfolios and Stephens hereby accepts such
appointment and agrees to render such services and duties set forth in Paragraph
3, for the compensation and on the terms herein provided. Absent written
notification to the contrary by the Master Trust, NBAI or Stephens, each new
investment portfolio established in the future by the Master Trust shall
automatically become a "Master Portfolio" for all purposes hereunder as if
listed on Schedule I.
(b) The Master Trust also hereby appoints NBAI to act as
Co-Administrator of the Master Portfolios, and NBAI hereby accepts such
appointment and agrees to render such services and duties set forth in Paragraph
4, for the compensation and on the terms herein provided. Absent written
notification to the contrary by either the Master Trust or NBAI, each new
investment portfolio established in the future by the Master Trust shall
automatically become a "Master Portfolio" for all purposes hereunder as if
listed on Schedule I.
2. Delivery of Documents. The Master Trust has furnished Stephens and
NBAI with copies properly certified or authenticated of each of the following:
(a) The Master Trust's most recent Post-Effective Amendment to
its Registration Statement on Form N-1A (the "Registration Statement") under the
1940 Act (File No. 811-09347), as filed with the Securities and Exchange
Commission (the "SEC") relating to interests in the Master Portfolios (the
"Interests");
(b) The Master Portfolios' most recent Prospectus(es); and
<PAGE>
(c) The Master Portfolios' most recent Statement(s) of Additional
Information.
The Master Trust will furnish Stephens and NBAI from time to time with
copies, properly certified or authenticated, of all amendments of or supplements
to the foregoing. Furthermore, the Master Trust will provide Stephens and NBAI
with any other documents that Stephens and NBAI may reasonably request and will
notify Stephens and NBAI as soon as possible of any matter materially affecting
either Stephens' or NBAI's performance of its services under this Agreement.
3. Duties as Co-Administrator. Subject to the supervision and direction
of the Board of Trustees of the Master Trust, Stephens, as Co-Administrator,
will assist in supervising various aspects of the Master Trust's administrative
operations and undertakes to perform the following specific services from and
after the effective date of this Agreement:
(a) Maintaining office facilities for the Master Trust (which may
be in the offices of Stephens or a corporate affiliate);
(b) Furnishing clerical services, internal executive and
administrative services and stationery and office supplies in connection with
the foregoing;
(c) Assist in furnishing statistical and research data and data
processing services in connection with the foregoing;
(d) Furnishing corporate secretarial services, including
assisting in the coordination of the preparation and distribution of materials
for Board of Trustees meetings;
(e) Providing the services of certain persons who may be
appointed as officers of the Master Trust by the Master Trust's Board of
Trustees;
(f) Assist in coordinating the provision of legal advice and
counsel to the Master Trust with respect to regulatory matters, including
monitoring regulatory and legislative developments which may affect the Master
Trust and assisting in the strategic response to such developments, counseling
and assisting the Master Trust in routine regulatory examinations or
investigations of the Master Trust, and working closely with outside counsel to
the Master Trust in connection with any litigation in which the Master Trust is
involved;
(g) Assist in coordinating the preparation of reports to the
Master Trust's interestholders of record and the SEC including, but not
necessarily limited to, Annual Reports and Semi-Annual Reports and on Form
N-SAR, if applicable;
(h) Coordinating with the Master Trust regarding the
jurisdictions in which the Interests shall be registered or qualified for sale,
if any, and, in connection therewith, being responsible for the registration or
qualification and the maintenance of such registration or qualification of
Interests for sale under the securities laws of any state.
2
<PAGE>
Payment of Interest registration fees and any fees for qualifying or continuing
the qualification of the Master Trust or any Master Portfolio as a dealer or
broker shall be made or reimbursed by the Master Trust or that Master Portfolio,
respectively;
(i) Assisting in the preparation and filing on a timely basis of
various reports, registration statements and post-effective amendments thereto,
and other documents required by federal, state and other applicable laws and
regulations, other than those filed or required to be filed by NBAI or the
Master Portfolios' Sub-Advisers or Custodian;
(j) Performing certain compliance procedures for the Master Trust
which will include, among other matters, monitoring compliance with personal
trading guidelines by the Master Trust's Board of Trustees; and
(k) Generally assisting in all aspects of the Master Trust's
operations.
In performing all services under this Agreement, Stephens shall (i) act
in conformity with: the Master Trust's Declaration of Trust, the 1940 Act and
the rules thereunder, and other applicable laws and regulations, as the same may
be amended from time to time, and the Master Trust's Registration Statement, as
such Registration Statement may be amended from time to time; (ii) consult and
coordinate with the Master Trust, as necessary and appropriate; and (iii) advise
and report to the Master Trust, as necessary or appropriate, with respect to any
compliance matters that come to its attention.
Stephens represents and warrants to the Master Trust that it will use
reasonable efforts to perform its duties and obligations under this Agreement
without: (a) any failure of its computer systems, or those used by it in the
performance of its duties hereunder, to properly record, store, process,
calculate or present calendar dates falling on and after, and time spans
including, January 1, 2000 as a result of the occurrence of, or use of data
containing, such date; (b) any failure of its computer systems, or those used by
it in the performance of its duties hereunder, to calculate any information
dependent on or relating to dates on or after January 1, 2000; or (c) any loss
of functionality or performance with respect to the maintenance of records or
processing of data containing dates falling on or after January 1, 2000 ((a),
(b), and (c) above shall be referred to as "Y2K Failures"). Notwithstanding the
above, Stephens shall not be liable for any Y2K Failures caused by Y2K Failures
in a third party system with which Stephens interfaces or from which Stephens
receives data in connection with the performance of its duties hereunder.
In performing its services under this Agreement, Stephens shall
cooperate and coordinate with NBAI as necessary and appropriate and shall
provide such information as is reasonably necessary or appropriate for NBAI to
perform its responsibilities to the Master Trust.
4. Duties as Co-Administrator. Subject to the supervision and direction
of the Board of Trustees of the Master Trust, NBAI, as Co-Administrator, will
assist in supervising various aspects of the Master Trust's administrative
operations and
3
<PAGE>
undertakes to perform the following specific services, from and after the
effective date of this Agreement:
(a) providing accounting and bookkeeping services (including the
maintenance for the periods prescribed by Rule 31a-2 under the 1940 Act of such
accounts, books and records of the Master Trust as may be required by Section
31(a) of the 1940 Act and the rules thereunder). NBAI further agrees that all
such records which it maintains for the Master Trust are the property of the
Master Trust and further agrees to surrender promptly to the Master Trust any of
such records upon the Master Trust's request;
(b) valuing each Master Portfolio's assets and calculating the
net asset value and the net income of the Interests of each Master Portfolio in
accordance with the Master Trust's current Prospectus(es), applicable pricing
procedures and resolutions of the Master Trust's Board of Trustees, provided,
that in performing such services, NBAI shall obtain security market quotes from
independent pricing services, or if such quotes are unavailable, obtain such
prices from the Master Portfolios' Sub-Advisers;
(c) maintaining a listing of all holders of Interests of each
Master Portfolio, including the number and amount of the Interests held by each
holder, based upon daily or periodic allocations of Master Portfolio assets, and
provide such other services in the nature of transfer agency services as the
parties may agree from time to time;
(d) accumulating information for reports to the Master Trust's
interestholders of record and the SEC including, but not necessarily limited to,
Annual Reports and Semi-Annual Reports and on Form N-SAR, if applicable;
(e) preparing and filing on a timely basis the Master Trust's tax
returns and other tax filings;
(f) monitoring the development and implementation of certain
compliance procedures for the Master Trust including, but not limited to,
monitoring (i) each Master Portfolio's status as a regulated investment company
under Sub-Chapter M of the Internal Revenue Code of 1986, as amended, including
performing, on a monthly basis and based upon information provided by the Master
Portfolio's Sub-Advisers, the 90% gross income and asset diversification tests
derived from such Sub-Chapter; and (ii) compliance by each Master Portfolio with
its investment objective, policies and restrictions, and applicable laws and
regulations;
(g) preparing and furnishing to the Master Trust monthly broker
security transaction summaries and monthly security transaction listings and (at
the Master Trust's request) performance information (including yield and total
return information) calculated in accordance with applicable U.S. securities
laws and reporting to external databases such information as may reasonably be
requested;
(h) assisting the Master Trust and its agents in their
accumulation and preparation of materials for the Board of Trustees' meetings
and for regulatory
4
<PAGE>
examinations and inspections of the Master Trust, to the extent such materials
relate to the services being performed for the Master Trust by NBAI; and
(i) coordinate the provisions of services to the Master Trust by
other service providers to the Master Trust, including the custodian.
In performing all services under this Agreement, NBAI shall (i) act in
conformity with the Master Trust's Declaration of Trust; the 1940 Act and the
rules thereunder, and other applicable laws and regulations, as the same may be
amended from time to time; and the Master Trust's Registration Statement, as
such Registration Statement may be amended from time to time, (ii) consult and
coordinate with the Master Trust, as necessary and appropriate, and (iii) advise
and report to the Master Trust, as necessary or appropriate, with respect to any
compliance matters that come to its attention.
NBAI represents and warrants to the Master Trust that it will use
reasonable efforts to perform its duties and obligations under this Agreement
without: (a) any failure of its computer systems to properly record, store,
process, calculate or present calendar dates falling on and after, and time
spans including, January 1, 2000 as a result of the occurrence of, or use of
data containing, such date; (b) any failure of its computer systems to calculate
any information dependent on or relating to dates on or after January 1, 2000;
or (c) any loss of functionality or performance with respect to the maintenance
of records or processing of data containing dates falling on or after January 1,
2000 ((a), (b), and (c) above shall be referred to as "Y2K Failures").
Notwithstanding the above, NBAI shall not be liable for any Y2K Failures caused
by Y2K Failures in a third party system with which NBAI interfaces or from which
NBAI receives data in connection with the performance of its duties hereunder
including, without limitation, the system of any sub-administrator engaged
pursuant to Paragraph 4.
In connection with its duties under this Paragraph 4, it is understood
and agreed that NBAI may, at its own expense, enter into sub-administration
agreements with other service providers and the Master Portfolio(s), provided
that each such service provider agrees with NBAI and the Master Portfolio(s) to
comply with all relevant provisions of the 1940 Act and applicable rules and
regulations thereunder. In addition, upon notice to the Board of Trustees of the
Master Trust, the parties agree that NBAI may from time to time assume some or
all of Stephens' duties set forth in Paragraph 3 above.
In performing its responsibilities under this Agreement, NBAI shall
cooperate and coordinate with Stephens as necessary and appropriate and shall
provide such information within its possession or control as is reasonably
necessary or appropriate to Stephens to enable it to perform its
responsibilities to the Master Trust.
5. Compensation.
(a) Stephens shall bear all expenses in connection with the
performance of its services under this Agreement, except those enumerated in
Paragraph 5(a)(2) below.
(1) Stephens will from time to time employ or associate with
such person or persons as Stephens may believe to be particularly suited to
assist it in performing
5
<PAGE>
services under this Agreement. Such person or persons may be officers and
employees of both Stephens and the Master Trust. The compensation of such person
or persons shall be paid by Stephens and no obligation shall be incurred on
behalf of the Master Trust or NBAI in such respect.
(2) Stephens shall not be required to pay any of the
following expenses incurred by the Master Trust: investment advisory expenses;
costs of printing and mailing stock certificates, prospectuses, reports and
notices; interest on borrowed money; brokerage fees and commissions; taxes and
fees payable to federal, state and other governmental agencies; fees of Trustees
of the Master Trust who are not affiliated with Stephens; outside auditing
expenses; outside legal expenses; fees of any other service provider to the
Master Trust; or other expenses not specified in this Section 5(a) which may be
properly payable by the Master Trust and which are approved by the Master
Trust's President or Treasurer.
