As filed with the Securities and Exchange Commission
on March 7, 2000
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. 46 |X|
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 |_|
Amendment No. 47 |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):
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|X| Immediately upon filing pursuant to Rule 485(b); or |_| on (date) pursuant to Rule
485(b), or
|_| 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.
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<PAGE>
EXPLANATORY NOTE
The Registrant is filing this Post-Effective Amendment No. 46 to the
Registration Statement of Nations Fund, Inc. (the "Company") for the purpose of
filing all corporate documents and agreements. The prospectuses and Statement of
Additional Information are hereby incorporated by reference to Post-Effective
Amendment No. 45, filed on July 30, 1999.
<PAGE>
NATIONS FUND, INC.
CROSS REFERENCE SHEET
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Part A
Item No. Prospectus
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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
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Part B
Item No.
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10. Cover Page and Table of Contents............................ Cover Page and Table of Contents
11. Fund History................................................ Introduction
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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
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<PAGE>
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
<PAGE>
NATIONS FUND, INC.
ONE BANK OF AMERICA PLAZA
33rd Floor
Charlotte, NC 28255
1-800-626-2275
FORM N-1A
PART C
OTHER INFORMATION
ITEM 23. Exhibits
All references to the "Registration Statement" in the following
list of Exhibits refer to the Registrant's Registration Statement on Form N-1A
(File Nos. 33-4038; 811-4614)
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Exhibit Letter Description
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(a) Articles of Incorporation:
(a)(1) Articles of Incorporation dated December 9, 1983, filed herewith.
(a)(2) Articles of Amendment dated March 10, 1986, filed herewith.
(a)(3) Articles of Amendment dated July 31, 1986, filed herewith.
(a)(4) Articles Supplementary dated July 31, 1986, filed herewith.
(a)(5) Articles of Amendment dated October 4, 1989, filed herewith.
(a)(6) Articles Supplementary dated November 30, 1989, filed herewith.
(a)(7) Articles Supplementary dated March 26, 1991, filed herewith.
(a)(8) Articles Supplementary dated April 15, 1992, filed herewith.
(a)(9) Articles Supplementary dated September 22, 1992, filed herewith.
(a)(10) Articles Supplementary dated February 18, 1993, filed herewith.
(a)(11) Articles Supplementary dated July 9, 1993, filed herewith.
(a)(12) Articles Supplementary dated March 21, 1994, filed herewith.
(a)(13) Articles Supplementary dated December 21, 1994, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
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Exhibit Letter Description
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(a)(14) Articles Supplementary dated March 18, 1996, filed herewith.
(a)(15) Articles Supplementary dated November 4, 1996, filed herewith.
(a)(16) Articles Supplementary dated February 5, 1997, filed herewith.
(a)(17) Articles Supplementary dated May 1, 1998, filed herewith.
(a)(18) Articles Supplementary dated October 7, 1998, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(b) Bylaws:
(b)(1) Amended and Restated Bylaws dated January 26, 1995, last
amended May 26, 1999, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(c) Instruments Defining Rights of Securities Holders:
Not Applicable
- ---------------------- -------------------------------------------------------------------------------------
(d) Investment Advisory Contracts:
(d)(1) Investment Advisory Agreement between Banc of America Advisors, Inc. (formerly
NationsBanc Advisors, Inc.) ("BAAI") and Nations Fund, Inc. ("Registrant") dated
January 1, 1996, Schedule I dated August 19, 1999, filed herewith.
(d)(2) Sub-Advisory Agreement among BAAI, and Banc of America Capital
Management, Inc. (formerly TradeStreet Investment Associates, Inc.) ("BACAP") and the
Registrant dated January 1, 1996, Schedule I dated February 14, 2000, filed herewith.
(d)(3) Sub-Advisory Agreement among BAAI, Gartmore Global Partners ("Gartmore") and the
Registrant dated April 10, 1996, Schedule I dated May 3, 1999, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(e) Underwriting Contract:
(e)(1) Distribution Agreement between the Registrant and Stephens Inc. ("Stephens") dated
September 1, 1993, Schedule I amended August 19, 1999, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
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Exhibit Letter Description
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(f) Bonus or Profit Sharing Contracts.
(f)(1) Deferred Compensation Plan dated January 26, 1995, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(g) Custodian Agreement:
(g)(1) Custody Agreement between the Registrant and The Bank of
New York ("BNY") dated October 19, 1998, Schedule I dated
August 25, 1999, filed herewith.
(g)(2) Amendment to the Custody Agreement dated September 1, 1999, filed herewith.
(g)(3) Amendment to the Custody Agreement dated February 14, 2000, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(h) Other Material Contracts:
(h)(1) Co-Administration Agreement among the Registrant,
Stephens and BAAI dated December 1, 1998, Schedule I
dated August 19, 1999, filed herewith.
(h)(2) Sub-Administration Agreement among the Registrant, BNY
and BAAI dated December 1, 1998, Schedule I dated August
19, 1999, filed herewith.
(h)(3) Transfer Agency and Services Agreement between PFPC Inc. (formerly First Data
Investor Services Group, Inc.) ("PFPC") and the Nations Funds family dated June 1,
1995, Schedule G dated February 14, 2000, filed herewith.
(h)(4) Amendment to Transfer Agency and Services Agreement dated January 1, 1999, filed
herewith.
(h)(5) Sub-Transfer Agency Agreement between PFPC and Bank of
America, N.A. ("Bank of America") dated September 11,
1995, Schedule A dated February 14, 2000, filed herewith.
(h)(6) Shareholder Servicing Plan relating to Primary B Shares, filed herewith.
(h)(7) Shareholder Servicing Plan relating to Investor A Shares, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
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Exhibit Letter Description
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(h)(8) Amended and Restated Shareholder Servicing Plan relating to
Investor B Shares of the Money Market Funds and Investor
C Shares of the Non-Money Market Funds, Exhibit I amended
August 19, 1999, filed herewith.
(h)(9) Shareholder Servicing Plan relating to Investor C Shares of the
Money Market Funds and Investor B Shares of the Non-Money
Market Funds, Exhibit I amended August 19, 1999, filed
herewith.
(h)(10) Shareholder Servicing Plan relating to Marsico Shares, filed herewith.
(h)(11) Shareholder Servicing Plan relating to Daily Shares, filed herewith.
(h)(12) Cross Indemnification Agreement among Nations Fund Trust, Nations Reserves, Nations
Master Investment Trust, Nations Funds Trust and the
Registrant dated February 14, 2000, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(i) Legal Opinion
Not Applicable
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(j) Other Opinions
Not Applicable
- ---------------------- -------------------------------------------------------------------------------------
(k) Omitted Financial Statements
Not Applicable
- ---------------------- -------------------------------------------------------------------------------------
(l) Initial Capital Agreements:
Not Applicable
- ---------------------- -------------------------------------------------------------------------------------
(m) Rule 12b-1 Plans:
(m)(1) Shareholder Administration Plan relating to Primary B
Shares, Exhibit I amended August 19, 1999, filed
herewith.
(m)(2) Shareholder Servicing and Distribution Plan relating to
Investor A Shares, Exhibit A amended August 19, 1999,
filed herewith.
(m)(3) Distribution Plan relating to Investor B Shares, Exhibit
A amended August 19, 1999, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
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Exhibit Letter Description
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(m)(4) Distribution Plan relating to Investor B Shares of the
Money Market Funds and Investor C Shares of the Non-Money
Market Funds, Exhibit A amended August 19, 1999, filed
herewith.
(m)(5) Distribution Plan relating to Daily Shares, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(n) Financial Data Schedule:
Not Applicable
- ---------------------- -------------------------------------------------------------------------------------
(o) Rule 18f-3 Plan:
(o)(1) Rule 18f-3 Multi-Class Plan amended August 19, 1999, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
(p) Powers of Attorney for Edmund L. Benson, Charles B. Walker, A. Max Walker, Thomas
S. Word, Jr., William H. Grigg, James Ermer, Thomas F. Keller, Carl E. Mundy, Jr.,
James B. Sommers and Cornelius J. Pings, filed herewith.
- ---------------------- -------------------------------------------------------------------------------------
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ITEM 24. Persons Controlled by of Under Common Control with the Fund
No person is controlled by or under common control with the
Registrant.
ITEM 25. Indemnification
Under the terms of the Maryland Corporation Law and the
Registrant's Charter and Bylaws, provides for the indemnification of the
Registrant's directors, officers, employees and other agents. Indemnification of
the Registrant's administrators, distributor, custodian and transfer agents is
provided for, respectively, in the Registrant's:
1. Co-Administration Agreement with Stephens and BAAI;
2. Sub-Administration Agreement with BNY and BAAI;
3. Distribution Agreement with Stephens;
4. Custody Agreement with BNY;
5. Transfer Agency and Services Agreement with PFPC; and
6. Sub-Transfer Agency and Services Agreement with PFPC and
Bank of America.
C-5
<PAGE>
The Registrant has entered into a Cross Indemnification Agreement with
Nations Fund Trust (the "Trust"), Nations Reserves ("Reserves"), Nations Master
Investment Trust ("Master Trust") and Nations Funds Trust ("Funds Trust")dated
February 14, 2000. The Trust, Reserves, Master Trust and/or Funds Trust will
indemnify and hold harmless the Registrant against any losses, claims, damages
or liabilities, to which the Registrant may become subject, under the Securities
Act of 1933, as amended (the "1933 Act") and the Investment Company Act of 1940,
as amended (the "1940 Act") or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any prospectuses, any preliminary prospectuses, the registration
statements, any other prospectuses relating to the securities, or any amendments
or supplements to the foregoing (hereinafter referred to collectively as the
"Offering Documents"), or arise out of or are based upon the omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in the Offering Documents in reliance upon and in
conformity with written information furnished to the Registrant by the Trust,
Reserves, Master Trust and/or Funds Trust expressly for use therein; and will
reimburse the Registrant for any legal or other expenses reasonably incurred by
the Registrant in connection with investigating or defending any such action or
claim; provided, however, that the Trust, Reserves, Master Trust and/or Funds
Trust shall not be liable in any such case to the extent that any such loss,
claim, damage, or liability arises out of or is based upon an untrue statement
or alleged untrue statement or omission or alleged omission made in the Offering
Documents in reliance upon and in conformity with written information furnished
to the Trust, Reserves, Master Trust and/or Funds Trust by the Registrant
expressly for use in the Offering Documents.
Promptly after receipt by an indemnified party above of notice of the
commencement of any action, such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such subsection,
notify the indemnifying party in writing of the commencement thereof; but the
omission to so notify the indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against any indemnified
party and it shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall be entitled to 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.
The 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 the 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
C-6
<PAGE>
misfeasance, bad faith, gross negligence in the performance of his/her duties,
or by reason of his/her reckless disregard of the duties involved in the conduct
of his/her office or arising under his agreement with the Registrant. The
Registrant will comply with Rule 484 under the 1933 Act and Release No. 11330
under the 1940 Act, in connection with any indemnification.
Insofar as indemnification for liability arising under the 1933 Act may
be permitted to directors, officers, and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange Commission ("SEC")
such indemnification is against public policy as expressed in the 1933 Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer, or controlling person of the 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, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the 1933 Act and will be governed by the
final adjudication of such issue.
ITEM 26. Business and Other Connections of the Investment Adviser
To the knowledge of the Registrant, none of the directors or officers
of BAAI, the adviser to the Registrant's portfolios, or BACAP or Gartmore, the
investment sub-advisers, except those set forth below, are or have been, at any
time during the past two calendar years, engaged in any other business,
profession, vocation or employment of a substantial nature, except that certain
directors and officers also hold various positions with, and engage in business
for, the company that owns all the outstanding stock (other than directors'
qualifying shares) of BAAI, BACAP or Gartmore, respectively, or other
subsidiaries of Bank of America Corporation.
(a) BAAI performs investment advisory services for the Registrant and
certain other customers. BAAI is a wholly-owned subsidiary of Bank of America
which in turn is a wholly-owned banking subsidiary of Bank of America
Corporation. Information with respect to each director and officer of the
investment adviser is incorporated by reference to Form ADV filed by BAAI with
the SEC pursuant to the Investment Advisers Act of 1940, as amended (the
"Advisers Act") (file no. 801-49874).
(b) BACAP performs investment sub-advisory services for the Registrant
and certain other customers. BACAP is a wholly-owned subsidiary of Bank of
America Corporation. Information with respect to each director and officer of
the investment sub-adviser is incorporated by reference to Form ADV filed by
BACAP (formerly TradeStreet Investment Associates, Inc.) with the SEC pursuant
to the Advisers Act (file no. 801-50372).
(c) Gartmore performs investment sub-advisory services for the
Registrant and certain other customers. Gartmore is a joint venture structured
as a general
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partnership between NB Partner Corp., a wholly-owned subsidiary of Bank of
America, and Gartmore U.S. Limited, an indirect, wholly-owned subsidiary of
Gartmore Investment Management plc, a UK Company which is the holding company
for a leading UK based international fund management group of companies.
Information with respect to each director and officer of the investment
sub-adviser is incorporated by reference to Form ADV filed by Gartmore with the
SEC pursuant to the Advisers Act (file no. 801-48811).
ITEM 27. Principal Underwriters
(a) Stephens, distributor for the Registrant, does not presently act as
investment adviser for any other registered investment companies, but does act
as distributor for Nations Fund Trust, Nations Reserves, Nations
LifeGoal Funds, Inc., Nations Annuity Trust, Nations Funds Trust, Wells Fargo
Trust, Wells Fargo Variable Trust, and is the exclusive placement agent
for Master Investment Trust, Managed Series Investment Trust, Wells Fargo Core
Trust, Nations Master Investment 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 the 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
with the SEC pursuant to the 1940 Act (file No. 501-15510).
(c) Not applicable.
ITEM 28. Location of Accounts and Records
(1) BAAI, One Bank of America Plaza, Charlotte, NC 28255 (records
relating to its function as investment adviser and
co-administrator).
(2) BACAP, One Bank of America Plaza, Charlotte, NC 28255 (records
relating to its function as investment sub-adviser).
(3) Gartmore, One Bank of America Plaza, Charlotte, NC 28255
(records relating to its function as investment sub-adviser).
(4) Stephens, 111 Center Street, Little Rock, AR 72201 (records
relating to its function as distributor and co-administrator).
(5) PFPC, 400 Bellevue Parkway, Wilmington, DE 19809 (records
relating to its function as transfer agent).
(6) BNY, 100 Church Street, New York, NY 10286 (records relating
to its function as custodian and sub-administrator).
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(7) Bank of America, One Bank of America Plaza, Charlotte, NC
28255 (records relating to its function as sub-transfer agent)
ITEM 29. Management Services
Not Applicable
ITEM 30. Undertakings
Not Applicable
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SIGNATURES
----------
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant certifies that it meets all the requirements
for effectiveness of this Post-Effective Amendment to the Registration Statement
pursuant to Rule 485(b) under the Securities Act of 1933 and has duly caused
this Amendment to its Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Little Rock, State of
Arkansas on the 6th day of March, 2000.
NATIONS 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:
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SIGNATURES TITLE DATE
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* President and Chairman March 6, 2000
- ----------------------------- of the Board of Directors
(A. Max Walker) (Principal Executive Officer)
/s/ Richard H. Blank, Jr. Treasurer and Secretary March 6, 2000
- ----------------------------- (Principal Financial and
(Richard H. Blank, Jr.) Accounting Officer)
* Director March 6, 2000
- -----------------------------
(Edmund L. Benson, III)
* Director March 6, 2000
- -----------------------------
(James Ermer)
* Director March 6, 2000
- -----------------------------
(William H. Grigg)
* Director March 6, 2000
- -----------------------------
(Thomas F. Keller)
* Director March 6, 2000
- -----------------------------
(Carl E. Mundy, Jr.)
* Director March 6, 2000
- -----------------------------
(Charles B. Walker)
* Director March 6, 2000
- -----------------------------
(Cornelius J. Pings)
* Director March 6, 2000
- -----------------------------
(Thomas S. Word)
*
- -----------------------------
(James P. Sommers) Director March 6, 2000
/s/ Richard H. Blank, Jr.
- -----------------------------
Richard H. Blank, Jr.
*Attorney-in-Fact
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<PAGE>
Nations Fund, Inc.
Exhibit Index
Exhibit No. Description
- ----------- -----------
EX-99.A1 Articles of Incorporation
EX-99.A2 Articles of Amendment (3/10/86)
EX-99.A3 Articles of Amendment (7/31/86)
EX-99.A4 Articles Supplementary (7/31/86)
EX-99.A5 Articles of Amendment (10/4/89)
EX-99.A6 Articles Supplementary (11/30/89)
EX-99.A7 Articles Supplementary (3/26/91)
EX-99.A8 Articles Supplementary (4/15/92)
EX-99.A9 Articles Supplementary (9/22/92)
EX-99.A10 Articles Supplementary (2/18/93)
EX-99.A11 Articles Supplementary (7/9/93)
EX-99.A12 Articles Supplementary (3/21/94)
EX-99.A13 Articles Supplementary (12/21/94)
EX-99.A14 Articles Supplementary (3/18/96)
EX-99.A15 Articles Supplementary (11/4/96)
EX-99.A16 Articles Supplementary (2/5/97)
EX-99.A17 Articles Supplementary (5/1/98)
EX-99.A18 Articles Supplementary (10/7/98)
EX-99.B1 Amended and Restated Bylaws
EX-99.D1 Investment Advisory Agreement
EX-99.D2 Sub-Advisory Agreement - TradeStreet Investment Associates,
Inc.
EX-99.D3 Sub-Advisory Agreement - Gartmore Global Partners
EX-99.E1 Distribution Agreement
EX-99.F1 Nations Funds Deferred Compensation Plan
EX-99.G1 Custody Agreement
EX-99.G2 Amendment to the Custody Agreement
EX-99.G3 Amendment No. 2 to the Custody Agreement
EX-99.H1 Co-Administration Agreement
EX-99.H2 Sub-Administration Agreement
EX-99.H3 Transfer Agency Agreement
EX-99.H4 Amendment To Transfer Agency Agreement
EX-99.H5 Sub-Transfer Agency Agreement
EX-99.H6 Shareholder Servicing Plan--Primary B Shares
EX-99.H7 Shareholder Servicing Plan--Investor A Shares
EX-99.H8 Shareholder Servicing Plan--Investor B Shares of Money Market
Funds/Investor C Shares of Non-Money Market Funds
EX-99.H9 Shareholder Servicing Plan for Investor C Shares of Money
Market Funds/Investor B Shares of Non-Money Market Funds
EX-99.H10 Shareholder Servicing Plan--Marsico Shares
EX-99.H11 Shareholder Servicing Plan--Daily Shares
EX-99.H12 Cross Indemnification Agreement
<PAGE>
EX-99.M1 Shareholder Administration Plan
EX-99.M2 Shareholder Servicing and Distribution Plan
EX-99.M3 Distribution Plan--Investor B Shares
EX-99.M4 Distribution Plan--Investor B Shares of Money Market Funds/
Investor C Shares of Non-Money Market Funds
EX-99.M5 Distribution Plan--Daily Shares
EX-99.O1 Rule 18f-3 Plan
EX-99.P Powers of Attorney
ARTICLES OF INCORPORATION
OF
I.T.D. FUND, INC.
FIRST: THE UNDERSIGNED, Stanley N. Griffith, whose post office
address is Eleven Greenway Plaza, Suite 1919, Houston, Texas 77046, being at
least eighteen years of age, does, under and by virtue of the General Laws of
the State of Maryland authorizing the formation of corporations, act as
incorporator with the intention of forming a corporation.
SECOND: The name of the corporation is I.T.D. Fund, Inc.
(hereinafter called the "Corporation").
THIRD: The purpose for which the Corporation is formed and the
business or objects to be transacted, carried on and promoted by it, is to act
as an open-end investment company of the management type registered as such with
the Securities and Exchange Commission pursuant to the Investment Company Act of
1940 and to exercise and generally to enjoy all of the powers, rights and
privileges granted to, or conferred upon, corporations by the general laws of
the State of Maryland now or hereafter in force.
FOURTH: The post office address of the principal office of the
Corporation in the State of Maryland is c/o The Corporation Trust Incorporated,
32 South Street, Baltimore, Maryland 21202. The name of the resident agent of
the Corporation in Maryland is The Corporation Trust Incorporated, 32 South
Street, Baltimore, Maryland 21202.
FIFTH: The total number of shares of capital stock which the
Corporation shall have authority to issue is 1,000,000,000 shares of Common
Stock of the par value of $.001 per share, and having an aggregate par value for
all such shares of $1,000,000.
<PAGE>
SIXTH: The preferences, conversion and other rights, voting
powers, restrictions, limitations as to dividends, qualifications and terms or
conditions of redemption of the Common Stock of the Corporation, shall be as
follows:
(a) To the extent that the Corporation has funds or property
legally available therefor, each holder of shares of stock of the Corporation,
upon proper written request (including signature guarantees, if required by the
Board of Directors) to the Corporation accompanied, when stock certificates
representing such shares are outstanding, by surrender of the appropriate stock
certificate or certificates in proper form for transfer, or any such form as the
Board of Directors may provide, shall be entitled to require the Corporation to
redeem all or any number of the shares standing in the name of such holder on
the books of the Corporation, at the net asset value of such shares computed as
hereinafter provided. Notwithstanding the foregoing, the Board of Directors of
the Corporation may suspend the right of the holders of the shares of stock of
the Corporation to require the Corporation to redeem such shares when permitted
or required to do so by the Investment Company Act of 1940 or any rule or
regulation of the Securities and Exchange Commission promulgated thereunder.
When the Board of Directors of the Corporation, including a
majority of the Directors who are no interested persons as defined in Section
2(a)(19) of the Investment Company Act of 1940, determines in its sole
discretion, that the action is necessary for the business success and general
welfare of the Corporation in order to reduce disproportionate and unduly
burdensome expenses in the operation of the Corporation's affairs, to achieve
efficiencies in the administration of its activities, or to reduce or eliminate
excessive expenditures and undue difficulties in servicing, accounting and
reporting requirements with respect to the accounts of shareowners, it may by
resolution order the redemption of all shares of the stock of the Corporation at
the net asset value of such shares computed as hereinafter provided in accounts
having a net asset value for a period of three months less than that specified
in such resolution (but not exceeding $500 on the date of notice), excepting
accounts established within one year and accounts in which a purchase (other
than reinvestment of dividends and/or capital gains distributions) has been made
within the preceding six calendar months, and further
2
<PAGE>
excepting accounts having a net asset value less than that specified in such
resolution as a result of a decline in the net asset value per share, following
notice to affected holders by mail, postage prepaid, at their addresses
contained in the books and records of the Corporation or its transfer agent, and
subject to such other reasonable terms and conditions as the Board of Directors
may, in its sole discretion, determine appropriate and desirable and to any
requirements of applicable statutes or regulations.
(b) No holder of shares of stock of the Corporation shall, as
such holder, have any right to purchase or subscribe for any shares of stock of
the Corporation, other than such rights, if any, as the Board of Directors of
the Corporation, in its discretion, may from time to time determine.
(c) All persons who shall acquire stock or securities of the
Corporation shall acquire the same subject to the provisions of these Articles
of Incorporation.
SEVENTH: The number of directors of the Corporation shall be
three and the names of those who are now serving and who will serve as such
directors until the first annual meeting and until their successors are duly
chosen and qualified are as follows:
Charles T. Bauer
Robert H. Graham
Gary T. Crum
The By-Laws of the Corporation may fix the number of directors
at a number greater or less than that named in these Articles of Incorporation
and may authorize the Board of Directors, by the vote of a majority of the
entire Board of Directors, to increase or decrease the number of directors fixed
by these Articles of Incorporation or by the By-Laws within the limits specified
from time to time in the By-Laws, provided that in no case shall the number of
directors be less than three, and to fill the vacancies created by any such
increase in the number of directors. Unless otherwise provided by the By-Laws of
the Corporation, the directors of the Corporation need not be stockholders
therein.
3
<PAGE>
EIGHTH: In furtherance and not in limitation of the powers
conferred by the laws of the State of Maryland, the following provisions are
hereby adopted for the purpose of defining and regulating the powers of the
Corporation and of the directors and stockholders:
(a) The Board of Directors of this Corporation is hereby
empowered to authorized the issuance from time to time of shares of stock of
this Corporation and/or securities convertible into shares of stock of this
Corporation, in each case upon such terms and conditions and for such
consideration as such Board of Directors shall from time to time determine.
(b) The Board of Directors of the Corporation shall be
authorized, from time to time, to classify or to reclassify any unissued shares
of stock of the Corporation by setting or changing the preference, conversion or
other rights, voting powers, restrictions, limitation as to dividends,
qualifications or terms and conditions of redemption of the stock and pursuant
to such classification or reclassification to increase or decrease the number of
authorized shares of any class, but the number of shares of any class shall not
be reduced by the Board of Directors below the number of shares thereof then
outstanding and the total number of authorized shares shall not be increased
above one billion (1,000,000,000) shares except by amendment to the
Corporation's Charter. Without limiting the generality of the foregoing, the
dividends and distributions of investment income and capital gains with respect
to the stock of the Corporation and with respect to each class that may
hereafter be created shall be in such amount as may be declared from time to
time by the Board of Directors, and such dividends and distributions may vary
from class to class to such extent and for such purposes as the Board of
Directors may deem appropriate, including but not limited to, the purpose of
complying with requirements or regulatory or legislative authorities.
(c) The Board of Directors of this Corporation is hereby
empowered to authorize the issuance from time to time of fractional shares of
stock of this Corporation, whether now or hereafter authorized, and any
fractional shares so issued shall entitle the holders thereof to exercise voting
rights, received dividends and participate in the distribution of assets of the
Corporation in the event of liquidation or dissolution to the extent of their
proportionate interest represented by such fractional shares.
4
<PAGE>
(d) The Corporation reserves the right to make from time to
time any amendment of its Articles of Incorporation, now or hereafter authorized
by law, including, but without limitation, any amendment which alters the
contract rights as expressly set forth in such Articles of Incorporation of any
outstanding stock.
(e) Except to the extent otherwise prohibited by applicable
law, the Corporation may enter into any management or investment advisory
contract or underwriting contract or any other type of contract with, and may
otherwise engage in any transaction or do business with, any person, firm or
corporation or any subsidiary or other affiliate of any such person, firm or
corporation and may authorize such person, firm or corporation or such
subsidiary or other affiliate to enter into any other contracts or arrangements
with any other person, firm or corporation which relate to the Corporation or
the conduct of its business, notwithstanding that any directors or officers of
the Corporation are or may subsequently become partners, directors, officers,
stockholders or employees or such person, firm or corporation or of such
subsidiary of other affiliate or may have a material financial interest in any
such contract, transaction or business; and except to the extent otherwise
provided by applicable law, no such contract or transaction or business shall be
invalidated or voidable or in any way affected thereby nor shall any of such
directors or officers of the Corporation be liable to the Corporation or to any
stockholder or creditor thereof or to any other person for any loss incurred
solely because of the entering into and performance of such contract or the
engaging in such transaction or business or the existence of such material
financial interest therein, provided that such relationship to such person, firm
or corporation or said subsidiary or affiliate or such material financial
interest was disclosed or otherwise known to the Board of Directors prior to the
Corporation's entering into such contract or engaging in such transaction or
business and in the case of directors of the Corporation that any requirements
of the Maryland General Corporation Law have been satisfied; and provided
further that nothing herein shall protect any director or officer of the
Corporation from liability to the Corporation or its security holders to which
he would be otherwise subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office.
5
<PAGE>
(f) The method of computing the "net asset value" of each
share of stock of the Corporation shall be determined by or pursuant to the
direction of the Board of Directors of the Corporation; and subject to the
authority of the Board of Directors to change the method of such computation,
such net asset value as of the close of business on The New York Stock Exchange,
Inc. on any day shall be computed as follows:
The net asset value of a Corporation share will be determined
as of the close of business on The New York Stock Exchange, Inc. on each
business day on which that Exchange is open for trading by dividing the value of
the Corporation's securities, cash and other assets (including interest and
dividends accrued but not collected) less all its liabilities (including accrued
expenses but excluding capital and surplus), by the number of shares
outstanding. Determination of the Corporation's net asset value per share will
also be made in accordance with generally accepted accounting principles.
The Board of Directors is empowered in its absolute discretion
to establish the methods of determining net asset value of the shares of stock
whenever such methods are deemed by it to be necessary or desirable in order (i)
to enable the Corporation to comply with any provision of the Investment Company
Act of 1940, or any rule or regulation thereunder, or (ii) to more fairly and
accurately reflect the net asset value of such shares of stock.
(g) The stockholders of the Corporation may remove any
director of the Corporation prior to the expiration of his term of office for
cause, and not otherwise, by the affirmative vote of a majority of all votes
entitled to be cast for the election of directors.
(h) Except to the extent otherwise specifically provided in
the Articles of Incorporation or By-Law of the Corporation, the Corporation may
authorize or take any corporate action (including, but without limitation, any
amendment to its Articles of Incorporation) upon the affirmative vote of the
holders of a majority of the outstanding shares of stock entitled to vote
thereon, notwithstanding any provision of the Maryland General Corporation Law
which would otherwise require more than a majority vote of the outstanding
shares of stock to authorize or take such action.
6
<PAGE>
NINTH: The duration of the Corporation shall be perpetual.
IN WITNESS WHEREOF, the undersigned incorporator of I.T.D.
Fund, Inc. who executed the foregoing Articles of Incorporation hereby
acknowledges the same to be his act and further acknowledges that, to the best
of his knowledge, information and belief, the matters and facts set forth
therein are true in all material respects under the penalties of perjury.
Dated the 9th day of December, 1983.
/S/ Stanley N. Griffith
------------------------
Stanley N. Griffith
Sole Incorporator
7
ARTICLES OF AMENDMENT
OF
ARTICLES OF INCORPORATION
L.T.D. FUND, INC., a corporation organized and existing under and by
virtue of the General Laws of the State of Maryland, DOES HEREBY CERTIFY:
FIRST: That the Board of Directors of said corporation, at a meeting
duly held, adopted a resolution proposing and declaring advisable the following
amendment to the Articles of Incorporation of said corporation:
RESOLVED, that the Articles of Incorporation as amended, of
L.T.D. FUND, INC., be amended by changing the Article thereof
numbered "Second" so that, as amended, said Article shall be
and read in full as follows:
"Second: The name of the corporation is Silver Star
Fund, Inc., (hereinafter called the
"Corporation")."
SECOND: That no stock entitled to vote on the matter was outstanding or
subscribed for at the time of director's approval.
THIRD: That the aforesaid amendment was duly adopted in accordance with
the applicable provisions of Sections 3-603 and 3-607 of The General Laws of the
State of Maryland.
IN WITNESS WHEREOF, L.T.D. FUND, INC., has caused this certificate to
be signed by C. T. Bauer, its President, and attested by Stanley M. Griffith,
its Secretary, this 10th day of March, 1986.
ATTEST: L.T.D. FUND, INC.
/s/ Stanley M. Griffith By: /s/ Charles T. Bauer
- ------------------------------- ----------------------------
Stanley M. Griffith, Secretary Charles T. Bauer, President
ARTICLES OF AMENDMENT
OF
ARTICLES OF INCORPORATION
Silver Star Fund, Inc. (the "Corporation"), a corporation organized and
existing under and by virtue of the Public General Laws of the State of
Maryland, does hereby certify:
FIRST: That the Board of Directors by unanimous consent of the
Directors in lieu of a meeting adopted resolutions pursuant to Section
2-408(c) of the Maryland General Corporation Law advising the adoption
of the following amendments to the Articles of Incorporation of the
Corporation:
RESOLVED, that it is recommended as advisable that the
Articles of Incorporation of the Corporation be amended by
changing the Fifth Article thereof to read in full as follows:
FIFTH: The total number of shares of capital stock
which the Corporation shall have authority to issue
is 5,000,000,000 shares of Common Stock of the par
value of $.001 per share, and having an aggregate par
value for all such shares of $5,000,000.
FURTHER RESOLVED, that it is recommended as advisable that the
Eighth Article of the Articles of Incorporation of the
Corporation be amended by changing the reference in the first
sentence of Item (b) of the Eighth Article to read "five
billion (5,000,000,000) shares" instead of "one billion
(1,000,000,000) shares;" and
FURTHER RESOLVED, that it is recommended as advisable that the
Eighth Article of the Articles of Incorporation of the
Corporation be further amended by changing Item (f) of the
Eighth Article to read in full as follows:
(f) The method of computing the "net asset value" of
each share of stock of the Corporation shall be
determined by or pursuant to the direction of the
Board of Directors of the Corporation.
SECOND: That prior to the amendment to the Articles of Incorporation
the Corporation had authority to issue 1,000,000,000 shares of Common
Stock of the par value of $.001 per share, and having an aggregate par
value for all such shares of $1,000,000. That the Corporation pursuant
to its Articles of Incorporation, as amended, has authority to issue
5,000,000,000 shares of Common Stock of the par value of $.001 per
share, and having an aggregate par value for all such shares of
$5,000,000. That the information required by subsection (b)(2)(i) of
Section 2-607 of the Maryland General Corporation Law was not changed
by the amendment.
