As filed with the Securities and Exchange Commission
on April 30, 1999
Registration No. 33-4038; 811-4614
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 |_|
Post-Effective Amendment No. 42 |X|
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 |_|
Amendment No. 43 |X|
(Check appropriate box or boxes)
------------------------
NATIONS FUND, INC.
(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) 321-7854
Richard H. Blank, Jr.
c/o Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
(Name and Address of Agent for Service)
With copies to:
Robert M. Kurucza, Esq. Carl Frischling, Esq.
Marco E. Adelfio, Esq. Kramer, Levin, Naftalis
Morrison & Foerster LLP & Frankel
2000 Pennsylvania Ave., N.W., Suite 5500 919 Third Avenue
Washington, D.C. 20006 New York, New York 10022
It is proposed that this filing will become effective (check appropriate box):
|_| Immediately upon filing pursuant to Rule 485(b); or |_| on (date) pursuant
to Rule 485(b), or
|X| 60 days after filing pursuant to Rule 485(a), or |_| on (date) pursuant
to Rule 485(a)
|_| 75 days after filing pursuant to paragraph (a)(2) |_| on (date) pursuant
to paragraph
(a)(2) of
Rule 485
If appropriate, check the following box:
|_| this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
<PAGE>
EXPLANATORY NOTE
The Registrant is filing this Post-Effective Amendment No. 42 to the
Registration Statement of Nations Fund, Inc. (the "Company") for the purpose of
filing the prospectus for the Nations Money Market Funds prepared under new Form
N-1A. The Statement of Additional Information is incorporated by reference from
Post-Effective Amendment No. 41 as filed on April 16, 1999.
<PAGE>
NATIONS FUND, INC.
CROSS REFERENCE SHEET
<TABLE>
<CAPTION>
Part A
Item No. Prospectus
- -------- ----------
<S> <C> <C>
1. Front and Back Cover Pages ..................... Front and Back Cover Pages
2. Risk/Return Summary: Investments, Risks
and Performance.................................. About this Prospectus
3. Risk/Return Summary: Fee Tables................... About the Funds; Financial Highlights
4. Investment Objectives, Principal
Investment Strategies, and Related Risks......... About the Funds; Other Important
Information
5. Management's Discussion of Fund
Performance...................................... About the Funds
6. Management, Organization, and
Capital Structure................................ What's Inside; About the Funds;
How the Funds Are Managed;
About your Investment
7. Shareholder Information.......................... About the Funds; About your
Investment
8. Distribution Arrangements........................ Information for Investors
9. Financial Highlights Information................. Financial Highlights; About the Funds
Part B
Item No.
- --------
10. Cover Page and Table of Contents................. Cover Page and Table of Contents
11. Fund History..................................... Introduction
<PAGE>
12. Description of the Fund and Its
Investments and Risks............................ Additional Information on Portfolio
Investments
13. Management of the Funds.......................... Trustees And Officers; Investment
Advisory, Administration, Custody Transfer
Agency, Shareholder Servicing and Distribution
Agreements
14. Control Persons and Principal
Holders of Securities............................ Not Applicable
15. Investment Advisory and Other Services........... Investment Advisory,
Administration, Custody, Transfer Agency,
Shareholder Servicing And Distribution Agreements
16. Brokerage Allocation and Other Practices......... Portfolio Transactions and
Brokerage--General Brokerage Policy
17. Capital Stock and Other
Securities....................................... Description Of Shares;
Investment Advisory, Administration, Custody,
Transfer Custody, Transfer Agency, Shareholder
Servicing And Distribution Agreements
18. Purchase, Redemption and Pricing
of Shares........................................ Net Asset Value -- Purchases
And Redemptions; Distributor
19. Taxation of the Fund............................. Additional Information Concerning
Taxes
20. Underwriters..................................... Investment Advisory,
Administration Custody, Transfer Agency
Shareholder Servicing And Distribution
Agreements; Distributor
21. Calculation of Performance Data.................. Additional Information on
Performance
22. Financial Statements............................. Independent Accountant and
Reports
Part C
Item No. Other Information
- -------- -----------------
Information required to be
included in Part C is set
forth under the
appropriate Item, so
numbered, in Part C of
this Document
</TABLE>
<PAGE>
[GRAPHIC APPEARS HERE]
MONEY MARKET FUNDS
PROSPECTUS
AUGUST 1, 1999
Money Market Funds
NATIONS PRIME FUND
NATIONS TREASURY FUND
NATIONS GOVERNMENT MONEY MARKET FUND
NATIONS TAX EXEMPT FUND
o DAILY SHARES
THE SECURITIES AND EXCHANGE COMMISSION (SEC) HAS NOT APPROVED OR DISAPPROVED
THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
[GRAPHIC APPEARS HERE]
NOT FDIC INSURED
May Lose Value
No Bank Guarantee
[NATIONS FUND LOGO APPEARS HERE]
<PAGE>
ABOUT THIS PROSPECTUS
- --------------------------------------------------------------------------------
[GRAPHIC APPEARS HERE]
TERMS USED IN THIS PROSPECTUS
IN THIS PROSPECTUS, WE, US AND OUR REFER TO THE NATIONS FUNDS
FAMILY (NATIONS FUNDS). SOME OTHER IMPORTANT TERMS WE'VE USED
MAY BE NEW TO YOU. THESE ARE PRINTED IN ITALICS WHERE THEY FIRST
APPEAR IN A SECTION AND ARE DESCRIBED IN TERMS USED IN THIS
PROSPECTUS.
[GRAPHIC APPEARS HERE]
YOU'LL FIND TERMS USED IN
THIS PROSPECTUS ON PAGE 0.
[GRAPHIC APPEARS HERE]
FOR MORE INFORMATION
YOU'LL FIND MORE INFORMATION ABOUT THE FUNDS IN THE STATEMENT OF
ADDITIONAL INFORMATION (SAI). THE SAI INCLUDES DETAILED
INFORMATION ABOUT EACH FUND'S INVESTMENTS, POLICIES, PERFORMANCE
AND MANAGEMENT, AMONG OTHER THINGS. THE SAI IS LEGALLY
CONSIDERED TO BE PART OF THIS PROSPECTUS BECAUSE IT'S
INCORPORATED BY REFERENCE. TURN TO THE BACK COVER TO FIND OUT
HOW YOU CAN GET A COPY OF THE SAI.
This booklet, which is called a prospectus, tells you about some of the Nations
Funds money market funds. Please read it carefully because it contains
information that's designed to help you make informed investment decisions.
The Funds seek to provide income while protecting your original investment by
investing in MONEY MARKET INSTRUMENTS. Money market instruments include
short-term DEBT SECURITIES that are either government guaranteed or have
relatively low risk. However, your investment and return aren't guaranteed.
Your return will vary as short-term interest rates change. Over time, the
return on these Funds may be lower than the return on other kinds of mutual
funds or investments.
This makes these Funds best suited for investors who are looking for a low risk
investment with stability of principal, or have short-term investment needs.
These Funds may not be suitable for investors who are looking for higher
returns, or are more comfortable with bank deposits that are FDIC insured.
You'll find a discussion of each Fund's principal investments, strategies and
risks in the Fund descriptions that start on page 0.
If you have any questions about the Funds, please call us at 1.800.321.7854 or
contact your investment professional.
[NATIONS FUND LOGO APPEARS HERE]
2
<PAGE>
WHAT'S INSIDE
- --------------------------------------------------------------------------------
[GRAPHIC APPEARS HERE]
BANC OF AMERICA ADVISORS, INC.
(BAAI) IS THE INVESTMENT ADVISER TO EACH OF THE FUNDS. BAAI IS
RESPONSIBLE FOR THE OVERALL MANAGEMENT AND SUPERVISION OF THE
INVESTMENT MANAGEMENT OF EACH FUND. BAAI AND NATIONS FUNDS HAVE
ENGAGED A SUB-ADVISER -- TRADESTREET INVESTMENT ASSOCIATES,
INC. (TRADESTREET), WHICH IS RESPONSIBLE FOR THE DAY-TO-DAY
INVESTMENT DECISIONS FOR EACH OF THE FUNDS.
[GRAPHIC APPEARS HERE]
YOU'LL FIND MORE ABOUT
BAAI AND TRADESTREET
STARTING ON PAGE 0.
THE MONEY MARKET FUNDS SEEK TO PROVIDE INCOME WHILE PROTECTING
YOUR INVESTMENT BY INVESTING IN MONEY MARKET INSTRUMENTS.
<TABLE>
[GRAPHIC APPEARS HERE]
About the funds
<S> <C>
Money Market Funds
NATIONS PRIME FUND 4
Sub-adviser: TradeStreet Investment Associates, Inc.
- ------------------------------------------------------
NATIONS TREASURY FUND 7
Sub-adviser: TradeStreet Investment Associates, Inc.
- ------------------------------------------------------
NATIONS GOVERNMENT MONEY MARKET FUND 10
Sub-adviser: TradeStreet Investment Associates, Inc.
- ------------------------------------------------------
NATIONS TAX EXEMPT FUND 13
Sub-adviser: TradeStreet Investment Associates, Inc.
- ------------------------------------------------------
OTHER IMPORTANT INFORMATION 16
- ------------------------------------------------------
HOW THE FUNDS ARE MANAGED 18
[GRAPHIC APPEARS HERE]
About your investment
INFORMATION FOR INVESTORS
Buying, selling and exchanging shares 20
How selling agents are paid 27
Distributions and taxes 28
- ------------------------------------------------------ --
FINANCIAL HIGHLIGHTS 30
- ------------------------------------------------------ --
TERMS USED IN THIS PROSPECTUS 31
- ------------------------------------------------------ --
WHERE TO FIND MORE INFORMATION BACK COVER
</TABLE>
3
<PAGE>
ABOUT THE MONEY MARKET FUNDS
- --------------------------------------------------------------------------------
[GRAPHIC APPEARS HERE]
ABOUT THE SUB-ADVISER
TRADESTREET IS THIS FUND'S SUB-ADVISER. TRADESTREET'S TAXABLE
MONEY MARKET MANAGEMENT TEAM MAKES THE DAY-TO-DAY INVESTMENT
DECISIONS FOR THE FUND.
[GRAPHIC APPEARS HERE]
YOU'LL FIND MORE ABOUT
TRADESTREET ON PAGE 0.
[GRAPHIC APPEARS HERE]
LIMITS ON INVESTMENTS
THIS FUND, LIKE ALL MONEY MARKET FUNDS, MUST COMPLY WITH RULE
2A-7 UNDER THE 1940 ACT, WHICH SETS OUT CERTAIN LIMITS ON
INVESTMENTS. THESE ARE DESCRIBED IN OTHER IMPORTANT
INFORMATION.
Nations Prime Fund
[GRAPHIC APPEARS HERE]
INVESTMENT OBJECTIVE
This Fund seeks the maximization of current income to the extent
consistent with the preservation of capital and maintenance of
liquidity.
[GRAPHIC APPEARS HERE]
PRINCIPAL INVESTMENT STRATEGIES
This Fund generally invests in a diversified portfolio of high quality
money market instruments that, at the time of investment, have remaining
maturities of 397 days or less.
These instruments consist primarily of:
o COMMERCIAL PAPER
o BANK OBLIGATIONS
o short-term CORPORATE OBLIGATIONS, including instruments issued by certain
trusts, partnerships or other SPECIAL PURPOSE ISSUERS, including PASS-
THROUGH CERTIFICATES representing PARTICIPATIONS in, or debt instruments
backed by, the securities and other assets owned by these issuers
o GUARANTEED INVESTMENT CONTRACTS
o short-term taxable MUNICIPAL SECURITIES
o REPURCHASE AGREEMENTS secured by FIRST-TIER SECURITIES or U.S. GOVERNMENT
OBLIGATIONS
o other INVESTMENT COMPANY SECURITIES
The Fund may also invest in other money market funds, consistent with its
investment objective and strategies, and in obligations of U.S. banks, foreign
branches of U.S. banks and U.S. branches of foreign banks.
The Fund will only buy first-tier securities. The Fund may also invest up to
10% of its assets in other kinds of securities, which are described in the SAI.
The portfolio management team tries to maintain a constant net asset value of
$1.00 per share for the Fund. The team uses extensive research, including
economic, technical and security analysis to select individual investments.
o Economic analysis includes reviewing global economic conditions, as well
as the direction of interest rates.
o Technical analysis includes looking for yield and sector opportunities,
and evaluating changes in the supply of the instruments in which the Fund
may invest.
o Security analysis includes evaluating the credit quality of an instrument.
4
<PAGE>
[GRAPHIC APPEARS HERE]
YOU'LL FIND MORE ABOUT
OTHER RISKS OF INVESTING IN
THIS FUND ON PAGE 0 AND
IN THE SAI.