(3) The Master Trust will compensate Stephens for its
services rendered pursuant to this Agreement in accordance with Schedule A. In
addition, the Master Trust shall reimburse Stephens for certain reasonable
out-of-pocket distributions made in connection with fulfilling its obligations
under the Agreement. The items eligible for reimbursement are set forth on
Schedule A.
(b) NBAI shall bear all expenses in connection with the
performance of its services under this Agreement, except those enumerated in
5(b)(2) below.
(1) NBAI will from time to time employ or associate with
such person or persons as NBAI may believe to be particularly suited to assist
it in performing services under this Agreement. Such person or persons may be
officers and employees of both NBAI and the Master Trust. The compensation of
such person or persons shall be paid by NBAI and no obligation shall be incurred
on behalf of the Master Trust or Stephens in such respect.
(2) NBAI shall not be required to pay any of the following
expenses incurred by the Master Trust: investment advisory expenses; costs of
printing and mailing stock certificates, prospectuses, reports and notices;
interest on borrowed money; brokerage fees and commissions; taxes and fees
payable to federal, state and other governmental agencies; fees of Trustees of
the Master Trust who are not affiliated with NBAI; outside auditing expenses;
outside legal expenses; fees of independent pricing services utilized by NBAI to
value each Master Portfolio's assets; fees of any other service provider to the
Master Trust (other than a sub-administrator engaged pursuant to Paragraph 4);
or other expenses not specified in this Section 5(b) which may be properly
payable by the Master Trust and which are approved by the Master Trust's
President or Treasurer.
(3) The Master Trust will compensate NBAI for its services
rendered pursuant to this Agreement in accordance with Schedule A. In addition,
the Master Trust shall reimburse NBAI for certain reasonable out-of pocket
distributions made in
6
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connection with fulfilling its obligations under the Agreement. The items
eligible for reimbursement are set forth on Schedule A.
6. Limitation of Liability; Indemnification.
(a) Stephens shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Master Trust in connection with
the performance of its obligations and duties under this Agreement, except a
loss resulting from Stephens' willful misfeasance, bad faith or gross negligence
in the performance of such obligations and duties, or by reason of its reckless
disregard thereof.
(b) NBAI shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Master Trust in connection with the
performance of its obligations and duties under this Agreement, except a loss
resulting from NBAI's willful misfeasance, bad faith or gross negligence in the
performance of such obligations and duties, or by reason of its reckless
disregard thereof.
(c) The Master Trust, on behalf of each Master Portfolio, will
indemnify Stephens and/or NBAI against and hold each harmless from any and all
losses, claims, damages, liabilities or expenses (including reasonable counsel
fees and expenses) resulting from any claim, demand, action or suit relating to
the particular Master Portfolio and not resulting from the willful misfeasance,
bad faith or gross negligence of Stephens and/or NBAI in the performance of such
obligations and duties or by reason of their reckless disregard thereof.
Stephens and/or NBAI will not confess any claim or settle or make any compromise
in any instance in which the Master Trust will be asked to provide
indemnification, except with the Master Trust's prior written consent. Any
amounts payable by the Master Trust under this Section 6(c) shall be satisfied
only against the assets of the Master Portfolio involved in the claim, demand,
action or suit and not against the assets of any other investment portfolio of
the Master Trust.
7. Effective Date; Termination of Agreement.
(a) This Agreement shall become effective as of the date first
set forth above and shall remain in full force and effect with respect to such
Master Portfolio(s) unless terminated pursuant to the provisions of Section
7(c).
(b) This Agreement may be terminated at any time without payment
of any penalty, upon 60 days' written notice, by vote of the Board of Trustees
of the Master Trust, by Stephens or by NBAI. Stephens and NBAI will each
cooperate with and assist the Master Trust, its agents and any successor
administrator or administrators in the substitution/conversion process.
(c) Sections 6 and 9 shall survive this Agreement's termination.
8. Amendments. No provision of this Agreement may be changed,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, discharge or termination is
sought.
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9. Confidentiality. All books, records, information and data pertaining
to the business of the Master Trust, its prior, present or potential
interestholders and NBAI's customers that are exchanged or received pursuant to
the performance of Stephens' and/or NBAI's duties under this Agreement shall
remain confidential and shall not be disclosed to any other person, except as
specifically authorized by the Master Trust or as may be required by law, and
shall not be used for any purpose other than performance of NBAI's and Stephens'
responsibilities and duties hereunder.
10. Service to Other Companies or Accounts. The Master Trust
acknowledges that both Stephens and NBAI now act, will continue to act and may
act in the future as investment adviser to fiduciary and other managed accounts,
and as investment adviser, investment sub-adviser and/or administrator to other
investment companies or series of investment companies, and the Master Trust has
no objection to either Stephens or NBAI so acting. The Master Trust further
acknowledges that the persons employed by both Stephens and NBAI to assist in
the performance of their duties under this Agreement may not devote their full
time to such service and nothing contained in this Agreement shall be deemed to
limit or restrict the right of Stephens or NBAI or any affiliate of either to
engage in and devote time and attention to other businesses or to render
services of whatever kind or nature.
11. Miscellaneous.
(a) Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Master Trust, Stephens or NBAI shall be
sufficiently given if addressed to that party and received by it at its office
set forth below or at such other place as it may from time to time designate in
writing.
To the Master Trust:
Nations Master Investment Trust
111 Center Street, Suite 3000
Little Rock, Arkansas 72201
Attention: Secretary
To Stephens:
Stephens Inc.
111 Center Street, Suite 3000
Little Rock, Arkansas 72201
Attention: Richard H. Blank, Jr.
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To NBAI:
NationsBanc Advisors, Inc.
One Bank of America Plaza
33rd Floor
Charlotte, NC 28255
Attention: Edward D. Bedard
(b) 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 without the written consent of the
other parties.
(c) This Agreement shall be construed in accordance with the laws
of the State of Delaware.
(d) This Agreement may be executed in any number of counterparts
each of which shall be deemed to be an original and which collectively shall be
deemed to constitute only one instrument.
(e) The captions of this Agreement are included for convenience
of reference only and in no way define or delimit any of the provisions hereof
or otherwise affect their construction or effect.
(f) This Agreement constitutes the entire agreement between the
parties hereto with respect to the matters described herein.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly executed and delivered by their duly authorized officers as of the date
first written above.
STEPHENS INC.
By: /s/ Richard H. Blank, Jr.
-------------------------
Richard H. Blank, Jr.
Senior Vice President
NATIONSBANC ADVISORS, INC.
By: /s/ Edward D. Bedard
-------------------------
Edward D. Bedard
Senior Vice President and
Chief Operating Officer
NATIONS MASTER INVESTMENT TRUST
By: /s/ James E. Banks, Jr.
-----------------------
James E. Banks, Jr.
Assistant Secretary
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SCHEDULE I
1. Nations Intermediate Bond Master Portfolio
2. Nations Blue Chip Master Portfolio
3. Nations International Equity Master Portfolio
4. Nations Marsico Focused Equities Master Portfolio
5. Nations Marsico Growth & Income Master Portfolio
6. Nations International Value Master Portfolio
7. Nations High Yield Bond Master Portfolio
Adopted: December 2, 1998
Last Amended: February 14, 2000
IN WITNESS WHEREOF, the parties hereto have caused this amended Schedule I
to be executed by their officers designated below as of the 14th day of
February, 2000.
STEPHENS INC.
By: /s/ Richard H. Blank, Jr.
-------------------------
Richard H. Blank, Jr.
Senior Vice President
BANC OF AMERICA ADVISORS, INC.
(Formerly, NationsBanc Advisors, Inc.)
By: /s/ Edward D. Bedard
-------------------------
Edward D. Bedard
Senior Vice President and Chief
Operating Officer
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ James E. Banks, Jr.
-----------------------
James E. Banks, Jr.
Assistant Secretary
I-1
<PAGE>
SCHEDULE A
For services rendered pursuant to this Agreement, the Master Trust will
pay Stephens and NBAI, in the aggregate, an administration fee, computed daily
and payable monthly, based on the annual rate of each Master Portfolio's daily
net assets as follows:
1. Money Market Master Portfolios: 0.05%
2. Fixed Income Master Portfolios: 0.05%
3. International Master Portfolios: 0.05%
4. Domestic Equity Master Portfolios
(except Nations Marsico Focused Equities
Master Portfolio, Nations Marsico
Growth & Income Master Portfolio
and Nations Marsico 21st Century
Master Portfolio): 0.05%
5. Nations Marsico Focused Equities
Master Portfolio, Nations Marsico
Growth & Income Master Portfolio
and Nations Marsico 21st Century
Master Portfolio 0.10%
It is understood and agreed among the parties that the aggregate
administration fee payable hereunder shall be divided by and between Stephens
and NBAI, as they may agree from time to time.
In addition to the asset-based fee set forth above, the Master Trust
shall reimburse Stephens, NBAI and any sub-administrator engaged pursuant to
Paragraph 4 for certain reasonable out-of-pocket expenses incurred by them in
connection with the performance of their respective duties hereunder.
Reimbursable out-of-pocket expenses shall include the following:
reasonable costs associated with postage (including overnight services),
telephone, telecommunications (including facsimiles), duplicating, pricing
services, and forms and supplies.
A-1
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this amended Schedule A to be
executed by their officers designated below as of the 18th day of November,
1999.
STEPHENS INC.
By: /s/ Richard H. Blank, Jr.
-------------------------
Richard H. Blank, Jr.
Senior Vice President
BANC OF AMERICA ADVISORS, INC.
(Formerly, NationsBanc Advisors, Inc.)
By: /s/ Edward D. Bedard
-------------------------
Edward D. Bedard
Senior Vice President and Chief
Operating Officer
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ James E. Banks, Jr.
-----------------------
James E. Banks, Jr.
Assistant Secretary
B-1
SUB-ADMINISTRATION AGREEMENT
This SUB-ADMINISTRATION AGREEMENT (the "Agreement") is made as of May
21, 1999 by and among THE BANK OF NEW YORK ("BNY"), NATIONSBANC ADVISORS, INC.
("NBAI") and NATIONS MASTER INVESTMENT TRUST (the "Master Trust").
WHEREAS, the Master Trust is registered as an open-end management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act");
WHEREAS, NBAI serves as the Co-Administrator for the investment
portfolios of the Master Trust pursuant to a separate Co-Administration
Agreement; and
WHEREAS, NBAI desires to retain BNY to render certain
sub-administrative and other services to the Master Trust and to NBAI, as
Co-Administrator of the Master Trust, and BNY is willing to render such
services.
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed among the parties hereto as follows:
1. Appointment and Duties as Sub-Administrator.
(a) NBAI hereby appoints BNY to act as Sub-Administrator of the Master
Trust and to render sub-administrative services for each portfolio of the Master
Trust listed on Schedule I (individually, a "Fund" and collectively, the "Master
Portfolios") and BNY hereby accepts such appointment and agrees to render the
services and duties set forth in Schedule II as it may be amended from time to
time, for the compensation and on the terms herein provided. Each new investment
portfolio established in the future by the Master Trust or NBAI will become a
"Master Portfolio" for all purposes hereunder when BNY receives a revised
Schedule I from NBAI or the Master Trust that includes such new portfolio.
(b) Subject to the other provisions of this Section 1, in performing
all services under this Agreement, BNY shall (i) act in conformity with the
Master Trust's Declaration of Trust and Bylaws (the "Bylaws"), the 1940 Act and
the rules thereunder, including but not limited to Rules 31a-1 to 31a-3, and
other applicable laws and regulations, as the same may be amended from time to
time, and the Master Trust's Registration Statement, as such Registration
Statement may be amended from time to time; (ii) consult and coordinate with
NBAI and the Master Trust, as necessary and appropriate; and (iii) advise and
report to NBAI and the Master Trust, as necessary or appropriate, with respect
to any compliance matters that come to its attention. In performing all services
under this Agreement BNY shall meet the minimum quality of service standards set
forth on Schedule III.