<PAGE>
THIRD: That the sole shareholder of the Corporation approved the
adoption of the amendments to the Articles of Incorporation of the
Corporation.
FOURTH: That the aforesaid amendment was duly adopted in accordance
with the applicable provisions of Sections 2-603 and 2-607 of the
Maryland General Corporation Law.
IN WITNESS WHEREOF, Silver Star Fund, Inc. has caused this certificate
to be signed by Charles T. Bauer, its President, and attested by Robert H.
Graham, its Secretary, as of July 31, 1986.
Silver Star Fund, Inc.
By: /S/ Charles T. Bauer
--------------------
Charles T. Bauer
President
Attest:
/S/ Robert H. Graham
-----------------
Robert H. Graham
Secretary
The undersigned, President of Silver Star Fund, Inc., who executed on
behalf of said corporation the foregoing Articles of Amendment, of which this
certificate is made a part, hereby acknowledges, in the name and on behalf of
said corporation the foregoing Articles of Amendment to be the corporate act of
said corporation and further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein with respect to
the approval thereof are true in all materials respects under the penalties for
perjury.
By: /S/ Charles T. Bauer
--------------------
Charles T. Bauer
2
SILVER STAR FUND, INC.
ARTICLES SUPPLEMENTARY
SILVER STAR FUND, INC., a Maryland corporation having its principal
office in Baltimore, Maryland (hereinafter called the "Corporation"), hereby
certifies to the State Department of Assessments and Taxation of Maryland, that:
FIRST: The Board of Directors of the Corporation, by unanimous written
consent dated as of July 31, 1986, adopted a resolution reclassifying Three
Billion (3,000,000,000) of the authorized and unissued shares of the par value
of $.001 per share of the Common Stock of the Corporation as shares of "Prime
Portfolio Series Common Stock" by setting or changing before the issuance of
such shares, the preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption thereof as hereinafter set forth.
SECOND: A description of the shares so reclassified with the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemption as set or changed by the Board of Directors of the Corporation as
follows:
(a) The shares of the Prime Portfolio Series Common Stock shall have
the following preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications, and terms
and conditions of redemption:
(1) All consideration received by the Corporation for the
issue or sale of shares of the Prime Portfolio Series Common Stock,
together with all income, earnings, profits, and proceeds thereof,
including any proceeds derived from the sale, exchange or liquidation
thereof, and any funds or payments derived from any reinvestment of
such proceeds in whatever form the same may be, shall irrevocably
belong to such class for all purposes, subject only to the rights of
creditors, and shall be so recorded upon the books of account of the
Corporation. Such consideration, income, earnings, profits, and
proceeds thereof, including any proceeds derived from the sale,
exchange or liquidation thereof, and any funds or payments derived from
any reinvestment of such proceeds, in whatever form the same may be,
are herein referred to as "assets belonging to" such class.
(2) Dividends or distributions on shares of the Prime
Portfolio Series Common Stock, whether payable in stock or cash, shall
be paid only out of earnings, surplus or other assets belonging to such
class.
<PAGE>
(3) In the event of the liquidation or dissolution of the
Corporation, the holders of Prime Portfolio Series Common Stock shall
be entitled to receive, as a class, out of the assets of the
Corporation available for distribution to stockholders, other than
general assets not belonging to any particular class, the assets
belonging to such class. The assets so distributable to the holders of
the Prime Portfolio Series Common Stock shall be distributed among such
stockholders in proportion to the number of shares of such class held
by them and recorded on the books of the Corporation.
(4) The assets belonging to the Prime Portfolio Series Common
Stock shall be charged with the liabilities of the Corporation in
respect of such class and with such class' share of the general
liabilities of the Corporation, in the latter case in the proportion
that the net asset value of such class bears to the net asset value of
all classes and in each case before the allocation of such general
liabilities. The liabilities so charged to the Prime Portfolio Series
Common Stock are herein referred to as "liabilities belonging to" such
class. The determination of the Board of Directors shall be conclusive
as to the allocation of liabilities, including accrued expenses and
reserves, and assets to a given class or classes.
(5) On each matter submitted to a vote of the stockholders,
each holder of a share of Prime Portfolio Series Common Stock shall be
entitled to one vote for each such share standing in his name on the
books of the Corporation and shall vote together with the holders of
all classes of Common Stock as a single class; provided, however, that
holders of the Prime Portfolio Series Common Stock shall have the
exclusive right to vote on any agreement, investment restriction or
other matter requiring shareholder vote that relates only to the Prime
Portfolio and that to the extent class voting is required by the
Investment Company Act of 1940 or Maryland law as to any such matter,
those requirements shall apply. Any fractional share, if any such
fractional share is outstanding, shall carry proportionately all the
rights of a whole share, including the right to vote and the right to
receive dividends, but excluding the right to receive a stock
certificate evidencing a fractional share.
(6) The net asset value of the Prime Portfolio Series Common
Stock shall be computed separately from that of the Government
Portfolio Series Common Stock or any other class of stock of the
Corporation.
(b) Except as otherwise provided herein, the preferences, conversion
and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption
applicable to the Corporation's stock as set forth in the Corporation's
Articles of Incorporation, as it may be amended from time to time,
shall apply to the Prime Portfolio Series Common Stock.
2
<PAGE>
THIRD: The shares aforesaid have been duly reclassified by the Board of
Directors pursuant to the authority and power contained in the Charter of the
Corporation as previously amended.
IN WITNESS WHEREOF, SILVER STAR FUND, INC., has caused these presents
to be signed in its name and on its behalf by its duly authorized officers who
acknowledge that these Articles Supplementary are the act of the Corporation,
that to the best of their knowledge, information and belief all matters and
facts set forth therein relating to the authorization and approval of the
Articles are true in all material respects and this statement is made under the
penalties of perjury, as of July 31, 1986.
[SEAL] SILVER STAR FUND, INC.
By: /S/ Charles T. Bauer
---------------------------
Charles T. Bauer, President
Attest:
/S/ Robert H. Graham
- ----------------------------
Robert H. Graham, Secretary
The undersigned, President of Silver Star Fund, Inc., who executed on
behalf of said corporation the foregoing Articles Supplementary, of which this
certificate is made a part, hereby acknowledges, in the name and on behalf of
said corporation, the foregoing Articles Supplementary to be the corporate act
of said corporation and further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein with respect to
the approval thereof are true in all material respects under the penalties for
perjury.
By: /S/ Charles T. Bauer
--------------------------
Charles T. Bauer, President
3
SILVER STAR FUND INC.
ARTICLES OF AMENDMENT
Silver Star Fund, Inc., a Maryland corporation having its principal
office in Baltimore City (hereinafter called the "Corporation"), certifies that:
FIRST: The Articles of Incorporation of Silver Star Fund, Inc., are
hereby amended by striking out Article SECOND and inserting in lieu thereof the
following:
"SECOND: The name of the corporation is Hattaras Funds, Inc.
(hereinafter referred to as the "Corporation")."
SECOND: The Articles of Incorporation of the Corporation are further
amended by adding a new paragraph (i) to Article EIGHTH of the Articles of
Incorporation to read in its entirety as follows:
"(i) To the fullest extent that limitations on the liability
of directors and officers are permitted by the Maryland General
Corporation Law, no director or officer of the Corporation shall have
any liability to the Corporation or its stockholders for damages. This
limitation on liability applies to events occurring at the time a
person serves as a director or officer of the Corporation whether or
not such person is a director or officer at the time of any proceeding
in which liability is asserted.
The Corporation shall indemnify and advance expenses to its
currently acting and its former directors to the fullest extent that
indemnification of directors is permitted by the Maryland General
Corporation Law. The Corporation shall indemnify and advance expenses
to its officers to the same extent as its directors and to such further
extent as is consistent with law. The Board of Directors may by By-Law,
resolution or agreement make further provisions for indemnification of
directors, officers, employees and agents to the fullest extent
permitted by the Maryland General Corporation Law.
No provision of this Article shall be effective to protect or
purport to protect any director or officer of the Corporation against
any liability to the Corporation or its security holders to which he
would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the
conduct of his office.
References to Maryland General Corporation Law in this Article
are to the law as from time to time amended. No further amendment to
the Articles of Incorporation shall affect any right of any person
under this Article based on any event, omission or proceeding prior to
such amendment."
1
<PAGE>
THIRD: The amendments of the Articles of Incorporation of the
Corporation as hereinabove set forth have been duly advised by the Board of
Directors and approved by the shareholders of the Corporation.
IN WITNESS WHEREOF, Silver Star Fund, Inc. has caused these Articles of
Amendment to be executed by its duly authorized officers who acknowledge that
these Articles of Amendment are the act of the Corporation and state that to the
best of their knowledge, information and belief all matters and facts as set
forth herein relating to the authorization and approval of the amendments set
forth in these Articles of Amendment are true in all material respects and that
this statement is made under the penalties of perjury on October 4, 1989.
[SEAL]
ATTEST: SILVER STAR FUND, INC.
/s/ William H. Kleh /s/ Charles T. Bauer
- -------------------- ----------------------
William H. Kleh Charles T. Bauer
Secretary President
2
HATTERAS FUNDS, INC.
ARTICLES SUPPLEMENTARY
Hatteras Funds, Inc., a Maryland corporation having its principal
office in Baltimore, Maryland (hereinafter called the "Corporation"), hereby
certifies to the State Department of Assessments and Taxation of Maryland that:
FIRST: The Board of Directors, has increased the number of authorized
shares of Common Stock to 10,000,000,000.
SECOND: Prior to the increase, the Corporation had authority to issue
5,000,000,000 shares of Common Stock, comprised of 3,000,000,000 shares of the
Prime Portfolio Series Common Stock and 2,000,000,000 shares of Common Stock
(which may be referred to by the Charter as shares of the Government Portfolio
Series Common Stock) of the par value of $.001 per share, and having an
aggregate par value for such shares of $5,000,000. The Corporation, subsequent
to the increase, has authority to issue 10,000,000,000 shares of Common Stock,
comprised of 3,000,000,000 shares of the Prime Portfolio Series Common Stock and
7,000,000,000 shares of Common Stock (which may be referred to by the Charter as
shares of the Government Portfolio Series common Stock) of the par value of
$.001 per share, and having an aggregate par value for all such shares of
$10,000,000. The Corporation is registered as an open-end investment company
under the Investment Company Act of 1940. The total number of shares of Common
Stock that the Corporation has authority to issue has been increased by the
Board of Directors in accordance with Section 2-105(c) of the laws of the State
of Maryland.
THIRD: The Board of Directors has reclassified One Billion
(1,000,000,000) of the authorized and unissued shares of the par value of $.001
per share of the Common Stock of the Corporation as shares of "Tax-Exempt Money
Market Portfolio Series Common Stock" by setting or changing before the issuance
of such shares, the preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemptions thereof as hereinafter set forth.
(a) The shares of the Tax-Exempt Money Market Portfolio Series
Common Stock shall have the following preferences, conversion
and other rights, voting powers, restrictions, limitations as
to dividends, qualifications, and terms and conditions of
redemptions;
(1) All consideration received by the Corporation for
the issue or sale of shares of the Tax-Exempt Money Market
Portfolio Series Common Stock, together with all income,
earnings, profits, and proceeds thereof,
1
<PAGE>
including any proceeds derived from the sale, exchange or
liquidation thereof, and any funds or payments derived from
any reinvestment of such proceeds in whatever form the same
may be, shall irrevocably belong to such class for all
purposes, subject only to the rights of creditors, and shall
be so recorded upon the books of account of the Corporation.
Such consideration, income, earnings, profits, and proceeds
thereof, including any proceeds derived from the sale,
exchange or liquidation thereof, and any funds or payments
derived from any reinvestment of such proceeds, in whatever
form the same may be, are herein referred to as "assets
belonging to" such class.
(2) Dividends or distributions on shares of the
Tax-Exempt Money Market Portfolio Series Common Stock, whether
payable in stock or cash, shall be paid only out of earnings,
surplus or other assets belonging to such class.
(3) In event of the liquidation or dissolution of the
Corporation, the holders of Tax-Exempt Money Market Portfolio
Series Common Stock shall be entitled to receive, as a class,
out of the assets of the Corporation available for
distribution to stockholders, other than general assets not
belonging to any particular class, the assets belonging to
such class. The assets so distributable to the holders of the
Tax-Exempt Money Market Portfolio Series Common Stock shall be
distributed among such stockholders in proportion to the
number of shares of such class held by them and recorded on
the books of the Corporation.
(4) The assets belonging to the Tax-Exempt Money
Market Portfolio Series Common Stock shall be charged with the
liabilities of the Corporation in respect of such class and
with such class' share of the general liabilities of the
Corporation, in the latter case in the proportion that the net
asset value of such class bears to the net asset value of all
classes and in each case before the allocation of such general
liabilities. The liabilities so charged to the Tax-Exempt
Money Market Portfolio Series Common Stock are herein referred
to as "liabilities belonging to" such class. The determination
of the Board of Directors shall be conclusive as to the
allocation of liabilities, including accrued expenses and
reserves, and assets to a given class or classes.
(5) On each matter submitted to a vote of the
stockholders, each holder of a share of Tax-Exempt Money
Market Portfolio Series Common Stock shall be entitled to one
vote for each such share standing in his name on the books of
the Corporation and shall vote together with the holders of
all classes of Common Stock as a single class; provided,
however, that holders of the Tax-Exempt Money Market Portfolio
Series Common Stock shall have the exclusive right to vote on
any agreement, investment restriction or other matter
requiring shareholder vote that relates only to the Tax-Exempt
Money Market Portfolio and that to the extent class voting is
required by the Investment Company Act of 1940 or Maryland law
as to any such matter, those requirements shall apply. Any
fractional share, if any such fractional share is outstanding,
shall carry proportionately all the rights of a whole share,
including the right to vote and the right to receive
dividends, but excluding the right to receive a stock
certificate evidencing a fractional share.
2
<PAGE>
(6) The net asset value of the Tax-Exempt Money
Market Portfolio Series Common Stock shall be computed
separately from that of the Prime Portfolio Series Common
Stock or the shares referred to herein as the Treasury
Portfolio Series Common Stock or any other class of stock of
the Corporation.
(b) Except as otherwise provided herein, the preferences,
conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and
conditions of redemption applicable to the Corporation's stock
as set forth in the Corporation's Charter, as it may be
amended from time to time, shall apply to the Tax-Exempt Money
Market Portfolio Series Common Stock.
FOURTH: The Common Stock of the Corporation which is not otherwise
reclassified by these Articles Supplementary or by the Charter as shares of the
Prime Portfolio Series Common Stock or the Tax-Exempt Money Market Portfolio
Series Common Stock or as Retail Class Shares of any Portfolio, and which may be
referred to by the Charter as the Government Portfolio Series Common Stock,
shall be referred to hereafter as shares of the "Treasury Portfolio Series
Common Stock" or as the "Common Stock" of the Corporation, as the context
requires.
FIFTH: The Board of Directors has reclassified Five Billion
($5,000,000,000) of the authorized and unissued shares of the par value of $.001
per share of the Common Stock of the Corporation as follows:
one billion (1,000,000,000) of the authorized, unissued shares of
the Prime Portfolio Series Common Stock and one billion
(1,000,000,000) shares of the authorized, unissued shares of Common
Stock of the Corporation are reclassified as "Retail Class" Shares
of the Prime Portfolio Series Common Stock; and
one billion (1,000,000,000) shares of the authorized, unissued
shares of Common Stock of the Corporation are reclassified as
"Retail Class" Shares of the Tax-Exempt Money Market Portfolio
Series Common Stock; and
two billion (2,000,000,000) shares of the authorized, unissued
shares of Common Stock of the Corporation are reclassified as
"Retail Class" Shares of the Treasury Portfolio Series Common
Stock;
3
<PAGE>
by setting or changing before the issuance of such shares, the preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption thereof as
hereinafter set forth. The one billion (1,000,000,000) shares of the Tax-Exempt
Money Market Portfolio Series Common Stock described in Article THIRD of these
Articles Supplementary are hereby reclassified as the "Non-Retail" Class of the
Tax-Exempt Money Market Portfolio Series Common Stock by further setting or
changing before the issuance of such shares, the preferences, conversion and
other rights, voting powers, restrictions, limitations as to dividends,
qualifications and terms and conditions of redemption thereof as hereinafter set
forth. The remaining two billion (2,000,000,000) shares of the Prime Portfolio
Series Common Stock and the remaining two billion (2,000,000,000) shares of the
Treasury Portfolio Series Common Stock shall be hereinafter referred to as the
"Non-Retail" Class of the Prime Portfolio Series Common Stock and the Treasury
Portfolio Series Common Stock, respectively.
The shares of the Retail Classes and the Non-Retail Classes of the Prime,
Treasury and Tax-Exempt Money Market Portfolio Series Common Stock,
respectively, (referred to herein individually as a "Class" or collectively as
the "Classes") shall have the preferences, conversion and other rights, voting
powers, restrictions, limitations as to dividends, qualifications, and terms and
conditions of redemption described each for the corresponding Portfolio which
shall apply to the several Retail and Non-Retail Classes of such Portfolio as a
whole and shall not differentiate between such Retail and Non-Retail classes of
a Portfolio. In addition to those items, the terms below shall apply:
(a) All consideration received by the Corporation for the issue or
sale of shares of each Class of each Portfolio, together with all
income, earnings, profits, and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation thereof,
and any funds or payments derived from any reinvestment of such
proceeds in whatever form the same may be, shall irrevocably belong
to such Class for all purposes, subject only to the rights of
creditors, and shall be so recorded upon the books of account of
the Corporation. Such consideration, income, earnings, profits, and
proceeds thereof, including any proceeds derived from the sale,
exchange or liquidation thereof, and any funds or payments derived
from any reinvestment of such proceeds, in whatever form the same
may be, are herein referred to as "assets belonging to" each such
Class. The assets belonging to each class of each Portfolio may be
invested with the assets belonging to the other class of such
Portfolio and, if so, the income, earnings, profits and proceeds
thereof shall be allocated to each class of the Portfolio in the
proportion that the assets belonging to each class bear to the
total assets of the Portfolio or as otherwise determined by the
Board of Directors.
(b) Dividends or distributions on shares of each Class of each
Portfolio, whether payable in stock or cash, shall be paid only out
of earnings, surplus or other assets belonging to each such Class.
4
<PAGE>
(c) In event of the liquidation or dissolution of the Corporation,
the holders of each Class of each Portfolio shall each be entitled
to receive, as a Class, out of the assets of the Corporation
available for distribution to stockholders, other than general
assets not belonging to any particular Class, assets belonging to
such Class of such Portfolio. The assets so distributable to the
holders of each Class of each Portfolio shall be distributed among
such stockholders in proportion to the number of shares of each
such Class held by them and recorded on the books of the
Corporation.
(d) The assets belonging to each Class of each Portfolio shall be
charged with the expenses and liabilities of the Corporation in
respect of such shares as well as with such Class' share of the
general expenses and liabilities of the Corporation as determined
by the Board of Directors. The expenses and liabilities so charged
to each Class are herein referred to as "expenses and liabilities
belonging to" such Class. The determination of the Board of
Directors shall be conclusive as to the allocation of expenses and
liabilities, including accrued expenses and reserves, and assets to
a given Class or Classes.
(e) On each matter submitted to a vote of the stockholders, each
holder of shares of a Class shall be entitled to one vote for each
such share standing in his name on the books of the Corporation and
shall vote together with the holders of all Classes of stock as a
single Class; provided, however, that holders of each Class of a
Portfolio shall have the exclusive right to vote on any agreement
or other matter requiring shareholder vote that relates only to
that Class of such Portfolio and that to the extent Class voting is
required by the Investment Company Act of 1940 or Maryland law as
to any such matter, those requirements shall apply. Any fractional
share, if any such fractional share is outstanding, shall carry
proportionately all the rights of a whole share, including the
right to vote and the right to receive dividends, but excluding the
right to receive a stock certificate evidencing a fractional share.
(f) The net asset value of each Class of each Portfolio shall be
computed separately from that of each other Class of that Portfolio
or any other class of stock of the Corporation.
SIXTH: The shares aforesaid have been duly reclassified by the Board of
Directors pursuant to authority and power contained in the Charter of the
Corporation.
5
<PAGE>
IN WITNESS WHEREOF, HATTERAS FUNDS, INC. has caused these Articles
Supplementary to be executed by its Executive Vice President and its corporate
seal to be affixed and attested by its Secretary on this 30th day of November,
1989. The Executive Vice President of the Corporation who signed these Articles
Supplementary acknowledges them to be the act of the Corporation, and states
under the penalties of perjury that to the best of his knowledge, information
and belief the matters and facts relating to approval hereof are true in all
material respects.
[SEAL] HATTERAS FUNDS, INC.
By: /S/ Robert H. Graham
---------------------------
Robert H. Graham
Executive Vice President
ATTEST:
/S/ William H. Kleh
- ---------------------------
William H. Kleh, Secretary
6
HATTERAS FUNDS, INC.
ARTICLES SUPPLEMENTARY
Hatteras Funds, Inc., a Maryland corporation having its principal
office in the State of Maryland in Baltimore City (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation hereby increases the
aggregate number of shares of the Non-Retail Class of the Prime Portfolio Series
Common Stock that the Corporation has the authority to issue by six billion
(6,000,000,000) shares and hereby reclassifies one billion (1,000,000,000) of
such shares as shares of the Non-Retail Class of the Equity Income Portfolio
Series Common Stock, one billion (1,000,000,000) of such shares as shares of the
Retail Class of the Equity Income Portfolio Series Common Stock, one billion
(1,000,000,000) of such shares as shares of the Non-Retail Class of the
Government Securities Portfolio Series Common Stock, one billion (1,000,000,000)
of such shares as shares of the Retail Class of the Government Securities
Portfolio Series Common Stock, one billion (1,000,000,000) of such shares as
shares of the Non-Retail Class of the International Equity Portfolio Series
Common Stock and one billion (1,000,000,000) of such shares as shares of the
Retail Class of the International Equity Portfolio Series Common Stock.
SECOND: The shares of the Non-Retail Class of the Prime Portfolio
Series Common Stock reclassified hereby shall have the preferences, conversion
and other rights, voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemption prescribed each for the
corresponding Portfolio which shall apply to the several Retail and Non-Retail
Classes of such Portfolio as a whole and shall not differentiate between such
Retail and Non-Retail Classes of a Portfolio. In addition to those items, the
terms below shall apply:
<PAGE>
(a) All consideration received by the Corporation for the
issue or sale of shares of each Class of each Portfolio, together with all
income, earnings, profits, and proceeds thereof, including any proceeds derived
from the sale, exchange or liquidation thereof, and any funds or payments
derived from any reinvestment of such proceeds in whatever form the same may be,
shall irrevocably belong to such Class for all purposes, subject only to the
rights of creditors, and shall be so recorded upon the books of account of the
Corporation. Such consideration, income, earnings, profits and proceeds thereof,
including any proceeds derived from the sale, exchange or liquidation thereof,
and any funds or payments derived from any reinvestment of such proceeds, in
whatever form the same may be, are herein referred to as "assets belonging to"
each such Class. The assets belonging to each class of each Portfolio may be
invested with the assets belonging to the other class of such Portfolio and, if
so, the income, earnings, profits and proceeds thereof shall be allocated to
each class of the Portfolio in the proportion that the assets belonging to each
class bear to the total assets of the Portfolio or as otherwise determined by
the Board of Directors.
(b) Dividends or distributions on shares of each Class of each
Portfolio, whether payable in stock or cash, shall be paid only out of earnings,
surplus or other assets belonging to each such Class.
2
<PAGE>
(c) In event of the liquidation or dissolution of the
Corporation, the holders of each Class of each Portfolio shall each be entitled
to receive, as a Class, out of the assets of the Corporation available for
distribution to stockholders, other than general assets not belonging to any
particular Class, assets belonging to such Class of such Portfolio. The assets
so distributable to the holders of each Class of each Portfolio shall be
distributed among such stockholders in proportion to the number of shares of
each such Class held by them and recorded on the books of the Corporation.
(d) The assets belonging to each Class of each Portfolio shall
be charged with the expenses and liabilities of the Corporation in respect of
such shares as well as with such Class' share of the general expenses and
liabilities of the Corporation as determined by the Board of Directors. The
expenses and liabilities so charged to each Class are herein referred to as
"expenses and liabilities belonging to" such Class. The determination of the
Board of Directors shall be conclusive as to the allocation of expenses and
liabilities, including accrued expenses and reserves, and assets to a given
Class or Classes.
(e) On each matter submitted to a vote of the stockholders,
each holder of shares of a Class shall be entitled to one vote for each share
standing in his name on the books of the Corporation and shall vote together
with the holders of all Classes of stock as a single Class; provided, however,
that holders of each Class of a Portfolio shall have the exclusive right to vote
on any agreement or other matter requiring shareholder vote that relates only to
that Class of such Portfolio and that to the extent Class voting is required by
the Investment Company Act of 1940 or Maryland Law as to any such matter, those
requirements shall apply. Any fractional share, if such fractional share is
outstanding, shall carry proportionately all the rights of a whole share,
including the right to vote and the right to receive dividends, but excluding
the right to receive a stock certificate evidencing a fractional share.
3
<PAGE>
(f) The net asset value of each Class of each Portfolio shall
be computed separately from that of each other Class of that Portfolio or any
other class of stock of the Corporation.
THIRD: Immediately before the increase in the aggregate number of
shares as set forth in Article FIRST hereto, the Corporation was authorized to
issue ten billion (10,000,000,000) shares of Common Stock, all of which had an
aggregate par value of one tenth of one cent ($.001) per share, having an
aggregate par value of ten million dollars ($10,000,000.00) of which
2,000,000,000 shares were classified as Non-Retail Class of the Prime Portfolio
Series Common Stock, 2,000,000,000 shares were classified as Non-Retail Class of
the Treasury Portfolio Series Common Stock, 1,000,000,000 shares were classified
as Non-Retail Class of the Tax-Exempt Money Market Portfolio Series Common
Stock, 2,000,000,000 shares were classified as Retail Class of the Prime
Portfolio Series Common Stock, 2,000,000,000 shares were classified as Retail
Class of the Treasury Portfolio Series Common Stock and 1,000,000,000 shares
were classified as Retail Class of the Tax-Exempt Money Market Portfolio Series
Common Stock.
FOURTH: As hereby increased and reclassified, the total number of
shares of stock which the Corporation has authority to issue is sixteen billion
(16,000,000,000) shares of Common Stock, all of which are of a par value of one
tenth of one cent ($.001) per share having an aggregate par value of sixteen
million dollars ($16,000,000.00), of which two billion (2,000,000,000) shares
are classified as shares of the Non-Retail Class of Prime Portfolio Series
Common Stock, two billion (2,000,000,000) shares are classified as shares of the
Non-Retail Class of the Treasury Portfolio Series Common Stock, one billion
(1,000,000,000) shares are classified as shares of the Non-Retail Class of the
Tax-Exempt Money Market Portfolio Series Common Stock, two billion
4
<PAGE>
(2,000,000,000) shares are classified as shares of the Retail Class of the Prime
Portfolio Series Common Stock, two billion (2,000,000,000) shares are classified
as shares of the Retail Class of the Treasury Portfolio Series Common Stock, one
billion (1,000,000,000) shares are classified as shares of the Retail Class of
the Tax-Exempt Money Market Portfolio Series Common Stock, one billion
(1,000,000,000) shares are classified as shares of the Non-Retail Class of the
Equity Income Portfolio Series Common Stock, one billion (1,000,000,000) shares
are classified as shares of the Non-Retail Class of the Government Securities
Portfolio Series Common Stock, one billion (1,000,000,000) shares are classified
as shares of the Non-Retail Class of the International Equity Portfolio Series
Common Stock, one billion (1,000,000,000) shares are classified as shares of the
Retail Class of the Equity Income Portfolio Series Common Stock, one billion
(1,000,000,000) shares are classified as shares of the Retail Class of the
Government Securities Portfolio Series Common Stock and one billion
(1,000,000,000) shares are classified as shares of the Retail Class of the
International Equity Portfolio Series Common Stock.
FIFTH: The Corporation is registered as an open-end investment company
under the Investment Company Act of 1940, as amended.
5
<PAGE>
SIXTH: The Board of Directors of the Corporation increased the total
number of shares of Common Stock the Corporation has authority to issue pursuant
to section 2-105(c) of the Maryland General Corporation Law and classified the
increased shares pursuant to authority provided in the Corporation's Charter.
IN WITNESS WHEREOF, HATTERAS FUNDS, INC. has caused these Articles
Supplementary to be executed by its Executive Vice President and its corporate
seal to be affixed and attested by its Secretary on this 26th day of March,
1991. The Executive Vice President of the Corporation who signed these Articles
Supplementary acknowledges them to be the act of the Corporation, and states
under the penalties of perjury that to the best of his knowledge, information
and belief, the matters and facts relating to approval hereof are true in all
material respects.
HATTERAS FUNDS, INC.
By: /S/ Robert H. Graham
---------------------
Robert H. Graham
Executive Vice President
ATTEST:
/S/ William H. Kleh
- --------------------
William H. Kleh
Secretary
6
HATTERAS FUNDS, INC.
ARTICLES SUPPLEMENTARY
Hatteras Funds, Inc., a Maryland corporation having its principal
office in the State of Maryland in Baltimore City (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The Board of Directors, pursuant to resolution at a regular
meeting of the Corporation's Board of Directors on March 19, 1992, hereby
authorizes an increase in the number of authorized shares of common stock of the
Corporation to twenty-four billion (24,000,000,000), all of which have a par
value of one tenth of one cent ($.001) per share having an aggregate par value
of twenty four million dollars ($24,000,000.00).
SECOND: Immediately before the eight billion (8,000,000,000) increase
in the aggregate number of shares as set forth in Article FIRST hereto, the
Corporation was authorized to issue sixteen billion (16,000,000,000) shares of
common stock, all of which had an aggregate par value of one tenth of one cent
($.001) per share, having an aggregate par value of sixteen million dollars
($16,000,000.00), of which two billion (2,000,000,000) shares were classified as
shares of the Retail Class of the Prime Portfolio Series Common Stock, two
billion (2,000,000,000) shares were classified as shares of the Non-Retail Class
of Prime Portfolio Series Common Stock, two billion (2,000,000,000) shares were
classified as shares of the Retail Class of the Treasury Portfolio Series Common
Stock, two billion (2,000,000,000) shares were classified as shares of the
Non-Retail Class of the Treasury Portfolio Series Common Stock, one billion
(1,000,000,000) shares were classified as shares of the Retail Class of the
Tax-Exempt Money Market Portfolio Series Common Stock, one billion
(1,000,000,000) shares were classified as shares of the Non-Retail Class of the
Tax-Exempt Money Market Portfolio Series Common Stock, one billion
(1,000,000,000) shares were classified as shares of the Retail Class of the
Equity Income Portfolio Series Common Stock, one billion (1,000,000,000) shares
were classified as shares of the Non-Retail Class of the Equity Income Portfolio
Series Common Stock, one billion (1,000,000,000) shares were classified as
7
<PAGE>
shares of the Retail Class of the Government Securities Portfolio Series Common
Stock, one billion (1,000,000,000) shares were classified as shares of the
Non-Retail Class of the Government Securities Portfolio Series Common Stock, one
billion (1,000,000,000) shares were classified as shares of the Retail Class of
the International Equity Portfolio Series Common Stock and one billion
(1,000,000,000) shares were classified as shares of the Non-Retail Class of the
International Equity Portfolio Series Common Stock.