[GRAPHIC APPEARS HERE]
THE BAR CHART SHOWS YOU THE PERFORMANCE OF THE FUND'S DAILY
SHARES. THESE RETURNS DO NOT REFLECT DEDUCTIONS OF ACCOUNT FEES,
IF ANY, AND WOULD BE LOWER IF THEY DID.
CALL US AT 1.800.321.7854 OR CONTACT YOUR INVESTMENT
PROFESSIONAL FOR THE FUND'S CURRENT 7-DAY YIELD.
[GRAPHIC APPEARS HERE]
RISKS AND OTHER THINGS TO CONSIDER
Nations Prime Fund has the following general risks:
o INVESTMENT STRATEGY RISK -- Although the Fund tries to maintain a
share price of $1.00, an investment in the Fund may lose money. AN
INVESTMENT IN THIS FUND IS NOT A BANK DEPOSIT AND IS NOT INSURED OR
GUARANTEED BY NATIONSBANK, N.A., (NATIONSBANK), BANK OF AMERICA
NATIONAL TRUST AND SAVINGS ASSOCIATION (BANK OF AMERICA), THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY.
o INCOME PAYMENT RISK -- The ability of the Fund to pay dividends
depends on the ability of the issuers of the securities the Fund
holds to pay interest or repay principal when it's due. Any cash the
Fund holds does not earn income.
[GRAPHIC APPEARS HERE]
A LOOK AT THE FUND'S PERFORMANCE
Looking at past performance can give you an idea of a Fund's volatility
and its average returns over time. Performance will vary based on a
number of factors, including market conditions, the composition of the
Fund's holdings and the Fund's expenses. A FUND'S PAST PERFORMANCE IS NO
GUARANTEE OF HOW IT WILL PERFORM IN THE FUTURE.
YEAR BY YEAR TOTAL RETURN (%)
[CHART APPEARS HERE]
00% 00% 00% 00% 00% 00% 00%
- -----------------------------------------------------------------
1900 1900 1900 1900 1900 1900 1900
BEST AND WORST QUARTERLY RETURNS DURING THIS PERIOD:
<TABLE>
<S> <C>
Best -- 0 quarter 1900: 0%
Worst -- 0 quarter 1900: 0%
Year-to-date return as of 00: .00%
7-day yield as of December 31, 1998: 0.00%
</TABLE>
AVERAGE ANNUAL TOTAL RETURN AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
1 year 5 years 10 years
<S> <C> <C> <C>
Daily Shares 0.00% 0.00% 0.00%
[benchmark] 0.00% 0.00% 0.00%
[benchmark description]
</TABLE>
5
<PAGE>
[GRAPHIC APPEARS HERE]
THERE ARE TWO KINDS OF FEES -- THOSE YOU PAY DIRECTLY, AND
ONGOING FEES AND EXPENSES THAT ARE DEDUCTED FROM THE FUND'S
ASSETS.
[GRAPHIC APPEARS HERE]
THIS IS AN EXAMPLE ONLY. YOUR ACTUAL COSTS COULD BE HIGHER OR
LOWER, DEPENDING ON THE AMOUNT YOU INVEST, AND ON THE FUND'S
ACTUAL EXPENSES AND PERFORMANCE.
[GRAPHIC APPEARS HERE]
WHAT IT COSTS TO INVEST IN THE FUND
<TABLE>
<CAPTION>
Daily
Fees you pay directly Shares
<S> <C>
Maximum sales charge (load)
when you buy your shares none
Maximum deferred sales charge (load)
when you sell your shares none
Ongoing fees and expenses deducted from the Fund's assets
(the Fund's operating expenses)(1)
Management fees 0.00%
Distribution (12b-1) and service fees 0.00%
Other expenses 0.00%
Total annual fund operating expenses 0.00%
</TABLE>
(1)The Fund's investment adviser and some of its other service providers
have agreed to waive fees or reimburse expenses until August 1, 2000.
The figures shown here are after waivers and reimbursements. Total
actual Fund operating expenses last year were 0.00% for Daily Shares.
There is no guarantee that these waivers and reimbursements will
continue after this date.
EXAMPLE
This example is designed to help you compare the cost of investing in
this Fund with the cost of investing in other mutual funds.
This example assumes:
o you invest $10,000 in Daily Shares of the Fund
o your investment has a 5% return each year
o the Fund's operating expenses remain the same as shown in the table
above.
If you sold all your shares at the end of the period, your costs would
be:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
<S> <C> <C> <C> <C>
Daily Shares $000 $000 $000 $000
</TABLE>
6
<PAGE>
ABOUT THE MONEY MARKET FUNDS
- --------------------------------------------------------------------------------
[GRAPHIC APPEARS HERE]
ABOUT THE SUB-ADVISER
TRADESTREET IS THIS FUND'S SUB-ADVISER. TRADESTREET'S TAXABLE
MONEY MARKET MANAGEMENT TEAM MAKES THE DAY-TO-DAY INVESTMENT
DECISIONS FOR THE FUND.
[GRAPHIC APPEARS HERE]
YOU'LL FIND MORE ABOUT
TRADESTREET ON PAGE 0.
[GRAPHIC APPEARS HERE]
LIMITS ON INVESTMENTS
THIS FUND, LIKE ALL MONEY MARKET FUNDS, MUST COMPLY WITH RULE
2A-7 UNDER THE 1940 ACT, WHICH SETS OUT CERTAIN LIMITS ON
INVESTMENTS. THESE ARE DESCRIBED IN OTHER IMPORTANT
INFORMATION.
Nations Treasury Fund
[GRAPHIC APPEARS HERE]
INVESTMENT OBJECTIVE
This Fund's investment objective is the maximization of current income
to the extent consistent with the preservation of capital and
maintenance of liquidity.
[GRAPHIC APPEARS HERE]
PRINCIPAL INVESTMENT STRATEGIES
This Fund generally invests in a diversified portfolio of high quality
money market instruments that, at the time of investment, have remaining
maturities of 397 days or less.
These instruments include U.S. TREASURY OBLIGATIONS, and REPURCHASE AGREEMENTS
and REVERSE REPURCHASE AGREEMENTS secured by U.S Treasury obligations. The
Fund also invests in obligations whose principal and interest are backed by
the U.S. government.
The Fund normally invests at least 65% of its assets in U.S. Treasury
obligations and repurchase agreements. The Fund may also invest in other money
market funds, consistent with its investment objective and policies.
The Fund will only buy first-tier securities. The Fund may also invest up to
10% of its assets in other kinds of securities, which are described in the SAI.
The portfolio management team tries to maintain a constant net asset value of
$1.00 per share for the Fund. The team uses extensive research, including
economic, technical and security analysis to select individual investments.
o Economic analysis includes reviewing global economic conditions, as well
as the direction of interest rates.
o Technical analysis includes looking for yield and sector opportunities,
and evaluating changes in the supply of the instruments in which the Fund
may invest.
o Security analysis includes evaluating the credit quality of an instrument.
7
<PAGE>
[GRAPHIC APPEARS HERE]
YOU'LL FIND MORE ABOUT
OTHER RISKS OF INVESTING IN
THIS FUND ON PAGE 0 AND
IN THE SAI.
[GRAPHIC APPEARS HERE]
THE BAR CHART SHOWS YOU THE PERFORMANCE OF THE FUND'S DAILY
SHARES. THESE RETURNS DO NOT REFLECT DEDUCTIONS OF ACCOUNT FEES,
IF ANY, AND WOULD BE LOWER IF THEY DID.
CALL US AT 1.800.321.7854 OR CONTACT YOUR INVESTMENT
PROFESSIONAL FOR THE FUND'S CURRENT 7-DAY YIELD.
[GRAPHIC APPEARS HERE]
RISKS AND OTHER THINGS TO CONSIDER
Nations Treasury Fund has the following general risks:
o INVESTMENT STRATEGY RISK -- Although the Fund tries to maintain a
share price of $1.00, an investment in the Fund may lose money. AN
INVESTMENT IN THIS FUND IS NOT A BANK DEPOSIT AND IS NOT INSURED OR
GUARANTEED BY NATIONSBANK, N.A., (NATIONSBANK), BANK OF AMERICA
NATIONAL TRUST AND SAVINGS ASSOCIATION (BANK OF AMERICA), THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY.
o INCOME PAYMENT RISK -- The ability of the Fund to pay dividends
depends on the ability of the issuers of the securities the Fund
holds to pay interest or repay principal when it's due. Any cash the
Fund holds does not earn income.
[GRAPHIC APPEARS HERE]
A LOOK AT THE FUND'S PERFORMANCE
Looking at past performance can give you an idea of a Fund's volatility
and its average returns over time. Performance will vary based on a
number of factors, including market conditions, the composition of the
Fund's holdings and the Fund's expenses. A FUND'S PAST PERFORMANCE IS NO
GUARANTEE OF HOW IT WILL PERFORM IN THE FUTURE.
YEAR BY YEAR TOTAL RETURN (%)
[CHART APPEARS HERE]
00% 00% 00% 00% 00% 00% 00%
- -----------------------------------------------
1900 1900 1900 1900 1900 1900 1900
BEST AND WORST QUARTERLY RETURNS DURING THIS PERIOD:
<TABLE>
<S> <C>
Best -- 0 quarter 1900: 0%
Worst -- 0 quarter 1900: 0%
Year-to-date return as of 00: 0%
7-day yield as of December 31, 1998: 0.00%
</TABLE>
AVERAGE ANNUAL TOTAL RETURN AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
1 year 5 years 10 years
<S> <C> <C> <C>
Daily Shares 0.00% 0.00% 0.00%
[benchmark] 0.00% 0.00% 0.00%
</TABLE>
[benchmark description]
8
<PAGE>
[GRAPHIC APPEARS HERE]
THERE ARE TWO KINDS OF FEES -- THOSE YOU PAY DIRECTLY, AND
ONGOING FEES AND EXPENSES THAT ARE DEDUCTED FROM THE FUND'S
ASSETS.
[GRAPHIC APPEARS HERE]
THIS IS AN EXAMPLE ONLY. YOUR ACTUAL COSTS COULD BE HIGHER OR
LOWER, DEPENDING ON THE AMOUNT YOU INVEST, AND ON THE FUND'S
ACTUAL EXPENSES AND PERFORMANCE.
[GRAPHIC APPEARS HERE]
WHAT IT COSTS TO INVEST IN THE FUND
<TABLE>
<CAPTION>
Daily
Fees you pay directly Shares
<S> <C>
Maximum sales charge (load)
when you buy your shares none
Maximum deferred sales charge (load)
when you sell your shares none
Ongoing fees and expenses deducted from the Fund's assets
(the Fund's operating expenses)(1)
Management fees 0.00%
Distribution (12b-1) and service fees 0.00%
Other expenses 0.00%
Total annual fund operating expenses 0.00%
</TABLE>
(1)The Fund's investment adviser and some of its other service providers
have agreed to waive fees or reimburse expenses until August 1, 2000.
The figures shown here are after waivers and reimbursements. Total
actual Fund operating expenses last year were 0.00% for Daily Shares.
There is no guarantee that these waivers and reimbursements will
continue after this date.
EXAMPLE
This example is designed to help you compare the cost of investing in
this Fund with the cost of investing in other mutual funds.
This example assumes:
o you invest $10,000 in Daily Shares of the Fund
o your investment has a 5% return each year
o the Fund's operating expenses remain the same as shown in the table
above.
If you sold all your shares at the end of the period, your costs would
be:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
<S> <C> <C> <C> <C>
Daily Shares $000 $000 $000 $000
</TABLE>
9
<PAGE>
ABOUT THE MONEY MARKET FUNDS
- --------------------------------------------------------------------------------
[GRAPHIC APPEARS HERE]
ABOUT THE SUB-ADVISER
TRADESTREET IS THIS FUND'S SUB-ADVISER. TRADESTREET'S TAXABLE
MONEY MARKET MANAGEMENT TEAM MAKES THE DAY-TO-DAY INVESTMENT
DECISIONS FOR THE FUND.
[GRAPHIC APPEARS HERE]
YOU'LL FIND MORE ABOUT
TRADESTREET ON PAGE 0.
[GRAPHIC APPEARS HERE]
LIMITS ON INVESTMENTS
THIS FUND, LIKE ALL MONEY MARKET FUNDS, MUST COMPLY WITH RULE
2A-7 UNDER THE 1940 ACT, WHICH SETS OUT CERTAIN LIMITS ON
INVESTMENTS. THESE ARE DESCRIBED IN OTHER IMPORTANT
INFORMATION.
[GRAPHIC APPEARS HERE]
YOU'LL FIND MORE ABOUT
OTHER RISKS OF INVESTING IN
THIS FUND ON PAGE 0 AND
IN THE SAI.