(c) The Master Trust has furnished BNY and NBAI with copies properly
certified or authenticated of each of the following: (i) the Master Trust's
Declaration of Trust or other organizational document and all amendments thereto
(the "Declaration"); (ii) the Master Trust's
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Bylaws; (iii) resolutions of the Master Trust's Board of Trustees or other
governing body (the "Board") authorizing the execution, delivery and performance
of this Agreement by the Master Trust; (iv) the Master Trust's most recent
Post-Effective Amendment to its Registration Statement on Form N-1A (the
"Registration Statement") under the 1940 Act (File No. 811-09347), as filed with
the Securities and Exchange Commission (the "SEC") relating to interests in the
Master Portfolios (the "Interests"); (iv) the Master Portfolios' current
Prospectus(es); (v) the Master Portfolios' current Statement(s) of Additional
Information; and (vi) the pricing procedures applicable to the calculation of
the Master Portfolios' net asset values as approved by the Master Trust's Board
(the "Pricing Procedures"). It is solely the Master Trust's responsibility to
furnish BNY from time to time with copies, properly certified or authenticated,
of all amendments of or supplements to the foregoing, and BNY will not be held
to have knowledge of any such amendments or supplements until the same are
actually received by BNY. Furthermore, the Master Trust will provide BNY with
any other documents that BNY and NBAI may reasonably request and will notify BNY
and NBAI as soon as possible of any matter materially affecting either BNY's or
NBAI's performance of its services under this Agreement.
(d)(i) BNY undertakes to report on a regular basis to NBAI and the
Master Trust regarding: (A) the readiness of its computer systems, or those used
by it in the performance of its duties hereunder, properly to record, store,
process, calculate or present calendar dates falling on and after, and time
spans including, September 9, 1999, January 1, 2000 or February 29, 2000 (the
"Subject Dates") as a result of the occurrence, or use of data containing any
such Subject Dates; (B) the readiness of its computer systems or those used by
it in the performance of its duties hereunder, to calculate any information
dependent on or relating to dates on or after the Subject Dates; and (C) its
ability to perform the administration and fund accounting services set forth in
Schedule II (the "Services") in accordance with any applicable performance
standards set forth in Schedule III (the "Standards") with respect to the
maintenance of records or processing of data containing dates falling on or
after the Subject Dates, provided that, with respect to computers used but not
owned by BNY and third-party computer systems other than InvestOne, BNY's
responsibility shall be limited to seeking similar reports from such owners or
third parties and promptly forwarding such reports to NBAI. Without limiting the
foregoing, BNY undertakes to notify NBAI and the Master Trust, in writing, of
any concerns believed by BNY to be material regarding the events described in
this paragraph, provided that, with respect to computers owned by others and
third-party computer systems other than InvestOne, BNY's responsibility shall be
limited to seeking similar notice from such owners or third parties and promptly
forwarding such notifications to NBAI.
(ii) NBAI or the Master Trust shall have the right to terminate this
Agreement if there is a "material failure" by BNY to perform any of the Services
in accordance with the Standards due to a failure by computers owned or used by
BNY in performing its duties hereunder to properly process the occurrence of the
Subject Dates or data containing the Subject Dates. As used in this Section
1(d), the term "material failure" shall be limited to a failure to provide any
of the Services in accordance with the Standards, provided that no such failure
shall be deemed a "material failure" if such failure occurs at or about the time
other major financial institutions similar to BNY providing similar services in
a similar volume to investment companies similar to the Master Trust are
experiencing similar failures, and, provided further, that no failure by BNY
shall be or be deemed a "material failure" if BNY substantially provides the
Services under a contingency plan, it being agreed that, to the extent that the
parties mutually agree, the time
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frames and deadlines set forth in Schedule III of this Agreement and elsewhere
shall not be considered in determining whether BNY is substantially providing
the Services in accordance with the Standards. NBAI and the Master Trust agree
to act reasonably and in good faith in considering any request by BNY to extend
time frames and deadlines.
(iii) In the event there is a "material failure" by BNY to provide the
Services and such "material failure" is not cured by BNY within 10 days after
such material failure arises, NBAI or the Master Trust shall have the right to
terminate this Agreement upon the giving of 60 days written notice to BNY. BNY
shall, notwithstanding any other provision contained in this Agreement, have no
liability to the Master Trust or NBAI under this Agreement if such "material
failure" initially arose out of or was caused by a failure of a computer used
but not owned by BNY or owned by a third party (other than InvestOne) to
properly process the Subject Dates or data containing the Subject Dates, and BNY
shall be entitled to any compensation and reimbursement for out-of-pocket
expense as may then be due and payable, as well as agreed-upon out-of-pocket
expenses incurred in connection with such a termination. If such a termination
is the result of a "material failure" initially arising out of, or caused by a
failure of computers owned by BNY or a failure by InvestOne, then, first, BNY's
liability hereunder for such failure shall, notwithstanding any other provision
contained in this Agreement to the contrary, be limited to the lesser of (x) the
fees paid to a successor service provider during the six months next succeeding
the date of termination to the extent such fees exceed the fees that would have
been paid to BNY hereunder, and (y) $1,000,000; and second, BNY shall not be
entitled to out-of-pocket expenses incurred in connection with such a
termination.
(iv) In the event of conflict between this Section 1(d) and any other
provision contained in this Agreement, this Section 1(d) shall control.
(v) NBAI and the Master Trust each agree to hold all of the provisions
of this Section 1(d) in strict confidence and not to disclose, nor permit
disclosure of, such provisions.
(e) Subject to the direction and approval of the Master Trust's Board
and appropriate officers and the provisions of this Agreement, BNY shall provide
to each Master Portfolio the administrative services set forth on Schedule II
attached hereto. In performing such services hereunder, BNY shall provide, at
its expense, office space, facilities, equipment and personnel. BNY shall not
provide any services relating to the management, investment advisory or
sub-advisory functions of any Master Portfolio, distribution of Interests of any
Master Portfolio, maintenance of any Master Portfolio's financial records
(except as otherwise agreed by the parties) or any services normally performed
by the Master Portfolios' counsel or independent accountants. Upon receipt of
the Master Trust's prior written consent, BNY may delegate any of its duties and
obligations hereunder to any delegee or agent whenever and on such terms and
conditions as it deems necessary or appropriate. Unless expressly agreed in
writing, BNY shall not be relieved of liability or responsibility for the
performance of any duties or obligations delegated to a delegee or agent,
provided that BNY shall have no liability for duties or obligations that are
delegated to a delegee or agent at the instruction of the Master Trust or NBAI.
The Master Trust and NBAI shall cause their respective officers, and shall use
reasonable efforts to cause the Master Trust's or NBAI's legal counsel and
independent accountants to cooperate with BNY and to provide BNY, upon BNY's
reasonable written request, such information, documents and advice relating to
such Master Portfolio as is within the possession
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<PAGE>
or knowledge of such persons, in order to enable BNY to perform its duties
hereunder. Such cooperation or provision of information, documents or advice
shall be at no cost to BNY, provided BNY's request is reasonable and NBAI shall
have been notified of the request. In connection with its duties hereunder, BNY
shall be entitled to reasonably rely upon any documents relating to a Master
Portfolio provided to BNY by any of the aforementioned persons. BNY may apply to
the Master Trust or NBAI for written instructions with respect to any matter
arising in connection with BNY's performance hereunder. If, after a reasonable
period of time, BNY receives no response to any such application, BNY may then
notify the Master Trust or NBAI of reasonable action that BNY shall take if
written instructions are not received within a stated period of time after such
notice, and then BNY shall not be liable for taking such reasonable action as if
written instructions had been provided. BNY is entitled to reasonably rely and
act in accordance with written instructions believed to have been given by
authorized persons and shall incur no costs for such reasonable reliance. BNY
shall have no duties or responsibilities whatsoever except such duties and
responsibilities as are specifically set forth in this Agreement and Schedule II
hereto, and no covenant or obligation shall be implied against BNY in connection
with this Agreement.
(f) The Master Trust and NBAI, for itself and not for the others,
hereby represents and warrants to BNY, which representations and warranties
shall be deemed to be continuing, that: (i) it is duly organized and existing
under the laws of the jurisdiction of its organization, with full power to carry
on its business as now conducted, to enter into this Agreement and to perform
its obligations hereunder; (ii) this Agreement has been duly authorized,
executed and delivered by it in accordance with all requisite action and
constitutes a valid and legally binding obligation, enforceable in accordance
with its terms; (iii) it is conducting its business substantially in compliance
with all applicable laws and regulations, both state and federal, and has
obtained all regulatory licenses, approvals and consents necessary to carry on
its business as now conducted; (iv) there is no statute, regulation, rule, order
or judgment binding on it and no provision of its Declaration or Bylaws, nor of
any mortgage, indenture, credit agreement or other contract binding on it or
affecting its property which would prohibit its execution or performance of this
Agreement; and (v) the Master Trust and NBAI will use reasonable efforts to
promptly notify BNY of any errors or omissions contained in any reports,
calculations, valuations and other items of information, provided that any
failure by the Master Trust or NBAI to detect any such errors or omissions shall
not relieve BNY of any resulting liability therefrom. To the extent that NBAI
has actual knowledge of any such error or omission and fails to use reasonable
efforts to promptly notify BNY, BNY shall be relieved of any liability that BNY
may have mitigated had NBAI provided notice of such error or omission to BNY.
(g) BNY hereby represents and warrants to the Master Trust and NBAI,
which representations and warranties shall be deemed to be continuing, that: (i)
it is duly organized and existing under the laws of the jurisdiction of its
organization, with full power to carry on its business as now conducted, to
enter into this Agreement and to perform its obligations hereunder; (ii) this
Agreement has been duly authorized, executed and delivered by it in accordance
with all requisite action and constitutes a valid and legally binding
obligation, enforceable in accordance with its terms; and (iii) it is conducting
its business substantially in compliance with all applicable laws and
regulations, both state and federal, and has obtained all regulatory licenses,
approvals and consents necessary to carry on its business as now conducted;
there is no statute, regulation, rule, order or judgment binding on it and no
provision of its
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Declaration or Bylaws, nor of any mortgage, indenture, credit agreement or other
contract binding on it or affecting its property which would prohibit its
execution or performance of this Agreement.
2. Compensation. For the services to be rendered, the facilities to be
furnished and the compensation and other expenses to be borne by BNY, as
provided for in this Agreement, BNY shall be entitled to receive a monthly fee
from NBAI and reimbursement for out-of-pocket expenses as set forth in Schedule
IV to this Agreement. It is understood that NBAI shall be responsible for BNY's
monthly fee for its services hereunder, and BNY agrees that it shall have no
claim against the Master Trust or the Master Portfolios with respect to
compensation under this Agreement.
3. Recordkeeping. BNY shall, as agent for the Master Trust, and subject
to the direction and approval of the Master Trust's Board and the provisions of
this Agreement, maintain and keep current the books, accounts and other
documents, if any, pursuant to the services and duties provided by BNY as set
forth in Schedule II of this Agreement, and preserve any such books, accounts
and other documents in accordance with the applicable provisions of Rule 31a-2
of the 1940 Act. Such books, accounts and other documents shall be made
available upon reasonable request for inspection by officers, employees and
auditors of the Master Trust and NBAI during BNY's normal business hours. All
records maintained and preserved by BNY pursuant to this Agreement which the
Master Trust is required to maintain and preserve in accordance with Rule 31a-2
of the 1940 Act shall be and remain the property of the Master Trust and shall
be surrendered to the Master Trust promptly upon request in the form in which
such records have been maintained and preserved. Upon reasonable request of the
Master Trust, BNY shall provide in data files or hard copy, whichever the Master
Trust shall reasonably elect, any records included in any such delivery which
are maintained by BNY on a computer disc, or are similarly maintained, and the
Master Trust shall reimburse BNY for its expenses of providing such hard copy.