THIRD: The Board of Directors hereby changes the names of the
previously authorized sixteen billion (16,000,000,000) shares described in
Article SECOND hereto as follows:
(a) the name of the two billion (2,000,000,000) shares classified
as the Retail Class of the Prime Portfolio Series Common Stock
is changed to Investor A Shares of Nations Prime Portfolio;
(b) the name of the two billion (2,000,000,000) shares classified
as the Non-Retail Class of the Prime Portfolio Series Common
Stock is changed to Trust A Shares of Nations Prime Portfolio;
(c) the name of the two billion (2,000,000,000) shares classified
as the Retail Class of the Treasury Portfolio Series Common
Stock is changed to Investor A Shares of Nations Treasury
Portfolio;
(d) the name of the two billion (2,000,000,000) shares classified
as the Non-Retail Class of the Treasury Portfolio Series
Common Stock is changed to Trust A Shares of Nations Treasury
Portfolio;
2
<PAGE>
(e) the name of the one billion (1,000,000,000) shares of the
Retail Class of the Tax-Exempt Money Market Portfolio Series
Common Stock is changed to Investor A Shares of Nations
Tax-Exempt Money Market Portfolio;
(f) the name of the one billion (1,000,000,000) shares of the
Non-Retail Class of the Tax-Exempt Money Market Portfolio
Series Common Stock is changed to Trust A Shares of Nations
Tax-Exempt Money Market Portfolio;
(g) the name of the one billion (1,000,000,000) shares of the
Retail Class of the Equity Income Portfolio Series Common
Stock is changed to Investor A Shares of Nations Equity Income
Portfolio;
(h) the name of the one billion (1,000,000,000) shares of the
Non-Retail Class of the Equity Income Portfolio Series Common
Stock is changed to Trust A Shares of Nations Equity Income
Portfolio;
(i) the name of the one billion (1,000,000,000) shares of the
Retail Class of the Government Securities Portfolio Series
Common Stock is changed to Investor A Shares of Nations
Government Securities Portfolio;
(j) the name of the one billion (1,000,000,000) shares of the
Non-Retail Class of the Government Securities Portfolio Series
Common Stock is changed to Trust A Shares of Nations
Government Securities Portfolio;
(k) the name of the one billion (1,000,000,000) shares of the
Retail Class of the International Equity Portfolio Series
Common Stock is changed to Investor A Shares of Nations
International Equity Portfolio; and
3
<PAGE>
(l) the name of the one billion (1,000,000,000) shares of the
Non-Retail Class of the International Equity Portfolio Series
Common Stock is changed to Trust A Shares of Nations
International Equity Portfolio.
The preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemptions of such classes of shares have not been changed.
FOURTH: The Board of Directors hereby classifies the additional
authorized but unissued eight billion (8,000,000,000) shares referred to in
Article FIRST as follows
(a) two billion (2,000,000,000) shares are classified as Trust B
Shares of Nations Prime Portfolio;
(b) two billion (2,000,000,000) shares are classified as Trust B
Shares of Nations Treasury Portfolio;
(c) one billion (1,000,000,000) shares are classified as Trust B
Shares of Nations Tax-Exempt Money Market Portfolio;
(d) one billion (1,000,000,000) shares are classified as Investor
B Shares of Nations Equity Income Portfolio;
(e) one billion (1,000,000,000) shares are classified as Trust B
Shares of Nations Equity Income Portfolio;
(f) one billion (1,000,000,000) shares are classified as Investor
B Shares of Nations Government Securities Portfolio;
4
<PAGE>
(g) one billion (1,000,000,000) shares are classified as Trust B
Shares of Nations Government Securities Portfolio;
(h) one billion (1,000,000,000) shares are classified as Investor
B Shares of Nations International Equity Portfolio; and
(i) one billion (1,000,000,000) shares are classified as Trust B
Shares of Nations International Equity Portfolio.
FIFTH: The classes of shares of each Portfolio of the Corporation
referred to in Article FOURTH shall have the following preferences, conversion
and other rights, voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemptions:
(a) All consideration received by the Corporation for the issue or sale
of shares of each class of Shares ("Class") of each Portfolio, together with all
income, earnings, profits, and proceeds thereof, including any proceeds derived
from the sale, exchange or liquidation thereof, and any funds or payments
derived from any reinvestment of such proceeds in whatever form the same may be,
shall irrevocably belong to such Class for all purposes, subject only to the
rights of creditors, and shall be so recorded upon the books of account of the
Corporation. Such consideration, income, earnings, profits and proceeds thereof,
including any proceeds derived from the sale, exchange or liquidation thereof,
and any funds or payments derived from any reinvestment of such proceeds, in
whatever form the same may be, are herein referred to as "assets belonging to"
each such Class. The assets belonging to each Class of each Portfolio may be
invested with the assets belonging to each other Class of such Portfolio and, if
so, the income, earnings, profits and proceeds thereof shall be allocated to
each Class of the Portfolio in the proportion that the assets belonging to each
Class bear to the total assets of the Portfolio or as otherwise determined by
the Board of Directors;
5
<PAGE>
(b) Dividends or distributions on each Class of each Portfolio, whether
payable in stock or cash, shall be paid only out of earnings, surplus or other
assets belonging to each such Class;
(c) In event of the liquidation or dissolution of the Corporation, the
holders of each Class of each Portfolio shall each be entitled to receive, as a
Class, out of the assets of the Corporation available for distribution to
stockholders, other than general assets not belonging to any particular Class,
assets belonging to such Class of such Portfolio. The assets so distributable to
the holders of each Class of each Portfolio shall be distributed among such
stockholders in proportion to the number of shares of each such Class held by
them and recorded on the books of the Corporation;
(d) The assets belonging to each Class of each Portfolio shall be
charged with the expenses and liabilities of the Corporation in respect of such
Class as well as with such Class' share of the general expenses and liabilities
of the Portfolio and/or the Corporation as determined by the Board of Directors.
The expenses and liabilities so charged to each Class are herein referred to as
"expenses and liabilities belonging to" such Class. The determination of the
Board of Directors shall be conclusive as to the allocation of expenses and
liabilities, including accrued expenses and reserves, and assets to a given
Class or Classes;
(e) On each matter submitted to a vote of the stockholders, each holder
of shares of a Class shall be entitled to one vote for each such share standing
in his or her name on the books of the Corporation and shall vote together with
the holders of all Classes of stock of the Corporation as a single class;
provided, however, that holders of a Class of a Portfolio shall have the
exclusive right to vote on any agreement, investment restriction or other matter
requiring shareholder vote that relates only to such Class or Classes of such
Portfolio ("Class Voting"), that holders of all Classes of a Portfolio shall
have the exclusive right to vote on any agreement or other matter requiring
shareholder vote that relates only to that Portfolio ("Portfolio Voting"), and
that to the extent Class Voting or Portfolio Voting is required by the
Investment Company Act of 1940 or Maryland Law as to any matter, those
6
<PAGE>
requirements shall apply. Any fractional share, if any such fractional share is
outstanding, shall carry proportionately all the rights of a whole share,
including the right to vote and the right to receive dividends, but excluding
the right to receive a stock certificate evidencing a fractional share;
(f) The net asset value of each Class of each Portfolio shall be
computed separately from that of each other Class of that Portfolio or any other
class of stock of the Corporation;
(g) Investor B Shares of a Portfolio shall be convertible into Investor
A shares of such Portfolio on such basis and at such time as may be determined
by agreement between the Corporation and holders of Investor B Shares; and
(h) Except as otherwise provided herein, the preferences, conversion
and other rights, voting powers, restrictions, limitations as to dividends,
qualifications and terms and conditions of redemption applicable to the
Corporation's stock as set forth in the Corporations Articles of Incorporation,
as it may be amended from time to time, shall apply.
SIXTH: The Corporation is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended.
SEVENTH: The Board of Directors of the Corporation increased the total
number of shares of common stock the Corporation has authority to issue pursuant
to Section 2-105(c) of the Maryland General Corporation Law, has classified such
increased shares pursuant to Section 2-105(a) of the Maryland General
Corporation Law and the Corporation's Articles of Incorporation, and has changed
the name of the previously authorized and existing shares pursuant to resolution
duly adopted.
7
<PAGE>
EIGHTH: The Board of Directors has duly authorized the filing of these
Articles Supplementary.
IN WITNESS WHEREOF, HATTERAS FUNDS, INC. has caused these Articles
Supplementary to be executed by its President and its corporate seal to be
affixed and attested by its Secretary on this 15th day of April, 1992. The
President of the Corporation who signed these Articles Supplementary
acknowledges them to be the act of the Corporation, and states under the
penalties of perjury that to the best of his knowledge, information and belief,
the matters and facts relating to approval hereof are true in all material
respects.
HATTERAS FUNDS, INC.
[SEAL] By: /S/ Peter Meenan
------------------
Peter Meenan
President
ATTEST:
/S/ Patricia L. Bickimer
- ------------------------
Patricia L. Bickimer
Secretary
8
HATTERAS FUNDS, INC.
ARTICLES OF AMENDMENT
Hatteras Funds, Inc., a Maryland corporation having its principal
office in the State of Maryland in Baltimore City (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation, at a meeting duly
held on June 24, 1992, adopted the following resolutions and directed that the
proposed amendment be submitted for consideration at a special meeting of
shareholders of the Corporation:
RESOLVED, that the Corporation change its name from Hatteras
Funds, Inc. to Nations Fund, Inc.; and further
RESOLVED, that the appropriate officers of the corporation be,
and each hereby is, authorized and directed to prepare,
execute and file such documents, including, but not limited
to, Articles of Amendment and Articles Supplementary, with the
State of Maryland and other regulatory authorities to reflect
the change of the name of the "Corporation."
SECOND: The Articles of Incorporation of Hatteras Funds, Inc. are
hereby amended by striking out existing Article SECOND in its entirety and
inserting in lieu thereof the following:
SECOND: The name of the corporation is Nations Fund, Inc.
(hereinafter referred to as the "Corporation").
THIRD: The amendment to the Articles of Incorporation as set forth
above has been duly advised and approved by the Board of Directors of the
Corporation and approved by the stockholders of the Corporation, in accordance
with the applicable provisions of Sections 2-604 and 2-607 of the General
Corporation Law of the State of Maryland.
FOURTH: The undersigned president acknowledges these Articles of
Amendment to be the corporate act of the Corporation and as to all matters and
facts required to be verified under oath, the undersigned president acknowledges
that to the best of his knowledge, information and belief, these matters and
facts are true in all material respects and that this statement is made under
the penalties for perjury.
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused these Articles of
Amendment to be executed by its duly authorized president and attested to by its
secretary on this 22nd day of September, 1992
[SEAL]
ATTEST: HATTERAS FUNDS,
INC.
/S/ Patricia L. Bickimer /S/ Peter Meenan
- ------------------------ ----------------
Patricia L. Bickimer Peter Meenan
Secretary President
2
NATIONS FUND, INC
ARTICLES SUPPLEMENTARY
Nations Fund, Inc., a Maryland corporation having its principal office
in the State of Maryland in Baltimore City (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The Board of Directors, by resolution at a regular meeting of
the Corporation's Board of Directors on February 3, 1993 and pursuant to Section
2-208.1 of the Maryland General Corporation Law, authorized the appropriate
Officers of the Corporation to take such action as necessary to reclassify the
authorized shares of the Corporation's common stock designated as shares of
Nations Tax-Exempt Money Market Fund. Currently, the three billion shares of
Nations Tax-Exempt Money Market Fund are classified as follows: one billion
(1,000,000,000) shares classified as Investor A Shares, one billion
(1,000,000,000) shares classified as Trust A Shares, and one billion
(1,000,000,000) shares classified as Trust B Shares. The three billion
(3,000,000,000) shares are hereby reclassified as follows:
(1) zero (0) shares classified as Investor A Shares of Nations
Tax-Exempt Money Market Fund;
(2) zero (0) shares classified as Trust A Shares of Nations
Tax-Exempt Money Market Fund;
(3) zero (0) shares classified as Trust B Shares of Nations
Tax-Exempt Money Market Fund; and
(4) three billion (3,000,000,000) shares classified as unissued
shares of capital stock of the Corporation.
SECOND: The Board of Directors, pursuant to resolution at a regular
meeting of the Corporation's Board of Directors on February 3, 1993, authorized
the appropriate Officers of the Corporation to take such action as necessary to
increase the number of authorized shares of common stock of the Corporation to
two hundred thirty billion (230,000,000,000), all of which have a par value of
one tenth of one cent ($.001) per share, having an aggregate par value of two
hundred thirty million dollars ($230,000,000.00).
THIRD: Immediately before the two hundred three billion
(203,000,000,000) increase in the aggregate number of shares as set forth in
Article SECOND hereto, the Corporation was authorized to issue twenty-seven
billion (27,000,000,000) shares of common stock, all of which had an aggregate
par value of one tenth of one cent ($.001) per share, having an aggregate par
value of twenty-seven million dollars ($27,000,000,00).
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Of those twenty-seven billion (27,000,000,000) shares, three billion
shares (3,000,000,000) were classified as unissued shares of capital stock of
the corporation (pursuant to Article FIRST, subparagraph (4)); two billion
(2,000,000,000) shares were classified as Investor A Shares of Nations Prime
Fund; two billion (2,000,000,000) shares were classified as Trust A Shares of
Nations Prime Fund; two billion (2,000,000,000) shares were classified as Trust
B Shares of Nations Prime Fund; two billion (2,000,000,000) shares were
classified as Investor A Shares of Nations Treasury Fund; two billion
(2,000,000,000) shares were classified as Trust A Shares of Nations Treasury
Fund; two billion (2,000,000,000) shares were classified as Trust B Shares of
Nations Treasury Fund; one billion (1,000,000,000) shares were classified as
Investor A Shares of Nations Equity Income Fund; one billion (1,000,000,000)
shares were classified as Investor B Shares of Nations Equity Income Fund; one
billion (1,000,000,000) shares were classified as Trust A Shares of Nations
Equity Income Fund; one billion (1,000,000,000) shares were classified as Trust
B Shares of Nations Equity Income Fund; one billion (1,000,000,000) shares were
classified as Investor A Shares of Nations Government Securities Fund; one
billion (1,000,000,000) shares were classified as Investor B Shares of Nations
Government Securities Fund; one billion ((1,000,000,000) shares were classified
as Trust A Shares of Nations Government Securities Fund; one billion
(1,000,000,000) shares were classified as Trust B Shares of Nations Government
Securities Fund; one billion (1,000,000,000) shares were classified as Investor
A Shares of Nations International Equity Fund; one billion (1,000,000,000)
shares were classified as Investor B Shares of Nations International Equity
Fund; one billion (1,000,000,000) shares were classified as Trust A Shares of
Nations International Equity Fund; and one billion (1,000,000,000) shares were
classified as Trust B Shares of Nations International Equity Fund.
FOURTH: The Board of Directors has duly classified forty-three billion
(43,000,000,000) shares of the unissued shares of capital stock of the
Corporation into a class designated new "Investor A Shares" and has provided for
the issuance of such class. The designation of these 43,000,000,000 Investor A
shares is divided as follows:
(a) eight billion (8,000,000,000) shares are designated as
Investor A Shares of Nations Prime Fund;
(b) eight billion (8,000,000,000) shares are designated as
Investor A Shares of Nations Treasury Fund;
(c) nine billion (9,000,000,000) shares are designated as Investor
A Shares of Nations Equity Income Fund;
(d) nine billion (9,000,000,000) shares are designated as Investor
A Shares of Nations Government Securities Fund; and
(e) nine billion (9,000,000,000) shares are designated as Investor
A Shares of Nations International Equity Fund.
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FIFTH: The Board of Directors has duly classified forty-seven billion
(47,000,000,000) shares of the unissued shares of capital stock of the
Corporation into a class designated new "Investor B Shares" and has provided for
the issuance of such class. The designation of these 47,000,000,000 Investor B
shares is divided as follows:
(a) ten billion (10,000,000,000) shares are designated as Investor
B Shares of Nations Prime Fund;
(b) ten billion (10,000,000,000) shares are designated as Investor
B Shares of Nations Treasury Fund;
(c) nine billion (9,000,000,000) shares are designated as Investor
B Shares of Nations Equity Income Fund;
(d) nine billion (9,000,000,000) shares are designated as Investor
B Shares of Nations Government Securities Fund; and
(e) nine billion (9,000,000,000) shares are designated as Investor
B Shares of Nations International Equity Fund.
SIXTH: The Board of Directors has duly classified thirty billion
(30,000,000,000) shares of the unissued shares of capital stock of the
Corporation into a class designated new "Investor C Shares" and has provided for
the issuance of such class. The designation of these 30,000,000,000 Investor C
shares is divided as follows:
(a) ten billion (10,000,000,000) shares are designated as Investor
C Shares of Nations Equity Income Fund;
(b) ten billion (10,000,000,000) shares are designated as Investor
C Shares of Nations Government Securities Fund; and
(c) ten billion (10,000,000,000) shares are designated as Investor
C Shares of Nations International Equity Fund.
SEVENTH: The Board of Directors has duly classified forty-three billion
(43,000,000,000) shares of the unissued shares of capital stock of the
Corporation into a class designated new "Trust A Shares" and has provided for
the issuance of such class. The designation of these 43,000,000,000 Trust A
shares is divided as follows:
(a) eight billion (8,000,000,000) shares are designated as Trust A
Shares of Nations Prime Fund;
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(b) eight billion (8,000,000,000) shares are designated as Trust A
Shares of Nations Treasury Fund;
(c) nine billion (9,000,000,000) shares are designated as Trust A
Shares of Nations Equity Income Fund;
(d) nine billion (9,000,000,000) shares are designated as Trust A
Shares of Nations Government Securities Fund; and
(e) nine billion (9,000,000,000) shares are designated as Trust A
Shares of Nations International Equity Fund.
EIGHTH: The Board of Directors has duly classified forty-three billion
(43,000,000,000) shares of the unissued shares of capital stock of the
Corporation into a class designated new "Trust B Shares" and has provided for
the issuance of such class. The designation of these 43,000,000,000 Trust B
shares is divided as follows:
(a) eight billion (8,000,000,000) shares are designated as Trust B
Shares of Nations Prime Fund;
(b) eight billion (8,000,000,000) shares are designated as Trust B
Shares of Nations Treasury Fund;
(c) nine billion (9,000,000,000) shares are designated as Trust B
Shares of Nations Equity Income Fund;
(d) nine billion (9,000,000,000) shares are designated as Trust B
Shares of Nations Government Securities Fund; and
(e) nine billion (9,000,000,000) shares are designated as Trust B
Shares of Nations International Equity Fund.
NINTH: The classes of shares of each Fund of the Corporation referred
to in Articles FOURTH, FIFTH, SIXTH, SEVENTH, and EIGHTH shall have the
following preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and terms and conditions of
redemptions:
(a) All consideration received by the Corporation for the issue or sale
of shares of each class of Shares ("Class") of each Fund, together with all
income, earnings, profits, and proceeds thereof, including any proceeds derived
from the sale, exchange or liquidation thereof, and any funds or payments
derived from any reinvestment of such proceeds in whatever form the same may be,
shall irrevocably belong to such Class for all purposes, subject only to the
rights of creditors, and shall be so recorded upon the books of account of the
Corporation. Such consideration, income, earnings, profits and proceeds thereof,
including any proceeds derived from the sale, exchange or liquidation thereof,
and any funds or payments derived from any reinvestment of such proceeds, in
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<PAGE>
whatever form the same may be, are herein referred to as "assets belonging to"
each such Class. The assets belonging to each Class of each Fund may be invested
with the assets belonging to each other Classes of such Fund and, if so, the
income, earnings, profits and proceeds thereof shall be allocated to each Class
of the Fund in the proportion that the assets belonging to each Class bear to
the total assets of the Fund or as otherwise determined by the Board of
Directors;
(b) Dividends or distributions on each Class of each Fund, whether
payable in stock or cash, shall be paid only out of earnings, surplus or other
assets belonging to each such Class;
(c) In event of the liquidation or dissolution of the Corporation, the
holders of each Class of each Fund shall each be entitled to receive, as a
Class, out of the assets of the Corporation available for distribution to
stockholders, other than general assets not belonging to any particular Class,
assets belonging to such Class of such Fund. The assets so distributable to the
holders of each Class of each Fund shall be distributed among such stockholders
in proportion to the number of shares of each such Class held by them and
recorded on the books of the Corporation;
(d) The assets belonging to each Class of each Fund shall be charged
with the expenses and liabilities of the Corporation in respect of such Class as
well as with such Class' share of the general expenses and liabilities of the
Fund and/or the Corporation as determined by the Board of Directors. The
expenses and liabilities so charged to each Class are herein referred to as
"expenses and liabilities belonging to" such Class. The determination of the
Board of Directors shall be conclusive as to the allocation of expenses and
liabilities, including accrued expenses and reserves, and assets to a given
Class or Classes;
(e) On each matter submitted to a vote of the stockholders, each holder
of shares of a Class shall be entitled to one vote for each such share standing
in his or her name on the books of the Corporation and shall vote together with
the holders of all Classes of stock of the Corporation as a single Class;
provided, however, that holders of a Class of a Fund shall have the exclusive
right to vote on any agreement, investment restriction or other matter requiring
shareholder vote that relates only to such Class or Classes of such Fund ("Class
Voting"), that holders of all Classes of a Fund shall have the exclusive right
to vote on any agreement or other matter requiring shareholder vote that relates
only to that Fund ("Fund Voting"), and that to the extent Class Voting or Fund
Voting is required by the Investment Company Act of 1940 or Maryland Law as to
any matter, those requirements shall apply. Any fractional share, if any such
fractional share is outstanding, shall carry proportionately all the rights of a
whole share, including the right to vote and the right to receive dividends, but
excluding the right to receive a stock certificate evidencing a fractional
share;
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(f) The net asset value of each Class of each Fund shall be computed
separately from that of each other Class of that Fund or any other Class of
stock of the Corporation;
(g) Investor B Shares of a Fund shall be convertible into Investor A
Shares of such Fund on such basis and at such time as may be determined by
agreement between the Corporation and holders of Investor B Shares; and
(h) Except as otherwise provided herein, the preferences, conversion
and other rights, voting powers, restrictions, limitations as to dividends,
qualifications and terms and conditions of redemption applicable to the
Corporation's stock as set forth in the Corporation's Articles of Incorporation,
as it may be amended from time to time, shall apply.
TENTH: Following the authorization of the two hundred thirty billion
(230,000,000,000) shares referred to in Article SECOND and classified in
Articles FOURTH, FIFTH, SIXTH, SEVENTH and EIGHTH, the total outstanding shares
of the Corporation's common stock are classified as follows:
(a) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Prime Fund;
(b) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Prime Fund;
(c) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Prime Fund;
(d) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Prime Fund;
(e) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Treasury Fund;
(f) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Treasury Fund;
(g) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Treasury Fund;
(h) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Treasury Fund;
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(i) zero (0) shares are classified as Investor A Shares of Nations
Tax-Exempt Money Market Fund;
(j) zero (0) shares are classified as Trust A Shares of Nations
Tax-Exempt Money Market Fund;
(k) zero (0) shares are classified as Trust B Shares of Nations
Tax-Exempt Money Market Fund;
(l) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Equity Income Fund;
(m) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Equity Income Fund;
(n) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Equity Income Fund;
(o) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Equity Income Fund;
(p) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Equity Income Fund;
(q) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Government Securities Fund;
(r) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Government Securities Fund;
(s) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Government Securities Fund;
(t) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Government Securities Fund;
(u) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Government Securities Fund;
(v) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations International Equity Fund;
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(w) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations International Equity Fund;
(x) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations International Equity Fund;
(y) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations International Equity Fund;
(z) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations International Equity Fund;
The summary and restatement of the total outstanding shares of the
Corporation's common stock in this Article TENTH has not otherwise changed the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemptions of such classes of shares.
ELEVENTH: The Corporation is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended.
TWELFTH: The Board of Directors of the Corporation increased the total
number of shares of common stock the Corporation has authority to issue pursuant
to Section 2-105(c) of the Maryland General Corporation Law, and has classified
such shares pursuant to Section 2-105(a) of the Maryland General Corporation Law
and the Corporation's Articles of Incorporation.
THIRTEENTH: The Board of Directors has duly authorized the filing of
these Articles Supplementary.
IN WITNESS WHEREOF, NATIONS FUND, INC. has caused these Articles
Supplementary to be executed by its President and its corporate seal to be
affixed and attested by its Secretary on this 18th day of February, 1993. The
President of the Corporation who signed these Articles Supplementary
acknowledges them to be the act of the Corporation, and states under the
penalties of perjury that to the best of his knowledge, information and belief,
the matters and facts relating to approval hereof are true in all material
respects.
NATIONS FUND, INC.
[SEAL] By: /s/ Peter Meenan
------------------
Peter Meenan
President
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ATTEST:
/s/ Patricia L. Bickimer
- -------------------------
Patricia L. Bickimer
Secretary
9
NATIONS FUND, INC.
ARTICLES SUPPLEMENTARY
Nations Fund, Inc., a Maryland corporation having its principal office
in the State of Maryland in Baltimore City (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The Board of Directors, pursuant to resolution duly adopted by
unanimous written consent of the Corporation's Board of Directors and Section
2-208.1 of the Maryland General Corporation Law, authorized the appropriate
Officers of the Corporation to take such action as necessary to increase the
number of authorized shares of common stock of the Corporation to two hundred
fifty billion (250,000,000,000), all of which have a par value of one tenth of
one cent ($.001) per share, having an aggregate par value of two hundred fifty
million dollars ($250,000,000.00).
SECOND: Immediately before the twenty billion (20,000,000,000) increase
in the aggregate number of shares as set forth in Article FIRST hereto, the
Corporation was authorized to issue two hundred thirty billion (230,000,000,000)
shares of common stock, all of which had an aggregate par value of one tenth of
one cent ($.001) per share, having an aggregate par value of two hundred thirty
million dollars ($230,000,000.00).
Of those two hundred thirty billion (230,000,000,000) shares, ten
billion (10,000,000,000) shares were classified as Investor A Shares of Nations
Prime Fund; ten billion (10,000,000,000) shares were classified as Investor B
Shares of Nations Prime Fund; ten billion (10,000,000,000) shares were
classified as Trust A Shares of Nations Prime Fund; ten billion (10,000,000,000)
shares were classified as Trust B Shares of Nations Prime Fund; ten billion
(10,000,000,000) shares were classified as Investor A Shares of Nations Treasury
Fund; ten billion (10,000,000,000) shares were classified as Investor B Shares
of Nations Treasury Fund; ten billion (10,000,000,000) shares were
<PAGE>
classified as Trust A Shares of Nations Treasury Fund; ten billion
(10,000,000,000) shares were classified as Trust B Shares of Nations Treasury
Fund; zero (0) shares were classified as Trust A Shares of Nations Tax-Exempt
Money Market Fund Fund; zero (0) shares were classified as Trust A Shares of
Nations Tax-Exempt Money market Fund; zero (0) shares were classified as Trust B
Shares of Nations Tax-Exempt Money Market Fund Fund; ten billion
(10,000,0000,000) shares were classified as Investor A Shares of Nations Equity
Income Fund; ten billion (10,000,000,000) shares were classified as Investor B
Shares of Nations Equity Income Fund; ten billion (10,000,000,0000) shares were
classified as Investor C Shares of Nations Equity Income Fund; ten billion
(10,000,000,000) shares were classified as Trust A Shares of Nations Equity
Income Fund; ten billion (10,000,000,000) shares were classified as Trust B
Shares of Nations Equity Income Fund; ten billion (10,000,000,000) shares were
classified as Investor A Shares of Nations Government Securities Fund; ten
billion (10,000,000,000) shares were classified as Investor B Shares of Nations
Government Securities Fund; ten billion (10,000,000,000) shares were classified
as Investor C Shares of Nations Government Securities Fund; ten billion
(10,000,000,000) shares were classified as Trust A Shares of Nations Government
Securities Fund; ten billion (10,000,000,000) shares were classified as Trust B
Shares of Nations Government Securities Fund; ten billion (10,000,000,000)
shares were classified as Investor A Shares of Nations International Equity
Fund; ten billion (10,000,000,000) shares were classified as Investor B Shares
of Nations International Equity Fund; ten billion (10,000,000,000) shares were
classified as Investor C Shares of Nations International Equity Fund; ten
billion (10,000,000,000) shares were classified as Trust A Shares of Nations
International Equity Fund; and ten billion (10,000,000,000) shares were
classified as Trust B Shares of Nations International Equity Fund.
THIRD: The Board of Directors has duly classified twenty billion
(20,000,000,000) shares of the unissued shares of capital stock of the
Corporation into a class designated new "Investor C Shares" and has provided for
the issuance of such shares. The designation of these 20,000,000,000 Investor C
Shares is divided as follows:
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(a) ten billion (10,000,000,000) shares are designated as Investor
C Shares of Nations Prime Fund; and
(b) ten billion (10,000,000,000) shares are designated as Investor
C Shares of Nations Treasury Fund.
FOURTH: The classes of shares of each Fund of the Corporation referred
to in Article THIRD shall have the following preferences, conversion and other
rights, voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemptions:
(a) All consideration received by the Corporation for the issue or sale
of shares of each class of Shares ("Class") of each Fund, together with all
income, earnings, profits, and proceeds thereof, including any proceeds derived
from the sale, exchange or liquidation thereof, and any funds or payments
derived from any reinvestment of such proceeds in whatever form the same same
may be, shall irrevocably belong to such Class for all purposes, subject only to
the rights of creditors, and shall be so recorded upon the books of account of
the Corporation. Such consideration, income, earnings, profits and proceeds
thereof, including any proceeds derived from the sale, exchange or liquidation
thereof, and any funds or payments derived from any reinvestment of such
proceeds, in whatever form the same may be, are herein referred to as "assets
belonging to" each such Class. The assets belonging to each Class of each Fund
may be invested with the assets belonging to each other Class of such Fund and,
if so, the income, earnings, profits and proceeds thereof shall be allocated to
each Class of the Fund in the proportion that the assets belonging to each Class
bear to the total assets of the Fund or as otherwise determined by the Board of
Directors;
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(b) Dividends or distributions on each Class of each Fund, whether
payable in stock or cash, shall be paid only out of earnings, surplus or other
assets belonging to each such Class;
(c) In event of the liquidation or dissolution of the Corporation, the
holders of each Class of each Fund shall each be entitled to receive, as a
Class, out of the assets of the Corporation available for distribution to
stockholders, other than general assets not belonging to any particular Class,
assets belonging to such Class of such Fund. The assets so distributable to the
holders of each Class of each Fund shall be distributed among such stockholders
in proportion to the number of shares of each such Class held by them and
recorded on the books of the Corporation;
(d) The assets belonging to each Class of each Fund shall be charged
with the expenses and liabilities of the Corporation in respect of such Class as
well as with such Class' share of the general expenses and liabilities of the
Fund and/or the Corporation as determined by the Board of Directors. The expense
and liabilities so charged to each Class are herein referred to as "expenses and
liabilities belonging to" such Class. The determination of the Board of
Directors shall be conclusive as to the allocation of expenses and liabilities,
including accrued expenses and reserves, and assets to a given Class or Classes;
(e) On each matter submitted to a vote of the stockholders, each holder
of shares of a Class shall be entitled to one vote for each such shared standing
in his or her name on the books of the Corporation and shall vote together with
the holders of all Classes of stock of the Corporation as a single Class;
provided, however, that holders of a Class of a Fund shall have the exclusive
right to vote on any agreement, investment restriction or other matter requiring
shareholder vote that relates only to such Class or Classes of such Fund ("Class
Voting'), that holders of all Classes of a Fund shall have the exclusive right
to vote on any agreement or other matter requiring shareholder vote that relates
only to that Fund ("Fund Voting"), and that to the extent Class Voting or Fund
Voting is required by the Investment Company Act of 1940 or Maryland Law as to
any matter, those requirements shall apply. Any fractional share, if any such
fractional share is outstanding, shall carry proportionately all the rights of a
whole share, including the right to vote and the right to receive dividends, but
excluding the right to receive a stock certificate evidencing a fractional
share;
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(f) The net asset value of each Class of each Fund shall be computed
separately from that of each other Class of that Fund or any other Class of
stock of the Corporation;
(g) Investor B Shares of a Fund shall be convertible into Investor A
Shares of such Fund on such basis and at such time as may be determined by
agreement between the Corporation and holders of Investor B Shares; and
(h) Except as otherwise provided herein, the preferences, conversion
and other rights, voting powers, restrictions, limitations as to dividends,
qualifications and terms and conditions of redemption applicable to the
Corporation's stock as set forth in the Corporation's Articles of Incorporation,
as it may be amended from time to time, shall apply.
FIFTH: Following the authorization of the two hundred fifty billion
(250,000,000,000) shares referred to in Article FIRST and classified in Article
THIRD, the total outstanding shares of the Corporation's common stock are
classified as follows:
(a) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Prime Fund;
(b) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Prime Fund;
(c) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Prime Fund;
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(d) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Prime Fund;
(e) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Prime Fund;
(f) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Treasury Fund;
(g) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Treasury Fund;
(h) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Treasury Fund;
(i) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Treasury Fund;
(j) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Treasury Fund;
(k) zero (0) shares are classified as Investor A Shares of Nations
Tax-Exempt Money Market Fund Fund;
(l) zero (0) shares are classified as Trust A Shares of Nations
Tax-Exempt Money Market Fund Fund;
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(m) zero (0) shares are classified as Trust B Shares of Nations
Tax-Exempt Money Market Fund Fund;
(n) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Equity Income Fund;
(o) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Equity Income Fund;
(p) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nation Equity Income Fund;
(q) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Equity Income Fund;
(r) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Equity Income Fund;
(s) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Government Securities Fund;
(t) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Government Securities Fund;
(u) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Government Securities Fund;
(v) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Government Securities Fund;
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(w) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Government Securities Fund;
(x) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations International Equity Fund;
(y) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations International Equity Fund;
(z) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations International Equity Fund;
(aa) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations International Equity Fund; and
(bb) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations International Equity Fund.