Nations Government Money Market Fund
[GRAPHIC APPEARS HERE]
INVESTMENT OBJECTIVE
This Fund seeks as high a level of current income as is consistent with
liquidity and stability of principal.
[GRAPHIC APPEARS HERE]
PRINCIPAL INVESTMENT STRATEGIES
This Fund generally invests in a diversified portfolio of high quality
money market instruments, that at the time of investment, have remaining
maturities of 397 days or less.
These instruments consist primarily of U.S. GOVERNMENT OBLIGATIONS. The Fund
may invest in other money market funds, consistent with its investment
objective and policies.
The Fund will only buy FIRST-TIER SECURITIES. The Fund may also invest up to
10% of its assets in other kinds of securities, which are described in the SAI.
The portfolio management team tries to maintain a constant net asset value of
$1.00 per share for the Fund. The team uses extensive research, including
economic, technical and security analysis to select individual investments.
o Economic analysis includes reviewing global economic conditions, as well
as the direction of interest rates.
o Technical analysis includes looking for yield and sector opportunities,
and evaluating changes in the supply of the instruments in which the Fund
may invest.
o Security analysis includes evaluating the credit quality of an instrument.
[GRAPHIC APPEARS HERE]
RISKS AND OTHER THINGS TO CONSIDER
Nations Government Money Market Fund has the following general risks:
o INVESTMENT STRATEGY RISK -- Although the Fund tries to maintain a
share price of $1.00, an investment in the Fund may lose money. AN
INVESTMENT IN THIS FUND IS NOT A BANK DEPOSIT AND IS NOT INSURED OR
GUARANTEED BY NATIONSBANK, N.A., (NATIONSBANK), BANK OF AMERICA
NATIONAL TRUST AND SAVINGS ASSOCIATION (BANK OF AMERICA), THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY.
o INCOME PAYMENT RISK -- The ability of the Fund to pay dividends
depends on the ability of the issuers of the securities the Fund
holds to pay interest or repay principal when it's due. Any cash the
Fund holds does not earn income.
10
<PAGE>
[GRAPHIC APPEARS HERE]
THE BAR CHART SHOWS YOU THE PERFORMANCE OF THE FUND'S DAILY
SHARES. THESE RETURNS DO NOT REFLECT DEDUCTIONS OF ACCOUNT FEES,
IF ANY, AND WOULD BE LOWER IF THEY DID.
CALL US AT 1.800.321.7854 OR CONTACT YOUR INVESTMENT
PROFESSIONAL FOR THE FUND'S CURRENT 7-DAY YIELD.
[GRAPHIC APPEARS HERE]
A LOOK AT THE FUND'S PERFORMANCE
Looking at past performance can give you an idea of a Fund's volatility
and its average returns over time. Performance will vary based on a
number of factors, including market conditions, the composition of the
Fund's holdings and the Fund's expenses. A FUND'S PAST PERFORMANCE IS NO
GUARANTEE OF HOW IT WILL PERFORM IN THE FUTURE.
YEAR BY YEAR TOTAL RETURN (%)
[CHART APPEARS HERE]
00% 00% 00% 00% 00% 00% 00%
- -----------------------------------------------
1900 1900 1900 1900 1900 1900 1900
BEST AND WORST QUARTERLY RETURNS DURING THIS PERIOD:
<TABLE>
<S> <C>
Best: -- 0 quarter 1900: 0%
Worst: -- 0 quarter 1900: 0%
Year-to-date return as of 0: 0%
7-day yield as of December 31, 1998: 0.00%
</TABLE>
AVERAGE ANNUAL TOTAL RETURN AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
1 year 5 years 10 years
<S> <C> <C> <C>
Daily Shares 0.00% 0.00% 0.00%
[benchmark] 0.00% 0.00% 0.00%
</TABLE>
[benchmark description]
11
<PAGE>
[GRAPHIC APPEARS HERE]
THERE ARE TWO KINDS OF FEES -- THOSE YOU PAY DIRECTLY, AND
ONGOING FEES AND EXPENSES THAT ARE DEDUCTED FROM THE FUND'S
ASSETS.
[GRAPHIC APPEARS HERE]
THIS IS AN EXAMPLE ONLY. YOUR ACTUAL COSTS COULD BE HIGHER OR
LOWER, DEPENDING ON THE AMOUNT YOU INVEST, AND ON THE FUND'S
ACTUAL EXPENSES AND PERFORMANCE.
[GRAPHIC APPEARS HERE]
WHAT IT COSTS TO INVEST IN THE FUND
<TABLE>
<CAPTION>
Daily
Fees you pay directly Shares
<S> <C>
Maximum sales charge (load)
when you buy your shares none
Maximum deferred sales charge (load)
when you sell your shares none
Ongoing fees and expenses deducted from the Fund's assets
(the Fund's operating expenses)(1)
Management fees 0.00%
Distribution (12b-1) and service fees 0.00%
Other expenses 0.00%
Total annual fund operating expenses 0.00%
</TABLE>
(1)The Fund's investment adviser and some of its other service providers
have agreed to waive fees or reimburse expenses until August 1, 2000.
The figures shown here are after waivers and reimbursements. Total
actual Fund operating expenses last year were 0.00% for Daily Shares.
There is no guarantee that these waivers and reimbursements will
continue after this date.
EXAMPLE
This example is designed to help you compare the cost of investing in
this Fund with the cost of investing in other mutual funds.
This example assumes:
o you invest $10,000 in Daily Shares of the Fund
o your investment has a 5% return each year
o the Fund's operating expenses remain the same as shown in the table
above.
If you sold all your shares at the end of the period, your costs would
be:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
<S> <C> <C> <C> <C>
Daily Shares $000 $000 $000 $000
</TABLE>
12
<PAGE>
ABOUT THE MONEY MARKET FUNDS
- --------------------------------------------------------------------------------
[GRAPHIC APPEARS HERE]
ABOUT THE SUB-ADVISER
TRADESTREET IS THIS FUND'S SUB-ADVISER. TRADESTREET'S
TAX-EXEMPT MONEY MARKET MANAGEMENT TEAM MAKES THE DAY-TO-DAY
INVESTMENT DECISIONS FOR THE FUND.
[GRAPHIC APPEARS HERE]
YOU'LL FIND MORE ABOUT
TRADESTREET ON PAGE 0.
[GRAPHIC APPEARS HERE]
LIMITS ON INVESTMENTS
THIS FUND, LIKE ALL MONEY MARKET FUNDS, MUST COMPLY WITH RULE
2A-7 UNDER THE 1940 ACT, WHICH SETS OUT CERTAIN LIMITS ON
INVESTMENTS. THESE ARE DESCRIBED IN OTHER IMPORTANT
INFORMATION.
Nations Tax Exempt Fund
[GRAPHIC APPEARS HERE]
INVESTMENT OBJECTIVE
This Fund seeks as high a level of current interest income exempt from
federal income taxes as is consistent with liquidity and stability of
principal.
[GRAPHIC APPEARS HERE]
PRINCIPAL INVESTMENT STRATEGIES
The Fund generally invests in a diversified portfolio of high quality
money market instruments that, at the time of investment, have remaining
maturities of 397 days or less.
The Fund normally invests at least 80% of its assets in MUNICIPAL SECURITIES,
which pay interest that is free from federal income tax. The Fund invests in
municipal securities that, at the time of investment, are considered by the
portfolio management team to have minimal credit risk and to be HIGH QUALITY.
The Fund may invest up to 20% of its assets in:
o private activity bonds
o taxable money market instruments, including REPURCHASE AGREEMENTS
The Fund may also invest in instruments issued by certain trusts, partnerships
or other SPECIAL PURPOSE ISSUERS, including PASS-THROUGH CERTIFICATES
representing PARTICIPATIONS in or debt instruments backed by, the securities
and other assets owned by these issuers. The Fund may invest in other money
market funds, consistent with its investment objective and strategies.
The Fund will only buy FIRST-TIER SECURITIES. The Fund may also invest up to
10% of its assets in other kinds of securities, which are described in the SAI.
The portfolio management team tries to maintain a constant net asset value of
$1.00 per share for the Fund. The team uses extensive research, including
economic, technical and security analysis to select individual investments.
o Economic analysis includes reviewing global economic conditions, as well
as the direction of interest rates.
o Technical analysis includes looking for yield and sector opportunities,
and evaluating changes in the supply of the instruments in which the
Fund may invest.
o Security analysis includes evaluating the credit quality of an
instrument, and structural analysis, which includes evaluating the
arrangements between the municipality and others involved in the issue
of an instrument.
13
<PAGE>
[GRAPHIC APPEARS HERE]
YOU'LL FIND MORE ABOUT
OTHER RISKS OF INVESTING IN
THIS FUND ON PAGE 0 AND
IN THE SAI.
[GRAPHIC APPEARS HERE]
THE BAR CHART SHOWS YOU THE PERFORMANCE OF THE FUND'S DAILY
SHARES. THESE RETURNS DO NOT REFLECT DEDUCTIONS OF ACCOUNT FEES,
IF ANY, AND WOULD BE LOWER IF THEY DID.
CALL US AT 1.800.321.7854 OR CONTACT YOUR INVESTMENT
PROFESSIONAL FOR THE FUND'S CURRENT 7-DAY YIELD.
[GRAPHIC APPEARS HERE]
RISKS AND OTHER THINGS TO CONSIDER
Nations Tax Exempt Fund has the following general risks:
o INVESTMENT STRATEGY RISK -- Although the Fund tries to maintain a
share price of $1.00, an investment in the Fund may lose money. AN
INVESTMENT IN THIS FUND IS NOT A BANK DEPOSIT AND IS NOT INSURED OR
GUARANTEED BY NATIONSBANK, BANK OF AMERICA, THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY.
o INCOME PAYMENT RISK -- The ability of the Fund to pay dividends
depends on the ability of the issuers of the securities the Fund
holds to pay interest or repay principal when it's due. Any cash the
Fund holds does not earn income. The Fund may hold cash while it's
waiting to make an investment, as a temporary defensive strategy, or
if the portfolio management team believes that attractive tax-exempt
investments are not available.
o TAX CONSIDERATIONS -- Most of the income paid by the Fund is interest
from municipal securities, which is generally free from federal
income tax, but generally subject to state and local taxes. The Fund
may also pay income from other kinds of securities, which is
generally subject to federal, state and local taxes. The interest on
private activity bonds may be treated as a specific tax preference
item for investors who are subject to the federal alternative minimum
tax.
[GRAPHIC APPEARS HERE]
A LOOK AT THE FUND'S PERFORMANCE
Looking at past performance can give you an idea of a Fund's volatility
and its average returns over time. Performance will vary based on a
number of factors, including market conditions, the composition of the
Fund's holdings and the Fund's expenses. A FUND'S PAST PERFORMANCE IS NO
GUARANTEE OF HOW IT WILL PERFORM IN THE FUTURE.
YEAR BY YEAR TOTAL RETURN (%)
[CHART APPEARS HERE]
00% 00% 00% 00% 00% 00% 00%
- -----------------------------------------------
1900 1900 1900 1900 1900 1900 1900
BEST AND WORST QUARTERLY RETURNS DURING THIS PERIOD:
<TABLE>
<S> <C>
Best -- 0 quarter 1900: 0%
Worst -- 0 quarter 1900: 0%
Year-to-date return as of 00: 0%
7-day yield as of December 31, 1998: 0.00%
</TABLE>
14
<PAGE>
[GRAPHIC APPEARS HERE]
THERE ARE TWO KINDS OF FEES -- THOSE YOU PAY DIRECTLY, AND
ONGOING FEES AND EXPENSES THAT ARE DEDUCTED FROM THE FUND'S
ASSETS.
[GRAPHIC APPEARS HERE]
THIS IS AN EXAMPLE ONLY. YOUR ACTUAL COSTS COULD BE HIGHER OR
LOWER, DEPENDING ON THE AMOUNT YOU INVEST, AND ON THE FUND'S
ACTUAL EXPENSES AND PERFORMANCE.
AVERAGE ANNUAL TOTAL RETURN AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
1 year 5 years 10 years
<S> <C> <C> <C>
Daily Shares 0.00% 0.00% 0.00%
[benchmark] 0.00% 0.00% 0.00%
</TABLE>
[benchmark description]
[GRAPHIC APPEARS HERE]
WHAT IT COSTS TO INVEST IN THE FUND
<TABLE>
<CAPTION>
Daily
Fees you pay directly Shares
<S> <C>
Maximum sales charge (load)
when you buy your shares none
Maximum deferred sales charge (load)
when you sell your shares none
Ongoing fees and expenses deducted from the Fund's assets
(the Fund's operating expenses) (1)
Management fees 0.00%
Distribution (12b-1) and service fees 0.00%
Other expenses 0.00%
Total annual fund operating expenses 0.00%
</TABLE>
(1)The Fund's investment adviser and some of its other service providers
have agreed to waive fees or reimburse expenses until August 1, 2000.