4. Standard of Care; Indemnification.
(a) BNY shall at all times act in good faith and agrees to use its best
efforts to fulfill its obligations under this Agreement, but assumes no
responsibility for loss or damage to the Master Trust unless such loss or damage
is caused by BNY's own negligence, bad faith or willful misconduct or that of
its directors, officers or employees. BNY shall be responsible hereunder for all
direct damages resulting from its own negligence, bad faith or willful
misconduct, provided however that it shall not be responsible for lost profits
or lost business arising under or in connection with this Agreement. It is
understood and agreed that for purposes of this Section 4(a), "direct damages"
shall include, but shall not be limited to, all legal costs, penalties,
reimbursement for excess distribution and redemption payments, repurchasing
costs for servicing agents and reimbursement to the Master Portfolios for net
asset value breaks (as calculated under the Pricing Procedures).
(b) The Master Trust, on behalf of each Master Portfolio, will
indemnify BNY against and hold it harmless from any and all losses, claims,
damages, liabilities or expenses (including reasonable counsel fees and expenses
of a defense against any claim, demand, action or suit), relating to the
particular Master Portfolio and arising from any one or more of the
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following: (i) errors in records or instructions, explanations, information,
specifications or documentation of any kind, as the case may be, supplied to BNY
by any person described in Section 1 hereof or by any third party described in
Section 5; (ii) action or inaction taken or omitted to be taken by BNY pursuant
to written or oral instructions described in this Agreement (or otherwise
without bad faith, negligence or willful misconduct); (iii) any action taken or
omitted to be taken by BNY in good faith in accordance with the advice or
opinion of counsel for a Master Portfolio, the Master Trust, NBAI (obtained in
accordance with the procedures set forth in this Agreement) or its own counsel;
(iv) any improper use by the Master Portfolio, the Master Trust, NBAI or their
respective agents, of any valuations or computations supplied by BNY pursuant to
this Agreement; (v) the method of valuation of the securities and the method of
computing a Master Portfolio's net asset value or any other amount computed by
BNY hereunder, provided BNY has followed the Pricing Procedures; and (vi) any
valuation of securities, net asset value or other amount provided by a Master
Portfolio or NBAI. BNY will not confess any claim or settle or make any
compromise in any instance in which the Master Trust will be asked to provide
indemnification, except with the Master Trust's prior written consent. Any
amounts payable by the Master Trust under this Section 4(b) shall be satisfied
only against the assets of the Master Portfolio involved in the claim, demand,
action or suit and not against the assets of any other investment portfolio of
the Master Trust.
5. Master Portfolio Accounting and Other Services.
(a) BNY, in performing the services required of it under the terms of
this Agreement, shall be entitled to rely fully on the accuracy and validity of
any and all instructions, explanations, information, specifications and
documentation furnished to it by a Master Portfolio and shall have no duty or
obligation to review the accuracy, validity or propriety of such instructions,
explanations, information, specifications or documentation, including, without
limitation, evaluations of securities; the amounts or formula for calculating
the amounts and times of accrual of Master Portfolio's liabilities and expenses;
the amounts receivable and the amounts payable on the sale or purchase of
securities; and amounts receivable or amounts payable for the sale or redemption
of Master Portfolio Interests effected by or on behalf of the Master Portfolio.
In the event BNY's computations hereunder rely, in whole or in part, upon
information, including, without limitation, bid, offer or market values of
securities or other assets, or accruals of interest or earnings thereon, from a
pricing or similar service utilized, or subscribed to, by BNY which BNY in its
judgment deems reliable, or any other third party pricing source designated by
the Master Trust, BNY shall not be responsible for, under any duty to inquire
into, or deemed to make any assurances with respect to, the accuracy or
completeness of such information. BNY shall not be required to inquire into any
valuation of securities or other assets by the Master Portfolio or any third
party described in this Section, even though BNY in performing services similar
to the services provided pursuant to this Agreement for others may receive
different valuations of the same or different securities of the same issuers.
(b) Subject to the provisions of this Agreement and the direction and
approval of the Master Trust's Board, BNY shall perform the computations
described in Schedule II at such times and dates and in the manner specified or
described in the then-current Prospectus(es) of a Master Portfolio. To the
extent valuation of securities or a computation specified or described in a
Master Portfolio's Pricing Procedures or then-current effective Prospectus is at
any time inconsistent with any applicable laws or regulations, the Master Trust
or NBAI shall immediately
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so notify BNY in writing and thereafter shall furnish BNY at all appropriate
times with the values of such securities and such Master Portfolio's net asset
value or other amounts otherwise to be calculated by BNY, or, subject to the
prior approval of BNY, instruct BNY in writing to value securities and make such
computations in a manner which the Master Trust or NBAI then represents in
writing to be consistent with all applicable laws and regulations. The Master
Trust or NBAI may also from time to time, subject to the prior approval of BNY,
instruct BNY in writing to make computations other than as specified in this
Section of this Agreement. By giving such instruction, the Master Trust or NBAI
shall be deemed to have represented that such instruction is consistent with all
applicable laws and regulations and the then-current effective Prospectus of the
particular Master Portfolio. The Master Trust or NBAI shall have sole
responsibility for determining the method of valuation of securities and the
method of computations, and all computations, valuation of securities and the
method of computing each Master Portfolio's net asset value shall be subject to
approval by the Master Trust and NBAI. BNY shall not be liable for relying on
any price provided by any pricing service believed by BNY to be reliable, and
the Master Trust or NBAI shall furnish values when the same are not available
from a pricing service utilized by BNY, with such furnishing to constitute an
instruction to BNY to rely on the provided values.
(c) BNY shall be responsible for determining and properly reflecting in
the computations made by it under this Agreement: (i) the taxable nature of any
distribution or amount received or deemed received by, or payable to, a Master
Portfolio; (ii) the taxable nature or effect on a Master Portfolio or its
shareholders of any corporate actions, class actions, tax reclaims, tax refunds,
or similar events; (iii) the taxable nature or taxable amount of any
distribution or dividend paid, payable or deemed paid, by a Master Portfolio to
its shareholders; (iv) the effect under any federal, state, or foreign income
tax laws of a Master Portfolio making or not making any distribution or dividend
payment, or any election with respect thereto; or (v) any tax accounting;
provided, however, that if BNY is not certain of the taxable nature, amount or
effect of any such item, it may seek instructions regarding the proper treatment
of such item from the Master Trust or NBAI in accordance with the procedures set
forth in Section 1(e), above, and shall have no liability for acting in reliance
on such instructions.
6. Termination of Agreement.
(a) This Agreement shall become effective as of the date first set
forth above and shall remain in full force and effect unless terminated pursuant
to the provisions of Section 6(b).
(b) This Agreement may be terminated at any time without payment of any
penalty, upon 60 days' written notice to BNY by NBAI or by vote of the Board of
the Master Trust; or upon 180 days' written notice to NBAI and the Master Trust
by BNY. Upon any such termination, BNY will cooperate with and assist the Master
Trust, NBAI, their agents and any successor administrator(s) or
sub-administrator(s) in the substitution/conversion process. In connection with
any termination of this Agreement, unless BNY is in breach of this Agreement,
the Master Portfolios and NBAI agree to pay BNY any compensation and
reimbursement for out-of-pocket expenses as may then be due and payable, as well
as agreed-upon out-of-pocket expenses incurred in connection with a termination.
If BNY is in breach of this Agreement, the Master Portfolios and NBAI may offset
any compensation or reimbursement amounts owed to BNY by the amount of damages,
costs and expenses incurred as a result of BNY's breach,
7
<PAGE>
including costs, expenses and reasonable incremental fees for a period not to
exceed one year incurred in connection with a conversion by the Master Trust and
NBAI to a successor service provider. In the event of a dispute as to the amount
of such damages, the Master Portfolios and NBAI agree to escrow the set-off
amount.
(c) Sections 4 and 8 shall survive this Agreement's termination.
7. Amendments. Except as expressly provided in the first paragraph of
Section 1, no provision of this Agreement may be amended or modified orally, but
only by an instrument in writing signed by the party against which enforcement
of the amendment or modification is sought.
8. Confidentiality. All books, records, information and data pertaining
to the business of the Master Trust, or its prior, present or potential
shareholders that are exchanged or received in connection with the performance
of BNY's duties under this Agreement shall remain confidential and shall not be
disclosed to any other person, except as specifically authorized by the Master
Trust or as may be required by law, and shall not be used for any purpose other
than performance of its responsibilities and duties hereunder, and except that
BNY retains the right to disclose matters subject to confidentiality to its
examiners, regulators, internal or external auditors, its accountants, its
internal and external counsel, and to any other entity whenever it is advised by
its internal or external counsel that it is reasonably likely that BNY would be
liable for a failure to do so. BNY will endeavor to provide written notice to
the Master Trust and NBAI at least five business days prior to any disclosures
pursuant to this Section 8, but, provided it shall have provided as much notice
as is reasonably practicable under the circumstances, BNY shall have no
liability for any failure to do so.
9. Service to Other Companies. The Master Trust and NBAI acknowledge
that BNY now provides, will continue to provide and may in the future provide
administrative or other services to other investment companies or series of
investment companies, and the Master Trust and NBAI have no objection to BNY so
doing. The Master Trust and NBAI further acknowledge that the persons employed
by BNY to assist in the performance of BNY's duties under this Agreement may not
devote their full time to such service and nothing contained in this Agreement
shall be deemed to limit or restrict the right of BNY or any affiliate of BNY to
engage in and devote time and attention to other businesses or to render
services of whatever kind or nature.
10. Miscellaneous.
(a) This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflict of laws principles thereof.
Each Master Portfolio, the Master Trust and NBAI hereby consent to the
jurisdiction of a state or federal court situated in New York City, New York in
connection with any dispute arising hereunder. To the extent that in any such
jurisdiction any of the aforementioned persons may now or hereafter be entitled
to claim, for itself or its assets, immunity from suit, execution, attachment
(before or after judgment) or other legal process, each irrevocably agrees not
to claim, and it hereby waives, such immunity.
8
<PAGE>
(b) In case any provision in or obligation under this Agreement shall
be invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations shall not in any
way be affected or impaired thereby, and if any provision is inapplicable to any
person or circumstances, it shall nevertheless remain applicable to all other
persons and circumstances.
(c) Each and every right granted to BNY, the Master Trust or NBAI
hereunder or under any other document delivered hereunder or in connection
herewith, or allowed it by law or equity, shall be cumulative and may be
exercised from time to time. No failure on the part of BNY, the Master Trust or
NBAI to exercise, and no delay in exercising, any right will operate as a waiver
thereof, nor will any single or partial exercise by BNY, the Master Trust or
NBAI of any right preclude any other or future exercise thereof or the exercise
of any other right.
(d) BNY shall not be responsible for delays or errors that occur by
reason of circumstances beyond its reasonable control in the performance of its
duties under this Agreement, provided that reasonable back-up and disaster
recovery systems are in place, including, without limitation, labor
difficulties, mechanical breakdowns, computer breakdowns or malfunctions
(hardware or software), flood or catastrophe, acts of God, failures of
transportation, communication or power supply, or other similar circumstances.
Nor shall BNY be responsible for delays or failures to supply the information or
services specified in this Agreement where such delays or failures are caused by
the failure of any person(s) other than BNY to supply any instructions,
explanations, information, specifications or documentation deemed necessary by
BNY in the performance of its duties under this Agreement.
(e) Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Master Trust, BNY and/or NBAI shall be
sufficiently given if addressed to that party and received by it at its office
set forth below or at such other place as it may from time to time designate in
writing.
To the Master Trust:
Nations Master Investment Trust
111 Center Street
Little Rock, Arkansas 72201
Attention: Richard H. Blank, Jr.
To NBAI:
NationsBanc Advisors, Inc.
One Bank of America Plaza
101 South Tryon Street, NC1-002-33-31
Charlotte, NC 28255-0001
Attention: Edward D. Bedard
9
<PAGE>
To BNY:
The Bank of New York
90 Washington Street
22nd Floor
New York, NY 10286
Attention: Stephen E. Grunston
(f) This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement may not be assigned by BNY, nor may BNY delegate
responsibility for the performance of any of its duties hereunder, without the
written consent of the other parties hereto.