The summary and restatement of the total outstanding shares of the
Corporation's common stock in this Article FIFTH has not otherwise changed the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemptions of such classes of shares.
SIXTH: The Corporation is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended.
SEVENTH: The Board of Directors of the Corporation increased the total
number of shares of common stocks the Corporation has authority to issue
pursuant to Section 2-105(c) of the Maryland General Corporation Law, and has
classified such shares pursuant to Section 2-105(a) of the Maryland General
Corporation Law and the Corporation's Articles of Incorporation.
8
<PAGE>
EIGHTH: The Board of Directors has duly authorized the filing of these
Articles Supplementary.
IN WITNESS WHEREOF, NATIONS FUND, INC. has caused these Articles
Supplementary to be executed by its Vice President and its corporate seal to be
affixed and attested by its Assistant Secretary on this 9th day of July, 1993.
The Vice President of the Corporation who signed these Articles Supplementary
acknowledges them to be the act of the Corporation, and states under the
penalties of perjury that to the best of his knowledge, information and belief,
the matters and facts relating to approval hereof are true in all material
respects.
NATIONS FUND, INC.
(SEAL) By: /S/ Richard H. Rose
-------------------
Richard H. Rose
Vice President
ATTEST:
/S/ John E. Pelletier
- ----------------------
John E. Pelletier
Assistant Secretary
9
NATIONS FUND, INC.
ARTICLES SUPPLEMENTARY
Nations Fund, Inc., a Maryland corporation having its principal office
in the State of Maryland in Baltimore City (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The Board of Directors, pursuant to resolution duly adopted by
unanimous written consent, hereby renames the following sixty billion
(60,000,000,000) shares of the Corporation's two hundred fifty billion
(250,000,000,000) shares of authorized common stock, all of which have a par
value of one tenth of one cent ($.001) per share, having an aggregate par value
of two hundred and fifty million dollars ($250,000,000.00):
(a) the name of the ten billion (10,000,000,000) shares classified
as Investor C Shares of Nations Equity Income Fund is changed to
Investor N Shares of Nations Equity Income Fund;
(b) the name of the ten billion (10,000,000,000) shares classified
as Investor B Shares of Nations Equity Income Fund is changed to
Investor C Shares of Nations Equity Income Fund;
(c) the name of the ten billion (10,000,000,000) shares classified
as Investor C Shares of Nations Government Securities Fund is
changed to Investor N Shares of Nations Government Securities
Fund;
(d) the name of the ten billion (10,000,000,000) shares classified
as Investor B Shares of Nations Government Securities Fund is
changed to Investor C Shares of Nations Government Securities
Fund;
(e) the name of the ten billion (10,000,000,000) shares classified
as Investor C Shares of Nations International Equity Fund is
changed to Investor N Shares of Nations International Equity
Fund; and
(f) the name of the ten billion (10,000,000,000) shares classified
as Investor B Shares of Nations International Equity Fund is
changed to Investor C Shares of Nations International Equity
Fund.
The preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption of such classes of shares have not been changed.
<PAGE>
SECOND: Immediately before the renaming of the sixty billion
(60,000,000,000) shares as set forth in Article FIRST hereto, the Corporation's
two hundred fifty billion (250,000,000,000) shares of authorized common stock
were classified as follows:
Ten billion (10,000,000,000) shares were classified as Investor A
Shares of Nations Prime Fund; ten billion (10,000,000,000) shares were
classified as Investor B Shares of Nations Prime Fund; ten billion
(10,000,000,000) shares were classified as Investor C Shares of Nations Prime
Fund; ten billion (10,000,000,000) shares were classified as Trust A Shares of
Nations Prime Fund; ten billion (10,000,000,000) shares were classified as Trust
B Shares of Nations Prime Fund; ten billion (10,000,000,000) shares were
classified as Investor A Shares of Nations Treasury Fund; ten billion
(10,000,000,000) shares were classified as Investor B Shares of Nations Treasury
Fund; ten billion (10,000,000,000) shares were classified as Investor C Shares
of Nations Treasury Fund; ten billion (10,000,000,000) shares were classified as
Trust A Shares of Nations Treasury Fund; ten billion (10,000,000,000) shares
were classified as Trust B Shares of Nations Treasury Fund; zero (0) shares were
classified as Investor A Shares of Nations Tax-Exempt Money Market Fund Fund;
zero (0) shares were classified as Trust A Shares of Nations Tax-Exempt Money
Market Fund; zero (0) shares were classified as Trust B Shares of Nations
Tax-Exempt Money Market Fund Fund; ten billion (10,000,000,000) shares were
classified as Investor A Shares of Nations Equity Income Fund; ten billion
(10,000,000,000) shares were classified as Investor B Shares of Nations Equity
Income Fund; ten billion (10,000,000,000) shares were classified as Investor C
Shares of Nations Equity Income Fund; ten billion (10,000,000,000) shares were
classified as Trust A Shares of Nations Equity Income Fund; ten billion
(10,000,000,000) shares were classified as Trust B Shares of Nations Equity
Income Fund; ten billion (10,000,000,000) shares were classified as Investor A
Shares of Nations Government Securities Fund; ten billion (10,000,000,000)
shares were classified as Investor B Shares of Nations Government Securities
Fund; ten billion (10,000,000,000) shares were classified as Investor C Shares
of Nations Government Securities Fund; ten billion (10,000,000,000) shares were
classified as Trust A Shares of Nations Government Securities Fund; ten billion
(10,000,000,000) shares were classified as Trust B Shares of Nations Government
Securities Fund; ten billion (10,000,000,000) shares were classified as Investor
A Shares of Nations International Equity Fund; ten billion (10,000,000,000)
shares were classified as Investor B Shares of Nations International Equity
Fund; ten billion (10,000,000,000) shares were classified as Investor C Shares
of Nations International Equity Fund; ten billion (10,000,000,000) shares were
classified as Trust A Shares of Nations International Equity Fund; and ten
billion (10,000,000,000) shares were classified as Trust B Shares of Nations
International Equity Fund.
THIRD: Following the renaming of the sixty billion
(60,000,000,000) shares as set forth in Article FIRST, the Corporation's two
hundred fifty billion (250,000,000,000) shares of authorized common stock, all
of which have a par value of one tenth of one cent ($.001) per share, having an
aggregate par value of two hundred fifty million dollars ($250,000,000.00), are
classified as follows:
2
<PAGE>
(a) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Prime Fund;
(b) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Prime Fund;
(c) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Prime Fund;
(d) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Prime Fund;
(e) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Prime Fund;
(f) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Treasury Fund;
(g) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Treasury Fund;
(h) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Treasury Fund;
(i) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Treasury Fund;
(j) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Treasury Fund;
(k) zero (0) shares are classified as Investor A Shares of Nations
Tax-Exempt Money Market Fund;
(l) zero (0) shares are classified as Trust A Shares of Nations
Tax-Exempt Money Market Fund;
(m) zero (0) shares are classified as Trust B Shares of Nations
Tax-Exempt Money Market Fund;
(n) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Equity Income Fund;
(o) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Equity Income Fund;
3
<PAGE>
(p) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Equity Income Fund;
(q) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Equity Income Fund;
(r) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Equity Income Fund;
(s) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Government Securities Fund;
(t) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Government Securities Fund;
(u) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Government Securities Fund;
(v) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Government Securities Fund;
(w) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Government Securities Fund;
(x) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations International Equity Fund;
(y) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations International Equity Fund;
(z) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations International Equity Fund;
(aa) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations International Equity Fund; and
(bb) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations International Equity Fund.
The summary and restatement of the total outstanding shares of the
Corporation's common stock in this Article THIRD has not otherwise changed the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemptions of such classes of shares.
4
<PAGE>
FOURTH: The Corporation is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended.
FIFTH: The Board of Directors of the Corporation has renamed the
authorized and existing shares as set forth in Article FIRST hereto pursuant to
resolution duly adopted.
SIXTH: The Board of Directors has duly authorized the filing of these
Articles Supplementary.
IN WITNESS WHEREOF, NATIONS FUND, INC. has caused these Articles
Supplementary to be executed by its President and its corporate seal to be
affixed and attested by its Secretary on this 21st day of March, 1994. The
President of the Corporation who signed these Articles Supplementary
acknowledges them to be the act of the Corporation, and states under the
penalties of perjury that to the best of his knowledge, information and belief,
the matters and facts relating to approval hereof are true in all material
respects.
NATIONS FUND, INC.
[SEAL] By: /s/ A. Max Walker
-------------------
A. Max Walker
President
ATTEST:
/s/ Richard H. Blank, Jr.
- -------------------------
Richard H. Blank, Jr.
Secretary
5
NATIONS FUND, INC.
ARTICLES SUPPLEMENTARY
Nations Fund, Inc., a Maryland corporation having its principal
office in the State of Maryland in Baltimore City (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The Board of Directors, pursuant to resolution duly adopted
at a regular meeting of the Corporation's Board of Directors on October 14, 1994
and pursuant to Section 2-208.1 of the Maryland Corporation Law authorized the
appropriate Officers of the Corporation to take such action as necessary to
increase the number of authorized shares of common stock of the Corporation to
two hundred seventy billion (270,000,000,000), all of which have a par value of
one tenth of one cent ($.001) per share, having an aggregate par value of two
hundred and seventy million dollars ($270,000,000.00).
SECOND: Immediately before the twenty billion (20,000,000,000)
increase in the aggregate number of shares as set forth in Article FIRST hereto,
the Corporation was authorized to issue two hundred fifty billion
(250,000,000,000) shares of common stock, all of which had a par value of one
tenth of one cent ($.001) per share, having an aggregate par value of two
hundred fifty million dollars ($250,000,000.00).
Of those two hundred fifty billion (250,000,000,000) shares, ten
billion (10,000,000,000) shares were classified as Investor A Shares of Nations
Prime Fund; ten billion (10,000,000,000) shares were classified as Investor B
Shares of Nations Prime Fund; ten billion (10,000,000,000) shares were
classified as Investor C Shares of Nations Prime Fund; ten billion
(10,000,000,000) shares were classified as Trust A Shares of Nations Prime Fund;
ten billion (10,000,000,000) shares were classified as Trust B Shares of Nations
Prime Fund; ten billion (10,000,000,000) shares were classified as Investor A
Shares of Nations Treasury Fund; ten billion (10,000,000,000) shares were
classified as Investor B Shares of Nations Treasury Fund; ten billion
(10,000,000,000) shares were classified as Investor C Shares of Nations Treasury
Fund; ten billion (10,000,000,000) shares were classified as Trust A Shares of
Nations Treasury Fund; ten billion (10,000,000,000) shares were classified as
Trust B Shares of Nations Treasury Fund; zero (0) shares were classified as
Investor A Shares of Nations Tax-Exempt Money Market Fund Fund; zero (0) shares
were classified as Trust A Shares of Nations Tax-Exempt Money Market Fund; zero
(0) shares were classified as Trust B Shares of Nations Tax-Exempt Money Market
Fund Fund; ten billion (10,000,000,000) shares were classified as Investor A
Shares of Nations Equity Income Fund; ten billion (10,000,000,000) shares were
<PAGE>
classified as Investor C Shares of Nations Equity Income Fund; ten billion
(10,000,000,000) shares were classified as Investor N Shares of Nations Equity
Income Fund; ten billion (10,000,000,000) shares were classified as Trust A
Shares of Nations Equity Income Fund; ten billion (10,000,000,000) shares were
classified as Trust B Shares of Nations Equity Income Fund; ten billion
(10,000,000,000) shares were classified as Investor A Shares of Nations
Government Securities Fund; ten billion (10,000,000,000) shares were classified
as Investor C Shares of Nations Government Securities Fund; ten billion
(10,000,000,000) shares were classified as Investor N Shares of Nations
Government Securities Fund; ten billion (10,000,000,000) shares were classified
as Trust A Shares of Nations Government Securities Fund; ten billion
(10,000,000,000) shares were classified as Trust B Shares of Nations Government
Securities Fund; ten billion (10,000,000,000) shares were classified as Investor
A Shares of Nations International Equity Fund; ten billion (10,000,000,000)
shares were classified as Investor C Shares of Nations International Equity
Fund; ten billion (10,000,000,000) shares were classified as Investor N Shares
of Nations International Equity Fund; ten billion (10,000,000,000) shares were
classified as Trust A Shares of Nations International Equity Fund; and ten
billion (10,000,000,000) shares were classified as Trust B Shares of Nations
International Equity Fund.
THIRD: The Board of Directors has duly classified ten billion
(10,000,000,000) shares of the unissued shares of capital stock of the
Corporation into a class designated new "Investor D Shares" and has provided for
the issuance of such class. These 10,000,000,000 Investor D Shares are
designated as Investor D Shares of Nations Prime Fund.
FOURTH: The Board of Directors has duly classified ten billion
(10,000,000,000) shares of the unissued shares of capital stock of the
Corporation into a new class designated new "Investor D Shares" and has provided
for the issuance of such class. These 10,000,000,000 Investor D Shares are
designated as Investor D Shares of Nations Treasury Fund.
FIFTH: The classes of shares of Nations Prime Fund and Nations
Treasury Fund of the Corporation referred to in Articles THIRD and FOURTH shall
have the following preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications, and terms and
conditions of redemptions:
(a) All consideration received by the Corporation for the issue or
sale of shares of each class of Shares ("Class") of each Fund, together with all
income, earnings, profits, and proceeds thereof, including any proceeds derived
from the sale, exchange or liquidation thereof, and any funds or payments
derived from any reinvestment of such proceeds in whatever form the same may be,
shall irrevocably belong to such Class for all purposes, subject only to the
rights of creditors, and shall be so recorded upon the books of account of the
Corporation. Such consideration, income, earnings, profits and proceeds thereof,
including any proceeds derived from the sale, exchange or liquidation thereof,
and any funds or payments derived from any reinvestment of such proceeds, in
whatever form the same may be, are herein referred to as "assets belonging to"
each such Class. The assets belonging to each Class of each Fund may be invested
with the assets belonging to each other Class of such Fund and, if so, the
income, earnings, profits and proceeds thereof shall be allocated to each Class
of the Fund in the proportion that the assets belonging to each Class bear to
the total assets of the Fund or as otherwise determined by the Board of
Directors;
2
<PAGE>
(b) Dividends or distributions on each Class of each Fund, whether
payable in stock or cash, shall be paid only out of earnings, surplus or other
assets belonging to each such Class;
(c) In event of the liquidation or dissolution of the Corporation,
the holders of each Class of each Fund shall each be entitled to receive, as a
Class, out of the assets of the Corporation available for distribution to
stockholders, other than general assets not belonging to any particular Class,
assets belonging to such Class of such Fund. The assets so distributable to the
holders of each Class of each Fund shall be distributed among such stockholders
in proportion to the number of shares of each such Class held by them and
recorded on the books of the Corporation;
(d) The assets belonging to each Class of each Fund shall be
charged with the expenses and liabilities of the Corporation in respect of such
Class as well as with such Class' share of the general expenses and liabilities
of the Fund and/or the Corporation as determined by the Board of Directors. The
expenses and liabilities so charged to each Class are herein referred to as
"expenses and liabilities belonging to" such Class. The determination of the
Board of Directors shall be conclusive as to the allocation of expenses and
liabilities, including accrued expenses and reserves, and assets to a given
Class or Classes;
(e) On each matter submitted to a vote of the stockholders, each
holder of shares of a Class shall be entitled to one vote for each such share
standing in his or her name on the books of the Corporation and shall vote
together with the holders of all Classes of stock of the Corporation as a single
Class; provided, however, that holders of a Class of a Fund shall have the
exclusive right to vote on any agreement, investment restriction or other matter
requiring shareholder vote that relates only to such Class or Classes of such
Fund ("Class Voting"), that holders of all Classes of a Fund shall have the
exclusive right to vote on any agreement or other matter requiring shareholder
vote that relates only to that Fund ("Fund Voting"), and that to the extent
Class Voting or Fund Voting is required by the Investment Company Act of 1940 or
Maryland Law as to any matter, those requirements shall apply. Any fractional
share, if any such fractional share is outstanding, shall carry proportionately
all the rights of a whole share, including the right to vote and the right to
receive dividends, but excluding the right to receive a stock certificate
evidencing a fractional share;
(f) The net asset value of each Class of each Fund shall be
computed separately from that of each other Class of that Fund or any other
class of stock of the Corporation;
(g) Except as otherwise provided herein, the preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption applicable to
the Corporation's stock as set forth in the Corporation's Articles of
Incorporation, as it may be amended from time to time, shall apply.
SIXTH: Following the authorization of the two hundred seventy
billion (270,000,000,000) shares referred to in Article FIRST and classified in
Articles THIRD and FOURTH, the total outstanding shares of the Corporation's
common stock, all of which have a par value of one tenth of one cent ($.001) per
3
<PAGE>
share, having an aggregate par value of two hundred seventy million dollars
($270,000,000.00), are classified as follows:
(a) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Prime Fund;
(b) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Prime Fund;
(c) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Prime Fund;
(d) ten billion (10,000,000,000) shares are classified as Investor
D Shares of Nations Prime Fund;
(e) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Prime Fund;
(f) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Prime Fund;
(g) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Treasury Fund;
(h) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Treasury Fund;
(i) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Treasury Fund;
(j) ten billion (10,000,000,000) shares are classified as Investor
D Shares of Nations Treasury Fund;
(k) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Treasury Fund;
(l) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Treasury Fund;
(m) zero (0) shares are classified as Investor A Shares of Nations
Tax-Exempt Money Market Fund;
(n) zero (0) shares are classified as Trust A Shares of Nations
Tax-Exempt Money Market Fund;
(o) zero (0) shares are classified as Trust B Shares of Nations
Tax-Exempt Money Market Fund;
4
<PAGE>
(p) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Equity Income Fund;
(q) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Equity Income Fund;
(r) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Equity Income Fund;
(s) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Equity Income Fund;
(t) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Equity Income Fund;
(u) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Government Securities Fund;
(v) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Government Securities Fund;
(w) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Government Securities Fund;
(x) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations Government Securities Fund;
(y) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations Government Securities Fund;
(z) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations International Equity Fund;
(aa) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations International Equity Fund;
(bb) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations International Equity Fund;
(cc) ten billion (10,000,000,000) shares are classified as Trust A
Shares of Nations International Equity Fund; and
(dd) ten billion (10,000,000,000) shares are classified as Trust B
Shares of Nations International Equity Fund.
The summary and restatement of the total outstanding shares of the
Corporation's common stock in this Article SIXTH has not otherwise changed the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemptions of such classes of shares.
5
<PAGE>
SEVENTH: The Corporation is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended.
EIGHTH: The Board of Directors of the Corporation increased the
total number of shares of common stock the Corporation has authority to issue
pursuant to Section 2-105(c) of the Maryland General Corporation Law, and has
classified such shares pursuant to Section 2-105(a) of the Maryland General
Corporation Law and the Corporation's Articles of Incorporation.
NINTH: The Board of Directors has duly authorized the filing of
these Articles Supplementary.
6
<PAGE>
IN WITNESS WHEREOF, NATIONS FUND, INC. has caused these Articles
Supplementary to be executed by its President and its corporate seal to be
affixed and attested by its Secretary on this 21st day of December, 1994. The
President of the Corporation who signed these Articles Supplementary
acknowledges them to be the act of the Corporation, and states under the
penalties of perjury that to the best of his knowledge, information and belief,
the matters and facts relating to approval hereof are true in all material
respects.
NATIONS FUND, INC.
[SEAL] By: /S/ A. Max Walker
-----------------------
A. Max Walker
President
ATTEST:
/S/ Richard H. Blank, Jr.
- --------------------------
Richard H. Blank, Jr.
Secretary
7
NATIONS FUND, INC.
ARTICLES SUPPLEMENTARY
Nations Fund, Inc., a Maryland corporation having its principal
office in the State of Maryland in Baltimore City (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The Board of Directors, pursuant to resolution duly adopted
by a majority of the Corporation's Board of Directors at a special meeting of
the Corporation's Board of Directors on February 28, 1996, and pursuant to
Section 2-605 of the Corporations and Associations Article of the Annotated Code
of Maryland, hereby renames the following one hundred billion (100,000,000,000)
shares of the Corporation's two hundred seventy billion (270,000,000,000) shares
of authorized common stock, all of which have a par value of one tenth of one
cent ($.001) per share, having an aggregate par value of two hundred and seventy
million dollars ($270,000,000.00):
(a) the name of the ten billion (10,000,000,000) shares classified
as Trust A Shares of Nations Prime Fund is changed to Primary
A Shares of Nations Prime Fund;
(b) the name of the ten billion (10,000,000,000) shares classified
as Trust B Shares of Nations Prime Fund is changed to Primary
B Shares of Nations Prime Fund;
(c) the name of the ten billion (10,000,000,000) shares classified
as Trust A Shares of Nations Treasury Fund is changed to
Primary A Shares of Nations Treasury Fund;
(d) the name of the ten billion (10,000,000,000) shares classified
as Trust B Shares of Nations Treasury Fund is changed to
Primary B Shares of Nations Treasury Fund; .
(e) the name of the ten billion (10,000,000,000) shares classified
as Trust A Shares of Nations Equity Income Fund is changed to
Primary A Shares of Nations Equity Income Fund;
<PAGE>
(f) the name of the ten billion (10,000,000,000) shares classified
as Trust B Shares of Nations Equity Income Fund is changed to
Primary B Shares of Nations Equity Income Fund;
(g) the name of the ten billion (10,000,000,000) shares classified
as Trust A Shares of Nations Government Securities Fund is
changed to Primary A Shares of Nations Government Securities
Fund;
(h) the name of the ten billion (10,000,000,000) shares classified
as Trust B Shares of Nations Government Securities Fund is
changed to Primary B Shares of Nations Government Securities
Fund;
(i) the name of the ten billion (10,000,000,000) shares classified
as Trust A Shares of Nations International Equity Fund is
changed to Primary A Shares of Nations International Equity
Fund; and
(j) the name of the ten billion (10,000,000,000) shares classified
as Trust B Shares of Nations International Equity Fund is
changed to Primary B Shares of Nations International Equity
Fund.
The preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption of such classes of shares have not been changed.
SECOND: Immediately before the renaming of the one hundred billion
(100,000,000,000) shares as set forth in Article FIRST hereto, the Corporation's
two hundred seventy billion (270,000,000,000) shares of authorized common stock
were classified as follows:
Ten billion (10,000,000,000) shares were classified as Investor A
Shares of Nations Prime Fund; ten billion (10,000,000,000) shares were
classified as Investor B Shares of Nations Prime Fund; ten billion
(10,000,000,000) shares were classified as Investor C Shares of Nations Prime
Fund; ten billion (10,000,000,000) shares were classified as Investor D Shares
of Nations Prime Fund; ten billion (10,000,000,000) shares were classified as
Trust A Shares of Nations Prime Fund; ten billion (10,000,000,000) shares were
classified as Trust B Shares of Nations Prime Fund; ten billion (10,000,000,000)
shares were classified as Investor A Shares of Nations Treasury Fund; ten
billion (10,000,000,000) shares were classified as Investor B Shares of Nations
Treasury Fund; ten billion (10,000,000,000) shares were classified as Investor C
Shares of Nations Treasury Fund; ten billion (10,000,000,000) shares were
classified as Investor D Shares of Nations Treasury Fund; ten billion
(10,000,000,000) shares were classified as Trust A Shares of Nations Treasury
Fund; ten billion (10,000,000,000) shares were classified as Trust B Shares of
Nations Treasury Fund; zero (0) shares were classified as Investor A Shares of
Nations Tax-Exempt Money Market Fund; zero (0) shares were classified as Trust A
Shares of Nations Tax-Exempt Money Market Fund; zero (0) shares were classified
as Trust B Shares of Nations Tax-Exempt Money Market Fund; ten billion
(10,000,000,000) shares were classified as Investor A Shares of Nations Equity
Income Fund; ten billion (10,000,000,000) shares were classified as Investor C
2
<PAGE>
Shares of Nations Equity Income Fund; ten billion (10,000,000,000) shares were
classified as Investor N Shares of Nations Equity Income Fund; ten billion
(10,000,000,000) shares were classified as Trust A Shares of Nations Equity
Income Fund; ten billion (10,000,000,000) shares were classified as Trust B
Shares of Nations Equity Income Fund; ten billion (10,000,000,000) shares were
classified as Investor A Shares of Nations Government Securities Fund; ten
billion (10,000,000,000) shares were classified as Investor C Shares of Nations
Government Securities Fund; ten billion (10,000,000,000) shares were classified
as Investor N Shares of Nations Government Securities Fund; ten billion
(10,000,000,000) shares were classified as Trust A Shares of Nations Government
Securities Fund; ten billion (10,000,000,000) shares were classified as Trust B
Shares of Nations Government Securities Fund; ten billion (10,000,000,000)
shares were classified as Investor A Shares of Nations International Equity
Fund; ten billion (10,000,000,000) shares were classified as Investor C Shares
of Nations International Equity Fund; ten billion (10,000,000,000) shares were
classified as Investor N Shares of Nations International Equity Fund; ten
billion (10,000,000,000) shares were classified as Trust A Shares of Nations
International Equity Fund; and ten billion (10,000,000,000) shares were
classified as Trust B Shares of Nations International Equity Fund.
THIRD: Following the renaming of the one hundred billion
(100,000,000,000) shares as set forth in Article FIRST, the Corporation's two
hundred seventy billion (270,000,000,000) shares of authorized common stock, all
of which have a par value of one tenth of one cent ($.001) per share, having an
aggregate par value of two hundred seventy million dollars ($270,000,000.00),
are classified as follows:
(a) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Prime Fund;
(b) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Prime Fund;
(c) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Prime Fund;
(d) ten billion (10,000,000,000) shares are classified as Investor
D Shares of Nations Prime Fund;
(e) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Prime Fund;
(f) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Prime Fund;
(g) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Treasury Fund;
(h) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Treasury Fund;
(i) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Treasury Fund;
3
<PAGE>
(j) ten billion (10,000,000,000) shares are classified as Investor
D Shares of Nations Treasury Fund;
(k) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Treasury Fund;
(l) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Treasury Fund;
(m) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Equity Income Fund;
(n) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Equity Income Fund;
(o) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Equity Income Fund;
(p) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Equity Income Fund;
(q) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Equity Income Fund;
(r) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Government Securities Fund;
(s) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Government Securities Fund;
(t) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Government Securities Fund;
(u) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Government Securities Fund;
(v) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Government Securities Fund;
(w) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations International Equity Fund;
(x) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations International Equity Fund;
4
<PAGE>
(y) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations International Equity Fund;
(z) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations International Equity Fund; and
(aa) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations International Equity Fund.
The summary and restatement of the total outstanding shares of the
Corporation's common stock in this Article THIRD has not otherwise changed the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemptions of such classes of shares.
FOURTH: The Corporation is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended.
FIFTH: The Board of Directors of the Corporation has renamed the
authorized and existing shares as set forth in Article FIRST hereto pursuant to
resolution duly adopted.
SIXTH: The Board of Directors has duly authorized the filing of
these Articles Supplementary.
IN WITNESS WHEREOF, NATIONS FUND, INC. has caused these Articles
Supplementary to be executed by its President and its corporate seal to be
affixed and attested by its Secretary on this 20th day of March, 1996. The
President of the Corporation who signed these Articles Supplementary
acknowledges them to be the act of the Corporation, and states under the
penalties of perjury that to the best of his knowledge, information and belief,
the matters and facts relating to approval hereof are true in all material
respects.
NATIONS FUND, INC.
[SEAL] By: /s/ A. Max Walker
-------------------
A. Max Walker
President
ATTEST:
/s/ Richard H. Blank, Jr.
- ------------------------
Richard H. Blank, Jr.
Secretary
5
NATIONS FUND, INC.
ARTICLES SUPPLEMENTARY
Nations Fund, Inc., a Maryland corporation having its principal
office in the State of Maryland in Baltimore City (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The Board of Directors, pursuant to resolution duly adopted
by a majority of the Corporation's Board of Directors at a meeting of the
Corporation's Board of Directors on October 11, 1996, and pursuant to Section
2-605 of the Corporations and Associations Article of the Annoted Code of
Maryland, hereby renames the following twenty billion (20,000,000,000) shares of
the Corporation's two hundred seventy billion (270,000,000,000) shares of
authorized common stock, all of which have a par value of one tenth of one cent
($.001) per share, having an aggregate par value of two hundred and seventy
million dollars ($270,000,000.00):
(a) the name of the ten billion (10,000,000,000) shares classified
as Investor D Shares of Nations Prime Fund is changed to Daily
Shares of Nations Prime Fund;
(b) the name of the ten billion (10,000,000,000) shares classified
as Investor D Shares of Nations Treasury Fund is changed to
Daily Shares of Nations Treasury Fund;
The preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption of such classes of shares have not been changed.
SECOND: Immediately before the renaming of the twenty billion
(20,000,000,000) shares as set forth in Article FIRST hereto, the Corporation's
two hundred seventy billion (270,000,000,000) shares of authorized common stock
were classified as follows:
Ten billion (10,000,000,000) shares were classified as Investor A
Shares of Nations Prime Fund; ten billion (10,000,000,000) shares were
classified as Investor B Shares of Nations Prime Fund; ten billion
(10,000,000,000) shares were classified as Investor C Shares of Nations Prime
Fund; ten billion (10,000,000,000) shares were classified as Investor D Shares
of Nations Prime Fund; ten billion (10,000,000,000) shares were classified as
Primary A Shares of Nations Prime Fund; ten billion (10,000,000,000) shares were
classified as Primary B Shares of Nations Prime Fund; ten billion
(10,000,000,000) shares were classified as Investor A Shares of Nations Treasury
<PAGE>
Fund; ten billion (10,000,000,000) shares were classified as Investor B Shares
of Nations Treasury Fund; ten billion (10,000,000,000) shares were classified as
Investor C Shares of Nations Treasury Fund; ten billion (10,000,000,000) shares
were classified as Investor D Shares of Nations Treasury Fund; ten billion
(10,000,000,000) shares were classified as Primary A Shares of Nations Treasury
Fund; ten billion (10,000,000,000) shares were classified as Primary B Shares of
Nations Treasury Fund; zero (0) shares were classified as Investor A Shares of
Nations Tax-Exempt Money Market Fund Fund; zero (0) shares were classified as
Primary A Shares of Nations Tax-Exempt Money Market Fund; zero (0) shares were
classified as Primary B Shares of Nations Tax-Exempt Money Market Fund Fund; ten
billion (10,000,000,000) shares were classified as Investor A Shares of Nations
Equity Income Fund; ten billion (10,000,000,000) shares were classified as
Investor B Shares of Nations Equity Income Fund; ten billion (10,000,000,000)
shares were classified as Investor C Shares of Nations Equity Income Fund; ten
billion (10,000,000,000) shares were classified as Primary A Shares of Nations
Equity Income Fund; ten billion (10,000,000,000) shares were classified as
Primary B Shares of Nations Equity Income Fund; ten billion (10,000,000,000)
shares were classified as Investor A Shares of Nations Government Securities
Fund; ten billion (10,000,000,000) shares were classified as Investor B Shares
of Nations Government Securities Fund; ten billion (10,000,000,000) shares were
classified as Investor C Shares of Nations Government Securities Fund; ten
billion (10,000,000,000) shares were classified as Primary A Shares of Nations
Government Securities Fund; ten billion (10,000,000,000) shares were classified
as Primary B Shares of Nations Government Securities Fund; ten billion
(10,000,000,000) shares were classified as Investor A Shares of Nations
International Equity Fund; ten billion (10,000,000,000) shares were classified
as Investor B Shares of Nations International Equity Fund; ten billion
(10,000,000,000) shares were classified as Investor C Shares of Nations
International Equity Fund; ten billion (10,000,000,000) shares were classified
as Primary A Shares of Nations International Equity Fund; and ten billion
(10,000,000,000) shares were classified as Primary B Shares of Nations
International Equity Fund.
THIRD: Following the renaming of the twenty billion
(20,000,000,000) shares as set forth in Article FIRST, the Corporation's two
hundred seventy billion (270,000,000,000) shares of authorized common stock, all
of which have a par value of one tenth of one cent ($.001) per share, having an
aggregate par value of two hundred seventy million dollars ($270,000,000.00),
are classified as follows:
(a) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Prime Fund;
(b) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Prime Fund;
(c) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Prime Fund;
2
<PAGE>
(d) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Prime Fund;
(e) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Prime Fund;
(f) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Prime Fund;
(g) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Treasury Fund;
(h) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Treasury Fund;
(i) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Treasury Fund;
(j) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Treasury Fund;
(k) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Treasury Fund;
(l) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Treasury Fund;
(m) zero (0) shares are classified as Investor A Shares of Nations
Tax-Exempt Money Market Fund;
(n) zero (0) shares are classified as Primary A Shares of Nations
Tax-Exempt Money Market Fund;
(o) zero (0) shares are classified as Primary B Shares of Nations
Tax-Exempt Money Market Fund;
(p) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Equity Income Fund;
(q) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Equity Income Fund;
(r) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Equity Income Fund;
3
<PAGE>
(s) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Equity Income Fund;
(t) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Equity Income Fund;
(u) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Government Securities Fund;
(v) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Government Securities Fund;
(w) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Government Securities Fund;
(x) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Government Securities Fund;
(y) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Government Securities Fund;
(z) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations International Equity Fund;
(aa) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations International Equity Fund;
(bb) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations International Equity Fund;
(cc) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations International Equity Fund; and
(dd) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations International Equity Fund.