The figures shown here are after waivers and reimbursements. Total
actual Fund operating expenses last year were 0.00% for Daily Shares.
There is no guarantee that these waivers and reimbursements will
continue after this date.
EXAMPLE
This example is designed to help you compare the cost of investing in
this Fund with the cost of investing in other mutual funds.
This example assumes:
o you invest $10,000 in Daily Shares of the Fund
o your investment has a 5% return each year
o the Fund's operating expenses remain the same as shown in the table
above.
If you sold all your shares at the end of the period, your costs would
be:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
<S> <C> <C> <C> <C>
Daily Shares $000 $000 $000 $000
</TABLE>
15
<PAGE>
[GRAPHIC APPEARS HERE]
OTHER IMPORTANT INFORMATION
You'll find specific information about each Fund's principal investments,
strategies and risks in the descriptions starting on page 00. The following are
some other risks and information you should consider before you invest:
o YOUR INVESTMENT IN THESE FUNDS IS NOT A BANK DEPOSIT AND IS NOT INSURED
OR GUARANTEED BY NATIONSBANK, N.A. (NATIONSBANK), BANK OF AMERICA
NATIONAL TRUST AND SAVINGS ASSOCIATION (BANK OF AMERICA), THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY. YOUR
INVESTMENT MAY LOSE MONEY.
o AFFILIATES OF NATIONSBANK AND BANK OF AMERICA ARE PAID FOR THE SERVICES
THEY PROVIDE TO THE FUNDS.
o SPECIAL RULES FOR MONEY MARKET FUNDS - Money market funds must comply
with Rule 2a-7 under the 1940 Act. Rule 2a-7 sets out certain limits on
investments, which are designed to help protect investors from risk of
loss. These limits apply at the time an investment is made. The Funds,
like all money market funds:
o may only invest in securities with a remaining maturity of 397 days or
less, or that have maturities longer than 397 days, but have demand
features or guarantees that are less than 397 days.
o must maintain an average dollar-weighted maturity of 90 days or less.
o may normally invest no more than 5% of their assets in a single
security, other than U.S. government securities; however, they may
invest up to 25% of their assets in a FIRST-TIER SECURITY for up to
three business days.
o may generally only invest in U.S. dollar denominated instruments that
are determined to have minimal credit risk and are first-tier or
SECOND-TIER SECURITIES.
o CHANGING INVESTMENT OBJECTIVES AND POLICIES - The investment objective
and certain investment policies of any Fund can be changed without
shareholder approval. Other investment policies may be changed only with
shareholder approval.
o HOLDING OTHER KINDS OF INVESTMENTS - The Funds may hold investments that
aren't part of their principal investment strategies. Please refer to
the SAI for more information.
o INVESTING DEFENSIVELY - A Fund may temporarily hold investments that are
not part of its investment objective or its principal investment
strategies to try to protect it during a market or economic downturn or
because of political or other conditions. A Fund may not achieve its
investment objective while it is investing defensively.
16
<PAGE>
o PREPARING FOR THE YEAR 2000 - The year 2000 is an issue for
organizations, companies and entities around the world that rely on
computer systems to process date-related information. Computer systems
that cannot read a four-digit year may not be able to calculate and
process information on or after January 1, 2000.
All of the Funds' primary service providers have confirmed that they
have been working to make the necessary changes to their systems, and
that they expect them to be adapted in time. There is no guarantee,
however, that their computer systems will ready by the year 2000. If
their computer systems are not ready in time, there could be a negative
effect on Fund operations.
A Fund's performance could also be affected if securities it holds
decrease in value because of year 2000 issues.
17
<PAGE>
[GRAPHIC APPEARS HERE]
BANC OF AMERICA ADVISORS, INC.
ONE BANK OF AMERICA PLAZA
CHARLOTTE, NORTH CAROLINA 28255
[GRAPHIC APPEARS HERE]
HOW THE FUNDS ARE MANAGED
INVESTMENT ADVISER
BAAI is the investment adviser to the money market funds, as well as to over 60
other mutual fund portfolios in the Nations Funds Family (Nations Funds).
BAAI is a registered investment adviser. It's a wholly owned subsidiary of
NationsBank, which is owned by BankAmerica Corporation.
Nations Funds pays BAAI an annual fee for its investment advisory services. The
fee is calculated daily based on the average net assets of each Fund and is
paid monthly. BAAI uses part of this money to pay investment sub-advisers for
the services they provide to Nations Funds.
BAAI has agreed to waive fees or reimburse expenses for certain Funds until
August 1, 2000. You'll find a discussion of any waiver or reimbursement in the
Fund descriptions. There is no assurance that BAAI will continue to waive or
reimburse any fees or expenses after this date.
The following chart shows the maximum advisory fees BAAI can receive, along
with the actual advisory fees it received during the Funds' last fiscal period
(April 1, 1998 to March 31, 1999), after waivers and reimbursements:
ANNUAL INVESTMENT ADVISORY FEE,
AS A % OF AVERAGE DAILY NET ASSETS
<TABLE>
<CAPTION>
Maximum Actual fee
advisory paid last
fee fiscal year
<S> <C> <C>
Nations Prime Fund 0.00 0.00
Nations Treasury Fund 0.00 0.00
Nations Government Money Market Fund 0.00 0.00
Nations Tax Exempt Fund 0.00 0.00
</TABLE>
18
<PAGE>
[GRAPHIC APPEARS HERE]
TRADESTREET INVESTMENT
ASSOCIATES, INC.
ONE BANK OF AMERICA PLAZA
CHARLOTTE, NORTH CAROLINA 28255
[GRAPHIC APPEARS HERE]
STEPHENS INC.
111 CENTER STREET
LITTLE ROCK, ARKANSAS 72201
[GRAPHIC APPEARS HERE]
FIRST DATA INVESTOR
SERVICES GROUP, INC.
ONE EXCHANGE PLACE
BOSTON, MASSACHUSETTS 02109
INVESTMENT SUB-ADVISER
Nations Funds and BAAI have engaged an investment sub-adviser, TradeStreet
Investment Associates, Inc., to provide day-to-day portfolio management for the
Funds. TradeStreet and the sub-advisers for all other Nations Funds function
under the supervision of the Boards of Directors/Trustees of Nations Funds and
BAAI.
TRADESTREET INVESTMENT ASSOCIATES, INC.
TradeStreet is a registered investment adviser and a wholly-owned subsidiary of
NationsBank. Its management expertise covers all major domestic asset classes.
Currently managing more than [$70] billion, TradeStreet has more than [140]
institutional clients and is sub-adviser to [48] mutual funds in the Nations
Funds Family. TradeStreet uses a team approach to investment management. Each
team has access to the latest analytic technology and expertise.
TradeStreet is the investment sub-adviser to the Funds shown in the table
below. The table also tells you which internal TradeStreet asset management
team is responsible for making the day-to-day investment decisions for each
Fund.
<TABLE>
<CAPTION>
Fund TradeStreet Team
<S> <C>
Nations Prime Fund Taxable Money Market Management Team
Nations Treasury Fund Taxable Money Market Management Team
Nations Government Money Market Fund Taxable Money Market Management Team
Nations Tax Exempt Fund Tax-Exempt Money Market Management Team
</TABLE>
OTHER SERVICE PROVIDERS
The Funds are distributed and co-administered by Stephens Inc., a registered
broker/dealer. Stephens may pay service fees or commissions to companies that
assist investors in buying shares of the Funds.
BAAI is also co-administrator of the Funds, and assists in overseeing the
administrative operations of the Funds. BAAI and Stephens receive a combined
monthly fee of 0.10% from the Funds for their services, based on the annual
rate of the average daily net assets of the Funds, as well as certain out of
pocket expenses.
First Data Investor Services Group, Inc. (First Data) is the transfer agent for
the Funds' shares. Its responsibilities include processing purchases, sales and
exchanges, calculating and paying distributions, keeping shareholder records,
preparing account statements and providing customer service.
19
<PAGE>
ABOUT YOUR INVESTMENT
- --------------------------------------------------------------------------------
[GRAPHIC APPEARS HERE]
WE'VE USED THE TERM, INVESTMENT PROFESSIONAL, TO REFER TO THE
PERSON WHO HAS ASSISTED YOU WITH BUYING NATIONS FUNDS. SELLING
AGENT MEANS THE COMPANY THAT EMPLOYS YOUR INVESTMENT
PROFESSIONAL. SELLING AGENTS INCLUDE BANKS, BROKERAGE FIRMS,
MUTUAL FUND DEALERS AND OTHER FINANCIAL INSTITUTIONS, INCLUDING
AFFILIATES OF BANK OF AMERICA, THAT HAVE SIGNED AN AGREEMENT
WITH US OR STEPHENS.
IF YOU DON'T HAVE AN INVESTMENT PROFESSIONAL, CALL US AT
1.800.321.7854. WE'LL BE PLEASED TO RECOMMEND INVESTMENT
PROFESSIONALS IN YOUR AREA.
YOUR SELLING AGENT MAY HAVE DIFFERENT LIMITS, CHARGE OTHER FEES,
OR HAVE DIFFERENT POLICIES FOR BUYING, SELLING AND EXCHANGING
SHARES THAN THOSE DESCRIBED IN THIS PROSPECTUS.
[GRAPHIC APPEARS HERE]
BUYING, SELLING AND EXCHANGING SHARES
You can invest in the Funds through your selling agent or directly from Nations
Funds. You don't pay any sales charges when you buy, sell or exchange Daily
Shares.
We encourage you to consult with an investment professional who can open an
account for you with a selling agent and help you with your investment
decisions. Once you have an account, you can buy, sell and exchange shares by
contacting your investment professional or selling agent. They will look after
any paperwork that's needed to complete a transaction and send your order to
us.
Some people prefer to invest directly with Nations Funds. You can find out how
to open an account, and buy, sell and exchange shares by writing us or calling
us at 1.800.321.7854.
The table below summarizes some key information about buying, selling and
exchanging shares. These are described in more detail on the following pages.
Please contact your investment professional or selling agent, or call us at
1.800.321.7854 if you have any questions about how to place an order or set up
one of our automatic plans.
20
<PAGE>
<TABLE>
<CAPTION>
Ways to
buy, sell or How much you can buy,
exchange sell or exchange Other things to know
----------------- ---------------------------------------- ------------------------------------------------
<S> <C> <C> <C>
Buying shares In a lump sum minimum initial investment: There is no limit to the
amount you can invest
o $1,000 for regular accounts in Daily Shares.
o $500 for traditional IRA accounts
o $250 for non-working spousal IRAs
o $250 for certain fee-based accounts
o no minimum for certain retirement
plan accounts like 401(k) plans and
SEP accounts, but other restrictions
apply.
minimum additional investment:
o $100 for all accounts
- -------------------------------------------------------------------------------------------------------------------------------
Using our minimum initial investment: You can buy shares monthly, twice a month or
Systematic o $100 quarterly, using automatic transfers from your
Investment Plan minimum additional investment: bank account.
o $50
- -------------------------------------------------------------------------------------------------------------------------------
Selling shares In a lump sum o you can sell up to $50,000 of your We usually send you or your selling agent the
shares by telephone, otherwise there sale proceeds on the same day that we receive
are no limits to the amount you can your order.
sell
o other restrictions may apply to
withdrawals from retirement plan
accounts
- -------------------------------------------------------------------------------------------------------------------------------
Using our o minimum $25 per withdrawal Your account balance must be at least $10,000
Automatic to set up the plan. You can make withdrawals
Withdrawal Plan monthly, twice a month or quarterly. We'll send
your money by check or deposit it directly to
your bank account.
- -------------------------------------------------------------------------------------------------------------------------------
Exchanging shares In a lump sum o minimum $1,000 per exchange You can exchange Daily Shares of a money
market fund for Daily Shares of other money
market funds, or for Investor C Shares of all
other Nations Funds, except money market
funds.
- -------------------------------------------------------------------------------------------------------------------------------
Using our o minimum $25 per exchange You must already have an investment in the
Automatic Funds you want to buy and sell. You can make
Exchange exchanges monthly or quarterly.
Feature
</TABLE>
21
<PAGE>
[GRAPHIC APPEARS HERE]
A BUSINESS DAY IS ANY DAY THAT THE FEDERAL RESERVE BANK OF NEW
YORK IS OPEN.