(g) This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original and which collectively shall be
deemed to constitute only one instrument.
(h) The captions of this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect.
(i) This Agreement constitutes the entire agreement between the parties
hereto with respect to the provision by BNY of sub-administrative services and
the receipt of fees therefor, and supersedes all prior arrangements or
understandings, written or oral, with respect to the provision by BNY of such
services and the receipt of fees therefor.
10
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly executed and delivered by their duly authorized officers as of the date
first written above.
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
------------------------
Stephen E. Grunston
Vice President
NATIONSBANC ADVISORS, INC.
By: /s/ Edward D. Bedard
------------------------
Edward D. Bedard
Senior Vice President and
Chief Operating Officer
NATIONS MASTER INVESTMENT TRUST
By: /s/ James E. Banks, Jr.
------------------------
James E. Banks, Jr.
Assistant Secretary
11
<PAGE>
SCHEDULE I
1. Nations Intermediate Bond Master Portfolio
2. Nations Blue Chip Master Portfolio
3. Nations International Equity Master Portfolio
4. Nations Marsico Focused Equities Master Portfolio
5. Nations Marsico Growth & Income Master Portfolio
6. Nations International Value Master Portfolio
7. Nations High Yield Bond Master Portfolio
Adopted: December 2, 1998
Last Amended: February 14, 2000
IN WITNESS WHEREOF, the parties hereto have caused this amended
Schedule I to be executed by their officers designated below as of the 14th day
of February, 2000.
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
------------------------
Stephen E. Grunston
Vice President
BANC OF AMERICA ADVISORS, INC.,
(Formerly, NationsBanc Advisors, Inc.)
By: /s/ Edward D. Bedard
------------------------
Edward D. Bedard
Senior Vice President and
Chief Operating Officer
NATIONS MASTER INVESTMENT TRUST
By: /s/ James E. Banks, Jr.
------------------------
James E. Banks, Jr.
Assistant Secretary
I-1
<PAGE>
SCHEDULE II
MASTER PORTFOLIO ADMINISTRATION SERVICES
BNY shall perform the following sub-administrative services, in
addition to any other services agreed to from time to time:
o Monitor and document compliance by the Master Portfolios with their
policies and restrictions as delineated in their Prospectuses and
Statements of Additional Information, including any supplements or
amendments thereto, and with the rules and regulations under the 1940
Act utilizing Charles River Development's compliance monitoring system
or by such other means as the parties may agree. NBAI shall be
responsible for communicating such policies and restrictions, including
any changes thereto, to BNY by such means as the parties agree.
o Provide income attribution summary schedules necessary for year-end tax
reporting, including the attached examples. Provide a gross up for
foreign taxes on a per share basis and the redesignation of income and
capital gains on a per share basis.
o Prepare federal, state, excise and local income tax returns for the
Master Portfolios and file such returns upon the approval of the Master
Portfolios' independent accountants; monitor, report on and prepare
periodic worksheet and tax provision packages with respect to
Sub-Chapter M qualifications; prepare and file all Form 1099s with
respect to the Master Portfolios' Trustees; monitor compliance with
Section 4982 of the Internal Revenue Code; calculate and maintain
records pertaining to original issue discount and premium amortization
as required; identify wash sales and all other book/tax differences,
and report results to the Master Portfolios' independent accountants
and Master Portfolios management; and such other duties relating to
federal and/or state tax compliance as the parties may agree. BNY shall
be responsible for providing all pertinent tax information to the
Master Portfolios' independent accountants.
o Prepare Return of Capital Statement of Position 93-2 adjustments.
o Support NBAI in its preparation of the schedules and provide NBAI
unaudited quarterly and semi-annual and audited annual financial
statements and schedules of Master Portfolio investments by providing,
without limitation, each Master Portfolios' schedule of investments and
general ledger in electronic format and/or hard copy, as required, and
such other information as may be necessary to complete such financial
reports.
o Prepare statistical reports for outside information services
(referenced in Schedule V), and such other information services as the
parties may agree, including the ICI expense survey.
o Prepare calculations for capital gains pursuant to IRS rules in
conjunction with NBAI and the Master Portfolios' independent
accountants.
o Attend Master Portfolio shareholder and Board of Trustees meetings as
requested by NBAI, including making such presentations as are
appropriate, and, with respect to the Master
II-1
<PAGE>
Portfolio administration services described herein, provide such
periodic and special reports to the Master Trust and NBAI as the Master
Trust and NBAI shall reasonably request.
MASTER PORTFOLIO ACCOUNTING AND OTHER SERVICES
BNY shall provide all accounting and recordkeeping services necessary
and appropriate for the business of the Master Portfolios, including but not
limited to those set forth below.
Required Records; Ledgers and Journals
BNY shall keep current the following accounts and records relating to
the business of the Master Portfolios, in such form as is required by the 1940
Act and the rules thereunder, and generally accepted accounting principles, to
support all filings under applicable federal and state tax laws and regulations
and as may be mutually agreed to among the Master Trust, NBAI and BNY, and shall
make available to NBAI and/or the Master Trust upon request:
1. Cash Receipts Journal
2. Cash Disbursements Journal
3. Dividends Paid and Payable Schedule (book vs. tax basis)
4. Purchase and Sales Journals - Portfolio Securities
5. Realized/Unrealized Gain (Loss) Reports
6. Subscription and Redemption Journals
7. Security Ledgers - Transaction Report and Tax Lot Holdings Report
8. Broker Ledger - Commission Report
9. Daily Expense Accruals
10. Daily Interest Accruals
11. Daily Trial Balance
12. Portfolio Interest Receivable and Income Journal
13. Portfolio Dividend Receivable and Income Register
14. Listing of Portfolio Holdings - showing cost, market value and
percentage of portfolio comprised of each security
15. Aged Receivables (dividends, interest, tax reclaiming)
16. Portfolio Turnover Rate
17. Cash reconciliations
18. Position reconciliations
BNY will be responsible for maintaining, in accordance with Section 31
and the rules thereunder of the 1940 Act, all books and records so required and
generated in the course of performing their duties under this agreement.
Further, at a minimum, BNY shall maintain on-site the above referenced reports
as of each month end for the most recent fiscal year-ended and the current
fiscal year.
BNY shall maintain a listing of all feeders of each Master Portfolio,
including the number and the value of the Interests held by each feeder, based
upon daily or periodic allocations of Master Portfolio assets.
II-2
<PAGE>
Daily Accounting Services
BNY shall perform the following services on each Business Day:
1. Calculate Net Asset Value (NAV), and Public Offering Price (POP) Per
Share Pursuant to SEC formulas:
o Update the valuation of security positions held by each Master
Portfolio's portfolio in accordance with the Master
Portfolio's Pricing Procedures and any other appropriate
procedures established by the Board and NBAI as NBAI shall
provide BNY in writing
o When instructed by NBAI, enter manual prices supplied by
broker and link to pricing procedures
o Calculate each Master Portfolio's NAV/POP in accordance with
the applicable Pricing Procedures approved by the Master
Trust's Board of Trustees and prepare NAV proof sheet. Review
components of change in NAV for reasonableness based on the
tolerance levels as NBAI shall direct BNY in writing
o Review variance reporting for price changes in individual
securities using variance levels established by Master
Portfolio and report to Master Portfolio portfolio managers
and to NBAI
o Review for ex-dividend items indicated by pricing sources;
trace to general ledger for agreement
o Communicate required pricing and yield information (NAV/POP),
as appropriate, to NBAI and, electronically, to NASDAQ and to
such other third parties as designated by the Master
Portfolios with respect to its various distribution channels.
In addition, provide Master Portfolio share activity to NBAI.
2. Dividend Rates/Yields/Dollar Weighted Average Maturity:
o Calculate, subject to the approval of NBAI, net investment
income available for distribution daily as appropriate
o Calculate daily dividend rate, and 1, 7, 30-day yields/SEC
yields
o Calculate dollar weighted average maturity
3. Determine and Report Cash Availability:
o Receive daily cash and transaction statements from the Master
Portfolios' Custodian
o Complete daily bank cash reconciliations (including
documentation of any reconciling items) and notify the Master
Portfolios' Custodian
o Report investable cash to NBAI and Master Portfolio
sub-advisers
4. Daily Expense Accruals:
o Accrue individual expenses on a daily basis based on
Instructions provided by NBAI, except for those instances
where such an adjustment would cause a full penny break in
NAV, in which case such adjustment will be included in the
calculation of NAV on the day received
o If applicable, accrue daily amortization of organization
expense as instructed by NBAI
II-3
<PAGE>
o If applicable, accrue daily Rule 12b-1 Plan expenses
o Adjust expense accruals as instructed by NBAI and provide
reports as requested by NBAI
5. Verify and Record All Daily Income Accruals for Debt Issues:
o Track income and provide year end tax schedules
o Review and verify all interest and amortization reports
o Periodic tie-out of receivables
o Ensure security masters denote proper interest and
amortization methods as per the fund set up sheets as
instructed by NBAI
6. Monitor Securities:
o Review each Master Portfolios portfolio holding and current
days security trades for dividend activity
o Interface with Master Portfolios' Custodian for timely
collection and postings of corporate actions, dividends and
interest pre-payments
7. Enter All Security Trades:
o Review verification of trade and interest calculations
o Verify settlement through custodian statements
o Maintain security ledger transaction reporting
o Maintain tax lot holdings
o Determine realized gains or losses on security trades
o Provide broker commission information
8. Enter All Master Portfolio Share Transactions:
o Periodically reconcile dividend payable amounts
o Process activity identified on reports
o Verify settlement through custodian statements
o Reconcile to report balances
o Process and track capital stock gain/loss activity
9. Prepare Daily Trial Balance:
o Post manual entries to general ledger
o Post custodian bank activity
o Require automated settled transactions between custody and
activity records (prepare, clear and post)
o Post shareholder and security transactions
o Post and verify income and expense accruals and resolve
differences
o Prepare general ledger
o Post corporate action activity
II-4
<PAGE>
10. Review and Reconcile Custodian Statements:
o Verify all posted interest, dividends, expenses, and
shareholder and security payments/receipts, etc. when
requested
o Post all cash settlement activity to trial balance
o Reconcile to ending cash balance accounts
o Report to NBAI the status of past due items and failed trades
with the custodian
o Reconcile cash exception Income items, tax reclaims and past
due income items with custody area
11. Preparation of Accounting Reports:
o Price Variance Report
o Trial Balance
o Portfolio Valuation
o NAV Calculation Report
o Cash Availability
o Change in NAV
o Non-standard entries
o Stale Price Report
o Other such reports as may be reasonably be requested by NBAI
Monthly/Quarterly Services
BNY shall provide the following services on a monthly or quarterly
basis, within such timeframe as may be mutually agreed upon by BNY, the Master
Trust and NBAI:
1. Submission of Monthly Accounting Reports as mutually agreed upon
2. Reconcile Asset Listing to Custodian Asset Listing
3. Provide Monthly Analysis and Reconciliation of Trial Balance Accounts
4. Prepare Documentation Supporting the Preparation of:
o SEC yield reporting
o Income by state reporting
o Standard Industry Code Valuation Report (please provide NBAI's
industry code classifications/is there a standard for all
funds)
o Alternative Minimum Tax Income segregation schedule
II-5
<PAGE>
5. Provide Upon Request Broker Commission and Net Trade Reports
Annual (and Semi-Annual) Accounting Services
BNY shall provide the following services on an annual and semi-annual
basis:
1. Supply auditors InvestOne reports supporting securities and shareholder
transactions, income and expense accruals, etc. during the year in
accordance with standard audit assistance requirements
2. Provide NBAI with information to assist NBAI in the preparation of NSAR
filings
Other Core Services
BNY shall provide the following services:
o Accrete discounts and amortize premiums to put and call events
as directed by NBAI and in a manner acceptable under generally
accepted accounting principles
o Process principal repayments on mortgage backed securities
o Update variable securities with current rates
o Process corporate action events through a primary vender feed,
and monitor results via Reuters, Bloomberg, or other available
sources as the parties may agree
o Perform automated portfolio pricing with a second vendor as
requested by NBAI
o Produce documents and respond to inquiries during account and
SEC examinations
Money Market Master Portfolios: Prepare daily mark to market reports
and analysis in compliance with Rule 2a-7 including:
o Calculating the daily portfolio weighted average maturity
o Report portfolio diversification based on trade/security
information provided by NBAI by: Country, State, Tier,
Liquidity, Asset Backed Securities, Industry, Letter of Credit
o Listing percentage of portfolio maturing in specified
intervals (I.E., number of days)
o Providing issuer and guarantor diversification exception
reporting
International Master Portfolios: BNY shall provide the following
services:
o Report in base and local currency
II-6
<PAGE>
o Processing of tax liability on foreign income subject to
approval of NBAI
o Daily variance analysis performed on FX rates for security
position held
o Produce automated bifurcation reporting in compliance with IRC
Section 988
o Mark to market security receivables and payables on a daily
basis
o Determine portfolio exposure by country and currency
In addition to the above, BNY will provide additional support as agreed
upon from time to time (i.e., financial statement production).