The summary and restatement of the total outstanding shares of the
Corporation's common stock in this Article THIRD has not otherwise changed the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemptions of such classes of shares.
FOURTH: The Corporation is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended.
4
<PAGE>
FIFTH: The Board of Directors of the Corporation has renamed the
authorized and existing shares as set forth in Article FIRST hereto pursuant to
resolution duly adopted.
SIXTH: The Board of Directors has duly authorized the filing of
these Articles Supplementary.
IN WITNESS WHEREOF, NATIONS FUND, INC. has caused these Articles
Supplementary to be executed by its President and its corporate seal to be
affixed and attested by its Secretary on this 4th day of November, 1996. The
President of the Corporation who signed these Articles Supplementary
acknowledges them to be the act of the Corporation, and states under the
penalties of perjury that to the best of his knowledge, information and belief,
the matters and facts relating to approval hereof are true in all material
respects.
NATIONS FUND, INC.
[SEAL] By: /s/ A. Max Walker
-------------------
A. Max Walker
President
ATTEST:
/s/ Richard H. Blank, Jr.
- -------------------------
Richard H. Blank, Jr.
Secretary
5
NATIONS FUND, INC.
ARTICLES SUPPLEMENTARY
RENAMING EXISTING SERIES OF CAPITAL STOCK
OF THE CORPORATION AND ESTABLISHING NEW SERIES
Nations Fund, Inc., a Maryland corporation having its principal
office in the State of Maryland in Baltimore City (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: Pursuant to a resolution duly adopted by a majority of the
Corporation's Board of Directors at a regular meeting of the Corporation's Board
of Directors held on October 11, 1996, and pursuant to Sections 2-605 and 2-607
of the Corporations and Associations Article of the Annotated Code of Maryland
(the "Code"), the Board of Directors has taken the following actions, which are
expressly limited to changes permitted by Section 2-605(a)(4) of the Code to be
made without action by the stockholders:
(a) renamed ten billion (10,000,000,000) shares, with a par value of
$.001 per share, of the Corporation's authorized, classified and
designated shares currently classified as Investor D Shares of
Nations Prime Fund as Daily Shares of Nations Prime Fund; and
(b) renamed ten billion (10,000,000,000) shares, with a par value of
$.001 per share, of the Corporation's authorized, classified and
designated shares currently classified as Investor D Shares of
Nations Treasury Fund as Daily Shares of Nations Treasury Fund.
SECOND: The preferences, conversion and other rights, voting
powers, restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption of such classes of shares named in Article FIRST
thereto have not been changed.
THIRD: The Board of Directors, pursuant to a resolution duly
adopted by a majority of the Corporation's Board of Directors at a regular
meeting of the Board held on February 5, 1997, and pursuant to Article EIGHTH of
the Corporation's Articles of Incorporation and in accordance with Sections
2-105 (c) and 2-208.1 of the Code, authorized the appropriate Officers of the
Corporation to take such action as necessary to increase the number of
authorized shares of common stock of the Corporation to four hundred twenty
billion (420,000,000,000) shares, all of which have a par value of one-tenth of
one cent ($.001) per share, having an aggregate par value of four hundred twenty
million dollars ($420,000,000.00).
FOURTH:The Board of Directors has duly classified one hundred
fifty billion (150,000,000,000) shares of the authorized, unissued and
unclassified shares of common stock of the Corporation into the following
classes and has provided for the issuance of such shares:
<PAGE>
(a) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary A Shares of
Nations Small Company Growth Fund;
(b) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary B Shares of
Nations Small Company Growth Fund;
(c) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor A Shares of
Nations Small Company Growth Fund;
(d) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor C Shares of
Nations Small Company Growth Fund;
(e) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor N Shares of
Nations Small Company Growth Fund;
(f) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary A Shares of
Nations U.S. Government Bond Fund;
(g) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary B Shares of
Nations U.S. Government Bond Fund;
(h) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor A Shares of
Nations U.S. Government Bond Fund;
(i) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor C Shares of
Nations U.S. Government Bond Fund;
(j) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor N Shares of
Nations U.S. Government Bond Fund;
(k) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary A Shares of
Nations International Growth Fund; and
(l) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary B Shares of
Nations International Growth Fund;
(m) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor A Shares of
National International Growth Fund;
(n) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor C Shares of
Nations International Growth Fund;
(o) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor N Shares of
Nations International Growth Fund.
2
<PAGE>
FIFTH: Immediately before the renaming of the twenty billion
(20,000,000,000) shares and the authorization and issuance of the one hundred
fifty billion (150,000,000,000) shares as set forth in Articles FIRST, THIRD and
FOURTH hereto, the Corporation was authorized to issue two hundred seventy
billion (270,000,000,000) shares of authorized common stock, which were
classified as follows:
(a) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Prime Fund;
(b) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Prime Fund;
(c) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Prime Fund;
(d) ten billion (10,000,000,000) shares are classified as Investor
D Shares of Nations Prime Fund;
(e) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Prime Fund;
(f) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Prime Fund;
(g) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Treasury Fund;
(h) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Treasury Fund;
(i) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Treasury Fund;
(j) ten billion (10,000,000,000) shares are classified as Investor
D Shares of Nations Treasury Fund;
(k) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Treasury Fund;
(l) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Treasury Fund;
(m) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Equity Income Fund;
3
<PAGE>
(n) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Equity Income Fund;
(o) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Equity Income Fund;
(p) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Equity Income Fund;
(q) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Equity Income Fund;
(r) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Government Securities Fund;
(s) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Government Securities Fund;
(t) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Government Securities Fund;
(u) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Government Securities Fund;
(v) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Government Securities Fund;
(w) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations International Equity Fund;
(x) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations International Equity Fund;
(y) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations International Equity Fund;
(z) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations International Equity Fund; and
(aa) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations International Equity Fund.
4
<PAGE>
SIXTH: Following the renaming of the twenty billion
(20,000,000,000) shares and the authorization and issuance of the one hundred
fifty billion (150,000,000,000) shares as set forth in Articles FIRST, THIRD and
FOURTH, the Corporation's four hundred twenty billion (420,000,000,000) total
authorized common stock, all of which have a par value of one tenth of one cent
($.001) per share, having an aggregate par value of four hundred twenty million
dollars ($420,000,000.00), are classified as follows:
(a) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary A Shares of
Nations Small Company Growth Fund;
(b) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary B Shares of
Nations Small Company Growth Fund;
(c) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor A Shares of
Nations Small Company Growth Fund;
(d) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor C Shares of
Nations Small Company Growth Fund;
(e) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor N Shares of
Nations Small Company Growth Fund;
(f) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary A Shares of
Nations U.S. Government Bond Fund;
(g) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary B Shares of
Nations U.S. Government Bond Fund;
(h) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor A Shares of
Nations U.S. Government Bond Fund;
(i) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor C Shares of
Nations U.S. Government Bond Fund;
(j) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor N Shares of
Nations U.S. Government Bond Fund;
(k) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary A Shares of
Nations International Growth Fund; and
(l) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary B Shares of
Nations International Growth Fund;
(m) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor A Shares of
National International Growth Fund;
5
<PAGE>
(n) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor C Shares of
Nations International Growth Fund;
(o) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor N Shares of
Nations International Growth Fund.
(p) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Prime Fund;
(q) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Prime Fund;
(r) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Prime Fund;
(s) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Prime Fund;
(t) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Prime Fund;
(u) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Prime Fund;
(v) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Treasury Fund;
(w) ten billion (10,000,000,000) shares are classified as Investor
B Shares of Nations Treasury Fund;
(x) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Treasury Fund;
(y) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Treasury Fund;
(z) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Treasury Fund;
(aa) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Treasury Fund;
(bb) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Equity Income Fund;
6
<PAGE>
(cc) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Equity Income Fund;
(dd) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Equity Income Fund;
(ee) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Equity Income Fund;
(ff) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Equity Income Fund;
(gg) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations Government Securities Fund;
(hh) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations Government Securities Fund;
(ii) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations Government Securities Fund;
(jj) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations Government Securities Fund;
(kk) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations Government Securities Fund;
(ll) ten billion (10,000,000,000) shares are classified as Investor
A Shares of Nations International Equity Fund;
(mm) ten billion (10,000,000,000) shares are classified as Investor
C Shares of Nations International Equity Fund;
(nn) ten billion (10,000,000,000) shares are classified as Investor
N Shares of Nations International Equity Fund;
(oo) ten billion (10,000,000,000) shares are classified as Primary
A Shares of Nations International Equity Fund; and
(pp) ten billion (10,000,000,000) shares are classified as Primary
B Shares of Nations International Equity Fund.
The summary and restatement of the total outstanding shares of the
Corporation's common stock in this Article SIXTH has not otherwise changed the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemptions of such classes of shares.
7
<PAGE>
SEVENTH: The Corporation is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended.
EIGHTH: The Board of Directors has duly authorized the filing of
these Articles Supplementary.
IN WITNESS WHEREOF, NATIONS FUND, INC. has caused these Articles
Supplementary to be executed by its President and its corporate seal to be
affixed and attested by its Secretary on this 5th day of February, 1997. The
President of the Corporation who signed these Articles Supplementary
acknowledges them to be the act of the Corporation, and states under the
penalties of perjury that to the best of his knowledge, information and belief,
the matters and facts relating to approval hereof are true in all material
respects.
NATIONS FUND, INC.
By: /s/ A. Max Walker
------------------
A. Max Walker
President
ATTEST:
/s/ Richard H. Blank, Jr.
- -------------------------
Richard H. Blank, Jr.
Secretary
8
NATIONS FUND, INC.
ARTICLES SUPPLEMENTARY
ESTABLISHING NEW SERIES
OF CAPITAL STOCK OF THE CORPORATION
FIRST: The Board of Directors, pursuant to a resolution duly
adopted by a majority of the Corporation's Board of Directors at a meeting of
the Board held on February 4, 1998, and pursuant to Article EIGHTH of the
Corporation's Articles of Incorporation and in accordance with Sections 2-105
(c) and 2-208.1 of the Code, authorized the appropriate Officers of the
Corporation to take such action as necessary to increase the number of
authorized shares of common stock of the Corporation from four hundred twenty
billion (420,000,000,000) shares to four hundred sixty billion (460,000,000,000)
shares, all of which have a par value of one-tenth of one cent ($.001) per
share, having an aggregate par value of four hundred sixty million dollars
($460,000,000.00).
SECOND:The Board of Directors has duly classified forty billion
(40,000,000,000) shares of the authorized, unissued and unclassified shares of
common stock of the Corporation into the following classes and has provided for
the issuance of such shares:
(a) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Primary A Shares of
Nations International Value Fund;
(b) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor A Shares of
Nations International Value Fund;
(c) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor B Shares of
Nations International Value Fund;
(d) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Investor C Shares of
Nations International Value Fund;
THIRD: The classes of shares of Nations International Value Fund
of the Corporation referred to in Articles FIRST and SECOND shall have the
following preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and terms and conditions of
redemptions:
(a) All considerations received by the Corporation for the issue
or sale of shares of each class of Shares ("Class") of each
Fund, together with all income, earnings, profits, and
proceeds thereof, including any proceeds derived from the
sale, exchange or liquidation thereof, and any funds or
payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall irrevocably belong to
such Class for all purposes, subject only to the rights of
<PAGE>
creditors, and shall be so recorded upon the books of account
of the Corporation. Such consideration, income, earnings,
profits and proceeds thereof, including any proceeds derived
from the sale, exchange or liquidation thereof, and any funds
or payments derived from any reinvestment of such proceeds, in
whatever form the same may be, are herein referred to as
"assets belong to" each such Class. The assets belonging to
each other Class of such Fund and, if so, the income,
earnings, profits and proceeds thereof shall be allocated to
each Class of the Fund in the proportion that the assets
belonging to each Class bear to the total assets of the Fund
or as otherwise determined by the Board of Directors;
(b) Dividends or distributions on each Class of each Fund, whether
payable in stock or cash, shall be paid only out of earnings,
surplus or other assets belonging to each such Class;
(c) In the event of the liquidation or dissolution of the
Corporation, the holders of each Class of each Fund shall each
be entitled to receive, as a Class, out of the assets of the
Corporation available for distribution to stockholders, other
than general assets not belonging to any particular Class,
assets belonging to such Class of such Fund. The assets so
distributable to the holders of each Class of each Fund shall be
distributed among such stockholders in proportion to the number
of shares of each such Class held by them and recorded on the
books the Corporation;
(d) The assets belonging to each Class of each Fund shall be charged
with the expenses and liabilities of the Corporation in respect
of such Class as well as with such Class' share of the general
expenses and liabilities of the Fund and/or the Corporation as
determined by the Board of Directors. The expenses and
liabilities so charged to each Class are herein referred to as
"expenses and liabilities belonging to" such Class. The
determination of the Board of Directors shall be conclusive as
to the allocation of expenses and liabilities, including accrued
expenses and reserves, and assets to a given Class or Classes;
(e) On each matter submitted to a vote of the stockholders, each
holder of shares of a Class shall be entitled to one vote for
each such share standing in his or her name on the books of the
Corporation and shall vote together with the holders of all
Classes of stock of the Corporation as a single Class; provided,
however, that holders of a Class of a Fund shall have the
exclusive right to vote on any agreement, investment restriction
or other matter requiring shareholder vote that relates only to
such Class or Classes of such Fund ("Class Voting"), that
holders of all Classes of a Fund shall have the exclusive right
to vote on any agreement or other matter requiring shareholder
vote that relates only to that Fund ("Fund Voting"), and that to
the extent Class Voting or Fund Voting is required by the
Investment Company Act of 1940 or Maryland Law as to any matter,
those requirements shall apply. Any fractional share, if any
such fractional share is outstanding, shall carry
proportionately all the rights of a whole share, including the
right to vote and the right to receive dividends, but excluding
the right to receive a stock certificate evidencing a fractional
share;
2
<PAGE>
(f) The net asset value of each Class of each Fund shall be computed
separately from that of each other Class of that Fund or any
other class of stock of the Corporation; and
(g) Except as otherwise provided herein, the preferences, conversion
and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption
applicable to the Corporation's stock as set forth in the
Corporation's Articles of Incorporation, as it may be amended
from time to time, shall apply.
FOURTH: Immediately before the issuance of the forty billion
(40,000,000,000) shares as set forth in Articles FIRST and SECOND hereto, the
Corporation was authorized to issue four hundred twenty billion
(420,000,000,000) shares of authorized common stock, which were classified as
follows:
(a) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations U.S. Government Bond Fund;
(b) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations U.S. Government Bond Fund;
(c) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations U.S. Government Bond Fund;
(d) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations U.S. Government Bond Fund;
(e) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations U.S. Government Bond Fund;
(f) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Growth Fund; and
(g) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations International Growth Fund;
(h) ten billion (10,000,000,000) shares are classified as Investor A
Shares of National International Growth Fund;
(i) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Growth Fund.
(j) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Growth Fund;
3
<PAGE>
(k) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Small Company Growth Fund;
(l) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Small Company Growth Fund;
(m) ten billion (10,000,000,000) shares are classified as Investor A
Shares of nations Small Company Growth Fund;
(n) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Small Company Growth Fund;
(o) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Small Company Growth Fund.
(p) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Prime Fund;
(q) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Prime Fund;
(r) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Prime Fund;
(s) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Prime Fund;
(t) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Prime Fund;
(u) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Prime Fund;
(v) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Treasury Fund;
(w) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Treasury Fund;
(x) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Treasury Fund;
(y) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Treasury Fund;
4
<PAGE>
(z) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Treasury Fund;
(y) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Treasury Fund;
(aa) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Equity Income Fund;
(bb) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Equity Income Fund;
(cc) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Equity Income Fund;
(dd) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Equity Income Fund;
(ee) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Equity Income Fund;
(ff) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Government Securities Fund;
(gg) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Government Securities Fund;
(hh) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Government Securities Fund;
(ii) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Government Securities Fund;
(jj) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Government Securities Fund;
(kk) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Equity Fund;
(ll) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations International Equity Fund;
(mm) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations International Equity Fund;
5
<PAGE>
(nn) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Equity Fund; and
(oo) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Equity Fund.
FIFTH: Following the issuance of the forty billion
(40,000,000,000) shares as set forth in Articles FIRST and SECOND, the
Corporation's four hundred sixty billion (460,000,000,000) total authorized
common stock, all of which have a par value of one tenth of one cent ($.001) per
share, having an aggregate par value of four hundred sixty million dollars
($460,000,000.00), are classified as follows:
(a) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Value Fund;
(b) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations International Value Fund;
(c) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Value Fund;
(d) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Value Fund;
(e) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations U.S. Government Bond Fund;
(f) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations U.S. Government Bond Fund;
(g) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations U.S. Government Bond Fund;
(h) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations U.S. Government Bond Fund;
(i) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations U.S. Government Bond Fund;
(j) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Growth Fund; and
(k) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations International Growth Fund;
6
<PAGE>
(l) ten billion (10,000,000,000) shares are classified as Investor A
Shares of National International Growth Fund;
(m) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Growth Fund;
(n) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Growth Fund;
(o) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Small Company Growth Fund; and
(p) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Small Company Growth Fund;
(q) ten billion (10,000,000,000) shares are classified as Investor A
Shares of National Small Company Growth Fund;
(r) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Small Company Growth Fund;
(s) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Small Company Growth Fund;
(t) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Prime Fund;
(u) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Prime Fund;
(v) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Prime Fund;
(w) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Prime Fund;
(x) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Prime Fund;
(y) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Prime Fund;
(z) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Treasury Fund;
7
<PAGE>
(aa) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Treasury Fund;
(bb) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Treasury Fund;
(cc) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Treasury Fund;
(cc) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Treasury Fund;
(ee) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Treasury Fund;
(ff) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Equity Income Fund;
(gg) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Equity Income Fund;
(hh) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Equity Income Fund;
(ii) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Equity Income Fund;
(jj) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Equity Income Fund;
(kk) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Government Securities Fund;
(ll) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Government Securities Fund;
(mm) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Government Securities Fund;
(nn) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Government Securities Fund;
(oo) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Government Securities Fund;
8
<PAGE>
(pp) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Equity Fund;
(qq) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations International Equity Fund;
(rr) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations International Equity Fund;
(ss) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Equity Fund; and
(tt) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Equity Fund.
The summary and restatement of the total outstanding shares of the
Corporation's common stock in this Article FIFTH has not otherwise changed the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemptions of such classes of shares.
SIXTH: The Corporation is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended.
SEVENTH: The Board of Directors has duly authorized the filing of
these Articles Supplementary.
9
<PAGE>
IN WITNESS WHEREOF, NATIONS FUND, INC. has caused these Articles
Supplementary to be executed by its President and its corporate seal to be
affixed and attested by its Secretary on this 1st day of May, 1998. The
President of the Corporation who signed these Articles Supplementary
acknowledges them to be the act of the Corporation, and states under the
penalties of perjury that to the best of his knowledge, information and belief,
the matters and facts relating to approval hereof are true in all material
respects.
NATIONS FUND, INC.
By: /s/ A. Max Walker
--------------------
A. Max Walker
President
ATTEST:
/s/ Richard H. Blank, Jr.
- -------------------------
Richard H. Blank, Jr.
Secretary
10
ARTICLES SUPPLEMENTARY
ESTABLISHING NEW SERIES
OF CAPITAL STOCK OF THE CORPORATION
FIRST: The Board of Directors, pursuant to a resolution duly
adopted by a majority of the Corporation's Board of Directors at a meeting of
the Board held on October 7, 1998, and pursuant to Article EIGHTH of the
Corporation's Articles of Incorporation and in accordance with Sections 2-105
(c) and 2-208.1 of the Code, authorized the appropriate Officers of the
Corporation to take such action as necessary to increase the number of
authorized shares of common stock of the Corporation from four hundred seventy
billion (470,000,000,000) shares to four hundred eighty billion
(480,000,000,000) shares, all of which have a par value of one-tenth of one cent
($.001) per share, having an aggregate par value of four hundred eighty million
dollars ($480,000,000.00).
SECOND:The Board of Directors has duly classified ten billion
(10,000,000,000) shares of the authorized, unissued and unclassified shares of
common stock of the Corporation into the following class and has provided for
the issuance of such shares:
(a) ten billion (10,000,000,000) authorized, unissued and
unclassified shares are classified as Marsico Shares of Nations
Prime Fund;
THIRD: The class of shares of Nations Prime Fund of the
Corporation referred to in Articles FIRST and SECOND shall have the following
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and terms and conditions of
redemptions:
(a) All considerations received by the Corporation for the issue or
sale of shares of each class of Shares ("Class") of each Fund,
together with all income, earnings, profits, and proceeds
thereof, including any proceeds derived from the sale, exchange
or liquidation thereof, and any funds or payments derived from
any reinvestment of such proceeds in whatever form the same may
be, shall irrevocably belong to such Class for all purposes,
subject only to the rights of creditors, and shall be so
recorded upon the books of account of the Corporation. Such
consideration, income, earnings, profits and proceeds thereof,
including any proceeds derived from the sale, exchange or
liquidation thereof, and any funds or payments derived from any
reinvestment of such proceeds, in whatever form the same may be,
are herein referred to as "assets belong to" each such Class.
The assets belonging to each other Class of such Fund and, if
so, the income, earnings, profits and proceeds thereof shall be
allocated to each Class of the Fund in the proportion that the
assets belonging to each Class bear to the total assets of the
Fund or as otherwise determined by the Board of Directors;
<PAGE>
(b) Dividends or distributions on each Class of each Fund, whether
payable in stock or cash, shall be paid only out of earnings,
surplus or other assets belonging to each such Class;
(c) In the event of the liquidation or dissolution of the
Corporation, the holders of each Class of each Fund shall each
be entitled to receive, as a Class, out of the assets of the
Corporation available for distribution to stockholders, other
than general assets not belonging to any particular Class,
assets belonging to such Class of such Fund. The assets so
distributable to the holders of each Class of each Fund shall be
distributed among such stockholders in proportion to the number
of shares of each such Class held by them and recorded on the
books the Corporation;
(d) The assets belonging to each Class of each Fund shall be charged
with the expenses and liabilities of the Corporation in respect
of such Class as well as with such Class' share of the general
expenses and liabilities of the Fund and/or the Corporation as
determined by the Board of Directors. The expenses and
liabilities so charged to each Class are herein referred to as
"expenses and liabilities belonging to" such Class. The
determination of the Board of Directors shall be conclusive as
to the allocation of expenses and liabilities, including accrued
expenses and reserves, and assets to a given Class or Classes;
(e) On each matter submitted to a vote of the stockholders, each
holder of shares of a Class shall be entitled to one vote for
each such share standing in his or her name on the books of the
Corporation and shall vote together with the holders of all
Classes of stock of the Corporation as a single Class; provided,
however, that holders of a Class of a Fund shall have the
exclusive right to vote on any agreement, investment restriction
or other matter requiring shareholder vote that relates only to
such Class or Classes of such Fund ("Class Voting"), that
holders of all Classes of a Fund shall have the exclusive right
to vote on any agreement or other matter requiring shareholder
vote that relates only to that Fund ("Fund Voting"), and that to
the extent Class Voting or Fund Voting is required by the
Investment Company Act of 1940 or Maryland Law as to any matter,
those requirements shall apply. Any fractional share, if any
such fractional share is outstanding, shall carry
proportionately all the rights of a whole share, including the
right to vote and the right to receive dividends, but excluding
the right to receive a stock certificate evidencing a fractional
share;
(f) The net asset value of each Class of each Fund shall be computed
separately from that of each other Class of that Fund or any
other class of stock of the Corporation; and
(g) Except as otherwise provided herein, the preferences, conversion
and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption
applicable to the Corporation's stock as set forth in the
Corporation's Articles of Incorporation, as it may be amended
from time to time, shall apply.
2
<PAGE>
FOURTH: Immediately before the issuance of the ten billion
(10,000,000,000) shares as set forth in Articles FIRST and SECOND hereto, the
Corporation was authorized to issue four hundred seventy billion
(470,000,000,000) shares of authorized common stock, which were classified as
follows:
(a) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Value Fund;
(b) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations International Value Fund;
(c) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations International Value Fund;
(d) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Value Fund;
(e) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Value Fund;
(f) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations U.S. Government Bond Fund;
(g) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations U.S. Government Bond Fund;
(h) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations U.S. Government Bond Fund;
(i) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations U.S. Government Bond Fund;
(j) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations U.S. Government Bond Fund;
(k) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Growth Fund;
(l) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations International Growth Fund;
(m) ten billion (10,000,000,000) shares are classified as Investor A
Shares of National International Growth Fund;
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(n) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Growth Fund.
(o) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Growth Fund;
(p) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Small Company Growth Fund;
(q) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Small Company Growth Fund;
(r) ten billion (10,000,000,000) shares are classified as Investor A
Shares of nations Small Company Growth Fund;
(s) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Small Company Growth Fund;
(t) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Small Company Growth Fund.
(u) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Prime Fund;
(v) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Prime Fund;
(w) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Prime Fund;
(x) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Prime Fund;
(y) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Prime Fund;
(z) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Prime Fund;
(aa) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Treasury Fund;
(bb) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Treasury Fund;
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(cc) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Treasury Fund;
(dd) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Treasury Fund;
(ee) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Treasury Fund;
(ff) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Treasury Fund;
(gg) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Equity Income Fund;
(hh) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Equity Income Fund;
(ii) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Equity Income Fund;
(jj) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Equity Income Fund;
(kk) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Equity Income Fund;
(ll) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Government Securities Fund;
(mm) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Government Securities Fund;
(nn) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Government Securities Fund;
(oo) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Government Securities Fund;
(pp) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Government Securities Fund;
(qq) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Equity Fund;
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(rr) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations International Equity Fund;
(ss) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations International Equity Fund;
(tt) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Equity Fund; and
(uu) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Equity Fund.
FIFTH: Following the issuance of the ten billion (10,000,000,000)
shares as set forth in Articles FIRST and SECOND, the Corporation's four hundred
eighty billion (480,000,000,000) total authorized common stock, all of which
have a par value of one tenth of one cent ($.001) per share, having an aggregate
par value of four hundred eighty million dollars ($480,000,000.00), are
classified as follows:
(a) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Value Fund;
(b) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations International Value Fund;
(c) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations International Value Fund;
(d) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Value Fund;
(e) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Value Fund;
(f) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations U.S. Government Bond Fund;
(g) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations U.S. Government Bond Fund;
(h) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations U.S. Government Bond Fund;
(i) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations U.S. Government Bond Fund;
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(j) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations U.S. Government Bond Fund;
(k) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Growth Fund;
(l) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations International Growth Fund;
(m) ten billion (10,000,000,000) shares are classified as Investor A
Shares of National International Growth Fund;
(n) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Growth Fund;
(o) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Growth Fund;
(p) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Small Company Growth Fund;
(q) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Small Company Growth Fund;
(r) ten billion (10,000,000,000) shares are classified as Investor A
Shares of National Small Company Growth Fund;
(s) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Small Company Growth Fund;
(t) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Small Company Growth Fund;
(u) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Prime Fund;
(v) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Prime Fund;
(w) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Prime Fund;
(x) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Prime Fund;
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(y) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Prime Fund;
(z) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Prime Fund;
(aa) ten billion (10,000,000,000) shares are classified as Marsico
Shares of Nations Prime Fund'
(bb) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Treasury Fund;
(cc) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Treasury Fund;
(dd) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Treasury Fund;
(ee) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Treasury Fund;
(ff) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Treasury Fund;
(gg) ten billion (10,000,000,000) shares are classified as Daily
Shares of Nations Treasury Fund;
(hh) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Equity Income Fund;
(ii) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Equity Income Fund;
(jj) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Equity Income Fund;
(kk) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Equity Income Fund;
(ll) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Equity Income Fund;
(mm) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations Government Securities Fund;
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(nn) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations Government Securities Fund;
(oo) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations Government Securities Fund;
(pp) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations Government Securities Fund;
(qq) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations Government Securities Fund;
(rr) ten billion (10,000,000,000) shares are classified as Primary A
Shares of Nations International Equity Fund;
(ss) ten billion (10,000,000,000) shares are classified as Primary B
Shares of Nations International Equity Fund;
(tt) ten billion (10,000,000,000) shares are classified as Investor A
Shares of Nations International Equity Fund;
(uu) ten billion (10,000,000,000) shares are classified as Investor B
Shares of Nations International Equity Fund; and
(vv) ten billion (10,000,000,000) shares are classified as Investor C
Shares of Nations International Equity Fund.
The summary and restatement of the total outstanding shares of the
Corporation's common stock in this Article FIFTH has not otherwise changed the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemptions of such classes of shares.
SIXTH: The Corporation is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended.
SEVENTH: The Board of Directors has duly authorized the filing of
these Articles Supplementary.
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IN WITNESS WHEREOF, NATIONS FUND, INC. has caused these Articles
Supplementary to be executed by its President and its corporate seal to be
affixed and attested by its Secretary on this 7th day of October, 1998. The
President of the Corporation who signed these Articles Supplementary
acknowledges them to be the act of the Corporation, and states under the
penalties of perjury that to the best of his knowledge, information and belief,
the matters and facts relating to approval hereof are true in all material
respects.
NATIONS FUND, INC.
By: /s/ A. Max Walker
------------------
A. Max Walker
President
ATTEST:
/s/ Richard H. Blank, Jr.
- -------------------------
Richard H. Blank, Jr.
Secretary
10
NATIONS FUND, INC.
MARYLAND
AMENDED AND RESTATED
BY-LAWS
ARTICLE I
STOCKHOLDERS
Section 1. Time and Place of Meeting. Meetings of the stockholders need
not be held except as required under the general laws of the State of Maryland,
as the same may be amended from time to time. Such meetings of the stockholders
shall be held from time to time at a place designated by the Board of Directors
and stated in the notice of the meeting.
Section 2. Annual Meetings. If a meeting of the stockholders of the
Corporation is required by the Investment Company Act of 1940, as amended, to
take action on (1) the election of directors, (2) the approval of the investment
advisory agreement, (3) the ratification of the selection of independent public
accountants, or (4) the approval of a distribution agreement, then there shall
be submitted to the stockholders at such meeting the question of the election of
directors, and a special meeting called for any of the foregoing purposes shall
be deemed the annual meeting of stockholders for that year. In other years in
which no action by stockholders is required for any of the foregoing purposes,
no annual meeting need be held.
Section 3. Special or Extraordinary Meetings. Special or extraordinary
meetings of the stockholders for any purpose or purposes may be called by the
Chairman of the Board of Directors, if any, or by the President or by the Board
of Directors. In addition, such special or extraordinary meetings shall be
called by the Secretary upon receipt of a request in writing signed by
stockholders entitled to cast at least 10% of all the votes entitled to be cast
at the meeting stating the purpose of the meeting and the matters proposed to be
acted on and upon payment by such stockholders of the estimated cost of
preparing and mailing a notice of the meeting. Unless requested by stockholders
entitled to cast a majority of all of the votes entitled to be cast at the
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meeting, a special meeting need not be called to consider any matter which is
substantially the same as a matter voted on at a special meeting of the
stockholders held during the preceding 12 months.
Section 4. Notice of Meeting of Stockholders. Not less than ten days'
and not more than ninety days' written or printed notice of every meeting of
stockholders, stating the time and place thereof (and the purpose of any special
or extraordinary meeting), shall be given to each stockholder entitled to vote
thereat and each other stockholder entitled to notice, by leaving the same with
him or at his residence or usual place of business or by mailing it, postage
prepaid, and addressed to him at his address as it appears upon the books of the
Corporation.
Each person who is entitled to notice of any meeting waives notice if
he is present at the meeting, or attends in person or by proxy or either before
or after the meeting signs a waiver of notice which is filed with the records of
stockholders meetings.
Section 5. Closing of Transfer Books, Record Dates. The Board of
Directors may direct that the stock transfer books of the Corporation be closed
for a stated period not exceeding twenty days for the purpose of making any
proper determination with respect to stockholders, including which stockholders
are entitled to notice of and to vote at the meeting, receive a dividend or be
allotted other rights. If such books are closed for the purpose of determining
stockholders entitled to notice of or to vote at a meeting of stockholders, such
books shall be closed for at least ten days immediately preceding such meeting.