THE FEDERAL RESERVE BANK OF NEW YORK IS CLOSED ON WEEKENDS AND
ON THE FOLLOWING NATIONAL HOLIDAYS: NEW YEAR'S DAY, MARTIN
LUTHER KING, JR. DAY, PRESIDENTS' DAY, MEMORIAL DAY (OBSERVED),
INDEPENDENCE DAY, LABOR DAY, COLUMBUS DAY, VETERANS DAY,
THANKSGIVING DAY AND CHRISTMAS DAY.
HOW SHARES ARE PRICED
All transactions are based on the price of a Fund's shares -- or its NET ASSET
VALUE PER SHARE. We calculate net asset value per share at the following times:
o 3:00 p.m. Eastern time each business day for each share class of Nations
Prime Fund and Nations Treasury Fund
o 12:00 noon Eastern time each business day for each share class of Nations
Government Money Market Fund and Nations Tax Exempt Fund
First, we calculate the net ASSET VALUE for each class of a Fund by determining
the value of the Fund's assets in the class and then subtracting its
liabilities. Next, we divide this amount by the number of shares that investors
are holding in the class.
Although we try to maintain a net asset value per share of $1.00 for the Funds,
we can't guarantee that we will be able to do so.
VALUING SECURITIES IN A FUND
The value of a Fund's assets is based on the total market value of all of the
securities it holds. We use the amortized cost method, which approximates
market value, to value the assets in the Money Market Funds.
HOW ORDERS ARE PROCESSED
Orders to buy, sell or exchange shares are processed on business days. Orders
received by Stephens, First Data or their agents by 3:00 p.m. for Nations Prime
Fund and Nations Treasury Fund, or 12:00 noon for Nations Government Money
Market Fund and Nations Tax Exempt Fund on a business day will receive that
day's net asset value per share.
Orders received after these times will receive the next business day's net
asset value per share. The business day that applies to your order is also
called the TRADE DATE. We and Stephens may refuse any order. If this happens,
we'll return any money we've received to your selling agent.
TELEPHONE ORDERS
You can place orders to buy, sell or exchange by telephone if you complete the
telephone authorization section of our account application and send it to us.
Here's how telephone orders work:
o If you sign up for telephone orders after you open your account, you
must have your signature guaranteed.
o Telephone orders may not be as secure as written orders. You may be
responsible for any loss resulting from a telephone order.
o We'll take reasonable steps to confirm that telephone instructions
are genuine. For example, we require proof of your identification
before we will act on instructions received by telephone and may
record telephone conversations. If we and our service providers don't
take these steps, we may be liable for any losses from unauthorized
or fraudulent instructions.
o Telephone orders may be difficult to complete during periods of
significant economic or market change.
22
<PAGE>
[GRAPHIC APPEARS HERE]
BUYING SHARES
Here are some general rules for buying shares:
o We'll process your order only if we receive payment in federal
funds by 4:00 p.m. on the business day Stephens, First Data or
their agents receive the order. Otherwise, we'll cancel your
order.
o Selling agents are responsible for sending orders to us and
ensuring we receive your money on time.
o Shares you buy are recorded on the books of the Fund. We don't
issue certificates.
MINIMUM INITIAL INVESTMENT
The minimum initial amount you can buy is usually $1,000.
If you're buying shares through one of the following accounts or plans,
the minimum initial amount you can buy is:
o $500 for traditional Individual Retirement Accounts (IRAs)
o $250 for non-working spousal IRAs
o $250 for accounts set up with some fee-based investment advisers
or financial planners, including wrap fee accounts and other
managed accounts
o $100 for Systematic Investment Plans described below
o There is no minimum for 401(k) plans, simplified employee pension
plans (SEPs), salary reduction-simplified employee pension plans
(SAR-SEPs), Savings Incentives Method Plans for Employees (SIMPLE
IRAs), salary reduction-Individual Retirement Accounts (SAR-IRAs)
or other similar kinds of accounts. However, the value of your
account must be at least $1,000 for 401(k) plans or $500 for the
other plans within one year after you open your account.
Otherwise, we may sell the shares in your account if we give you
60 days notice in writing.
23
<PAGE>
[GRAPHIC APPEARS HERE]
FOR MORE INFORMATION
ABOUT TELEPHONE ORDERS,
SEE PAGE 0.
MINIMUM ADDITIONAL INVESTMENT
You can make additional purchases of as little as $100, or $50 if you
buy shares through our Systematic Investment Plan.
SYSTEMATIC INVESTMENT PLAN
You can make regular purchases of $50 or more using automatic transfers from
your bank account to the Funds you choose. You can contact your investment
professional or us to set up the plan.
Here's how the plan works:
o You can buy shares twice a month, monthly or quarterly.
o You can choose to have us transfer your money on or about the 15th or
the last day of the month.
o Some exceptions may apply to employees of NationsBank and its
affiliates, and to plans set up before August , 1997. For details,
please contact your investment professional.
[GRAPHIC APPEARS HERE]
SELLING SHARES
Here are some general rules for selling shares:
o If you're selling your shares through a selling agent, we'll
normally send the sale proceeds by federal funds wire to your
selling agent or to you on the same business day that Stephens,
First Data or their agents receive your order. Your selling agent
is responsible for depositing the sale proceeds to your account on
time.
o If you're selling your shares directly through us, we'll normally
send the sale proceeds by mail or wire them to your bank account on
the same business day that the Fund receives your order.
o We may take up to three business days to send the sale proceeds if
we believe that an earlier payment could adversely affect the Fund.
o You can sell up to $50,000 of shares by telephone if you qualify
for telephone orders.
o If you paid for your shares with a check that wasn't certified,
we'll hold the sale proceeds when you sell those shares for at
least 15 days, or until the check has cleared.
o If you hold any shares in certificate form, you must sign the
certificates (or send a signed stock power with them) and send them
to First Data. Your signature must be guaranteed unless you've made
other arrangements with us. We may ask for any other information we
need to prove that the order is properly authorized.
o Under certain circumstances allowed under the 1940 Act, we can pay
you in securities or other property when you sell your shares.
24
<PAGE>
[GRAPHIC APPEARS HERE]
YOU SHOULD MAKE SURE YOU UNDERSTAND THE INVESTMENT OBJECTIVES
AND POLICIES OF THE FUND YOU'RE EXCHANGING INTO. PLEASE READ
ITS PROSPECTUS CAREFULLY.
We may sell your shares:
o if the value of your account after you sell any shares falls below
$500. We'll give you 60 days notice in writing if we're going to
do this
o if your selling agent tells us to sell your shares under
arrangements made between the selling agent and its customers
o under certain circumstances allowed under the 1940 Act.
AUTOMATIC WITHDRAWAL PLAN
The Automatic Withdrawal Plan lets you withdraw $25 or more every month,
every quarter or every year. You can contact your investment professional
or us to set up the plan.
Here's how the plan works:
o Your account balance must be at least $10,000 to set up the plan.
o If you set up the plan after you've opened your account, your
signature must be guaranteed.
o You can choose to have us transfer your money on or about the 15th
or 25th of the month.
o We'll send you a check or deposit the money directly to your bank
account.
o You can cancel the plan by giving your selling agent or us 30 days
notice in writing.
It's important to remember that if you withdraw more than your Fund is earning,
you'll eventually use up your original investment.
[GRAPHIC APPEARS HERE]
EXCHANGING SHARES
You can sell shares of a Fund to buy shares of another Nations Fund.
This is called an exchange. You might want to do this if your investment
goals or tolerance for risk changes.
Here's how exchanges work:
o [You can exchange Daily Shares of a money market fund for Daily
Shares of other money market funds, or for Investor C Shares of
all other Nations Funds, except money market funds.]
o You must exchange at least $1,000.
o The rules for buying a Fund, including any minimum investment
requirements, apply to exchanges into that Fund.
o You may only make an exchange into a Fund that is legally sold in
your state of residence.
o You generally may only make an exchange into a share class that is
accepting investments.
25
<PAGE>
o We may limit the number of exchanges you can make within a
specified period of time.
o We may change or cancel your right to make an exchange by giving
the amount of notice required by regulatory authorities (currently
60 days for a material change or cancellation), unless we are
required to do so because of unusual circumstances.
o An exchange is treated the same as a sale of shares for federal
income tax purposes, which means you may realize a CAPITAL GAIN or
LOSS on the Fund you're making the exchange from. You may not be
able to deduct any capital losses if you exchange shares within 90
days of buying them.
o You cannot exchange any shares you own in certificate form until
First Data has received the certificate and deposited the shares
to your account.
o You must maintain a current value of $1,000 of any Daily Shares
you receive from an exchange of Investor C Shares.
AUTOMATIC EXCHANGE FEATURE
The Automatic Exchange Feature lets you exchange $25 or more of Daily Shares
every month or every quarter. You can contact your investment professional or
us to set up the plan.
Here's how automatic exchanges work:
o Send your request to First Data in writing or call [First Data's
telephone number].
o You must already have an investment in the Funds you want to buy
and sell.
o You can choose to have us transfer your money on or about the 15th
or the last day of the month.
o The rules for making exchanges apply to automatic exchanges.
26
<PAGE>
[GRAPHIC APPEARS HERE]
THE DISTRIBUTION FEE IS OFTEN REFERRED TO AS A "12B-1" FEE
BECAUSE IT'S PAID THROUGH A PLAN APPROVED UNDER RULE 12B-1 OF
THE 1940 ACT.
YOUR SELLING AGENT MAY CHARGE OTHER FEES RELATED TO SERVICES
PROVIDED TO YOUR ACCOUNT.
[GRAPHIC APPEARS HERE]
HOW SELLING AGENTS ARE PAID
Your selling agent may receive compensation in a number of ways when you invest
in the Funds. The kind and amount of the compensation depends on which share
class you choose.
Selling agents may pay a portion of their compensation to their investment
professionals, under their own arrangements.
DISTRIBUTION (12B-1) AND SHAREHOLDER SERVICING FEES
Selling agents may receive annual distribution (12b-1) and shareholder
servicing fees to cover the costs of selling shares and providing services to
investors.
The maximum annual distribution (12b-1) fee is 0.45% of the average daily net
assets of a Fund. The maximum annual shareholder servicing fee is 0.25% of the
average daily net assets of a Fund.
Fees are calculated daily and deducted monthly. Over time, these fees will
increase the cost of your investment.
We pay these fees according to our agreements with selling agents for as long
as the plan continues, while they are eligible to receive the fees. We and
Stephens may reduce or discontinue payments at any time.
OTHER COMPENSATION
Selling agents may also receive:
o a bonus, incentive or other compensation if they sell a minimum dollar
amount of shares of the Funds during a specified period
o an additional amount of up to 0.50% of the net asset value per share on
all sales of Daily Shares to retirement plans
o non-cash compensation like trips to sales seminars or vacation
destinations, tickets to sporting events, theater or other entertainment,
opportunities to participate in golf or other outings and gift
certificates for meals or merchandise
Stephens or BAAI may make this compensation available only to selected selling
agents. For example, Stephens sometimes sponsors promotions involving [Banc of
America Investments, Inc.,] an affiliate of BAAI, and certain other selling
agents. Selected selling agents may also receive compensation for opening a
minimum number of accounts.
Stephens is responsible for paying the costs of this compensation, and may be
reimbursed for them under the 12b-1 plan. Stephens may cancel any compensation
program at any time.
BAAI may pay amounts from its own assets to Stephens or other selling agents
for administrative or distribution related services they provide to
shareholders.
27
<PAGE>
[GRAPHIC APPEARS HERE]
THE POWER OF COMPOUNDING
YOU CAN CHOOSE TO REINVEST YOUR DISTRIBUTIONS IN ADDITIONAL
SHARES OF THE SAME FUND AND CLASS.
REINVESTING YOUR DISTRIBUTIONS BUYS YOU MORE SHARES OF A
FUND -- WHICH LETS YOU TAKE ADVANTAGE OF THE POTENTIAL FOR
COMPOUND GROWTH.
PUTTING THE MONEY YOU EARN BACK INTO YOUR INVESTMENT MEANS IT,
IN TURN, MAY EARN EVEN MORE MONEY. OVER TIME, THE POWER OF
COMPOUNDING HAS THE POTENTIAL TO SIGNIFICANTLY INCREASE THE
VALUE OF YOUR INVESTMENT.
[GRAPHIC APPEARS HERE]
DISTRIBUTIONS AND TAXES
ABOUT DISTRIBUTIONS
A mutual fund can make money two ways:
o It can earn income. Examples are interest paid on bonds and dividends paid
on COMMON STOCKS.
o A fund can also have CAPITAL GAINS if the value of its investments
increases. If a fund sells an investment at a gain, the gain is realized.
If a fund continues to hold the investment, any gain is unrealized.