II-7
<PAGE>
SCHEDULE III
SERVICE LEVEL PERFORMANCE STANDARDS
<TABLE>
<CAPTION>
<S> <C>
SERVICE STANDARD
1. Daily Cash Availability ( ) 100% accuracy and delivery by 9:00 a.m. EST for
Money Market Master Portfolios and 9:30 a.m. EST
for all others
( ) Compensation for uninvested cash at Nations Cash
Reserves' mill rate
2. Calculation of daily NAVs ( ) 100% accuracy by 5:00 p.m. EST including pricing,
expense accruals, cash activity, manual entries,
S/H activity. Delivery by 5:45 p.m. EST
3. Review of daily NAVs ( ) 100% review by 5:30 p.m. EST
( ) Review of NAV components for reasonableness
including analysis of the change in the NAV
and the change in mill rates.
( ) Review of price variance report
( ) Review of manual proof
4. NASDAQ Reporting ( ) 100% accuracy and communication by 5:45 p.m. EST
5. Daily Pricing and Rate Report (DPRR) ( ) 100% accuracy in nightly transmission of DPRRs
( ) Money Market Master Portfolios-5:30 p.m. EST
( ) All other Master Portfolios- 6:00 p.m. EST
6. FundStation Report (SubM) ( ) 100% accuracy and nightly transmission by 7:00 p.m. EST
7. Processing of trade tickets ( ) 100% accuracy and processed by T+1 if received by
the following cut-off times:
( ) All Master Portfolios (except International) - 10:00 am (T+1)
( ) International - 12:00 pm (T+1)
( ) Same day settlements - 1:30 pm
III-1
<PAGE>
8. Problem Resolution (general) ( ) NAV impact analysis within 1 day
( ) Clear and timely communication of 100% of issues
( ) Ongoing Tracking
9. Cash reconciliations ( ) Performed daily and sent daily to NBAI (Money Market
Master Portfolios) and sent weekly to NBAI (all
other Master Portfolios)
( ) Issues communicated to NBAI same day
( ) Outstanding items addressed within 1 business day
10. Position Reconciliations ( ) Performed daily and sent weekly to NBAI
( ) Issues communicated to NBAI same day
( ) Open issues addressed within 2 business days
11. Tax reporting
( ) Federal, state, tax returns ( ) Tax provision package prepared within time
parameters as set by NBAI/Independent tax
( ) Tax provision packages including Sub-M personnel (PWC)
and excise tax amounts/ distributions
( ) Estimates of tax requirements prepared as required
( ) Identification of all book/tax differences by NBAI for proper tax planning
( ) Capital gain estimate preparations
12. Statistical Reports ( ) Filed within the time parameters as set forth by
each statistical service
13. Expense accruals/payments ( ) Payments made on the business day written
instructions from an authorized signator received
( ) Expense accruals made with 100% accuracy based upon
written instructions from NBAI
III-2
<PAGE>
14. Management Reports ( ) Provided to NBAI within 10 business days of month end
15. Year end tax reports ( ) Provided to NBAI within the time frame agreed to
16. Annual/Semi-Annual Reports ( ) Provide Trial Balance within 5 business days after
annual/semi-annual period
( ) Provide additional financial statement support as
agreed to
17. Daily Reports ( ) To be provided on the following day
( ) Provide detailed portfolio valuation
( ) Trial Balance
18. Daily Cash Sweep ( ) 100% accuracy and communication by 2:00 p.m. EST
( ) Nations Cash Reserves
( ) AIM
( ) Nuveen
19. Post Dividends / Corporate Actions ( ) 100% accuracy and posted on effective date
20. Monthly Reconciliations ( ) Complete reconciliations within 10 business days
21. Reporting to Sub-Advisors ( ) Provide nightly and other periodic reporting to
Nations Funds Sub-Advisors
22. Compliance ( ) Provide compliance reports as requested by NBAI
</TABLE>
III-3
<PAGE>
SCHEDULE IV
(ATTACHED)
IV-1
<PAGE>
SCHEDULE V
All Database Companies Quarterly List
AMG Data Services Lipper
Barron's Morningstar
Bloomberg CDA Wiesenberger
CDA Wiesenberger Investment Company Institute
Commerce Clearing House (CCH) S&P Micropal
Forbes Institute for Economic Research
Institute for Economic Research Value Line
Interactive Data Services Media General Financial Services
Investment Company Institute LCG Associates
LCG Associates Closed End Fund Digest (Closed End Only)
Lipper Lipper - International (Closed End Only)
Media General
Moody's Investors Service
Morningstar
S&P Micropal
Strategic Insights
Value Line
V-1
PLACEMENT AGENCY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
111 Center Street
Little Rock, Arkansas 72201
May 21, 1999
Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
Dear Sirs:
This is to confirm that, in consideration of the agreements
hereinafter contained, the undersigned, Nations Master Investment Trust, a
Delaware business trust (the "Master Trust") consisting of the portfolios named
on Schedule 1 hereto, as such Schedule may be revised from time to time (each, a
"Master Portfolio"), has agreed that you shall be, for the period of this
Agreement, the exclusive placement agent for shares of beneficial interest of
each Master Portfolio.
1. You will act as agent for the private placement of interests of
each Master Portfolio covered by, and in accordance with, the registration
statement and prospectus then in effect under the Investment Company Act of
1940, as amended, and will transmit promptly any orders received by you for
purchase or redemption of interests of a Master Portfolio to the Transfer and
Dividend Disbursing Agent for the Master Trust of which the Master Trust has
notified you in writing. All orders from you shall be subject to acceptance and
confirmation by the Master Trust.
2. You shall act as exclusive placement agent for each Master
Portfolios' interests in compliance with all applicable laws, rules and
regulations, including, without limitation, all rules and regulations made or
adopted pursuant to the Investment Company Act of 1940, as amended, by the
Securities and Exchange Commission or any securities association registered
under the Securities Exchange Act of 1934, as amended.
3. Whenever in their judgment such action is warranted by market,
economic or political conditions, or by abnormal circumstances of any kind, the
Master Trust's officers may decline to accept any orders for, or make any sales
of, any of the Master Portfolios' interests until such time as they deem it
advisable to accept such orders and to make such sales and the Master Trust
shall advise you promptly of such determination.
4. Ownership of Master Portfolio interests sold hereunder shall be
registered in such names and denominations as are specified in writing to the
Master Trust or to its agent designated for the purpose. No certificates for
interests of the Master Portfolios will be issued.
5. The Master Trust agrees to pay all expenses in connection with
maintaining facilities for the issue and transfer of the Master Portfolios'
interests and for supplying information, prices and other data to be furnished
by the Master Trust hereunder, and all expenses in connection with preparing and
printing the Master Trust's prospectuses and statements of additional
information for regulatory
1
<PAGE>
purposes and for distribution to shareholders; provided, however, that nothing
contained herein shall be deemed to require the Master Trust to pay any of the
costs of advertising the sale of the Master Portfolios' interests. You shall pay
all other expenses incurred by you in connection with the sale of the Master
Portfolios' interests as contemplated in this agreement.
6. All interests offered for sale and sold by you shall be offered
for sale and sold by you to investors at the price per share (the "offering
price," which is the net asset value per share) specified and determined as
provided in the prospectus relating to the offering of relevant Master Portfolio
interests for sale. If the offering price is not an exact multiple of one cent,
it shall be adjusted to the nearest full cent. The Master Trust shall determine
and furnish promptly to you a statement of the offering price at least once on
each day on which the prospectus states the Master Trust is required to
determine the relevant Master Portfolio's net asset value for the purpose of
pricing purchase orders. Each offering price shall become effective at the time
and shall remain in effect during the period specified in the statement. Each
such statement shall show the basis of its computation. For purposes of
establishing the offering price, the Master Trust shall consider a purchase
order to have been presented to it at the time it was originally entered by you
for transmission to it, provided the original purchase order and your fulfilling
order to the Master Trust are appropriately time stamped or evidenced to show
the time of original entry and that your fulfilling order to the Master Trust is
received by the Master Trust within a time deemed by it to be reasonable after
the purchase order was originally entered. Purchases of interests shall be made
for full and fractional interests, carried to the third decimal place.
7. The Master Trust shall furnish you from time to time, for use
in connection with the sale of the Master Portfolios' interests, such
information with respect to the Master Trust and the Master Portfolios'
interests as you may reasonably request, all of which shall be signed by one or
more of the Master Trust's duly authorized officers; and the Master Trust
warrants that the statements contained in any such information, when so signed
by the Master Trust's officers, shall be true and correct. The Master Trust also
shall furnish you with copies of its reports to shareholders and such additional
information regarding a Master Portfolio's financial condition as you may
reasonably request from time to time.
8. The Master Trust represents to you that all registration
statements and prospectuses filed by the Master Trust with the Securities and
Exchange Commission under the Investment Company Act of 1940, as amended, with
respect to the Master Portfolios' interests have been carefully prepared in
conformity with the requirements of said Act and rules and regulations of the
Securities and Exchange Commission thereunder. As used in this agreement, the
terms "registration statement" and "prospectus" shall mean any registration
statement and prospectus, including the statement of additional information
incorporated by reference therein, filed with the Securities and Exchange
Commission and any amendments and supplements thereto which at any time shall
have been filed with said Commission. The Master Trust represents and warrants
to you that any registration statement and prospectus, when such registration
statement becomes effective, will contain all statements required to be stated
therein in conformity with said Act and the rules and regulations of said
Commission; that all statements of fact contained in any such registration
statement and prospectus will be true and correct when such registration
statement becomes effective; and that neither any registration statement nor any
prospectus when such registration statement becomes effective will include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading.
The Master Trust may, but shall not be obligated to, propose from time to time
such amendment or amendments to any registration statement and such supplement
or supplements to any prospectus as, in the light of future developments, may,
in the opinion of the Master Trust's counsel, be necessary or advisable. If the
Master Trust shall not propose such amendment or amendments and/or supplement or
supplements within fifteen days after receipt by the Master Trust of a written
request from you to do so, you may, at your option, terminate this agreement or
decline to make offers of the Master
2
<PAGE>
Portfolios' securities until such amendments are made. The Master Trust shall
not file any amendment to any registration statement or supplement to any
prospectus without giving you reasonable notice thereof in advance; provided,
however, that nothing contained in this agreement shall in any way limit the
Master Trust's right to file at any time such amendments to any registration
statement and/or supplements to any prospectus, of whatever character, as the
Master Trust may deem advisable, such right being in all respects absolute and
unconditional.