In lieu of providing for the closing of the stock transfer books, the Board of
Directors may set a date, not exceeding ninety days and not less than ten days
preceding the date of any meeting of stockholders, and not exceeding ninety days
preceding any dividend payment date or any date for the allotment of rights, as
a record date for the determination of the stockholders entitled to notice of
and to vote at such meeting, or entitled to receive such dividends or rights, as
the case may be; and only stockholders of record on such date shall be entitled
to notice of and to vote at such meeting or to receive such dividends or rights,
as the case may be.
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Section 6. Quorum, Adjournment of Meetings. The presence in person or
by proxy of stockholders entitled to cast a majority of all votes entitled to be
cast at the meeting shall constitute a quorum at all meetings of the
stockholders; and a majority of all votes cast at a meeting at which a quorum is
present is sufficient to approve any matter which properly comes before the
meeting, unless otherwise provided by applicable law, the Articles of
Incorporation or the By-Laws of the Corporation. If at any meeting of the
stockholders there shall be less than a quorum present, the stockholders present
at such meeting may, without further notice, adjourn the same from time to time
(but not more than 120 days after the original record date for such meeting)
until a quorum shall attend, but no business shall be transacted at any such
adjourned meeting except such as might have been lawfully transacted had the
meeting not been adjourned.
Section 7. Voting and Inspectors. At all meetings of stockholders every
stockholder of record entitled to vote thereat shall be entitled to vote at such
meeting either in person or by proxy appointed by instrument in writing
subscribed by such stockholder or his duly authorized attorney. Unless a proxy
provides otherwise, such proxy is not valid more than eleven months after its
date.
At any election of Directors, the Board of Directors prior thereto may,
or, if they have not so acted, the Chairman of the meeting may appoint two
inspectors of election who shall first subscribe an oath or affirmation to
execute faithfully the duties of inspectors at such election with strict
impartiality and according to the best of their ability, and shall after the
election make a certificate of the result of the vote taken. No candidate for
the office of Director shall be appointed to act as such Inspector.
The Chairman of the meeting may cause a vote by ballot to be taken upon
any election or matter.
Section 8. Conduct of Stockholders Meetings. The meetings of the
stockholders shall be presided over by the Chairman of the Board, or if he shall
not be present or if there is no Chairman, by the President, or if he shall not
be present, by a Vice-President, or if neither the President nor any
Vice-President is present, by a chairman to be elected at the meeting. The
Secretary of the Corporation, if present, shall act as Secretary of such
meetings, or if he is not present, an Assistant Secretary shall so act, and if
neither the Secretary nor an Assistant Secretary is present, then the meeting
shall elect a secretary.
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Section 9. Concerning Validity of Proxies, Ballots, Etc. At every
meeting of the stockholders, all proxies shall be received and taken in charge
of and all ballots shall be received and canvassed by the secretary of the
meeting, who shall decide all questions touching the qualification of voters,
the validity of the proxies, and the acceptance or rejection of votes, unless
inspectors of election shall have been appointed as provided in Section 7
hereof, in which event such inspectors of election shall decide all such
questions.
ARTICLE II
BOARD OF DIRECTORS
Section 1. Number and Term of Office. The business and property of the
Corporation shall be conducted and managed under the direction of a Board of
Directors consisting of two Directors, which number may be increased and
decreased as provided in Section 2 of this Article. Each Director shall hold
office until his successor is duly elected and qualified. Directors need not be
stockholders.
Section 2. Increase or Decrease in Number of Directors. The Board of
Directors, by the vote of a majority of the entire Board, may increase the
number of Directors to a number not exceeding fifteen, and may elect Directors
to fill the vacancies created by any such increase in the number of Directors
until their successors are duly elected and qualify. The Board of Directors, by
the vote of a majority of the entire Board, may decrease the number of Directors
to a number not less than three or the number of stockholders, whichever is
less, but any such decrease shall not affect the term of office of any Director.
Vacancies occurring other than by reason of any such increase shall be filled as
provided by the Maryland General Corporation Law.
Section 3. Place of Meeting. The Directors may hold their meetings,
have one or more offices, and keep the books of the Corporation outside the
State of Maryland, at any office or offices of the Corporation or at any other
place as they may from time to time determine, and in the case of meetings, as
they may from time to time determine or as shall be specified in the respective
notices of such meetings or waivers of notice thereof.
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Section 4. Regular Meetings. Regular meetings of the Board of Directors
shall be held at such time and on such notice, if any, as the Directors may from
time to time determine.
Section 5. Special Meetings. Special meetings of the Board of Directors
may be held from time to time upon call of the Chairman of the Board of
Directors, if any, the President or two or more of the Directors, by oral or
telegraphic or written notice duly served on each Director not less than one
business day before such meeting or if sent or mailed to each Director not less
than three business days before such meeting. Each Director who is entitled to
notice waives such notice if he either before or after the meeting signs a
waiver of the notice which is filed with the minutes of the meeting or is
present at the meeting. Such notice or waiver of notice need not state the
purpose or purposes of such meeting.
Section 6. Quorum. One third of the Directors then in office (but in no
event less than two Directors), shall constitute a quorum for the transaction of
business. If at any meeting of the Board there shall be less than a quorum
present, a majority of those present may adjourn the meeting from time to time
until a quorum shall have been obtained. The act of the majority of the
Directors present at any meeting at which there is a quorum shall be the act of
the Directors, except as may be otherwise specifically provided by applicable
law, by the Articles of Incorporation or by these By-Laws.
Section 7. Telephonic Meetings, Etc. The members of the Board of
Directors or any committee of the Board of Directors may participate in a
meeting by means of a conference telephone or similar communications equipment
if all persons participating in such meeting can hear each other at the same
time, and participation in a meeting by these means constitutes presence in
person at such meeting.
Section 8. Executive Committee. The Board of Directors may elect from
the Directors an Executive Committee to consist of such number of Directors (but
not less than two) as the Board may from time to time determine. The Board of
Directors shall have power at any time to change the members of such Committee
and may fill vacancies in the Committee by election from the Directors. When the
Board of Directors is not in session, the Executive Committee shall have and may
exercise any or all of the powers of the Board of Directors in the management of
the business and affairs of the Corporation (including the power to authorize
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the seal of the Corporation to be affixed to all papers which may require it)
except as provided by law and except the power to increase or decrease the size
of, or fill vacancies on the Board. The Executive Committee may fix its own
rules of procedure, and may meet, when and as provided by such rules or by
resolution of the Board of Directors, but in every case the presence of a
majority shall be necessary to constitute a quorum. In the absence of any member
of the Executive Committee the members thereof present at any meeting, whether
or not they constitute a quorum, may appoint a member of the Board of Directors
to act in the place of such absent member.
Section 9. Other Committees. The Board of Directors may appoint other
committees which shall in each case consist of such number of members (not less
than two) and shall have and may exercise such powers as the Board may determine
in the resolution appointing them. A majority of all members of any such
committee may determine its action, and fix the time and place of its meetings,
unless the Board of Directors shall otherwise provide. The Board of Directors
shall have power at any time to change the members and powers of any such
committee, to fill vacancies, and to discharge any such committee. In the
absence of any member of such committee, the members thereof present at any
meeting, whether or not they constitute a quorum, may appoint a member of the
Board of Directors to act in the place of such absent member.
Section 10. Informal Action by Directors. Except to the extent
otherwise specifically provided by applicable law, any action required or
permitted to be taken at any meeting of the Board of Directors or any Committee
thereof may be taken without a meeting, if a written consent to such action is
signed by all members of the Board or Committee and is filed with the minutes of
proceedings of the Board or Committee.
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Section 11. Compensation of Directors. Directors shall be entitled to
receive such compensation from the Corporation for their services as Directors
as may from time to time be voted by the Board of Directors.
Section 12. Qualifications of Directors. Except as provided in the
following sentence, no person shall be qualified to stand for election or
appointment as a Director if such person has already reached the age of 70. Each
Director shall retire from service on the Board of Directors no later than the
end of the calendar year in which such Director reaches age 70, provided that
(i) any Director who is a Director as of January 25, 1995 and who had reached
the age of 70 prior to such date may continue to serve as a Director of the
Company until the end of the calendar year in which such Director reaches age 75
and may continue to serve for successive annual periods thereafter upon the vote
of a majority of the other Directors; and (ii) any person who has already
reached the age of 70 may stand for election or appointment, pursuant to a vote
of the Directors, in connection with an investment company reorganization or
merger, and any such person may continue to serve for successive annual periods
thereafter upon the vote of a majority of the other Directors.
ARTICLE III
OFFICERS
Section 1. Executive Officers. The executive officers of the
Corporation shall be chosen by the Board of Directors as soon as may be
practicable after the incorporation of the Corporation. These may include a
Chairman of the Board, and shall include a President, one or more Vice
Presidents (the number thereof to be determined by the Board of Directors), a
Secretary and a Treasurer. The Chairman of the Board, if any, shall be selected
from among the Directors. The Board of Directors may also in its discretion
appoint Assistant Vice Presidents, Assistant Secretaries, Assistant Treasurers,
and other officers, agents and employees, who shall have such authority and
perform such duties as the Board may determine. The Board of Directors may fill
any vacancy which may occur in any office. Any two offices, except those of
President and Vice President, may be held by the same person, but no officer
shall execute, acknowledge or verify any instrument in more than one capacity,
if such instrument is required by law or by these By-Laws to be executed,
acknowledged or verified by two or more officers.
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Section 2. Term of Office. Unless otherwise specifically determined by
the Board of Directors, the officers shall serve at the pleasure of the Board of
Directors. If the Board of Directors in its judgment finds that the best
interests of the Corporation will be served, the Board of Directors may remove
any officer of the Corporation at any time with or without cause.
Section 3. President. The President shall be the chief executive
officer and head of the Corporation and, subject to the Board of Directors,
shall have the general control and management of the business and affairs of the
Corporation. If no Chairman of the Board be appointed, or if appointed, said
Chairman is absent, the President shall, if present, preside at all meetings of
the stockholders and the Board of Directors.
Section 4. Chairman of the Board. The Chairman of the Board shall
preside at all meetings of the stockholders and the Board of Directors at which
he shall be present. Subject to the provisions of Section 2, he shall have such
other powers and duties as shall be prescribed by the Board of Directors, and
shall undertake such other assignments as may be requested by the President.
Section 5. Other Officers. The Chairman or one or more Vice Presidents
shall have and exercise such powers and duties of the President in the absence
or inability of the President as may be assigned to them, respectively, by
resolution of the Board of Directors or, to the extent not so assigned, as the
President may assign to them, respectively. In the absence or inability to act
of the President, the powers and duties of the President not assigned by the
Board of Directors or the President shall devolve upon the Chairman or in his
absence the Vice Chairman or in his absence upon the Senior Vice President.
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Section 6. Secretary. The Secretary shall have custody of the seal of
the Corporation. He shall keep the minutes of the meetings of the stockholders,
Board of Directors and any committees thereof, and he shall attend to the giving
and serving of all notices of the Corporation. He shall have charge of the stock
certificate book and such other books and papers as the Board may direct; and he
shall perform such other duties as may be incidental to his office or as may be
assigned to him by the Board of Directors. He shall also keep or cause to be
kept a stock book, which may be maintained by means of computer systems,
containing the names, alphabetically arranged, of all persons who are
stockholders of the Corporation showing their places of residence, the number
and class or series of any class of shares of stock held by them respectively,
and the dates when they respectively became the owners of record thereof, and
such book shall be open for inspection as prescribed by the laws of the State of
Maryland.
Section 7. Treasurer. The Treasurer shall have the care and custody of
the funds and securities of the Corporation and shall deposit the same in the
name of the Corporation in such bank or banks or other depositories and subject
to withdrawal in such manner as these By-laws or the Board of Directors may
determine; he shall, if required by the Board of Directors give such bond for
the faithful discharge of his duties in such form as the Board of Directors may
require.
ARTICLE IV
CAPITAL STOCK
Section 1. Certificates of Shares. Each stockholder of the Corporation
shall be entitled to a certificate or certificates for the full number of shares
of each class of stock of the Corporation owned by him in such form as the Board
of Directors may from time to time prescribe.
Section 2. Transfer of Shares. Shares of the Corporation shall be
transferable on the books of the Corporation by the holder thereof in person or
by his duly authorized attorney or legal representative, upon surrender and
cancellation of certificates, if any, for the same number of shares, duly
endorsed or accompanied by proper instruments of assignment and transfer, with
such proof of the authenticity of the signature as the Corporation or its agents
may reasonably require. In the case of shares not represented by certificates,
the same or similar requirements may be imposed by the Board of Directors.
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Section 3. Stock Ledgers. The stock ledgers of the Corporation,
containing the names and addresses of the stockholders and the number of shares
held by them respectively, shall be kept at the principal offices of the
Corporation, or if the Corporation employs a transfer agent, at the offices of
the transfer agent of the Corporation.
Section 4. Lost, Stolen or Destroyed Certificates. The Board of
Directors may determine the conditions upon which a new certificate of stock of
the Corporation of any class may be issued in place of a certificate which is
alleged to have been lost, stolen or destroyed; and may, in their discretion,
require the owner of such certificate or his legal representative to give bond,
with sufficient surety to the Corporation and the transfer agent, if any, to
indemnify it and such transfer agent against any and all loss or claims which
may arise by reason of the issue of a new certificate in the place of the one so
lost, stolen or destroyed.
ARTICLE V
CORPORATE SEAL
The Board of Directors may provide a suitable corporate seal, in such
form and bearing such inscriptions as it may determine. In lieu of fixing the
Corporation's seal to a document, it is sufficient to meet the requirements of
any law, rule or regulation relating to a corporate seal to place the word
"(seal)" adjacent to the signature of the person authorized to sign the document
on behalf of the Corporation.
ARTICLE VI
FISCAL YEAR
The fiscal year of the Corporation shall be fixed by the Board of
Directors.
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ARTICLE VII
INDEMNIFICATION
Section 1. Indemnification of Directors and Officers. The Corporation
shall indemnify its directors to the fullest extent that indemnification of
directors is permitted by the Maryland General Corporation Law. The Corporation
shall indemnify its officers to the same extent as its directors and to such
further extent as is consistent with law. The Corporation shall indemnify its
directors and officers who while serving as directors or officers also serve at
the request of the Corporation as a director, officer, partner, trustee,
employee, agent or fiduciary of another corporation, partnership, joint venture,
trust, other enterprise or employee benefit plan to the fullest extent
consistent with law. The indemnification and other rights provided by this
Article shall continue as to a person who has ceased to be a director or officer
and shall inure to the benefit of the heirs, executors and administrators of
such a person. This Article shall not protect any such person against any
liability to the Corporation or any stockholder thereof to which such person
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office ("disabling conduct").
Section 2. Advances. Any current or former director or officer of the
Corporation seeking indemnification within the scope of this Article shall be
entitled to advances from the Corporation for payment of the reasonable expenses
incurred by him in connection with the matter as to which he is seeking
indemnification in the manner and to the fullest extent permissible under the
Maryland General Corporation Law. The person seeking indemnification shall
provide to the Corporation a written affirmation of his good faith belief that
the standard of conduct necessary for indemnification by the Corporation has
been met and a written undertaking to repay any such advance if it should
ultimately be determined that the standard of conduct has not been met. In
addition, at least one of the following additional conditions shall be met: (a)
the person seeking indemnification shall provide a security in form and amount
acceptable to the Corporation for his undertaking; (b) the Corporation is
insured against losses arising by reason of the advance; or (c) a majority of a
quorum of directors of the Corporation who are neither "interested persons" as
defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended,
nor parties to the proceeding ("disinterested non-party directors"), or
independent legal counsel, in a written opinion, shall have determined, based on
a review of facts readily available to the Corporation at the time the advance
is proposed to be made, that there is reason to believe that the person seeking
indemnification will ultimately be found to be entitled to indemnification.
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Section 3. Procedure. At the request of any person claiming
indemnification under this Article, the Board of Directors shall determine, or
cause to be determined, in a manner consistent with the Maryland General
Corporation Law, whether the standards required by this Article have been met.
Indemnification shall be made only following: (a) a final decision on the merits
by a court or other body before whom the proceeding was brought that the person
to be indemnified was not liable by reason of disabling conduct or (b) in the
absence of such a decision, a reasonable determination, based upon a review of
the facts, that the person to be indemnified was not liable by reason of
disabling conduct by (i) the vote of a majority of a quorum of disinterested
non-party directors or (ii) an independent legal counsel in a written opinion.
Section 4. Indemnification of Employees and Agents. Employees and
agents who are not officers or directors of the Corporation may be indemnified,
and reasonable expenses may be advanced to such employees or agents, as may be
provided by action of the Board of Directors or by contract, subject to any
limitations imposed by the Investment Company Act of 1940.
Section 5. Other Rights. The Board or Directors may make further
provision consistent with law for indemnification and advance of expenses to
directors, officers, employees and agents by resolution, agreement or otherwise.
The indemnification provided by this Article shall not be deemed exclusive of
any other right, with respect to indemnification or otherwise, to which those
seeking indemnification may be entitled under any insurance or other agreement
or resolution of stockholders or disinterested directors or otherwise.
Section 6. Amendments. References in this Article are to the Maryland
General Corporation Law and to the Investment Company Act of 1940 as from time
to time amended. No amendment of these By-laws shall affect any right of any
person under this Article based on any event, omission or proceeding prior to
the amendment.
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ARTICLE VIII
AMENDMENT OF BY-LAWS
The By-Laws of the Corporation may be altered, amended, added to or
repealed by the Board of Directors.
Last Amended: May 26, 1999
13
INVESTMENT ADVISORY AGREEMENT
NATIONS FUND, INC.
THIS AGREEMENT is made as of this 1st day of January, 1996, by and
between NATIONS FUND, INC., a Maryland corporation (the "Company"), and
NATIONSBANC ADVISORS, INC., a North Carolina corporation (the "Adviser"), on
behalf of those portfolios of the Company now or hereafter identified on
Schedule I hereto (each a "Fund" and, collectively, the "Funds").
RECITALS
WHEREAS, the Company is registered with the Securities and
Exchange Commission (the "Commission") under the Investment Company Act of 1940,
as amended (the "1940 Act") as an open-end, series management investment
company; and
WHEREAS, the Adviser is registered with the Commission under the
Investment Advisers Act of 1940, as amended (the "Advisers Act") as an
investment adviser; and
WHEREAS, the Company and the Adviser desire to enter into an
agreement to provide for investment advisory services to the Company upon the
terms and conditions hereinafter set forth; and
WHEREAS, the Company and the Adviser contemplate that certain
duties of the Adviser under this Agreement will be delegated to one or more
sub-investment adviser(s) (the "Sub-Adviser(s)") pursuant to separate
sub-advisory agreement(s) (the "Sub-Advisory Agreement(s)");
NOW THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereto agree as follows:
1. Advisory Services. The Adviser shall act as investment adviser
for the Funds and shall, in such capacity, manage and supervise the investment
and reinvestment of the cash, securities or other properties comprising the
Funds' assets, subject at all times to the policies and control of the Company's
Board of Directors. The Adviser shall give the Funds the benefit of its best
judgment, efforts and facilities in rendering its services as investment
adviser.
2. Investment Analysis and Implementation. In carrying out its
obligations under paragraph 1 hereof, the Adviser shall:
(a) obtain and evaluate pertinent information about
significant developments and economic, statistical and financial
data, domestic, foreign or otherwise, whether affecting the
economy generally or the Funds specifically, and whether
1
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concerning the individual issuers whose securities are included in
the Funds or the activities in which such issuers engage, or with
respect to securities which the Adviser considers desirable for
inclusion in the Funds;
(b) invest and reinvest, on an ongoing basis, assets
held in the Funds in strict accordance with the investment
policies of the Funds as set forth in the registration statement
of the Company with respect to the Funds, as the same may be
amended from time to time;
(c) in accordance with policies and procedures
established by the Company's Board of Directors, select brokers
and dealers to execute portfolio transactions for the Funds and
select the markets on or in which the transactions will be
executed;
(d) vote, either in person or by general or limited
proxy, or refrain from voting, any securities held in the Funds
for any purposes; exercise or sell any subscription or conversion
rights; consent to and join in or oppose any voting trusts,
reorganizations, consolidations, mergers, foreclosures and
liquidations and in connection therewith, deposit securities, and
accept and hold other property received therefor;
(e) determine on an ongoing basis the overall
investment strategy with respect to the Funds, and ensure on an
ongoing basis adherence to such strategy;
(f) use the same skill and care in providing
services to the Funds as it uses in providing services to
fiduciary accounts for which it has investment responsibilities;
(g) furnish the Company's Board of Directors with
such periodic and special reports as the Board of Directors may
request; and
(h) take, on behalf of the Funds, all actions which
appear necessary to carry into effect such purchase and sale
programs and supervisory functions set forth in this Paragraph 2.
3. Delegation of Responsibilities. Subject to the approval of the
Company's Board of Directors and, if required, the shareholders of the Funds,
the Adviser may, pursuant to the Sub-Advisory Agreement(s), delegate to the
Sub-Adviser(s) those of its duties hereunder identified in the Sub-Advisory
Agreement(s), provided that the Adviser shall continue to supervise and monitor
the performance of the duties delegated to the Sub-Adviser(s) and any such
delegation shall not relieve the Adviser of its duties and obligations under
this Agreement. The Adviser shall be solely responsible for compensating the
Sub-Adviser(s) for services rendered under the Sub-Advisory Agreement(s).
4. Control by Board of Directors. Any investment activities
undertaken by the Adviser pursuant to this Agreement, as well as any other
activities undertaken by the Adviser on behalf of the Funds, shall at all times
be subject to any directives of the Company's Board of Directors.
2
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5. Compliance with Applicable Requirements. In carrying out its
obligations under this Agreement, the Adviser shall at all times conform to:
(a) all applicable provisions of the 1940 Act, the
Advisers Act and any rules and regulations adopted thereunder;
(b) the provisions of the registration statement of
the Company, as the same may be amended from time to time, under
the Securities Act of 1933 and the 1940 Act;
(c) the provisions of the Articles of Incorporation
of the Company, as the same may be amended from time to time;
(d) the provisions of the By-laws of the Company, as
the same may be amended from time to time; and
(e) any other applicable provisions of state or
federal law.
6. Broker-Dealer Relationships. The Adviser is responsible for the
purchase and sale of securities for the Funds, broker-dealer selection, and
negotiation of brokerage commission rates. The Adviser's primary consideration
in effecting a security transaction will be to obtain the best price and
execution. In selecting a broker-dealer to execute each particular transaction
for a Fund, the Adviser will take the following into consideration: the best net
price available, the reliability, integrity and financial condition of the
broker-dealer; the size of and difficulty in executing the order; and the value
of the expected contribution of the broker-dealer to the Fund on a continuing
basis. Accordingly, the price to the Fund in any transaction may be less
favorable than that available from another broker-dealer if the difference is
reasonably justified by other aspects of the portfolio execution services
offered. Subject to such policies as the Company's Board of Directors may from
time to time determine, the Adviser shall not be deemed to have acted unlawfully
or to have breached any duty created by this Agreement or otherwise solely by
reason of having caused a Fund to pay a broker or dealer that provides brokerage
and research services to the Adviser an amount of commission for effecting a
portfolio investment transaction in excess of the amount of commission another
broker or dealer would have charged for effecting that transaction, if the
Adviser determines in good faith that such amount of commission was reasonable
in relation to the value of the brokerage and research services provided by such
broker or dealer, viewed in terms of either that particular transaction or the
overall responsibilities of the Adviser with respect to the Fund and to other
clients of the Adviser. The Adviser is further authorized to allocate the orders
placed by it on behalf of the Funds to brokers and dealers who also provide
research or statistical material, or other services to the Funds or to the
Adviser. Such allocation shall be in such amounts and proportions as the Adviser
shall determine and the Adviser will report on said allocations regularly to the
3
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Board of Directors of the Company indicating the brokers to whom such
allocations have been made and the basis therefor.
7. Compensation. The Company shall pay the Adviser as compensation
for services rendered hereunder fees, payable monthly, at the annual rates
indicated on Schedule I hereto, as such Schedule may be amended or supplemented
from time to time.
The average daily net asset value of the Funds shall be determined
in the manner set forth in the Company's Articles of Incorporation and
registration statement, as amended from time to time.
8. Expenses of the Funds. All of the ordinary business expenses
incurred in the operations of the Funds and the offering of their shares shall
be borne by the Funds unless specifically provided otherwise in this Agreement.
These expenses borne by the Funds include, but are not limited to, brokerage
commissions, taxes, legal, auditing, or governmental fees, the cost of preparing
share certificates, custodian, transfer agent and shareholder service agent
costs, expenses of issue, sale, redemption and repurchase of shares, expenses of
registering and qualifying shares for sale, expenses relating to directors and
shareholder meetings, the cost of preparing and distributing reports and notices
to shareholders, the fees and other expenses incurred by the Funds in connection
with membership in investment company organizations and the cost of printing
copies of prospectuses and statements of additional information distributed to
the Funds' shareholders.
9. Expense Limitation. If, for any fiscal year, the total of all
ordinary business expenses of a Fund, including all investment advisory fees,
but excluding brokerage commissions, fees, taxes, interest and extraordinary
expenses, such as litigation costs, would exceed the applicable expense
limitations imposed by state securities regulations in any state in which the
Funds' shares are qualified for sale, as such limitations may be raised or
lowered from time to time, the aggregate of all such investment advisory fees
shall be reduced by the amount of such excess. The amount of any such reduction
to be borne by the Adviser shall be deducted from the monthly investment
advisory fee otherwise payable to the Adviser during such fiscal year. If
required pursuant to such state securities regulations, the Adviser will, not
later than the last day of the first month of the next succeeding fiscal year,
reimburse the Fund for any such annual operating expenses (after reduction of
all investment advisory fees in excess of such limitation). For the purposes of
this paragraph, the term "fiscal year" shall exclude the portion of the current
fiscal year which shall have elapsed prior to the date hereof and shall include
the portion of the current fiscal year which shall have elapsed at the date of
termination of this Agreement.
10. Non-Exclusivity. The services of the Adviser to the Funds are
not to be deemed to be exclusive, and the Adviser shall be free to render
investment advisory and administrative or other services to others (including
other investment companies) and to engage in other activities. It is understood
and agreed that officers or directors of the Adviser may serve as officers and
directors of the Company, and that officers or directors of the Company may
serve as officers or directors of the Adviser, to the extent that such services
may be permitted by law, and that the officers and directors of the Adviser are
not prohibited from engaging in any other business activity or from rendering
4
<PAGE>
services to any other person, or from serving as partners, officers, directors
or trustees of any other firm or trust, including other investment advisory
companies.
11. Records. The Adviser shall, with respect to orders the Adviser
places for the purchase and sale of portfolio securities of the Funds, maintain
or arrange for the maintenance of the documents and records required pursuant to
Rule 31a-1 under the 1940 Act as well as such records as the Funds'
administrator reasonably requests to be maintained, including, but not limited
to, trade tickets and confirmations for portfolio trades. All such records shall
be maintained in a form acceptable to the Funds and in compliance with the
provisions of Rule 31a-1. All such records will be the property of the Funds and
will be available for inspection and use by the Funds. The Adviser will promptly
notify the Funds' administrator if it experiences any difficulty in maintaining
the records in an accurate and complete manner.
12. Term and Approval. This Agreement shall become effective with
respect to a Fund when approved in accordance with the requirements of the 1940
Act, and shall thereafter continue from year to year, provided that the
continuation of the Agreement is specifically approved at least annually:
(a) (i) by the Company's Board of Directors or (ii) by the
vote of "a majority of the outstanding voting securities" of the
Fund (as defined in Section 2(a)(42) of the 1940 Act), and
(b) by the affirmative vote of a majority of the Company's
Directors who are not parties to this Agreement or "interested
persons" (as defined in the 1940 Act) of a party to this Agreement
(other than as Directors of the Company), by votes cast in person
at a meeting specifically called for such purpose.
13. Termination. This Agreement may be terminated with respect to a
Fund at any time, without the payment of any penalty, by vote of the Company's
Board of Directors or by vote of a majority of a Fund's outstanding voting
securities, or by the Adviser, on sixty (60) days' written notice to the other
party. The notice provided for herein may be waived by the party entitled to
receipt thereof. This Agreement shall automatically terminate in the event of
its assignment, the term "assignment" for purposes of this paragraph having the
meaning defined in Section 2(a)(4) of the 1940 Act.
14. Liability of Adviser. In the absence of willful misfeasance, bad
faith, negligence or reckless disregard of obligations or duties hereunder on
the part of the Adviser or any of its officers, directors, employees or agents,
the Adviser shall not be subject to liability to the Company or to any
shareholder of the Company for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that may be
sustained in the purchase, holding or sale of any security.
5
<PAGE>
15. Indemnification. In the absence of willful misfeasance, bad
faith, negligence or reckless disregard of duties hereunder on the part of the
Adviser or any of its officers, directors, employees or agents, the Company
hereby agrees to indemnify and hold harmless the Adviser against all claims,
actions, suits or proceedings at law or in equity whether brought by a private
party or a governmental department, commission, board, bureau, agency or
instrumentality of any kind, arising from the advertising, solicitation, sale,
purchase or pledge of securities, whether of the Funds or other securities,
undertaken by the Funds, their officers, directors, employees or affiliates,
resulting from any violations of the securities laws, rules, regulations,
statutes and codes, whether federal or of any state, by the Funds, their
officers, directors, employees or affiliates. Federal and state securities laws
impose liabilities under certain circumstances on persons who act in good faith,
and nothing herein shall constitute a waiver or limitation of any rights which a
Fund may have and which may not be waived under any applicable federal and state
securities laws.
16. Notices. Any notices under this Agreement shall be in writing,
addressed and delivered or mailed postage paid to the other party at such
address as such other party may designate for the receipt of such notice. Until
further notice to the other party, it is agreed that the address of the Company
shall be c/o Stephens Inc., 111 Center Street, Suite 300, Little Rock, Arkansas
72201 and that of the Adviser shall be One NationsBank Plaza, Charlotte, North
Carolina 28255.
17. Questions of Interpretation. Any question of interpretation of
any term or provision of this Agreement having a counterpart in or otherwise
derived from a term or provision of the 1940 Act or the Advisers Act shall be
resolved by reference to such terms or provision of the 1940 Act or the Advisers
Act and to interpretations thereof, if any, by the United States Courts or in
the absence of any controlling decision of any such court, by rules, regulations
or orders of the Commission issued pursuant to the 1940 Act or the Advisers Act.
In addition, where the effect of a requirement of the 1940 Act or the Advisers
Act reflected in any provision of this Agreement is revised by rule, regulation
or order of the Commission, such provision shall be deemed to incorporate the
effect of such rule, regulation or order.
18. Amendment of this Agreement. No provision of this Agreement may
be changed, waived, discharged or terminated orally, but only by an instrument
in writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No amendment of this Agreement affecting a
Fund shall be effective until approved by vote of a majority of the outstanding
voting securities of such Fund. However, this shall not prevent the Adviser from
reducing, limiting or waiving its fee.
6
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IN WITNESS WHEREOF, the parties hereto have cause this Agreement to
be executed in duplicate by their respective officers on the day and year first
written above.
NATIONS FUND, INC.
on behalf of the Funds
By: /s/ A. Max Walker
-----------------------------
A. Max Walker
President and Chairman of the
Board of Directors
NATIONSBANC ADVISORS, INC.
By: /s/ Mark H. Williamson
-----------------------------
Mark H. Williamson
President and Director
7
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SCHEDULE I
The Company shall pay the Adviser as full compensation for services
provided and expenses assumed hereunder an advisory fee for each Fund, computed
daily and payable monthly at the annual rates listed below as a percentage of
the average daily net assets of the Fund:
- -------------------------------------------- ----------------------------------
Fund Rate of Compensation
- -------------------------------------------- ----------------------------------
Nations Prime Fund 0.25% up to $250 million
0.20% in excess of $250 million
- -------------------------------------------- ----------------------------------
Nations Equity Income Fund 0.65% up to $100 million
0.60% up to $250 million
0.50% in excess of $250 million
- -------------------------------------------- ----------------------------------
Nations Government Securities Fund 0.50% up to $100 million
0.45% up to $250 million
0.40% in excess of $250 million
- -------------------------------------------- ----------------------------------
Nations Treasury Fund 0.25% up to $250 million
0.20% in excess of $250 million
- -------------------------------------------- ----------------------------------
Nations International Growth Fund 0.80% of net asset value
- -------------------------------------------- ----------------------------------
Nations Small Company Growth Fund 0.90% of net asset value
- -------------------------------------------- ----------------------------------
Nations U.S. Government Bond Fund 0.50% of net asset value
- -------------------------------------------- ----------------------------------
Last Amended: August 19, 1999
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IN WITNESS WHEREOF, the parties hereto have caused this amended Schedule I
to be executed by their officers designated below as of the 19th day of August,
1999.