A mutual fund is not subject to income tax as long as it distributes its net
investment income and realized capital gains to its shareholders. The Funds
intend to pay out a sufficient amount of their income and capital gains to
their shareholders so the Funds won't have to pay any income tax. When a Fund
makes this kind of a payment, it's split equally among all shares. This is
called a distribution.
All of the Funds distribute any net realized capital gains, including net
short-term capital gains, at least once a year.
Nations Prime Fund and Nations Treasury Fund declare distributions of net
investment income at 3:00 p.m. each business day. Nations Government Money
Market Fund and Nations Tax Exempt Fund declare distribution of net investment
income at 12:00 noon each business day. The Funds pay these distributions
monthly.
Distributions are paid based on the number of shares you hold on the day before
the distribution is declared. Shares are eligible to receive distributions from
the trade date of the purchase up to and including the day before they are
sold.
Different share classes of a Fund usually pay different distribution amounts,
because each class has different expenses. Each time a distribution is made,
the net asset value per share of the share class is reduced by the amount of
the distribution.
We'll automatically reinvest distributions in additional shares of the same
Fund unless you tell us you want to receive your distributions in cash.
We generally pay cash distributions within five business days after the end of
the month, quarter or year in which the distribution was made. If you sell all
of your shares, we'll pay any distribution that applies to those shares in cash
within five business days after the sale was made.
28
<PAGE>
[GRAPHIC APPEARS HERE]
THIS INFORMATION IS A SUMMARY OF HOW FEDERAL INCOME TAXES MAY
AFFECT YOUR INVESTMENT IN THE FUNDS. IT IS NOT INTENDED AS A
SUBSTITUTE FOR CAREFUL TAX PLANNING. YOU SHOULD CONSULT WITH
YOUR OWN TAX ADVISOR ABOUT YOUR SITUATION, INCLUDING ANY
FOREIGN, STATE AND LOCAL TAXES THAT MAY APPLY.
[GRAPHIC APPEARS HERE]
FOR MORE INFORMATION ABOUT
TAXES, PLEASE SEE THE SAI.
[If you buy shares of a Fund shortly before it makes a distribution, you will,
in effect, receive part of your purchase back in the distribution, which is
subject to tax. Similarly, if you buy shares of a Fund that holds securities
with unrealized capital gains, you will, in effect, receive part of your
purchase back if and when the Fund sells those securities, and realizes [and
distributes] the gain. This distribution is also subject to tax. Some Funds
have built up, or have the potential to build up, high levels of unrealized
capital gains. -Does this paragraph apply to these funds?]
HOW TAXES AFFECT YOUR INVESTMENT
Distributions of net investment income, [including net foreign currency gains]
and any excess of net short-term capital gain over net long-term capital loss,
generally are taxable to you as ordinary income. Corporate shareholders [may
be] able to exclude a portion of these distributions from their taxable income.
The Funds do not expect to realize any net capital gain (generally the excess
of net long-term capital gain over net short-term capital loss), and therefore,
do not expect to make any distributions of capital gains.
In general, all distributions are taxable to you when paid, whether they are
paid in cash or automatically reinvested in additional shares of the Fund.
However, any distributions declared in October, November or December of one
year and distributed in January of the following year will be taxable as if
they had been paid on December 31 of the first year.
We'll send you a notice every year that tells you how much you've received in
distributions during the year and their federal tax status. Foreign, state and
local taxes may also apply to these distributions.
NATIONS TAX EXEMPT FUND
Distributions of tax-exempt interest income are generally free from federal
income tax, but may be taxable under state or local law, even though a large
portion of the distribution may come from interest on tax-exempt investments,
which if realized directly, would be exempt from these taxes.
Tax exempt-interest income distributions may be treated by shareholders as
items of interest excludable from their federal gross income under section
103(a) of the tax code, unless that exclusion is disallowed for the
shareholder. Corporate shareholders will not be able to exclude a portion of
these distributions from their taxable income. The Fund does not intend to earn
any taxable income or net capital gains. If it did, any distributions would be
generally subject to tax.
29
<PAGE>
WITHHOLDING TAX
We're required by federal law to withhold tax of 31% on any distributions and
sale proceeds paid to you (including amounts deemed to be paid for "in kind"
and exchanges) if:
o you haven't given us a correct Taxpayer Identification Number (TIN) and
haven't certified that the TIN is correct and withholding doesn't apply
o the Internal Revenue Service (IRS) has notified us that the TIN listed on
your account is incorrect according to its records
o the IRS informs us that you're otherwise subject to backup withholding.
The IRS may also impose penalties against you if you don't give us a correct
TIN.
Amounts we withhold are applied to your federal income tax liability. You may
receive a refund from the IRS if the withholding tax results in an overpayment
of taxes.
We're also required by federal law to withhold tax on distributions paid to
some foreign shareholders.
[TAXATION OF REDEMPTIONS AND EXCHANGES
Your redemptions (including redemptions "in kind") and exchanges of Fund shares
will usually result in a taxable capital gain or loss, depending on the amount
you receive for your shares (or are deemed to receive in the case of exchanges)
and the amount you paid (or are deemed to have paid) for them.
-Does this paragraph apply to these Funds?]
[GRAPHIC APPEARS HERE]
FINANCIAL HIGHLIGHTS
The financial highlights table is designed to help you understand how the Funds
have performed for the past five years. Certain information reflects financial
results for a single Fund share. The total investment return line indicates how
much an investment in the Fund would have earned, assuming all dividends and
distributions had been reinvested.
This information has been audited by PricewaterhouseCoopers LLP. You'll find
the auditor's report and Nations Funds financial statements in the SAI. Please
see the back cover to find out how you can get a copy.
[financial highlights tables for each Fund here]
30
<PAGE>
[indexes to be added once benchmarks are provided for the money
market funds and any other outstanding fixed income and money
market modules]
[GRAPHIC APPEARS HERE]
TERMS USED IN THIS PROSPECTUS
ASSET-BACKED SECURITY - a debt security that gives you a share in a pool of
assets that is backed by loan paper, accounts receivable or other assets,
including mortgages, generally issued by banks, credit card companies or other
lenders. Some securities may be issued or guaranteed by the U.S. government or
by any of its agencies, authorities or instrumentalities. Asset-backed
securities make periodic payments, which may be interest or a combination of
interest and a portion of the principal of the underlying assets.
AVERAGE DOLLAR-WEIGHTED MATURITY - the average length of time until the debt
securities held by a Fund reach maturity and are repaid. In general, the longer
the average dollar-weighted maturity, the more a Fund's share price will
fluctuate in response to changes in interest rates.
BANK OBLIGATION - a money market instrument issued by a bank, including
certificates of deposit, time deposits and bankers' acceptances.
CAPITAL GAIN (CAPITAL LOSS) - the difference between the purchase price of a
security and its selling price. You REALIZE a capital gain (or loss) when you
sell a security for more (or less) than you paid for it.
COMMERCIAL PAPER - a money market instrument issued by a large company.
COMMON STOCK - an equity security that represents part ownership in a company.
Common stock typically allows you to vote at shareholder meetings and to share
in the company's profits by receiving dividends.
CONVERTIBLE SECURITY - a security that can be exchanged for common stock (or
another type of security) at a specified rate and date. Convertible securities
include convertible debt, rights and warrants.
CORPORATE OBLIGATION - a money market instrument issued by a corporation or
commercial bank.
DEBT SECURITY - when you invest in a debt security, you are lending your money
to a governmental body or company (the issuer) to help fund their operations or
major projects. The issuer pays interest at a specified rate on a specified
date or dates, and repays the principal when the security matures. Short-term
debt securities include money market instruments such as treasury bills.
Long-term debt securities include fixed income securities such as government
and corporate bonds, and mortgage-backed and asset-backed securities.
DEPOSITARY RECEIPTS - securities representing securities of companies based in
countries other than the U.S. Examples include ADRs, ADSs, GDRs and EDRs.
DOLLAR ROLL TRANSACTIONS - the sale by a Fund of mortgage-backed or other
asset-backed securities, together with a commitment to buy similar, but not
identical, securities at a future date.
31
<PAGE>
DURATION - a measure used to estimate how much a Fund's share price will
fluctuate in response to a change in interest rates. For example, if interest
rates rise by one percentage point, the share price of a Fund with a duration
of five years would decline by about 5%. If interest rates fall by one
percentage point, the Fund's share price would rise by about 5%.
EQUITY SECURITY - an investment that gives you part ownership in a company.
Equity securities (or "equities") include common and preferred stock, rights
and warrants.
FIRST-TIER SECURITY - according to Rule 2a-7 under the 1940 Act, a debt
security that is an eligible investment for money market funds and has the
highest short-term rating from a nationally recognized statistical rating
organization (NRSRO), or if unrated, is determined by the fund's board of
directors to be of comparable quality, or is a money market fund issued by a
registered investment company, or is a government security.
FIXED INCOME SECURITY - an intermediate to long-term debt security that matures
in more than one year.
FOREIGN SECURITY - a debt or equity security issued by a foreign government or
corporation.
FUTURES CONTRACT - a contract to buy or sell an asset or an index of securities
at a specified price on a specified date. The price is set through a futures
exchange.
GUARANTEED INVESTMENT CONTRACT - an investment instrument issued by a highly
rated insurance company. Under a contract, a fund makes a cash contribution to
the insurance company's general or separate account in return for guaranteed
interest.
HIGH QUALITY - a debt security that has been given a high credit rating by an
NRSRO. In the case of municipal securities, high quality means a long-term
rating of A or higher from Duff & Phelps Credit Rating Co. (D&P), Fitch IBCA
(Fitch), S&P, Thomson BankWatch, Inc. (BankWatch), or Moody's Investor
Services, Inc. (Moody's). Please see the SAI for more information about credit
ratings.
INVESTMENT GRADE - a debt security that has been given a medium to high credit
rating (BBB or higher) by an NRSRO based on the issuer's ability to pay
interest and repay principal on time. A debt security that has not been rated,
but is believed to be of comparable quality, may also be considered investment
grade. Please see the SAI for more information about credit ratings.
LEHMAN 3-YEAR MUNICIPAL BOND INDEX - a broad-based, unmanaged index of
investment grade bonds with maturities of two to four years. All dividends are
reinvested.
32
<PAGE>
LEHMAN 7-YEAR MUNICIPAL BOND INDEX - a broad-based, unmanaged index of
investment grade bonds with maturities of seven to eight years. All dividends
are reinvested.
LEHMAN AGGREGATE BOND INDEX - an index made up of the Lehman
Government/Corporate Index, the Asset-Backed Securities Index and the
Mortgage-Backed Securities Index. These indexes include U.S. government agency
and U.S. Treasury securities, corporate bonds and mortgage-backed securities.
All dividends are reinvested.
LEHMAN CORPORATE BOND INDEX - an index of U.S. government, U.S. Treasury and
agency securities, and corporate and Yankee bonds. All dividends are
reinvested.
LEHMAN GOVERNMENT BOND INDEX - an index of [U.S.] government bonds with an
average maturity of approximately nine years. All dividends are reinvested.
LEHMAN INTERMEDIATE GOVERNMENT BOND INDEX - an index of U.S. government agency
and U.S. Treasury securities. All dividends are reinvested.
LEHMAN INTERMEDIATE TREASURY INDEX - an index of U.S. Treasury securities with
maturities of three to 10 years. All dividends are reinvested.
LEHMAN MUNICIPAL BOND INDEX - a broad-based, unmanaged index of 8,000
investment grade bonds with maturities of [10] years or more.
MERRILL LYNCH 1-3 YEAR TREASURY INDEX - an index of U.S. Treasury bonds with
maturities of 1 to 3 years. All dividends are reinvested.
MONEY MARKET INSTRUMENT - a short-term debt security that matures in one year
or less. Money market instruments include U.S. Treasury obligations, U.S.
government obligations, certificates of deposit, bankers' acceptances,
commercial paper, repurchase agreements and municipal securities.
MORTGAGE-BACKED SECURITY - a debt security that gives you a share in (or is
backed by) a pool of residential mortgages issued by the U.S. government or by
financial institutions. The underlying mortgages may be guaranteed by the U.S.
government or one of its agencies, authorities or instrumentalities. Mortgage-
backed securities make monthly payments, which are a combination of interest
and a portion of the principal of the underlying mortgages.
MUNICIPAL SECURITY (OBLIGATION) - a debt security issued by state or local
governments or governmental authorities to pay for public projects and
services. "General obligations" are backed by the issuer's full taxing and
revenue-raising powers. "Revenue securities" depend on the income earned by a
specific project or authority, like road or bridge tolls, user fees for water
or revenues from a utility. Interest income is exempt from federal income taxes
and is generally exempt from state taxes if you live in the state that issued
the security. If you live in the municipality that issued the security,
interest income may also be exempt from local taxes.