9. The Master Trust authorizes you to use any prospectus in the
form furnished to you from time to time, in connection with the sale of the
Master Portfolios' interests. The Master Trust agrees to indemnify, defend and
hold you, your several officers and directors, and any person who controls you
within the meaning of Section 15 of the Securities Act of 1933, as amended, free
and harmless from and against any and all claims, demands, liabilities and
expenses (including the cost of investigating or defending such claims, demands
or liabilities and any counsel fees incurred in connection therewith) which you,
your officers and directors, or any such controlling person, may incur under the
Securities Act of 1933, as amended, or under common law or otherwise, arising
out of or based upon any untrue statement, or alleged untrue statement, of a
material fact contained in any registration statement or any prospectus or
arising out of or based upon any omission, or alleged omission, to state a
material fact required to be stated in either any registration statement or any
prospectus or necessary to make the statements in either thereof not misleading;
provided, however, that the Master Trust's agreement to indemnify you, your
officers or directors, and any such controlling person shall not be deemed to
cover any claims, demands, liabilities or expenses arising out of any untrue
statement or alleged untrue statement or omission or alleged omission made in
any registration statement or prospectus in reliance upon and in conformity with
written information furnished to the Master Trust by you specifically for use in
the preparation thereof. The Master Trust's agreement to indemnify you, your
officers and directors, and any such controlling person, as aforesaid, is
expressly conditioned upon the Master Trust's being notified of any action
brought against you, your officers or directors, or any such controlling person,
such notification to be given by letter or by telegram addressed to the Master
Trust at its office in Charlotte, North Carolina within ten days after the
summons or other first legal process shall have been served. The failure so to
notify the Master Trust of any such action shall not relieve the Master Trust
from any liability which the Master Trust may have to the person against whom
such action is brought by reason of any such untrue, or alleged untrue,
statement or omission, or alleged omission, otherwise than on account of the
Master Trust's indemnity agreement contained in this paragraph 9. The Master
Trust will be entitled to assume the defense of any suit brought to enforce any
such claim, demand or liability, but, in such case, such defense shall be
conducted by counsel of good standing chosen by the Master Trust and approved by
you. In the event the Master Trust elects to assume the defense of any such suit
and retain counsel of good standing approved by you, the defendant or defendants
in such suit shall bear the fees and expenses of any additional counsel retained
by any of them; but in case the Master Trust does not elect to assume the
defense of any such suit, or in case you do not approve of counsel chosen by the
Master Trust, the Master Trust will reimburse you, your officers and directors,
or the controlling person or persons named as defendant or defendants in such
suit, for the fees and expenses of any counsel retained by you or them. The
Master Trust's indemnification agreement contained in this paragraph 9 and the
Master Trust's representations and warranties in this agreement shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of you, your officers and directors, or any controlling person, and
shall survive the delivery of any of the Master Portfolio's interests. This
agreement of indemnity will inure exclusively to your benefit, to the benefit of
your several officers and directors, and their respective estates, and to the
benefit of any controlling persons and their successors. The Master Trust agrees
promptly to notify you of the commencement of any litigation or proceedings
against the Master Trust or any of its officers or Trustees in connection with
the issue and sale of any of the Master Portfolio's interests.
3
<PAGE>
10. You agree to indemnify, defend and hold the Master Trust, its
several officers and Trustees, and any person who controls the Master Trust
within the meaning of Section 15 of the Securities Act of 1933, as amended, free
and harmless from and against any and all claims, demands, liabilities and
expenses (including the cost of investigating or defending such claims, demands
or liabilities and any counsel fees incurred in connection therewith) which the
Master Trust, its officers or Trustees, or any such controlling person, may
incur under the Securities Act of 1933, as amended, or under common law or
otherwise, but only to the extent that such liability or expense incurred by the
Master Trust, its officers or Trustees, or such controlling person resulting
from such claims or demands, shall arise out of or be based upon (a) any untrue,
or alleged untrue, statement of a material fact contained in information
furnished in writing by you to the Master Trust specifically for use in the
Master Trust's registration statement and used in the answers to any of the
items of the registration statement or in the corresponding statements made in
the prospectus, or shall arise out of or be based upon any omission, or alleged
omission, to state a material fact in connection with such information furnished
in writing by you to the Master Trust and required to be stated in such answers
or necessary to make such information not misleading or (b) any act or omission
or alleged act or omission on your part as the Master Trust's agent that has not
been expressly authorized by the Master Trust in writing. Your agreement to
indemnify the Master Trust, its officers and Trustees, and any such controlling
person, as aforesaid, is expressly conditioned upon your being notified of any
action brought against the Master Trust, its officers or Trustees, or any such
controlling person, such notification to be given by letter or telegram
addressed to you at your principal office in Little Rock, Arkansas within ten
days after the summons or other first legal process shall have been served. You
shall have the right to control the defense of such action, with counsel of your
own choosing, satisfactory to the Master Trust, if such action is based solely
upon such alleged misstatement or omission on your part, and in any other event
the Master Trust, its officers or Trustees or such controlling person shall each
have the right to participate in the defense or preparation of the defense of
any such action. The failure so to notify you of any such action shall not
relieve you from any liability which you may have to the Master Trust, its
officers or Trustees, or to such controlling person by reason of any such
untrue, or alleged untrue, statement or omission, or alleged omission, otherwise
than on account of your indemnity agreement contained in this paragraph 10.
11. None of the Master Portfolios' interests shall be offered by
either you or the Master Trust under any of the provisions of this agreement and
no orders for the purchase or sale of such interests hereunder shall be accepted
by the Master Trust if and so long as the effectiveness of the registration
statement then in effect or any necessary amendments thereto shall be suspended
under any of the provisions of the Investment Company Act of 1940, as amended;
provided, however, that nothing contained in this paragraph 11 shall in any way
restrict or have an application to or bearing upon the Master Trust's obligation
to repurchase any of the Master Portfolios' interests from any shareholder in
accordance with the provisions of the Master Trust's prospectus or Declaration
of Trust.
12. The Master Trust agrees to advise you immediately in writing:
(a) of any request by the Securities and Exchange Commission
for amendments to the registration statement or prospectus then in
effect or for additional information;
(b) in the event of the issuance by the Securities and
Exchange Commission of any stop order suspending the effectiveness of
the registration statement or prospectus then in effect or the
initiation of any proceeding for that purpose;
(c) of the happening of any event which makes untrue any
statement of a material fact made in the registration statement or
prospectus then in effect or which requires the making of a
4
<PAGE>
change in such registration statement or prospectus in order to make
the statements therein not misleading; and
(d) of all actions of the Securities and Exchange Commission
with respect to any amendments to any registration statement or
prospectus which may from time to time be filed with the Securities and
Exchange Commission.
13. Insofar as they concern the Master Trust, the Master Trust
shall comply with all applicable laws, rules and regulations, including, without
limiting the generality of the foregoing, all rules or regulations made or
adopted pursuant to the Investment Company Act of 1940, as amended, or by any
securities association registered under the Securities Exchange Act of 1934, as
amended.
14. You may, if you desire and at your own cost and expense,
appoint or employ agents to assist you in carrying out your obligations under
this agreement, but no such appointment or employment shall relieve you of any
of your responsibilities or obligations to the Master Trust under this
agreement.
15. As to each Master Portfolio, subject to the provisions of
Paragraph 8, this agreement shall continue until the date set forth opposite
such Master Portfolio's name on Schedule 1 hereto (the "Reapproval Date"), and
thereafter shall continue automatically for successive annual periods ending on
the day of each year set forth opposite such Master Portfolio's name on Schedule
1 hereto (the "Reapproval Day"), provided such continuance is specifically
approved at least annually by (i) the Master Trust's Board of Trustees or (ii)
vote of a majority (as defined in the Investment Company Act of 1940, as
amended) of the Master Trust's outstanding voting securities, provided that in
either event its continuance also is approved by a majority of the Master
Trust's trustees who are not "interested persons" (as defined in said Act) of
any party to this agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval. This agreement is terminable without
penalty, on 60 days' notice, by vote of holders of a majority of the Master
Trust's interests, and, as to each Master Portfolio, by the Master Trust's Board
of Trustees or by you. This agreement also will terminate automatically, as to
the relevant Master Portfolio, in the event of its assignment (as defined in
said Act).
16. This agreement has been executed on behalf of the Master Trust
by the undersigned officer of the Master Trust in his capacity as an officer of
the Master Trust. The obligations of this agreement shall only be binding upon
the assets and property of the relevant Master Portfolio, as provided for in the
Master Trust's Declaration of Trust, and shall not be binding upon any Trustee,
officer or shareholder of the Master Trust or a Master Portfolio individually.
5
<PAGE>
Please confirm that the foregoing is in accordance with your
understanding and indicate your acceptance hereof by signing below, whereupon it
shall become a binding agreement between us.
Very truly yours,
NATIONS MASTER INVESTMENT TRUST
By: /s/ Richard H. Blank, Jr.
-------------------------
Name: Richard H. Blank, Jr.
----------------------
Title: Secretary
----------------------
ACCEPTED:
STEPHENS INC.
By: /s/ Richard H. Blank, Jr.
-------------------------
Name: Richard H. Blank, Jr.
----------------------
Title: Senior Vice President
----------------------
6
<PAGE>
SCHEDULE I
NAME OF MASTER PORTFOLIO
Nations Intermediate Bond Master Portfolio
Nations Blue Chip Master Portfolio
Nations International Equity Master Portfolio
Nations Marsico Focused Equities Master Portfolio
Nations Marsico Growth & Income Master Portfolio
Nations International Value Master Portfolio
Nations High Yield Bond Master Portfolio
Adopted: December 2, 1998
Last Amended: February 14, 2000
7
CROSS INDEMNIFICATION AGREEMENT
THIS AGREEMENT is made as of the 14th day of February, 2000, by and
among Nations Fund, Inc. (the "Company"), a Maryland corporation, Nations Fund
Trust (the "Trust"), a Massachusetts business trust, Nations Reserves
("Reserves"), a Massachusetts business trust, Nations Master Investment Trust
(the "Master Trust"), a Delaware business trust and Nations Funds Trust ("Funds
Trust"), a Delaware business trust.
WHEREAS, the Company is an open-end management investment company
registered as such under the Investment Company Act of 1940 (the "1940 Act"),
currently consisting of seven operating investment portfolios, but which may
from time to time consist of a greater or lesser number of investment
portfolios; and
WHEREAS, the Trust is an open-end management investment company
registered as such under the 1940 Act, currently consisting of thirty-six
operating investment portfolios, but which may from time to time consist of a
greater or lesser number of investment portfolios; and
WHEREAS, Reserves is an open-end management investment company
registered as such under the 1940 Act, currently consisting of sixteen operating
investment portfolios, but which may from time to time consist of a greater or
lesser number of investment portfolios; and
WHEREAS, the Master Trust is an open-end management investment company
registered as such under the 1940 Act, currently consisting of seven operating
investment portfolios, but which may from time to time consist of a greater or
lesser number of investment portfolios; and
WHEREAS, Funds Trust is an open-end management investment company
registered as such under the Investment Company Act of 1940 (the "1940 Act"),
currently consisting of three operating investment portfolios, but which may
from time to time consist of a greater or lesser number of investment
portfolios; and
WHEREAS, the Company, the Trust, Reserves and Funds Trust plan to
offer, on a continuous basis, shares of common stock, units of beneficial
interest, units of beneficial interests and units of beneficial interests,
respectively, in their investment portfolios ("Securities") in a combined set of
prospectuses ("Prospectuses") and/or preliminary prospectuses ("Preliminary
Prospectuses") (such offering of Securities to be hereinafter referred to as the
"Joint Offering") and plan to file, from time to time, such combined set of
prospectuses and other materials with the Securities and Exchange Commission
("SEC") (such filings with the SEC to be referred to herein as the "Registration
Statements");
WHEREAS, certain information relating to the Master Trust must be
included in the prospectuses of Reserves and Funds Trust and therefore will be
included in the Joint Offerings and Registration Statements;
<PAGE>
NOW THEREFORE, the Company, the Trust, Reserves, the Master Trust and
Funds Trust hereby agree as follows:
(1) (a) The Company will indemnify and hold harmless the Trust,
Reserves, the Master Trust and Funds Trust against any losses,
claims, damages or liabilities, to which the Trust, Reserves,
the Master Trust or Funds Trust may become subject under the
Securities Act of 1933 (the "Act"), the 1940 Act or otherwise,
insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material
fact contained in any Prospectuses, any Preliminary
Prospectuses, the Registration Statements, any other
Prospectuses relating to the Securities, or any amendments or
supplements to the foregoing (hereinafter referred to
collectively as the "Offering Documents"), or arise out of or
are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or
alleged omission was made in the Offering Documents in
reliance upon and in conformity with written information
furnished to the Trust, Reserves, the Master Trust or Funds
Trust by the Company expressly for use therein; and will
reimburse the Trust, Reserves, the Master Trust and Funds
Trust for any legal or other expenses reasonably incurred by
the Trust, Reserves, the Master Trust or Funds Trust in
connection with investigating or defending any such action or
claim; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim,
damage, or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged
omission made in the Offering Documents in reliance upon and
in conformity with written information furnished to the
Company by the Trust, Reserves, the Master Trust or Funds
Trust expressly for use in the Offering Documents.