NATIONS FUND, INC.
on behalf of the Funds
By: /s/ James E. Banks, Jr.
-----------------------
James E. Banks, Jr.
Assistant Secretary
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
-----------------------
Robert H. Gordon
President
2
SUB-ADVISORY AGREEMENT
NATIONS FUND, INC.
THIS AGREEMENT is made as of this 1st day of January, 1996, by and
among NATIONSBANC ADVISORS, INC., a North Carolina corporation (the "Adviser"),
TRADESTREET INVESTMENT ASSOCIATES, INC., a Maryland corporation (the
"Sub-Adviser"), and NATIONS FUND, INC., a Maryland corporation (the "Company"),
on behalf of those portfolios of the Company now or hereafter identified on
Schedule I hereto (each a "Fund" and collectively, the "Funds").
RECITALS
WHEREAS, the Company is registered with the Securities and
Exchange Commission (the "Commission") under the Investment Company Act of 1940,
as amended (the "1940 Act") as an open-end, series management investment
company; and
WHEREAS, the Adviser is registered with the Commission under the
Investment Advisers Act of 1940, as amended (the "Advisers Act") and engages in
the business of acting as an investment adviser; and
WHEREAS, the Sub-Adviser also is registered with the Commission
under the Advisers Act as an investment adviser; and
WHEREAS, the Adviser and the Company have entered into an
Investment Advisory Agreement of even date herewith (the "Investment Advisory
Agreement"), pursuant to which the Adviser shall act as investment adviser with
respect to the Funds; and
WHEREAS, pursuant to such Investment Advisory Agreement, the
Adviser, with the approval of the Company, wishes to retain the Sub-Adviser for
purposes of rendering advisory services to the Adviser and the Company in
connection with the Funds upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereto agree as follows:
1. Appointment of Sub-Adviser. The Adviser hereby appoints, and
the Company hereby approves, the Sub-Adviser to render investment research and
advisory services to the Adviser and the Company with respect to the Funds,
under the supervision of the Adviser and subject to the policies and control of
the Company's Board of Directors, and the Sub-Adviser hereby accepts such
appointment, all subject to the terms and conditions contained herein.
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2. Investment Services. The specific duties of the Adviser
delegated to the Sub-Adviser shall be the following:
(a) obtaining and evaluating pertinent information
about significant developments and economic, statistical and
financial data, domestic, foreign or otherwise, whether affecting
the economy generally or the Funds specifically, and whether
concerning the individual issuers whose securities are included in
the Funds or the activities in which such issuers engage, or with
respect to securities which the Adviser or Sub-Adviser considers
desirable for inclusion in the Funds;
(b) investing and reinvesting, on an ongoing basis,
assets held in the Funds in strict accordance with the investment
policies of the Funds as set forth in the registration statement
of the Company with respect to the Funds, as the same may be
amended from time to time;
(c) in accordance with policies and procedures
established by the Board of Directors of the Company and the
Adviser, selecting brokers and dealers to execute portfolio
transactions for the Funds and selecting the markets on or in
which the transactions will be executed;
(d) voting, either in person or by general or
limited proxy, or refraining from voting, any securities held in
the Funds for any purposes; exercising or selling any subscription
or conversion rights; consenting to and joining in or opposing any
voting trusts, reorganizations, consolidations, mergers,
foreclosures and liquidations and in connection therewith,
depositing securities, and accepting other property received
therefor; and
(e) performing other acts necessary or appropriate
in connection with the proper management of the Funds, consistent
with its obligations hereunder, and as may be directed by the
Adviser and/or the Company's Board of Directors.
3. Control by Board of Directors. As is the case with respect to
the Adviser under the Investment Advisory Agreement, any investment activities
undertaken by the Sub-Adviser pursuant to this Agreement, as well as any other
activities undertaken by the Sub-Adviser with respect to the Funds, shall at all
times be subject to any directives of the Board of Directors of the Company.
4. Compliance with Applicable Requirements. In carrying out its
obligations under this Agreement, the Sub-Adviser shall at all times conform to:
(a) all applicable provisions of the 1940 Act, the
Advisers Act and any rules and regulations adopted thereunder;
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(b) the provisions of the registration statement of
the Company applicable to the Funds, as the same may be amended
from time to time, under the Securities Act of 1933 and the 1940
Act;
(c) the provisions of the Articles of Incorporation
of the Company, as the same may be amended from time to time;
(d) the provisions of the By-Laws of the Company, as
the same may be amended from time to time;
(e) any other applicable provisions of state or
federal law.
In addition, any code of ethics adopted by the Sub-Adviser
pursuant to Rule 17j-1 under the 1940 Act shall include policies, prohibitions
and procedures which substantially conform to the recommendations regarding
personal investing approved by the Board of Governors of the Investment Company
Institute on June 30, 1994, as such recommendations may be amended from time to
time.
5. Broker-Dealer Relationships. The Sub-Adviser is responsible for
the purchase and sale of securities for the Funds, broker-dealer selection, and
negotiation of brokerage commission rates. The Sub-Adviser's primary
consideration in effecting a security transaction will be to obtain the best
price and execution. In selecting a broker-dealer to execute each particular
transaction for a Fund, the Sub-Adviser will take the following into
consideration: the best net price available, the reliability, integrity and
financial condition of the broker-dealer; the size of and difficulty in
executing the order; and the value of the expected contribution of the
broker-dealer to the Fund on a continuing basis. Accordingly, the price to the
Fund in any transaction may be less favorable than that available from another
broker-dealer if the difference is reasonably justified by other aspects of the
portfolio execution services offered. Subject to such policies as the Adviser or
the Company's Board of Directors may from time to time determine, the
Sub-Adviser shall not be deemed to have acted unlawfully or to have breached any
duty created by this Agreement or otherwise solely by reason of having caused a
Fund to pay a broker or dealer that provides brokerage and research services to
the Sub-Adviser an amount of commission for effecting a portfolio investment
transaction in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction, if the Sub-Adviser determines in
good faith that such amount of commission was reasonable in relation to the
value of the brokerage and research services provided by such broker or dealer,
viewed in terms of either that particular transaction or the overall
responsibilities of the Sub-Adviser with respect to the Fund and to other
clients of the Sub-Adviser. The Sub-Adviser is further authorized to allocate
the orders placed by it on behalf of the Funds to brokers and dealers who also
provide research or statistical material, or other services to the Funds or to
the Sub-Adviser. Such allocation shall be in such amounts and proportions as the
Sub-Adviser shall determine, and the Sub-Adviser will report on said allocations
regularly to the Adviser and to the Board of Directors of the Company indicating
the brokers to whom such allocations have been made and the basis therefor.
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6. Compensation. The Adviser shall pay the Sub-Adviser, as
compensation for services rendered hereunder, fees, payable monthly, at the
annual rates indicated on Schedule I hereto, as such Schedule may be amended or
supplemented from time to time. It is understood that the Adviser shall be
responsible for the Sub-Adviser's fee for its services hereunder, and the
Sub-Adviser agrees that it shall have no claim against the Company or the Funds
with respect to compensation under this Agreement.
The average daily net asset value of the Funds shall be determined
in the manner set forth in the Articles of Incorporation and registration
statement of the Company, as amended from time to time.
7. Expenses of the Funds. All of the ordinary business expenses
incurred by the Company in the operations of the Funds and the offering of their
shares shall be borne by the Funds unless specifically provided otherwise in
this Agreement. These expenses borne by the Funds include but are not limited to
brokerage commissions, taxes, legal, auditing, or governmental fees, the cost of
preparing share certificates, custodian, transfer agent and shareholder service
agent costs, expenses of issue, sale, redemption and repurchase of shares,
directors and shareholder meetings, the cost of preparing and distributing
reports and notices to shareholders, the fees and other expenses incurred by the
Funds in connection with membership in investment company organizations and the
cost of printing copies of prospectuses and statements of additional information
distributed to the Funds' shareholders.
8. Expense Limitation. If, for any fiscal year of a Fund, the
amount of the aggregate advisory fee which the Company would otherwise be
obligated to pay with respect to the Fund is reduced pursuant to expense
limitation provisions of the Investment Advisory Agreement, the fee which the
Sub-Adviser would otherwise receive pursuant to this Agreement shall be reduced
proportionately.
9. Non-Exclusivity. The services of the Sub-Adviser to the Adviser
and the Company with respect to the Fund are not to be deemed to be exclusive,
and the Sub-Adviser shall be free to render investment advisory and
administrative or other services to others (including other investment
companies) and to engage in other activities. It is understood and agreed that
the officers and directors of the Sub-Adviser are not prohibited from engaging
in any other business activity or from rendering services to any other person,
or from serving as partners, officers, directors or trustees of any other firm
or trust, including other investment advisory companies.
10. Records. The Sub-Adviser shall, with respect to the orders the
Sub-Adviser places for the purchases and sales of portfolio securities of the
Funds, maintain or arrange for the maintenance of the documents and records
required pursuant to Rule 31a-1 under the 1940 Act as well as such records as
the Funds' administrator reasonably requests to be maintained, including, but
not limited to, trade tickets and confirmations for portfolio trades. All such
-4-
<PAGE>
records shall be maintained in a form acceptable to the Funds and in compliance
with the provisions of Rule 31a-1. All such records will be the property of the
Funds and will be available for inspection and use by the Adviser or the Funds
upon request. The Sub-Adviser will promptly notify the Adviser and the Fund's
administrator if it experiences any difficulty in maintaining the records in an
accurate and complete manner.
11. Term and Approval. This Agreement shall become effective with
respect to each Fund when approved in accordance with the requirements of the
1940 Act, and shall thereafter continue in force and effect for one year, and
may be continued from year to year with respect to each Fund thereafter,
provided that the continuation of the Agreement is specifically approved at
least annually:
(a) (i) by the Company's Board of Directors or (ii) by the
vote of "a majority of the outstanding voting securities" of the
Fund (as defined in Section 2(a)(42) of the 1940 Act); and
(b) by the affirmative vote of a majority of the Directors
of the Company who are not parties to this Agreement or
"interested persons" (as defined in the 1940 Act) of a party to
this Agreement (other than as Directors of the Company), by votes
cast in person at a meeting specifically called for such purpose.
12. Termination. This Agreement may be terminated at any time with
respect to a Fund, without the payment of any penalty, by vote of the Company's
Board of Directors or by vote of a majority of the Fund's outstanding voting
securities, or by the Adviser or by the Sub-Adviser, on sixty (60) days' written
notice to the other parties to this Agreement. Any party entitled to notice may
waive the notice provided for herein. This Agreement shall automatically
terminate in the event of its assignment, the term "assignment" for purposes of
this paragraph having the meaning defined in Section 2(a)(4) of the 1940 Act.
13. Liability of Sub-Adviser. In the absence of willful
misfeasance, bad faith, negligence or reckless disregard of obligations or
duties hereunder on the part of the Sub-Adviser or any of its officers,
directors, employees or agents, the Sub-Adviser shall not be subject to
liability to the Adviser or to the Company for any act or omission in the course
of, or connected with, rendering services hereunder or for any losses that may
be sustained in the purchase, holding or sale of any security.
14. Indemnification. In the absence of willful misfeasance, bad
faith, negligence or reckless disregard of duties hereunder on the part of the
Sub-Adviser, or any officers, directors, employees or agents thereof, the
Company hereby agrees to indemnify and hold harmless the Sub-Adviser against all
claims, actions, suits or proceedings at law or in equity whether brought by a
private party or a governmental department, commission, board, bureau, agency or
instrumentality of any kind, arising from the advertising, solicitation, sale,
purchase or pledge of securities, whether of the Funds or other securities,
undertaken by the Funds, their officers, directors, employees, agents or
-5-
<PAGE>
affiliates, resulting from any violations of the securities laws, rules,
regulations, statutes and codes, whether federal or of any state, by the Funds,
their officers, directors, employees or affiliates. Federal and state securities
laws impose liabilities under certain circumstances on persons who act in good
faith, and nothing herein shall constitute a waiver or limitation of any rights
which a Fund may have and which may not be waived under any applicable federal
and state securities laws.
15. Notices. Any notices under this Agreement shall be in writing,
addressed and delivered or mailed postage paid to such address as may be
designated for the receipt of such notice, with a copy to the Company. Until
further notice, it is agreed that the address of the Company shall be 111 Center
Street, Little Rock, Arkansas 72201; that of the Sub-Adviser shall be One
NationsBank Plaza, Charlotte, North Carolina 28255; and that of the Adviser
shall be One NationsBank Plaza, Charlotte, North Carolina 28255.
16. Questions of Interpretation. Any question of interpretation of
any term or provision of this Agreement having a counterpart in or otherwise
derived from a term or provision of the 1940 Act or the Advisers Act shall be
resolved by reference to such term or provision of the 1940 Act or the Advisers
Act and to interpretations thereof, if any, by the United States courts or in
the absence of any controlling decision of any such court, by rules, regulations
or orders of the Commission issued pursuant to the 1940 Act or the Advisers Act.
In addition, where the effect of a requirement of the 1940 Act or the Advisers
Act reflected in any provision of this Agreement is revised by rule, regulation
or order of the Commission, such provision shall be deemed to incorporate the
effect of such rule, regulation or order.
17. Amendment of this Agreement. No provision of this Agreement
may be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought. No amendment of this
Agreement affecting a Fund shall be effective until approved by vote of a
majority of the outstanding voting securities of such Fund. However, this shall
not prevent the Sub-Adviser from reducing, limiting or waiving its fee.
-6-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed in triplicate by their respective officers on the day and year
first written above.
NATIONS FUND, INC.,
on behalf of the Funds
By: /s/ A. Max Walker
-----------------------------
A. Max Walker
President and Chairman of the
Board of Directors
NATIONSBANC ADVISORS, INC.
By: /s/ Mark H. Williamson
-----------------------------
Mark H. Williamson
President and Director
TRADESTREET INVESTMENT
ASSOCIATES, INC.
By: /s/ Andrew M. Silton
-----------------------------
Andrew M. Silton
President and Director
-7-
<PAGE>
SCHEDULE I
The Adviser shall pay the Sub-Adviser as full compensation for services
provided and expenses assumed hereunder a sub-advisory fee for each Fund,
computed daily and payable monthly at the annual rates listed below as a
percentage of the average daily net assets of the Fund:
Fund Rate of Compensation
---- --------------------
Nations Prime Fund 0.055%
Nations Treasury Fund 0.055%
Nations Equity Income Fund 0.20%
Nations Small Company Growth Fund 0.25%
Nations Government Securities Fund 0.15%
Nations U.S. Government Bond Fund* 0.15%
Approved: December 9, 1997
Last Amended: February 14, 2000
IN WITNESS WHEREOF, the parties hereto have caused this amended Schedule I
to be executed by their officers designated below as of the 14th day of
February, 2000.
NATIONS FUND, INC.,
on behalf of the Funds
By: /s/ A. Max Walker
-----------------------------------
A. Max Walker
President and Chairman of the
Board of Directors
BANC OF AMERICA ADVISORS, INC.
(Formerly, NationsBanc Advisors, Inc.)
By: /s/ Robert H. Gordon
-----------------------------------
Robert H. Gordon
President
- --------
* Banc of America Capital Management, Inc. (formerly TradeStreet Investment
Associates, Inc.) assumed responsibility for the investment sub-advisory
services of Nations U.S. Government Bond Fund from Boatmen's Capital Management,
Inc. on February 14, 2000.
-8-
<PAGE>
BANC OF AMERICA CAPITAL
MANAGEMENT, INC.
(Formerly, Tradestreet Investment
Associates, Inc.)
By: /s/ Holly H. Deem
--------------------------
Holly H. Deem
President
-9-
SUB-ADVISORY AGREEMENT
NATIONS FUND, INC.
THIS AGREEMENT is made this 10th day of April, 1996, by and among
NATIONSBANC ADVISORS, INC., a North Carolina corporation (the "Adviser"),
GARTMORE GLOBAL PARTNERS, a general partnership organized under the laws of the
State of Delaware (the "Sub-Adviser"), and NATIONS FUND, INC. (the "Company"),
on behalf of the portfolio or portfolios of the Company as now or hereafter may
be identified on Schedule I hereto (each a "Fund" and collectively, the
"Funds").
RECITALS
WHEREAS, the Company is a Maryland corporation registered under
the Investment Company Act of 1940, as amended (the "1940 Act") as an open-end,
series management investment company; and
WHEREAS, the Adviser is a national bank that serves as investment
adviser to other registered investment companies and various investment
accounts; and
WHEREAS, the Sub-Adviser is registered under the Investment
Advisers Act of 1940, as amended (the "Advisers Act"), as an investment adviser
and engages in the business of acting as an investment adviser, and is regulated
by the Investment Management Regulatory Organization Limited ("IMRO") of the
United Kingdom in the conduct of its investment business and is a member of
IMRO; and
WHEREAS, the Adviser and the Company have entered into an
Investment Advisory Agreement of even date herewith (the "Investment Advisory
Agreement"), pursuant to which the Adviser shall act as investment adviser with
respect to the Funds; and
WHEREAS, pursuant to such Investment Advisory Agreement, the
Adviser, with the approval of the Company, wishes to retain the Sub-Adviser for
purposes of rendering advisory services to the Adviser and the Company in
connection with the Funds upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt whereof is
hereby acknowledged, the parties hereto agree as follows:
1. Appointment of Sub-Adviser. The Adviser hereby appoints, and
the Company hereby approves, the Sub-Adviser to render investment research and
advisory services to the Adviser and the Company with respect to the Funds,
under the supervision of the Adviser and subject to the policies and control of
the Company's Board of Directors, and the Sub-Adviser hereby accepts such
appointment, all subject to the terms and conditions contained herein.
<PAGE>
2. Investment Services. The specific duties of the Adviser
delegated to the Sub-Adviser shall be the following:
(a) obtaining and evaluating pertinent information about
significant developments and economic, statistical and financial data,
domestic, foreign or otherwise, whether affecting the economy generally
or the Funds specifically, and whether concerning the individual issuers
whose securities are included in the Funds or the activities in which
such issuers engage, or with respect to securities which the Adviser or
Sub-Adviser considers desirable for inclusion in the Funds;
(b) investing and reinvesting, on an ongoing basis, assets
held in the Funds in strict accordance with the investment policies of
the Funds as set forth in the registration statement of the Company with
respect to the Funds, as the same may be amended from time to time;
(c) in accordance with policies and procedures established
by the Board of Directors of the Company and the Adviser, selecting
brokers and dealers to execute portfolio transactions for the Funds and
selecting the markets on or in which the transactions will be executed;
(d) voting, either in person or by general or limited
proxy, or refraining from voting, any securities held in the Funds for
any purposes; exercising or selling any subscription or conversion
rights; consenting to and joining in or opposing any voting trusts,
reorganizations, consolidations, mergers, foreclosures and liquidations
and in connection therewith, depositing securities, and accepting and
holding other property received therefor, all as may be considered
appropriate by the Sub-Adviser; and
(e) performing other acts necessary or appropriate in
connection with the proper management of the Funds, consistent with its
obligations hereunder, and as may be directed by the Adviser and/or the
Company's Board of Directors.
In carrying out its obligations under clauses (b) to (e),
inclusive, of this Paragraph 2, the Sub-Adviser shall act only as agent of the
Company and/or the Fund and shall not act as principal. The Sub-Adviser shall
not be responsible for the administration of the Fund, for the execution and
settlement of transactions in securities or derivative instruments nor for the
custody of any such securities or instruments or documents of title and the
Sub-Adviser shall not hold any money or other assets of the Fund or the Company.
3. Control by Board of Directors. As is the case with respect to
the Adviser under the Investment Advisory Agreement, any investment activities
undertaken by the Sub-Adviser pursuant to this Agreement, as well as any other
activities undertaken by the Sub-Adviser with respect to the Funds, shall at all
times be subject to any directives of the Board of Directors of the Company.
Without limiting the right of the Board of Directors of the Company to issue
directives, the Board of Directors shall take into consideration any views or
opinions that may be expressed by the Adviser of Sub-Adviser in formulating
2
<PAGE>
policies, procedures and directives. The Sub-Adviser shall not be obligated to
conform its activities to any directive of the Board of Directors of the Company
to the extent that compliance with such directive would be in contravention of
any law, rule or regulation applicable to the Sub-Adviser.
4. Compliance with Applicable Requirements. In carrying out its
obligations under this Agreement, the Sub-Adviser shall at all times conform to:
(a) all applicable provisions of the 1940 Act and any rules
and regulations adopted thereunder;
(b) the provisions of the registration statement of the
Company applicable to the Funds, as the same may be amended from time to
time, under the Securities Act of 1933 and the 1940 Act;
(c) the Conduct of Business Rules of IMRO ("IMRO Rules") to
the extent that the IMRO Rules are not inconsistent with any applicable
requirements under the 1940 Act, the Advisers Act or other United States
federal or state law; and
(d) such policies and procedures that may be established by
the Board of Directors of the Company and communicated to the
Sub-Adviser from time to time.
In addition, any code of ethics adopted by the Sub-Adviser
pursuant to Rule 17j-1 under the 1940 Act shall include policies, prohibitions
and procedures which substantially conform to the recommendations regarding
personal investing approved by the Board of Governors of the Investment Company
Institute on June 30, 1994, as such recommendations may be amended from time to
time.
5. Compensation. The Adviser shall pay the Sub-Adviser, as
compensation for services rendered hereunder, fees, payable monthly, at the
annual rates indicated on Schedule I hereto, as such Schedule may be
supplemented and amended from time to time. It is understood that the Adviser
shall be responsible for the Sub-Adviser's fee for its services hereunder, and
the Sub-Adviser agrees that it shall have no claim against the Company or the
Fund with respect to compensation under this Agreement. The Sub-Adviser's fees
shall be pro-rated for portions of months in which sub-advisory services are
provided.
The average daily net asset value of the Funds shall be determined
in the manner set forth in the Articles of Incorporation and registration
statement of the Company, as amended from time to time.
6. Expenses of the Funds. All of the ordinary business expenses
incurred by the Sub-Adviser in the operations of the Funds and the offering of
their shares shall be borne by the Funds unless specifically provided otherwise
in this Agreement. These expenses borne by the Funds include but are not limited
to brokerage commissions, taxes, legal, auditing, or governmental fees, the cost
of preparing share certificates, custodian, transfer agent and shareholder
service agent costs, expenses of issue, sale, redemption and repurchase of
3
<PAGE>
shares, directors and shareholder meetings, the cost of preparing and
distributing reports and notices to shareholders, the fees and other expenses
incurred by the Funds in connection with membership in investment company
organizations and the cost of printing copies of prospectuses and statements of
additional information distributed to the Funds' shareholders.
7. Expense Limitation. If, for any fiscal year a Fund, the amount
of the aggregate advisory fee which the Company would otherwise be obligated to
pay with respect to the Fund is reduced pursuant to expense limitation
provisions of the Investment Advisory Agreement, the fee which the Sub-Adviser
would otherwise receive pursuant to this Agreement shall be reduced
proportionately.
8. Non-Exclusivity. The services of the Sub-Adviser to the Adviser
and the Company with respect to the Fund are not to be deemed to be exclusive,
and the Sub-Adviser shall be free to render investment advisory and
administrative or other services to others (including other investment
companies) and to engage in other activities. It is understood and agreed that
the officers and directors of the Sub-Adviser are not prohibited from engaging
in any other business activity or from rendering services to any other person,
or from serving as partners, officers, directors or trustees of any other firm
or trust, including other investment advisory companies.
9. Records. The Sub-Adviser shall provide to the Adviser, with
respect to the orders the Sub-Adviser places for the purchases and sales of
portfolio securities of the Funds, the documents and records required pursuant
to Rule 31a-1 under the 1940 Act as well as such records as the Funds'
administrator reasonably requests to be maintained, including, but not limited
to, trade tickets and confirmations for portfolio trades. All such records shall
be maintained in a form acceptable to the Funds and in compliance with the
provisions of Rule 31a-1. All such records will be the property of the Funds and
will be available for inspection and use by the Funds. The Sub-Adviser will
promptly notify the Adviser and the Fund's administrator if it experiences any
difficulty in providing the records in an accurate and complete manner.
10. Term and Approval. This Agreement shall become effective when
approved, and shall thereafter continue from year to year, provided that the
continuation of the Agreement is specifically approved at least annually:
(a)(i) by the Company's Board of Directors or (ii) by the
vote of "a majority of the outstanding voting securities" of the Fund
(as defined in Section 2(a)(42) of the 1940 Act); and
(b) by the affirmative vote of a majority of the Directors
of the Company who are not parties to this Agreement or "interested
persons" (as defined in the 1940 Act) of a party to this Agreement
(other than as Directors of the Company), by votes cast in person at a
meeting specifically called for such purpose.
11. Termination. This Agreement may be terminated at any time with
respect to a Fund, without the payment of any penalty, by vote of the Company's
Board of Directors or by vote of a majority of the Fund's outstanding voting
4
<PAGE>
securities, or by the Adviser, or by the Sub-Adviser on sixty (60) days' written
notice to the other parties to this Agreement. Any party entitled to notice may
waive the notice provided for herein. This Agreement shall automatically
terminate in the event of its assignment, the term "assignment" for purposes of
this paragraph having the meaning defined in Section 2(a)(4) of the 1940 Act.
This Agreement shall automatically terminate 120 days after its effectiveness if
the Fund's shareholders have not ratified and approved it within such period.
The Agreement shall automatically terminate upon the effectiveness of a
Sub-Advisory Agreement between the Company on behalf of the Fund and Gartmore
Global Partners.
12. Liability of Sub-Adviser. In the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of obligations or
duties hereunder on the part of the Sub-Adviser or any of its officers,
directors, employees or agents, the Sub-Adviser shall not be subject to
liability to the Adviser or to the Company for any act or omission in the course
of, or connected with, rendering services hereunder or for any losses that may
be sustained in the purchase, holding or sale of any security. For purposes of
this paragraph and paragraph 13, brokers or dealers selected to execute
portfolio transactions for the Fund in accordance with Paragraph 2(c) hereof
shall not be considered agents of the Sub-Adviser.
13. Indemnification. In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of duties hereunder on the part of
the Sub-Adviser, or any officers, directors, employees or agents thereof, the
Company hereby agrees to indemnify and hold harmless the Sub-Adviser against all
claims, actions, suits or proceedings at law or in equity whether brought by a
private party or a governmental department, commission, board, bureau, agency or
instrumentality of any kind, (a) arising from the advertising, solicitation,
sale, purchase or pledge of securities, whether of the Funds or other
securities, undertaken by the Funds or the Company's officers, directors,
employees, agents or affiliates, or (b) resulting from any violations of the
securities laws, rules, regulations, statutes and codes, whether federal or of
any state, by the Funds, or the Company's officers, directors, employees or
affiliates.
14. Notices. Any notices under this Agreement shall be in writing
and shall be duly given if delivered, mailed (postage prepaid, effective upon
receipt) or telegraphed, telexed or transmitted by similar telecommunications
device (effective upon completion of transmission, with a confirming copy
delivered or mailed postage prepaid) to such address or number as may be
designated for the receipt of such notice, with a copy to the Company. Until
further notice, it is agreed that the address and telefax number of the Company
shall be 111 Center Street, Little Rock, Arkansas 72201, Fax No. (501) 377-2331;
that of the Sub-Adviser shall be Gartmore House, 16-18 Monument Street, London
EC3R 8AJ, England, Fax No. 71-782-2075; and that of the Adviser shall be c/o
Mutual Fund Group, 33rd Floor, One NationsBank Plaza, Charlotte, North Carolina
28255, Fax No. (704) 388-2187.
15. Questions of Interpretation. Any question of interpretation of
any term or provision of this Agreement having a counterpart in or otherwise
derived from a term or provision of the 1940 Act shall be resolved by reference
to such term or provision of the 1940 Act and to interpretations thereof, if
any, by the United States courts or in the absence of any controlling decision
of any such court, by rules, regulations or orders of the Securities and
Exchange Commission issued pursuant to the 1940 Act. In addition, where the
5
<PAGE>
effect of a requirement of the 1940 Act reflected in any provision of this
Agreement is revised by rule, regulation or order of the Securities and Exchange
Commission, such provision shall be deemed to incorporate the effect of such
rule, regulation or order.
16. IMRO Rules. Addendum A attached hereto sets forth certain
requirements under the IMRO Rules which are applicable to the Sub-Adviser, that
are expressly incorporated herein and made a part hereof, but only to the extent
that such requirements are not inconsistent with any applicable requirements
under the 1940 Act, the Advisers Act or other United States federal or state
law.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed in triplicate by their respective officers on the day and year
first written above.
NATIONS FUND, INC.,
on behalf of the Funds
By: /s/ A. Max Walker
------------------------------
A. Max Walker
President and Chairman of the
Board of Directors
NATIONSBANC ADVISORS, INC.
By: /s/ A. Max Walker
------------------------------
Mark H. Williamson
President and Director
GARTMORE GLOBAL PARTNERS
By: /s/ Charles G. Smith IV
------------------------------
Charles G. Smith IV
President
6
<PAGE>
SCHEDULE I
Fund Rate of Compensation
---- --------------------
1. Nations International Growth Fund 0.70% of average daily net assets
IN WITNESS WHEREOF, the parties hereto have caused this amended Schedule I
to be executed by their officers designated below as of the 3rd day of May,
1999.
NATIONS FUND, INC.,
on behalf of the Funds
By: /s/ James E. Banks, Jr.
-----------------------
James E. Banks, Jr.
Assistant Secretary
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
-----------------------
Robert H. Gordon
President
GARTMORE GLOBAL PARTNERS
By: /s/
Name:
Title:
Last Amended: May 3, 1999
<PAGE>
ADDENDUM A
1. To the extent that the Sub-Adviser receives any commissions or other forms
of remuneration, directly or indirectly, in connection with Fund
transactions, no portion of the Sub-Adviser's accrued investment advisory
fee shall be abated thereby.
2. Subject to the supervision of the Adviser and the policies and ultimate
control of the Company's Board of Directors, the Sub-Adviser shall advise
the Company and the Adviser on the management of the Funds' investments in
accordance with the terms of this Agreement and in accordance with the
investment parameters (including, inter alia, percentage limitations,
quality standards, investment selection criteria and types of permissible
investments and investment techniques, such as borrowing, options and
futures transactions, portfolio securities lending, etc.) established
pursuant to the investment objectives, policies and restrictions
specifically embodied in the Company's Registration Statement on Form N-1A,
and any amendments thereto, under the Securities Act of 1933 and the 1940
Act (the "Fund's Registration Statement").
3. The Sub-Adviser shall not have or maintain custody of any securities, cash
or other assets of the Funds. Custody of the Funds' assets will be
maintained by the custodian bank pursuant to an agreement approved by the
Funds' Board of Directors. It is expected that such custodian, or any
successor thereto, will not be an "Associate" of the Sub-Adviser as that
term is defined under IMRO Rules.
4. In the event the Funds or the Adviser has a significant complaint regarding
the services provided by the Sub-Adviser under the Sub-Advisory Agreement
by and among the Company, the Adviser and the Sub-Adviser, a Fund officer
should communicate such complaint to the Sub-Adviser, whereupon such
complaint will be recorded on a standard form prepared by the Sub-Adviser
for such purposes. The Sub-Adviser's complaints procedure requires that if
a complaint has not been cleared within twenty-one (21) days, the
Sub-Adviser must so advise IMRO and the Fund also must be advised that it
has the right to issue its complaint directly with a referee appointed by
IMRO.
5. The Sub-Adviser will provide to the Funds' Board of Directors written
financial reports and analyses on the Funds' securities transactions and
the operations of comparable investment companies on a quarterly basis or
more frequently as requested by the Board of Directors. Such reports and
analyses shall include information as at the last day of an applicable
reporting period.
6. The Funds may from time to time request or instruct the Sub-Adviser,
directly or through the Adviser, to act or not to act regarding certain
Fund-related investment and/or operational matters. Such request or
instructions will be communicated orally or in writing to the Sub-Adviser,
directly or through the Adviser and will be acknowledged in the same manner
in which they are communicated. To the extent that a particular request or
instruction is, or may be, refused (i.e., because it (a) is in
contravention of (i) a law or regulation, (ii) an investment policy of the
Fund, or (iii) a provision of this Agreement or (b) is not operationally
1
<PAGE>
feasible), such refusal shall be communicated by the Sub-Adviser, including
through the Adviser, and the Fund and the Sub-Adviser, upon advice of
counsel, shall discuss alternatives and determine an appropriate course of
action which will be reported to the full Board at the next meeting of the
Fund's Board of Directors for its approval.