33
<PAGE>
NON-DIVERSIFIED - a fund that holds fewer securities than other kinds of funds.
This increases the risk that its value could go down significantly if one or
more of its investments performs poorly. Non-diversified funds tend to have
greater price swings than more diversified funds.
PARTICIPATION - a pass-through certificate representing a share in a pool of
debt obligations or other instruments.
PASS-THROUGH CERTIFICATE - an asset-backed security that passes income from the
original borrower through an intermediary to investors.
PREFERRED STOCK - an equity security that gives you an ownership right in a
company, on a different basis than common stock. Preferred stock generally pays
a fixed annual dividend. If the company goes bankrupt, preferred shareholders
generally receive their share of the company's remaining assets before common
shareholders and after bondholders and other creditors.
REAL ESTATE INVESTMENT TRUST (REIT) - a managed portfolio of real estate
investments which may include office buildings, apartment complexes, hotels and
shopping malls, and real-estate-related loans or interests.
REPURCHASE AGREEMENT - a short-term (often overnight) investment agreement. The
investor agrees to buy certain securities from the borrower and the borrower
promises to buy them back at a specified date and price. The difference between
the purchase price paid by the investor and the repurchase price paid by the
borrower represents the investor's return.
REVERSE REPURCHASE AGREEMENT - a repurchase agreement in which an investor
sells a security to another party, like a bank or dealer, in return for cash,
and agrees to buy the security back at a specified date and price.
SECOND-TIER SECURITY - according to Rule 2a-7 under the 1940 Act, a debt
security that is an eligible investment for money market funds, but is not a
first-tier security.
SPECIAL PURPOSE ISSUER - an entity organized solely to issue asset-backed
securities on a pool of debt obligations it owns.
TRADE DATE - the effective date of a purchase, sale or exchange transaction, or
other instructions sent to us. The trade date is determined by the day and time
we receive the order or instructions in a form that's acceptable to us.
U.S. GOVERNMENT OBLIGATION - a debt security issued or guaranteed by the U.S.
government or any of its agencies, authorities or instrumentalities.
U.S. TREASURY OBLIGATION - a debt security issued by the U.S. Treasury.
34
<PAGE>
ZERO-COUPON BOND - a bond that makes no periodic interest payments. Zero coupon
bonds are sold at a deep discount to their face value and mature at face value.
The difference between the face value at maturity and the purchase price
represents the return to the investor.
[Are any trademarking/disclosure footnotes required for Lehman or Merrill
Lynch indexes?]
35
<PAGE>
[GRAPHIC APPEARS HERE]
WHERE TO FIND MORE INFORMATION
You'll find more information about the Money Market Funds in the following
documents:
[GRAPHIC APPEARS HERE]
ANNUAL AND SEMI-ANNUAL REPORTS
The annual and semi-annual reports contain information about Fund
investments and performance, the financial statements and the auditor's
reports. The annual report also includes a discussion about the market
conditions and investment strategies that had a significant effect on
each Fund's performance during the period covered.
[GRAPHIC APPEARS HERE]
STATEMENT OF ADDITIONAL INFORMATION
The SAI contains additional information about the Funds and their
policies. The SAI is legally part of this prospectus (it's incorporated
by reference). A copy has been filed with the Securities and Exchange
Commission (SEC).
You can obtain a free copy of these documents by contacting Nations
Funds:
By telephone: 1.800.321.7854
By mail:
NATIONS FUNDS
C/O STEPHENS INC.
ONE BANK OF AMERICA PLAZA
33RD FLOOR
CHARLOTTE, NC 28255
On the Internet: WWW.NATIONSBANK.COM/NATIONSFUND
If you prefer, you can write or call the SEC's Public Reference Room and
ask them to mail you copies of these documents. They'll charge you a fee
for this service. You can also download them from the SEC's website or
visit the Public Reference Section and copy the documents while you're
there.
PUBLIC REFERENCE SECTION OF THE SEC
WASHINGTON, DC 20549-6009
1.800.SEC.0330
HTTP://WWW.SEC.GOV
[NATIONS FUNDS LOGO APPEARS HERE]
INVESTMENTS FOR A LIFETIME(TM)
SEC file numbers: --
[Nations Fund Trust, 811-04305]
[Nations Fund, Inc., 811-04614]
NF-00000-8/99
<PAGE>
NATIONS FUND, INC.
FILE NOS. 33-4038; 811-4614
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements:
Included in Part A:
Per Share Income and Capital Changes
Included in Part B:
Audited financial statements for Nations Prime Fund, Nations Treasury
Fund, Nations International Equity Fund, Nations Equity Income Fund,
Nations International Growth Fund, Nations Small Company Growth Fund,
Nations U.S. Government Bond Fund and Nations Government Securities
Fund:
Schedule of Investments for March 31, 1998 Statements of Assets and
Liabilities for March 31, 1998 Statements of Operations for the
fiscal year ended March 31, 1998
Statements of Changes in Net Assets for the fiscal year ended March
31, 1998 and the fiscal period ended March 31, 1997
Schedule of Capital Stock Activity for the fiscal year ended March
31, 1998 Notes to Financial Statements Report of Independent
Accountants, dated May 28, 1998
1
<PAGE>
Included in Part C:
Consent of Independent Accountants
(b) Exhibits
Exhibit
Number
------
(1)(a) Articles of Incorporation dated December 9, 1983 and filed
December 13, 1983, are incorporated by reference to
Post-Effective Amendment No. 29 filed on March 19, 1996.
(1)(b) Articles of Amendment dated March 10, 1986 and filed March 11,
1986 are incorporated by reference to Post-Effective Amendment
No. 29 filed on March 19, 1996.
(1)(c) Articles of Amendment dated July 31, 1986 are incorporated by
reference to Post-Effective Amendment No. 29 filed on March 19,
1996.
(1)(d) Articles Supplementary dated July 31, 1986 are incorporated by
reference to Post-Effective Amendment No. 29 filed on March 19,
1996.
(1)(e) Articles of Amendment dated October 4, 1989 are incorporated by
reference to Post-Effective Amendment No. 29 filed on March 19,
1996.
(1)(f) Articles Supplementary dated November 30, 1989 are incorporated
by reference to Post-Effective Amendment No. 29 filed on March
19, 1996.
(1)(g) Articles Supplementary dated March 26, 1991 are incorporated by
reference to Post-Effective Amendment No. 29 filed on March 19,
1996.
(1)(h) Articles Supplementary dated April 15, 1992 and filed April 24,
1992, are incorporated by reference to Post-Effective Amendment
No. 29 filed on March 19, 1996.
(1)(i) Articles Supplementary filed September 22, 1992 are incorporated
by reference to Post-Effective Amendment No. 29 filed on March
19, 1996.
(1)(j) Articles Supplementary dated February 18, 1993 are incorporated
by reference to Post-Effective Amendment No. 29 filed on March
19, 1996.
(1)(k) Articles Supplementary dated July 9, 1993 and filed July 12, 1993
are incorporated by reference to Post-Effective Amendment No. 29
filed on March 19, 1996.
(1)(l) Articles Supplementary dated March 21, 1994 are incorporated by
reference to Post-Effective Amendment No. 29 filed on March 19,
1996.
2
<PAGE>
(1)(m) Articles Supplementary filed December 21, 1994 are incorporated
by reference to Post-Effective Amendment No. 29 filed on March
19, 1996.
(1)(n) Articles Supplementary dated March 18, 1996 are incorporated by
reference to Post-Effective Amendment No. 29 filed on March 19,
1996.
(1)(o) Articles Supplementary dated March 1, 1998 are incorporated by
reference to Post-Effective Amendment No. 29 filed on March 19,
1996.
(l)(p) Articles Supplementary dated October 7, 1998 are incorporated by
reference to Post-Effective Amendment No. 39 filed on November 5,
1998.
(2)(a) Amended and Restated By-Laws are incorporated by reference to
Post-Effective Amendment No. 36, filed June 1, 1998.
(3) None.
(4)(a) Specimen copy of share certificates, shall be filed by amendment.
(5)(a) Investment Advisory Agreement between NationsBanc Advisors, Inc
("NBAI") and Registrant is incorporated by reference to
Post-Effective Amendment No. 28, filed January 29, 1996.
(5)(b) Sub-Investment Advisory Agreement between TradeStreet Investment
Associates, Inc. ("TradeStreet") and Registrant is incorporated
by reference to Post-Effective Amendment No. 28, filed January
29, 1996.
(5)(c) Sub-Advisory Agreement between Gartmore Global Partners
("Gartmore") and Registrant is incorporated by reference to
Post-Effective Amendment No. 28, filed January 29, 1996.
(5)(d) Sub-Advisory Agreement between Boatmen's Capital Management, Inc.
("Boatmen's") and Registrant are incorporated by reference to
Post-Effective Amendment No. 36, filed June 1, 1998.
(5)(e) Sub-Advisory Agreement between Brandes Investment Partners, L.P.
and Registrant are incorporated by reference to Post-Effective
Amendment No. 36, filed June 1, 1998.
(6)(a) Distribution Agreement between Registrant and Stephens Inc. dated
March 31, 1993, is incorporated by reference to Post-Effective
Amendment No. 39 filed on November 5, 1998.
(7) None.
3
<PAGE>
(8)(a) Custody Agreement between Registrant and The Bank of New York
dated, October 19, 1998 is incorporated by reference to
Post-Effective Amendment No. 39 filed on November 5, 1998.
(8)(b) Global Custody Agreement between the Registrant, on behalf of
Nations International Equity Fund, and Morgan Guaranty Trust
Company of New York is incorporated by reference to
post-Effective Amendment No. 2, filed September 28, 1995.
(9)(a) Transfer Agency Agreement between Registrant and NCNB Texas
National Bank, dated October 1, 1991, relating to Institutional
Classes (currently known as Primary Shares), is incorporated by
reference to Post-Effective Amendment No. 39 filed on November 5,
1998.
(9)(b) Transfer Agency and Registrar Agreement, dated June 1, 1992,
between Registrant and The Shareholder Servicing Group, Inc.,
relating to Investor Shares, is incorporated by reference to
Post-Effective Amendment No. 39 filed on November 5, 1998.
(9)(c) Amendment No. 1 dated February 3, 1993, to the Transfer Agency
and Registrar Agreement between Registrant and The Shareholder
Services Group, Inc. dated April 25, 1992, relating to the Money
Market Funds' Investor B Shares and the Non-Money Market Funds'
Investor C Shares of the Company, is incorporated by reference to
Post-Effective Amendment No. 20, filed March 26, 1993.
(9)(d) Amendment No. 2 to the Transfer Agency and Registrar Agreement
between Registrant and The Shareholder Services Group, Inc. dated
April 25, 1992, relating to the addition of the Investor C Shares
to the Money Market Funds of the Company, is incorporated by
reference to Post-Effective Amendment No. 39 filed on November 5,
1998.
(9)(e) Shareholder Services Plan relating to the Primary B Shares, is
incorporated by reference to Post-Effective Amendment No. 39
filed on November 5, 1998.
(9)(f) Form of Shareholder Servicing Agreement, relating to the Primary
B Shares, is incorporated by reference to Post-Effective
Amendment No. 39 filed on November 5, 1998.
(9)(g) Shareholder Servicing Plan for Investor A Shares incorporated by
reference to Post-Effective Amendment No. 21, is incorporated by
reference to Post-Effective Amendment No. 39 filed on November 5,
1998.
4
<PAGE>
(9)(h) Forms of Shareholder Servicing Agreement for Investor A Shares
are incorporated by reference to Post-Effective Amendment No. 21
is incorporated by reference to Post-Effective Amendment No. 39
filed on November 5, 1998.
(9)(i) Amended and Restated Shareholder Servicing Plan for Investor B
Shares of the Money Market Funds and Investor C Shares (formerly
Investor B Shares) of the Non-Money Market Funds is incorporated
by reference to Post-Effective Amendment No. 39 filed on November
5, 1998.
(9)(j) Forms of Shareholder Servicing Agreement for Investor B Shares of
the Money Market Funds and Investor C Shares (formerly Investor B
Shares) of the Non-Money Market Funds are incorporated by
reference to Post-Effective Amendment No. 39 filed on November 5,
1998.
(9)(k) Shareholder Servicing Plan for Investor C Shares of the Money
Market Funds and Investor B Shares (formerly Investor N Shares)
of the Non-Money Market Funds is incorporated by reference to
Post-Effective Amendment No. 39 filed on November 5, 1998.
(9)(l) Forms of Shareholder Servicing Agreement for Investor C Shares of
the Money Market Funds and Investor B Shares (formerly Investor N
Shares) of the Non-Money Market Funds are incorporated by
reference to Post-Effective Amendment No. 39 filed on November 5,
1998.