(b) The Trust will indemnify and hold harmless the Company,
Reserves, the Master Trust and Funds Trust against any losses,
claims, damages or liabilities to which the Company, Reserves,
the Master Trust or Funds Trust may become subject under the
Act, the 1940 Act, or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon and untrue statement or alleged
untrue statement of a material fact contained in the Offering
Documents or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to
be stated or necessary to make the statements therein not
misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in the Offering
Documents in reliance upon and in conformity with written
information furnished to the Company, Reserves, the Master
Trust or Funds Trust by the Trust expressly for use therein;
and will reimburse the Company,
<PAGE>
Reserves, the Master Trust and Funds Trust for any legal or
other expenses reasonably incurred by the Company, Reserves,
the Master Trust or Funds Trust in connection with
investigating or defending any such action or claim; provided,
however, that the Trust shall not be liable in any such case
to the extent that any such loss, claim, damage, or liability
arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the
Offering Documents in reliance upon and in conformity with
written information furnished to the Trust by the Company,
Reserves, the Master Trust or Funds Trust expressly for use in
the Offering Documents.
(c) Reserves will indemnify and hold harmless the Company, the
Trust, the Master Trust and Funds Trust against any losses,
claims, damages or liabilities to which the Company, the
Trust, the Master Trust or Funds Trust may become subject
under the Act, the 1940 Act, or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in the
Offering Documents or arise out of or are based upon the
omission or alleged omission to state therein a material fact
required to be stated or necessary to make the statements
therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the
Offering Documents in reliance upon and in conformity with
written information furnished to the Company, the Trust, the
Master Trust or Funds Trust by Reserves expressly for use
therein; and will reimburse the Company, the Trust, the Master
Trust and Funds Trust for any legal or other expenses
reasonably incurred by the Company, the Trust, the Master
Trust or Funds Trust in connection with investigating or
defending any such action or claim; provided, however, that
Reserves shall not be liable in any such case to the extent
that any such loss, claim, damage, or liability arises out of
or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in the Offering
Documents in reliance upon and in conformity with written
information furnished to Reserves by the Company, the Trust,
the Master Trust or Funds Trust for use in the Offering
Documents.
(d) The Master Trust will indemnify and hold harmless the
Company, the Trust, Reserves and Funds Trust against any
losses, claims, damages or liabilities to which the Company,
the Trust, Reserves or Funds Trust may become subject under
the Act, the 1940 Act, or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the Offering
Documents or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to
be stated or necessary to make the statements therein not
misleading, in each case to the extent, but only to the
extent,
<PAGE>
that such untrue statement or alleged untrue statement or
omission or alleged omission was made in the Offering
Documents in reliance upon and in conformity with written
information furnished to the Company, the Trust, Reserves or
Funds Trust by the Master Trust expressly for use therein; and
will reimburse the Company, the Trust, Reserves and Funds
Trust for any legal or other expenses reasonably incurred by
the Company, the Trust, Reserves or Funds Trust in connection
with investigating or defending any such action or claim;
provided, however, that the Master Trust shall not be liable
in any such case to the extent that any such loss, claim,
damage, or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged
omission made in the Offering Documents in reliance upon and
in conformity with written information furnished to the Master
Trust by the Company, the Trust, Reserves or Funds Trust for
use in the Offering Documents.
(e) Funds Trust will indemnify and hold harmless the Company,
the Trust, Reserves and the Master Trust against any losses,
claims, damages or liabilities to which the Company, the
Trust, Reserves or the Master Trust may become subject under
the Act, the 1940 Act, or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the Offering
Documents or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to
be stated or necessary to make the statements therein not
misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in the Offering
Documents in reliance upon and in conformity with written
information furnished to the Company, the Trust, Reserves or
the Master Trust by Funds Trust expressly for use therein; and
will reimburse the Company, the Trust, Reserves and the Master
Trust for any legal or other expenses reasonably incurred by
the Company, the Trust, Reserves or the Master Trust in
connection with investigating or defending any such action or
claim; provided, however, that Reserves shall not be liable in
any such case to the extent that any such loss, claim, damage,
or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged
omission made in the Offering Documents in reliance upon and
in conformity with written information furnished to Funds
Trust by the Company, the Trust, Reserves or the Master Trust
for use in the Offering Documents.
(f) Promptly after receipt by an indemnified party under
subsection (a), (b),(c), (d) or (e) above of notice of the
commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against an indemnifying
party or parties
<PAGE>
under such subsection, notify the indemnifying party or
parties in writing of the commencement thereof; but the
omission to so notify the indemnifying party or parties shall
not relieve it or them from any liability which it or they may
have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against
any indemnified party and it shall notify the indemnifying
party or parties of the commencement thereof, the indemnifying
party or parties shall be entitled to participate therein and,
to the extent that either indemnifying party or both shall
wish, to assume the defense thereof, with counsel satisfactory
to such indemnified party, and, after notice from the
indemnifying party or parties to such indemnified part of its
or their election so to assume the defense thereof, the
indemnifying party or parties shall not be liable to such
indemnified party under such subsection for any legal expenses
of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection
with the defense thereof other than reasonable costs of
investigation.
(2) This agreement may be executed simultaneously in five or
more counterparts, each of which shall be deemed an original,
but all of which taken together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly executed by their authorized officers designated below as of the day and
year first written above.
NATIONS FUND, INC.
By:/s/ A. Max Walker
------------------------
A. Max Walker
Chairman of the Board of Directors
NATIONS FUND TRUST
By:/s/ A. Max Walker
------------------------
A. Max Walker
Chairman of the Board of Trustees
NATIONS RESERVES
By:/s/ A. Max Walker
------------------------
A. Max Walker
Chairman of the Board of Trustees
<PAGE>
NATIONS MASTER INVESTMENT TRUST
By:/s/ A. Max Walker
------------------------
A. Max Walker
Chairman of the Board of Trustees
NATIONS FUNDS TRUST
By:/s/ A. Max Walker
------------------------
A. Max Walker
Chairman of the Board of Trustees
POWER OF ATTORNEY
Edmund L. Benson, III, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Edmund L. Benson, III
-------------------------
Edmund L. Benson, III
<PAGE>
POWER OF ATTORNEY
William P. Carmichael, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., James E. Banks,
Jr., Robert M. Kurucza, Marco E. Adelfio and Steven G. Cravath, each
individually, his true and lawful attorneys and agents, with power of
substitution or resubstitution, to do any and all acts and things and to execute
any and all instruments which said attorneys and agents, each individually, may
deem necessary or advisable or which may be required to enable Nations LifeGoal
Funds, Inc., Nations Annuity Trust, Nations Master Investment Trust and Nations
Funds Trust (each a Company and collectively the "Companies"), to comply with
the Investment Company Act of 1940, as amended, and the Securities and Exchange
Act of 1933, as amended (together the "Acts"), and any other applicable federal
securities laws, or rules, regulations or requirements of the Securities and
Exchange Commission in respect thereof, in connection with the filing and
effectiveness of each Company's Registration Statement on Form N-1A pursuant to
the Acts, and any and all amendments thereto, and to determine the states in
which appropriate filings should be made and to take any and all necessary and
appropriate actions to make any and all such filings, and any and all amendments
thereto, including specifically, but without limiting the generality of the
foregoing, the power and authority to sign in the name and on behalf of the
undersigned as a director/trustee of the Companies, such Registration Statement
and filings, any and all exemptive applications under the Acts, and any and all
amendments and any other instruments or documents related thereto, and the
undersigned does hereby ratify and confirm all that said attorneys and agents,
individually or collectively, shall do or cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ William P. Carmichael
-------------------------
William P. Carmichael
<PAGE>
POWER OF ATTORNEY
James Ermer, whose signature appears below, does hereby constitute
and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M. Kurucza, Marco
E. Adelfio and Steven G. Cravath, each individually, his true and lawful
attorneys and agents, with power of substitution or resubstitution, to do any
and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ James Ermer
---------------
James Ermer
<PAGE>
POWER OF ATTORNEY
William H. Grigg, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ William H. Grigg
--------------------
William H. Grigg
<PAGE>
POWER OF ATTORNEY
Thomas F. Keller, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Thomas F. Keller
--------------------
Thomas F. Keller
<PAGE>
POWER OF ATTORNEY
Dr. Cornelius J. Pings, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., James E. Banks,
Jr., Robert M. Kurucza, Marco E. Adelfio and Steven G. Cravath, each
individually, his true and lawful attorneys and agents, with power of
substitution or resubstitution, to do any and all acts and things and to execute
any and all instruments which said attorneys and agents, each individually, may
deem necessary or advisable or which may be required to enable Nations Fund
Trust, Nations Fund, Inc., Nations Reserves, Nations LifeGoal Funds, Inc.,
Nations Annuity Trust, Nations Master Investment Trust and Nations Funds Trust
(each a Company and collectively the "Companies"), to comply with the Investment
Company Act of 1940, as amended, and the Securities and Exchange Act of 1933, as
amended (together the "Acts"), and any other applicable federal securities laws,
or rules, regulations or requirements of the Securities and Exchange Commission
in respect thereof, in connection with the filing and effectiveness of each
Company's Registration Statement on Form N-1A pursuant to the Acts, and any and
all amendments thereto, and to determine the states in which appropriate filings
should be made and to take any and all necessary and appropriate actions to make
any and all such filings, and any and all amendments thereto, including
specifically, but without limiting the generality of the foregoing, the power
and authority to sign in the name and on behalf of the undersigned as a
director/trustee of the Companies, such Registration Statement and filings, any
and all exemptive applications under the Acts, and any and all amendments and
any other instruments or documents related thereto, and the undersigned does
hereby ratify and confirm all that said attorneys and agents, individually or
collectively, shall do or cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Dr. Cornelius J. Pings
--------------------------
Dr. Cornelius J. Pings
<PAGE>
POWER OF ATTORNEY
A. Max Walker, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ A. Max Walker
-----------------
A. Max Walker
<PAGE>
POWER OF ATTORNEY
Charles B. Walker, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Charles B. Walker
---------------------
Charles B. Walker
<PAGE>
POWER OF ATTORNEY
Thomas S. Word, Jr., whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio, and Steven G. Cravath, each individually, his true
and lawful attorneys and agents, with power of substitution or resubstitution,
to do any and all acts and things and to execute any and all instruments which
said attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Thomas S. Word, Jr.
-----------------------
Thomas S. Word, Jr.
<PAGE>
POWER OF ATTORNEY
Carl E. Mundy, Jr., whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Carl E. Mundy, Jr.
----------------------
Carl E. Mundy, Jr.
<PAGE>
POWER OF ATTORNEY
James B. Sommers, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ James B. Sommers
--------------------
James. B. Sommers