(9)(m) Shareholder Administration Agreement for Primary B Shares is
incorporated by reference to Post-Effective Amendment No. 28,
filed January 29, 1996.
(9)(n) Cross-Indemnification dated June 27, 1995 between the Company,
Nations Fund Trust and Nations Fund Portfolios, Inc. are
incorporated by reference to Post-Effective Amendment No.
39 filed on November 5, 1998.
(10) Opinion and Consent of Counsel to be filed by amendment.
(11) Consent of Independent Accountants -- PriceWaterhouseCoopers LLP
to be filed by amendment.
(12) None.
(13) None.
(14)(a) Prototype Individual Retirement Account Plan, is incorporated by
reference to Amendment No. 20, filed March 26, 1993.
5
<PAGE>
(15)(a) Amended and Restated Shareholder Servicing and Distribution Plan
pursuant to Rule 12b-1, relating to Investor A Shares, is
incorporated by reference to Post-Effective Amendment No.
39 filed on November 5, 1998.
(15)(b) Form of Sales Support Agreement, relating to Investor A Shares is
incorporated by reference to Post-Effective Amendment No. 39
filed on November 5, 1998.
(15)(c) Amended and Restated Distribution Plan, relating to Investor B
Shares of the Money Market Funds and Investor C Shares (formerly
Investor B Shares) of the Non-Money Market Funds is incorporated
by reference to Post-Effective Amendment No. 39 filed on November
5, 1998.
(15)(d) Form of Sales Support Agreement relating to Investor B Shares of
the Money Market Funds and Investor C Shares (formerly Investor B
Shares) of the Non-Money Market Funds is incorporated by
reference to Post-Effective Amendment No. 39 filed on November 5,
1998.
(15)(e) Distribution Plan relating to the non-money market funds'
Investor B Shares (formerly Investor N Shares) is incorporated by
reference to Post-Effective Amendment No. 39 filed on November 5,
1998.
(15)(f) Form of Sales Support Agreement, relating to non-money market
funds' Investor B Shares (formerly Investor N Shares) is
incorporated by reference to Post-Effective Amendment No. 39
filed on November 5, 1998.
(15)(g) Shareholder Administration Plan for Primary B Shares is
incorporated by reference to Post-Effective Amendment No. 28,
filed January 29, 1996.
(16)(a) Schedules for Computation of Primary A Shares is incorporated by
reference to Post-Effective Amendment No. 21, filed March 29,
1994.
(16)(b) Schedules for Computation of Primary B Shares, shall be filed by
amendment.
(16)(c) Schedules for Computation of Investor A Shares is incorporated by
reference to Post-Effective Amendment No. 21, filed March 29,
1994.
(16)(d) Schedules for Computation of Investor C Shares (formerly Investor
B Shares) is incorporated by reference to Post-Effective
Amendment No. 21, filed March 29, 1994.
(16)(e) Schedules for Computation of Investor N Shares (formerly Investor
C Shares) is incorporated by reference to Post-Effective
Amendment No. 21, filed March 29, 1994.
(17) N/A
6
<PAGE>
(18) Revised Form of Plan entered into by Registrant pursuant to Rule
18f-3 under the Investment Company Act of 1940, is incorporated
by reference to Post-Effective Amendment No. 40, filed November
17, 1998.
(19) 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, Richard H. Rose and Peter Meenan, are
incorporated by reference to Post-Effective Amendment No. 15,
filed December 23, 1992.
Item 25. Persons Controlled By or Under Common Control With Registrant
Registrant is controlled by its Board of Directors.
Item 27. Indemnification
Under the terms of the Maryland Corporation Law and the Registrant's
Charter and By-Laws, incorporated by reference as Exhibits (1) and 2(a)
hereto, provides for the indemnification of Registrant's directors and
employees. Indemnification of Registrant's principal underwriter,
custodian, and transfer agent is provided for, respectively, in the
Registrant's:
1. Administration Agreement with Stephens Inc.;
2. Co-Administration Agreement with First Data Investors Services Group,
Inc.;
3. Distribution Agreement with Stephens;
4. Custody Agreement with Bank of New York;
5. Transfer Agency Agreement with NationsBank; and
6. Transfer Agency and Registrar Agreement with First Data Investors
Services Group, Inc.
7
<PAGE>
The Registrant has entered into a Cross Indemnification Agreement with
Nations Fund Trust (the "Trust") and Nations Portfolios, Inc.
("Portfolios") dated June 27, 1995. The Trust and/or the Portfolios will
indemnify and hold harmless the Company against any losses, claims,
damages or liabilities, to which the Company may become subject, under
the Securities Act of 1933 (the "Act") and 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 Company by the Trust and/or Portfolios expressly for use
therein; and will reimburse the Company for any legal or other expenses
reasonably incurred by the Company in connection with investigating or
defending any such action or claim; provided, however, that the Trust
and/or Portfolios 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 and/or
Portfolios by the Company 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 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 each case subsequently incurred by such indemnified party,
in connection with the defense thereof other than reasonable costs of
investigation.
Registrant has obtained from a major insurance carrier a directors' and
officers' liability policy covering certain types of errors and
omissions. In no event will Registrant indemnify any of its directors,
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 Registrant.
Registrant will comply with Rule 484 under the Act and Release No. 11330
under the 1940 Act, in connection with any indemnification.
8
<PAGE>
Insofar as indemnification for liability arising under the Act may be
permitted to directors, officers, and controlling persons of Registrant
pursuant to the foregoing provisions, or otherwise, Registrant has been
advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and
is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
Registrant of expenses incurred or paid by a director, officer, or
controlling person of Registrant in the successful defense of any action,
suit, or proceeding) is asserted by such director, officer, or
controlling person in connection with the securities being registered,
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
Item 28. Business and Other Connections of Investment Advisers
To the knowledge of the Registrant, none of the directors or officers of
NBAI, TradeStreet or Gartmore except those set forth below, is or has
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 NBAI,
TradeStreet or Gartmore or other subsidiaries of NationsBank Corporation.
(a) NBAI performs investment advisory services for the Registrant and
certain other customers. NBAI is a wholly owned subsidiary of NationsBank, N.A.,
which in turn is a wholly owned banking subsidiary of NationsBank Corporation.
Information with respect to each director and officer of the investment adviser
is incorporated by reference to Form ADV filed by NBAI with the Securities and
Exchange Commission pursuant to the Investment Advisers Act of 1940 (file no.
801-49874).
(b) TradeStreet performs investment sub-advisory services for the
Registrant and certain other customers. TradeStreet is a wholly owned subsidiary
of NationsBank, N.A., which in turn is a wholly owned banking subsidiary of
NationsBank Corporation. Information with respect to each director and officer
of the sub-investment adviser is incorporated by reference to Forms filed by
TradeStreet with the Securities and Exchange Commission pursuant to the
Investment Advisers Act of 1940 (file no. 801-50372).
(c) Gartmore performs investment sub-advisory services for Registrant
and certain other customers. Information with respect to each director and
officer of the sub-investment adviser is incorporated by reference to Forms
filed by Gartmore with the Securities and Exchange Commission pursuant to the
Investment Advisers Act of 1940 (file no. 801-88811).
(d) Boatmen's performs investment sub-advisory services for the
Registrant (and certain other customers). Boatmen's is a wholly owned subsidiary
of NationsBank, N.A., which in turn is a wholly owned banking subsidiary of
NationsBank Corporation. Information with respect to each director and officer
of the sub-investment adviser is incorporated by reference to Forms filed by
Boatmen's with the Securities and Exchange Commission pursuant to the Investment
Advisers Act of 1940 (file no. 801-54630).
9
<PAGE>
(d) Brandes performs investment sub-advisory services for the Registrant
(and certain other customers). Information with respect to each director and
officer of the sub-investment adviser is incorporated by reference to Forms
filed by Brandes with the Securities and Exchange Commission pursuant to the
Investment Advisers Act of 1940 (file no. 801-24896).
Item 29. Principal Underwriters
(a) Stephens Inc., distributor for the Registrant, does not presently act as
investment adviser for any other registered investment companies, but
does act as principal underwriter for the Nations Fund Trust, Nations
Annuity Trust, Nations Fund Portfolios, Inc., Nations Institutional
Reserves, Nations LifeGoal Funds, Inc., Overland Express Funds, Inc.,
Stagecoach Inc., Stagecoach Funds, Inc. and Stagecoach Trust and is the
exclusive placement agent for Master Investment Trust, Managed Series
Investment Trust, Life & Annuity 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 Trust 2003, Inc., Nations Government
Income Term Trust 2004, Inc. and Managed Balanced Target Maturity Fund,
Inc., closed-end management investment companies.
(b) Information with respect to each director and officer of the principal
underwriter is incorporated by reference to Form ADV filed by Stephens
Inc. with the Securities and Exchange Commission pursuant to the
Investment Advisers Act of 1940 (file #501-15510).
(c) Not applicable.
Item 30. Location of Accounts and Records
(1) NationsBank, 901 Main Street Dallas, Texas 75202 (records relating to its
function as custodian for Nations Prime, Nations Treasury, Nations
Government Securities and Nations Equity Income Funds, and records
relating to its function as transfer agent for the Primary A and B
Shares).
(2) NBAI, One NationsBank Plaza, Charlotte, North Carolina 28255 (records
relating to its function as investment adviser).
(3) TradeStreet, One NationsBank Plaza, Charlotte, North Carolina 28255
(records relating to its function as sub-adviser).
(4) Gartmore, Gartmore House, 16-18 Monument Street, London EC3R 8AJ, England
(records relating to its functions as sub-adviser for Nations
International Equity Fund).
(5) Brandes, 12750 High Bluff Drive, San Diego, California 92130 (records
relating to its function as sub-adviser to Nations International Value
Fund).
10
<PAGE>
(6) Boatmen's, 100 North Broadway, St. Louis, Missouri 63102 (records
relating to its function as sub-adviser to Nations U.S. Government Bond
Fund).
(7) Stephens Inc., 111 Center Street, Little Rock, Arkansas 72201 (records
relating to its functions as distributor).
(8) Stephens Inc., 111 Center Street, Little Rock, Arkansas 72201 (records
relating to its functions as Administrator).
(9) First Data Investors Services Group, Inc., One Exchange Place, Boston,
Massachusetts 02109 (records relating to its functions as
Co-Administrator and Transfer Agent.
(10) NationsBank, 1401 Elm Street, Dallas, Texas 75202 (records relating to
its function as Sub-Transfer Agent for the Primary A and B Shares).
(11) The Bank of New York, Avenue des Arts, 35 1040 Brussels, Belgium (records
relating to its function as custodian of Nations International Equity
Fund).
(12) The Bank of New York, 90 Washington Street, New York, New York 10286
(records relating to its function as custodian)
Item 31. Inapplicable.
Item 32. Undertakings
(a) Registrant undertakes to call a meeting for the purpose of voting upon
the question or removal of a director or directors when requested in
writing to do so by the holders of at least 10% of a Fund's outstanding
shares of beneficial interest and in connection with such meeting to
comply with the provisions of Section 16(c) of the 1940 Act, relating to
shareholder communications.
(b) Registrant undertakes to furnish each person to whom a prospectus is
delivered with a copy of the Registrant's most recent annual report to
shareholders upon request and without charge.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and 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
29th day of April, 1999.
NATIONS FUND, INC.
By: *
-----------------------------
A. Max Walker
President and Chairman
of the Board of Directors
By: /s/ Richard H. Blank, Jr.
-----------------------------
Richard H. Blank, Jr.
*Attorney-in-Fact
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment to the Registration Statement has been signed below by
the following persons in the capacities and on the date indicated:
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
---------- ----- ----
<S> <C> <C>
* President and Chairman April 29, 1999
- ------------------------------- of the Board of Directors
(A. Max Walker) (Principal Executive Officer)
/s/ Richard H. Blank, Jr. Treasurer and Secretary April 29, 1999
- ------------------------------ (Principal Financial and
(Richard H. Blank, Jr.) Accounting Officer)
* Director April 29, 1999
- ------------------------------
(Edmund L. Benson, III)
* Director April 29, 1999
- ------------------------------
(James Ermer)
* Director April 29, 1999
- ------------------------------
(William H. Grigg)
* Director April 29, 1999
- ------------------------------
(Thomas F. Keller)
* Director April 29, 1999
- ------------------------------
(Carl E. Mundy, Jr.)
* Director April 29, 1999
- ------------------------------
(Charles B. Walker)
* Director April 29, 1999
- ------------------------------
(Thomas S. Word)
* Director April 29, 1999
- ------------------------------
(James B. Sommers)
/s/ Richard H. Blank, Jr.
Richard H. Blank, Jr.
*Attorney-in-Fact
</TABLE>