7. Notwithstanding that all required disclosure concerning the risks
associated with the Funds' permissible investments and investment
techniques is included in the Funds' Registration Statement, which
Statement is intended for review by the investors in the Funds and to be
retained by them for future reference, with respect to the Funds' specified
use of options and futures transactions, the following shall be
specifically noted herein:
"Options and futures markets can be highly volatile and transactions of
this type carry a high risk of loss. Moreover, a relatively small
adverse market movement with respect to these types of transactions may
result not only in loss of the original investment but also in
unquantifiable further loss exceeding any margin deposited."
Further, in managing the Funds' assets, the Sub-Adviser shall consider the
risks associated with the Fund's permissible investments and investment
techniques.
8. The Sub-Adviser or its representatives may from time to time recommend to
the Funds or effect on behalf of the Funds with respect to Fund
transactions in securities the subject of a recent new issue, the price of
which transactions may have been influenced by bids made or transactions
effected for the purpose of stabilizing the price of those securities. Such
transactions would at all times be effected in accordance with the
provisions of IMRO Rule 14 and, in particular, with the conditions of the
IMRO Rule 14.02, including the requirement that the Sub-Adviser, with
respect to any specific transaction, communicate to the Fund orally or in
writing a statement in a form substantially similar to that which is set
forth in IMRO Rule 14.02(c). In addition, with respect to these
transactions, it is understood when executing this Agreement and thereafter
when approving the continuance of this Agreement in accordance with its
terms, that management of the Fund has carefully read the following
paragraphs in order to enable Fund management to judge whether it wishes a
Fund's assets to be invested at all in such securities or, if so, whether
it wishes to authorize the Sub-Adviser generally to effect transactions in
such securities on behalf of the Fund without further reference to Fund
management or whether Fund management wishes to be consulted before any
particular transaction is effected on behalf of the Fund.
Stabilization is a process whereby the market price of a security is pegged or
fixed during the period in which a new issue of securities is sold to the
public. Stabilization may take place in the new issue or in other securities
related to the new issue in such a way that the price of the other securities
may affect the price of the new issue or vice versa.
The reason stabilization is permitted is that when a new issue is brought to
market the sudden glut will sometimes force the price lower for a period of
time before buyers are found for the securities on offer.
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As long as it obeys a strict set of rules, the "stabilizing manager," normally
the issuing house chiefly responsible for bringing a new issue to market, is
entitled to buy securities in the market that it has previously sold to
investors or allotted to institutions who were included in the new issue but
who have decided not to continue participating. The effect of this may be to
keep the price at a higher level than would otherwise be the case during the
period of stabilizing.
The rules referred to above in the immediately preceding paragraph limit the
period in which the stabilizing manager may stabilize, fix the price at which
it may stabilize (in the case of shares and warrants but not bonds), and
require the stabilizing manager to disclose that it may be (but not that it is)
stabilizing. The fact that a new issue or a related security is being
stabilized does not in itself mean that investors are not interested in the
issue, but neither should the existence of transactions in an issue where the
stabilizing may take place be relied upon as an indication that investors are
interested in the new issue or interested in purchasing at the price at which
transactions are taking place.
9. A report containing the Funds' financial statements (including the contents
and valuation of the Funds) shall be submitted to shareholders and to the
Securities and Exchange Commission at least semi-annually. Such reports
shall include information as at the last day of any semi-annual period for
which such reports relate. To the extent that any performance information
is included in such report, it shall conform to the standards set forth in
the Funds' Registration Statement.
10. Except as permitted by or pursuant to Section 17 of the 1940 Act and the
Rules promulgated thereunder, the Sub-Adviser, or an "affiliate" thereof
(as that term is defined in the 1940 Act), may not effect transactions: (i)
with or for the Funds in which the Sub-Adviser or such affiliate has
directly or indirectly a material interest or a relationship of any kind
with another party which may involve a conflict with the Sub-Adviser's
responsibilities to the Funds as a sub-investment adviser; or (ii) with or
through the agency or another person with whom the Sub-Adviser or such
affiliate maintains an arrangement as described in Rule 6.01 of Chapter IV
of the IMRO Rules.
11. Upon termination of the Sub-Advisory Agreement by and among the Company,
the Adviser and the Sub-Adviser, unless otherwise directed by the Fund's
Board of Directors, all securities positions and other portfolio
transactions then in progress shall be transferred to the successor
investment adviser selected by the Board of Directors.
12. The Sub-Adviser shall be entitled at its discretion to disclose any
information known to it relating to the Fund's business or affairs to the
Securities and Investment Board or to IMRO on the terms that the
information so disclosed shall not without its consent be further disclosed
otherwise than is permitted in respect of Restricted Information under the
provisions of Part VIII of the Financial Services Act of 1986.
3
DISTRIBUTION AGREEMENT
NATIONS FUND, INC.
Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
Gentlemen:
This is to confirm that, in consideration of the agreements hereinafter
contained, the undersigned, Nations Fund, Inc. (the "Company"), a Maryland
corporation, has agreed that Stephens Inc. (the "Distributor") shall be, for the
period of this Agreement, the exclusive distributor of the shares of common
stock in all classes of shares ("Shares") of the investment portfolios of the
Company listed on Schedule I (individually, a "Fund" and collectively the
"Funds"). Absent written notification to the contrary by either the Company or
the Distributor, each new investment portfolio established in the future shall
automatically become a "Fund" for all purposes hereunder and shares of each new
class established in the future shall automatically become "Shares" for all
purposes hereunder as if set forth on Schedule I.
1. Services as Distributor.
1.1 The Distributor will act as agent for the distribution of
Shares in accordance with the instructions of the Company's Board of Directors
and the Company's registration statement and prospectus then in effect under the
Securities Act of 1933, as amended, and will transmit promptly any orders
received by it for the purchase or redemption of Shares to the Company or its
transfer agent.
1.2 The Distribution agrees to use appropriate efforts to solicit
orders for the sale of Shares and will undertake such advertising and promotion
as it believes appropriate in connection with such solicitation. The Company
understands that the Distributor is and may in the future be the distributor of
shares of other investment company portfolios ("Portfolios") including
Portfolios having investment objectives similar to those of the Funds. The
Company further understands that existing and future investors in the Funds may
invest in shares of such other Portfolios. The Company agrees that the
Distributor's duties to such Portfolios shall not be deemed in conflict with its
duties to the Company under this paragraph 1.2.
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1.3 The Distributor shall, at its own expense, finance such
activities as it deems reasonable and which are primarily intended to result in
the sale of Shares, including, but not limited to, advertising, compensation of
underwritings, dealers and sales personnel, the printing and mailing of
prospectuses to other than current shareholders, and the printing and mailing of
sales literature. The Distributor shall be responsible for reviewing and
providing advice and counsel on all sales literature (e.g., advertisements,
brochures and shareholder communications) with respect to each of the Funds. In
addition, the Distributor will provide one or more persons, during normal
business hours, to respond to telephone questions with respect to the Funds.
1.4 All activities by the Distributor and its agents and employees
as distributor of Shares shall comply with all applicable laws, rules and
regulations, including, without limitation, all rules and regulations made or
adopted pursuant to the Investment Company Act of 1940 ("1940 Act") by the
Securities and Exchange Commission (the "SEC") or any securities association
registered under the Securities Exchange Act of 1934.
1.5 Whenever in their judgment such action is warranted by unusual
market, economic or political conditions, or by other circumstances of any kind,
the Company's officers may decline to accept any orders for, or make any sales
of Shares until such time as those officers deem it advisable to accept such
orders and to make such sales.
1.6 The Company agrees at its own expense to execute any and all
documents and to furnish any and all information and otherwise to take all
actions that may be reasonably necessary in connection with the registration or
qualification of Shares for sale in such states as the Distributor may designate
to the Company and the Company may approve, and the Company shall pay all fees
and other expenses incurred in connection with such registration or
qualification.
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1.7 The Company shall furnish from time to time, for use in
connection with the sale of Shares, such information with respect to the Funds
and Shares as the Distributor may reasonably request; and the Company warrants
that the statements contained in any such information shall fairly show or
represent what they purport to show or represent. The Company shall also furnish
the Distributor upon request with: (a) audited annual and unaudited semi-annual
statements of the Company's books and accounts with respect to each Fund, and,
(b) from time to time such additional information regarding the Funds' financial
condition as the Distributor may reasonably request.
1.8 The Distributor may be reimbursed for all or a portion of the
expenses described above to the extent permitted by a distribution plan adopted
by the Company on behalf of a Fund pursuant to Rule 12b-1 under the 1940 Act. No
provision of this Agreement shall be deemed to prohibit any payments by a Fund
to the Distributor or by a Fund or the Distributor to investment dealers, banks
or other financial institutions through whom shares of the Fund are sold where
such payments are made under a distribution plan adopted by the Company on
behalf of such Fund pursuant to Rule 12b-1 under the 1940 Act. In addition, the
Company shall pay to the Distributor the proceeds from any contingent deferred
sales charge imposed on the redemption of the shares as specified in the Fund's
Registration Statement.
1.9 The Distributor will execute and deliver agreements with
broker/dealers, financial institutions and other industry professionals based on
the forms attached hereto or based on the additional forms of agreement approved
from time to time by the Company's Board of Directors with respect to the
various classes of shares of the Funds , including but not limited to forms of
sales support agreements and shareholder servicing agreements approved in
connection with a distribution and/or servicing plan approved in accordance with
Rule 12b-1 under the 1940 Act.
2. Representations; Indemnification.
2.1 The Company represents to the Distributor that all
registration statements and prospectuses filed by the Company with the SEC under
the Securities Act of 1933, as amended ("Act"), with respect to Shares have been
prepared in conformity with the requirements of said Act and rules and
regulations of the SEC thereunder. As used in this Agreement, the terms
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<PAGE>
"registration statement" and "prospectus" shall mean any registration statement
and then current prospectus (together with any related then current statement of
additional information) filed with the SEC with respect to Shares, and any
amendments and supplements thereto which at any time shall have been filed
therewith. The Company represents and warrants to the Distributor that any
registration statement and prospectus, when such registration statement becomes
effective, will contain all statements required to be stated therein in
conformity with said Act and the rules and regulations of the SEC; that all
statements of fact contained in any such registration statement and prospectus
will be true and correct when such registration statement and prospectus become
effective; and that neither any registration statement nor any prospectus when
any registration statement becomes effective will include an untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading to a purchaser of
Shares. The Company may, but shall not be obligated to, propose from time to
time such amendment or amendments to any registration statement and such
supplement or supplements to any prospectus which in light of future
developments, may, in the opinion of the Company's counsel, be necessary or
advisable. The Company shall promptly notify the Distributor of any advice given
to it by the Company's counsel regarding the necessity or advisability so to
amend or supplement such registration statement or prospectus. If the Company
shall not propose such amendment or amendments and/or supplement within fifteen
days after receipt by the Company of a written request from the Distributor to
do so, the Distributor may, at its option, terminate this Agreement. The Company
shall not file any amendment to any registration statement or supplement to any
prospectus without giving the Distributor reasonable notice thereof in advance;
provided, however, that nothing contained in this Agreement shall in any way
limit the Company's right to file at any time such amendments to any
registration statement and/or supplements to any prospectus, of whatever
character, as the Company may deem advisable, such right being in all respects
absolute and unconditional.
2.2 The Company authorizes the Distributor and dealers to use any prospectus in
the form furnished from time to time in connection with the sale of Shares and
represented by the Company as being the then current form of prospectus. The
Company agrees to indemnify, defend and hold the Distributor, its several
officers and directors, and any person who controls the Distributor within the
meaning of Section 15 of the Act free and harmless from and against any and all
claims, demands, liabilities and expenses (including the cost of investigating
or defending such claims, demands or liabilities and any counsel fees incurred
in connection therewith) which the Distributor, its officers and directors, or
any such controlling person, may incur under the Act or under common law or
4
<PAGE>
otherwise, arising out of or based upon any untrue statement, or alleged untrue
statement, of a material fact contained in any registration statement or any
prospectus or arising out of or based upon any omission, or alleged omission, to
state a material fact required to be stated in any registration statement or
prospectus or necessary to make any statement in such documents not misleading;
providing, however, that the Company's agreement to indemnify the Distributor,
its officers or directors, and any such controlling person shall not be deemed
to cover any claims, demands, liabilities or expenses arising out of any untrue
statement or alleged untrue statement or omission or alleged omission made in
any registration statement or prospectus or in any financial or other statements
in reliance upon and in conformity with any information furnished to the Company
by the Distributor or any affiliate thereof and used in the preparation thereof;
and further provided that the Company's agreement to indemnify the Distributor
and the Company's representations and warranties herein set forth shall not be
deemed to cover any liability to the Company or its shareholders to which the
Distributor would otherwise be subject by reason or willful misfeasance, bad
faith or gross negligence in the performance of its duties, or by reason of the
Distributor's reckless disregard of its obligations and duties under this
Agreement. The Company's agreement to indemnify the Distributor, its officers
and directors, and any such controlling person, as aforesaid, is expressly
conditioned upon the Company's being notified of any action bought against the
Distributor, its officers or directors, or any such controlling person, such
notification to be given by letter or by telegram addressed to the Company at
its principal office and sent to the Company by the person against whom such
action is brought, within a reasonable period of time after the summons or other
first legal process shall have been served. The failure to so notify the Company
of any such action shall not relieve the Company from any liability which the
Company may have to the person against whom such action is brought by reason or
any such untrue, or allegedly untrue, statement or omission, or alleged
omission, otherwise than on account of the Company's indemnity agreement
contained in this paragraph 2.2. The Company will be entitled to assume the
defense of any suit brought to enforce any such claim, demand or liability, but,
in such case, such defense shall be conducted by counsel of good standing chosen
by the Company and approved by the Distributor, which approval shall not
unreasonably be withheld. In the event the Company elects to assume the defense
of any such suit and retain counsel of good standing approved by the
Distributor, the defendant or defendants in such suit shall bear the fees and
expenses of any additional counsel retained by any of them; but in case the
Company does not elect to assume the defense of any such suit, or in case the
Distributor reasonably does not approve of counsel chosen by the Company, the
Company will reimburse the Distributor, its officers and directors, or the
controlling person or persons named as defendant or defendants in such suit, for
the fees and expenses of any counsel retained by the Distributor or them. The
Company's indemnification agreement contained in this paragraph 2.2 and the
5
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Company's representations and warranties in this Agreement shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of the Distributor, its officers and directors, or any controlling
person, and shall survive the delivery of any Shares. This agreement of
indemnify will inure exclusively to the Distributor's benefit, to the benefit of
its several officers and directors, and their respective estates, and to the
benefit of the controlling persons and their successors. The Company agrees
promptly to notify the Distributor of the commencement of any litigation or
proceedings against the Company or any of its officers or directors in
connection with the issue and sale of any Shares.
2.3 The Distributor agrees to indemnify, defend and hold the Company , its
several officers and directors, and any person who controls the Company within
the meaning of Section 15 of the Act free and harmless from and against any and
all claims, demands, liabilities and expenses (including the costs of
investigation or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which the Company, its officers or
directors or any such controlling person, may incur under the Act or under
common law or otherwise, but only to the extent that such liability or expense
incurred by the Company, its officers or directors, or such controlling person
resulting from such claims or demands, shall arise out of or be based upon any
untrue, or alleged untrue, statement of a material fact contained in information
furnished by the Distributor or any affiliate thereof to the Company or its
counsel and used in the Company's registration statement or corresponding
statements made in the prospectus, or shall arise out of or be based upon any
omission, or alleged omission, to state a material fact in connection with such
information furnished by the Distributor or any affiliate thereof to the Company
or its counsel required to be stated in such answers or necessary to make such
information not misleading. The Distributor's agreement to indemnify the
Company, its officers and directors, and any such controlling person, as
aforesaid, is expressly conditioned upon the Distributor's being notified of any
action brought against the Company, its officers or directors, or any such
controlling person, such notification to be given by letter or telegram
addressed to the Distributor at its principal office in Little Rock, Arkansas
and sent to the Distributor by the person against whom such action is brought,
within a reasonable period of time after the summons or other first legal
process shall have been served. The Distributor shall have the right to control
the defense of such action, with counsel of its own choosing, satisfactory to
the Company, if such action is based solely upon such alleged misstatement or
omission on the Distributor's part or any affiliate thereof, and in any other
event the Company, its officers or directors or such controlling person shall
each have the right to participate in the defense or preparation of the defense
of any such action. The failure so to notify the Distributor of any such action
6
<PAGE>
shall not relieve the Distributor or any affiliate thereof from any liability
which the Distributor or any affiliate thereof may have to the Company, its
officers or directors, or to such controlling person by reason of any such
untrue or alleged untrue statement, or omission or alleged omission, otherwise
than on account of the Distributor's indemnity agreement contained in this
paragraph 2.3.
2.4 No Shares shall be offered by either the Distributor or the
Company under any of the provisions of this Agreement and no orders for the
purchase or sale of Shares hereunder shall be accepted by the Company if and so
long as the effectiveness of the registration statement then in effect or any
necessary amendments thereto shall be suspended under any of the provisions of
the Act, or if and so long as a current prospectus, as required by Section 10(b)
of said Act, as amended, is not on file with the SEC; provided, however, that
nothing contained in this paragraph 2.4 shall in any way restrict or have any
application to or bearing upon the Company's obligation to repurchase Shares
from any shareholder in accordance with the provisions of the Company's
prospectus or Articles of Incorporation.
2.5 The Company agrees to advise the Distributor as soon as
reasonably practical:
7
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(a) of any request by the SEC for amendments to the registration
statement or prospectus then in effect;
(b) of the issuance by the SEC of any stop order suspending the
effectiveness of the registration statement or prospectus then in effect or of
the initiation of any proceeding for that purpose;
(c) of the happening of any event that makes untrue any statement
of a material fact made in the registration statement or prospectus then in
effect or which requires the making of a change in such registration statement
or prospectus in order to make the statements therein not misleading;
(d) of all actions of the SEC with respect to any amendment to any
registration statement or prospectus which may from time to time be filed with
the SEC; and
(e) if a current prospectus is not on file with the SEC.
For purposes of this section, informal requests by or acts of the
Staff of the SEC shall not be deemed actions of or requests by the SEC.
3. Confidentiality.
The Distributor agrees on behalf of itself and its employees to
treat confidentially and as proprietary information of the Company all records
and other information relative to the Funds and/or the Company and its prior,
present or potential shareholders, and not to use such records and information
for any purpose other than performance of its responsibilities and duties
hereunder, except after prior notification to and approval in writing by the
Company, which approval shall not be unreasonably withheld and may not be
withheld where the Distributor may be exposed to civil or criminal contempt
proceedings for failure to comply, when requested to divulge such information by
duly constituted authorities, or when so requested by the Company.
4. Limitations of Liability.
Except as provided in paragraph 2.3, the Distributor shall not
be liable for any error of judgment or mistake or law or for any loss suffered
by the Company or any Fund in connection with matters to which this agreement
relates, except a loss resulting from willful misfeasance, bad faith or gross
negligence on its part in the performance of its duties or from reckless
disregard of its obligations and duties under this agreement.
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5. Term.
This agreement shall become effective on the date of its execution
and, unless soon terminated as provided herein, shall continue thereafter with
respect to each Fund for successive annual periods, provided such continuance is
specifically approved at least annually by (i) the Company's Board of Directors
or (ii) by a vote of a majority (as defined in the 1940 Act) of the outstanding
voting securities of the Fund, provided that in either event the continuance is
also approved by the majority of the Company's Directors who are not parties to
this agreement or interested persons (as defined in the 1940 Act) of any such
party, by vote cast in person at a meeting called for the purpose of voting on
such approval. This agreement is not assignable and is terminable with respect
to a Fund, without penalty, on not less than sixty days' notice, by the
Company's Board of Directors, by vote of a majority (as defined in the 1940 Act)
of the outstanding voting securities of such Fund, or by the Distributor. This
agreement will also terminate automatically in the event of its assignment (as
defined in the 1940 Act).
6. Miscellaneous.
6.1 No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which an enforcement of the change, waiver, discharge or
termination is sought.
6.2 This agreement shall be governed by the laws of the State of
Arkansas.
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Please confirm that the foregoing is in accordance with your
understanding by indicating your acceptance hereof at the place indicated below,
whereupon it shall become a binding agreement between us.
Yours very truly,
NATIONS FUND, INC.
By: /s/ Richard H. Blank, Jr.
------------------------------
Name: Richard H. Blank, Jr.
Title: Secretary
Accepted:
STEPHENS INC.
By: /s/ R. Greg Feltus
-----------------------------
Name: R. Greg Feltus
Title: Senior Vice President
Dated as of September 1, 1993
10
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SCHEDULE I
1. Nations Prime Fund
2. Nations Treasury Fund
3. Nations Equity Income Fund
4. Nations Small Company Growth Fund
5. Nations Government Securities Fund
6. Nations U.S. Government Bond Fund
7. Nations International Growth Fund
Last Amended: August 19, 1999
NATIONS FUNDS
RETIREMENT PLAN FOR ELIGIBLE
DIRECTORS/TRUSTEES
PREAMBLE
Effective on or before January 26, 1995, the regulated investment
companies advised by NationsBank, N.A. (Carolinas) or its affiliates (the
"Nations Funds") have adopted THE NATIONS FUNDS RETIREMENT PLAN FOR ELIGIBLE
DIRECTORS/TRUSTEES (the "Plan") for the benefit of each of the directors and
trustees of each of the Nations Funds who is not an employee of any of the
Nations Funds, or their distributor, administrator or advisor, or any of their
affiliates. As the Plan does not benefit any employees of the Nations Funds, it
is not intended to be classified as an employee benefit plan within the meaning
of Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended.
ARTICLE I
DEFINITION OF TERMS AND CONSTRUCTION
1.1 Definitions.
Unless a different meaning is plainly implied by the context; the
following terms as used in this Plan shall have the following meanings;
(a) "Accrued Benefit" shall mean, as of any date prior to a
Participant's Normal Retirement Date, his Retirement Benefit, determined as of,
and commencing on, his Normal Retirement Date, but based upon his Compensation
and Years of Service computed as of such date of determination.
(b) "Administrator" shall mean the administrative committee
provided for in Article VI.
(c) "Board of Directors" shall mean the Board of Directors of each
of the Nations Funds.
(d) "Compensation" shall mean, for any Director, the aggregate
amount of director's fees paid or accrued by the Nations Funds for such Director
during the calendar year during which the Director's Retirement occurs,
including amounts of director's fees deferred during such fiscal year under a
separate agreement between the Nations Funds and the Director. In addition, for
purposes of this Plan, "Compensation" shall include fees which would have been
paid or accrued by the Nations Funds for such Director during the calendar year
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during which the Director's Retirement occurs but for the execution of a waiver
of such fees by the Director. In the event the Director's Retirement occurs on
other than the last day of the calendar year, his Compensation for such calendar
year shall be annualized, if necessary, to reflect the amount he would have
received (including deferred amounts) had his Retirement occurred on the last
day of such calendar year. The amount of such annualized Compensation shall be
determined by the Administrator.
(e) "Deferred Retirement Date" shall mean the first day of the
month coincident with or next following the date on which a Participant
terminated Service after his Normal Retirement Date.
(f) "Director" shall mean an individual who is a director or
trustee of one or more of the Nations Funds which have adopted the Plan but who
is not an employee of any of the Nations Funds, or their distributor,
administrator or advisor, or any of their affiliates. A director or trustee
shall not be considered to be an employee of any of the Nations Funds for
purposes of this Plan solely by reason of holding a position as an officer of a
Fund, provided the director or trustee receives no compensation from the Fund
other than director's or trustee's fees.
(g) "Disability" shall mean the inability of the Participant to
participate in meetings of the Board of Directors, either in person or by
telephone, for a period of at least nine (9) consecutive months.
(h) "Effective Date" shall mean, with respect to each of the
Nations Funds, the date on which this Plan was adopted (as shown on the last
page hereof).
(i) "Fund" shall mean a Nations Fund which has adopted this Plan.
(j) "Nations Funds" shall mean the regulated investment companies
advised by NationsBank, N.A. (Carolinas), or its affiliates.
(k) "Normal Retirement Date" shall mean the date on which a
Participant has both attained age 65 and has completed at least five continuous
and non-forfeited Years of Service with one or more of the Nations Funds.
(l) "Participant" shall mean a Director who has met all of the
eligibility requirements of the Plan and who is currently included in the Plan
as provided in Article II hereof.
(m) "Plan" shall mean the "Nations Funds Retirement Plan for
Eligible Directors/ Trustees" as described herein or as hereafter amended from
time to time.
(n) "Plan Year" shall mean a calendar year.
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(o) "Retirement" shall mean a Director's termination of his active
Service with the Nations Funds on or after his Normal Retirement Date, due to
his death, Disability, or voluntary or involuntary termination of his Service.
(p) "Retirement Benefit" shall mean the benefit described under
Sections 3.1 or 3.2 hereof to which a Participant is entitled on or after his
Normal or Deferred Retirement Date.
(q) "Service" shall mean an individual's serving as a Director of
one or more of the Nations Funds.
(r) "Year of Service" shall mean each complete calendar year
during which the Director was a Director for the entirety of such calendar year,
including years of unbroken service prior to the Effective Date. For all
purposes of this Plan, in the event a Director ceases to serve as a Director
prior to his Normal Retirement Date, he shall forfeit credit for all Years of
Service completed prior to such cessation even if he subsequently again becomes
a Director. Furthermore, any unbroken service provided by a Participant (i) to a
Nations Fund immediately prior to its being advised by NationsBank, N.A.
(Carolinas) (or any of its affiliates) or (ii) to a predecessor of a Nations
Fund immediately prior to its being merged into such Nations Fund, will be taken
into account in determining such Participant's Years of Service, subject to all
restrictions and other forfeiture provisions contained herein.
1.2 Plurals and Gender.
Where appearing in the Plan, the masculine gender shall include
the feminine and neuter genders, and the singular shall include the plural, and
vice versa, unless the context clearly indicates a different meaning.
1.3 Directors/Trustees.
Where appropriate, the term "director" shall also refer to
"trustee," "directorship" shall also refer to "trusteeship" and "Board of
Directors" shall also refer to "Board of Trustees."
1.4 Headings.
The headings and sub-headings in this Plan are inserted for the
convenience of reference only and are to be ignored in any construction of the
provisions hereof.
1.5 Severability.
In case any provision of this Plan shall be held illegal or void,
such illegality or invalidity shall not affect the remaining provisions of this
Plan, but shall be fully severable, and the Plan shall be construed and enforced
as if said illegal or invalid provisions had never been inserted herein.
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ARTICLE II
PARTICIPATION
2.1 Commencement of Participation.
Each Director shall become a Participant hereunder on the later of
the Effective Date or the date his directorship of one or more of the Nations
Funds commences.
2.2 Termination of Participation.
After commencement or resumption of his participation, a Director
shall remain a Participant until the earliest of the following dates:
(a) His actual Retirement date;
(b) His date of death;
(c) The date on which he otherwise incurs a termination of
Service; or
(d) The effective date of the termination of the Plan.
2.3 Resumption of Participation.
Any Participant whose Service terminates and who thereafter again
becomes a Director shall resume participation immediately upon again becoming a
Director except that, as provided in Section 1.1(t) hereof, if his Service is
terminated prior to his Normal Retirement Date, for all purposes of this Plan he
shall forfeit credit for all Years of Service completed prior to such
termination of his Service.
2.4 Determination of Eligibility.
The Administrator shall determine the eligibility of Directors in
accordance with the provisions of this Article.
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ARTICLE III
BENEFITS UPON RETIREMENT
AND OTHER TERMINATION OF SERVICE
3.1 Normal Retirement.
Upon Retirement a Participant shall be entitled to receive an
annual benefit from the Nations Fund commencing on the first day of the calendar
quarter coincident with or next following his date of Retirement, payable in
quarterly installments for a period of no more than five (5) years (thus
equaling no more than twenty (20) quarterly installments) equal to five percent
(5%) of his Compensation paid by the Nations Fund multiplied by the number of
his non-forfeited Years of Service (not in excess of ten (10) Years of Service)
completed with respect to any of the Nations Funds.
3.2 Deferred Retirement.
In the event that a Participant remains in Service with the
Nations Funds after his Normal Retirement Date, he shall not be entitled to any
benefits hereunder until his Deferred Retirement Date. Commencing on the first
day of the calendar quarter following his Deferred Retirement Date, a
Participant shall be entitled to receive a Retirement Benefit from the Nations
Funds paid in twenty (20) quarterly installments in an amount equal to the
quarterly Retirement Benefit he would have received from the Nations Funds under
Section 3.1 hereof had his Retirement occurred on his Normal Retirement Date,
except that such quarterly benefit shall be computed by including the number of
any additional Years of Service which have accrued since his Normal Retirement
Date (subject to the ten (10) Years of Service limitation set forth under
Section 3.1 hereof) and by taking into account any increases in Compensation
received since his Normal Retirement Date.
3.3 Other Termination of Service.
Upon termination of his participation in this Plan for any reason
prior to his Normal Retirement Date, a Participant shall not be entitled to any
benefit hereunder.
3.4 Benefits Calculated in the Aggregate for all of the Nations Funds.
With respect to each Participant, the benefits payable hereunder
shall be based on the aggregate Compensation paid by the Nations Funds and on
the Participant's non-forfeited Years of Service. Each Fund's share of the
obligation to provide such benefits shall be determined by use of accounting
methods adopted by the Administrator.
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ARTICLE IV
DEATH BENEFITS
4.1 Death Prior to Commencement of Benefits.
In the event of a Participant's death on or after his Normal
Retirement Date, but prior to the commencement of his Retirement Benefits under
Article III hereof, the surviving spouse (if any) of such Participant shall be
entitled to receive a quarterly survivor's benefit for no more than five (5)
years (thus, not exceeding twenty (20) quarterly installments) beginning on the
first day of the calendar quarter next following the date of the Participant's
death equal to fifty percent (50%) of the amount of the quarterly installments
of Retirement Benefits that would have been paid to the Participant under
Sections 3.1 or 3.2 hereof based upon the Participant's Compensation and Years
of Service as of his date of death.
4.2 Death Subsequent to Commencement of Benefits.
In the event a Participant dies after the commencement of his
Retirement Benefit under Article III, but prior to the cessation of the payment
of such Retirement Benefits, the surviving spouse (if any) of such Participant
shall be entitled to receive survivor's benefits equal to fifty percent (50%) of
the amount of the annual Retirement Benefits payable to the Participant under
Article III hereunder, paid at such times, and for such period, as such
Retirement Benefits would have continued to have been paid to the Participant
had he not died.
4.3 Death of Spouse.
(a) In the event a Participant is not survived by a spouse, no
benefits will be paid hereunder upon the Participant's death.
(b) If a deceased Participant's surviving spouse dies while
receiving survivor's benefits hereunder, any installments not paid at the time
of the surviving spouse's death shall be forfeited.
ARTICLE V
SUSPENSION OF BENEFITS
5.1 Suspension of Benefits Upon Resumption of Service.
In the case of a Participant who, at a time when he is receiving
Retirement Benefits under Article III of this Plan, resumes Service with any
Nations Fund, such Retirement Benefits shall be suspended until his subsequent
Retirement, termination of Service, or death. Subject to the Years of Service
limitations of Section 3.1 hereof, in the event of his Retirement or termination
of Service following such a suspension, the quarterly amount of his remaining
Retirement Benefits shall thereafter be adjusted to reflect any additional Years
of Service completed by, or a higher rate of Compensation received by, such
Participant.
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ARTICLE VI
ADMINISTRATOR
6.1 Appointment of Administrator.
This plan shall be administered by the Nominating and Compensation
Committees of the Boards of Directors of the Nations Funds. The members of such
committees are not "interested persons" (within the meaning of Section 2(a)(19)
of the Investment Company Act of 1940, as amended) of any of the Nations Funds.
The term "Administrator" as used in this Plan shall refer to the members of such
committees, either individually or collectively, as appropriate.
6.2 Powers and Duties of Administrator.
Except as provided below, the Administrator shall be authorized in
connection with the administration of this Plan:
(a) To promulgate and enforce such rules, regulations and
procedures as shall be proper for the efficient administration of the Plan;
(b) To determine all questions arising in the administration,
interpretation and application of the Plan, including questions of eligibility
and of the status and rights of the Participants and any other persons
hereunder;
(c) To decide any dispute arising hereunder; provided, however,
that no Administrator shall participate in any matter involving any questions
relating solely to his own participation or benefits under this Plan;
(d) To advise the Boards of Directors of the Nations Funds
regarding the known future need for funds to be available for distribution;
(e) To correct defects, supply omissions and reconcile
inconsistencies to the extent necessary to effectuate the Plan;
(f) To compute the amount of benefits and other payments which
shall be payable to any Participant or surviving spouse in accordance with the
provisions of the Plan and to determine the person or persons to whom such
benefits shall be paid;
(g) To make recommendations to the Boards of Directors of the
Nations Funds with respect to proposed amendments to the Plan;
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(h) To file all reports with government agencies; Participants and
other parties as may be required by law, whether such reports are initially the
obligation of the Nations Funds, or the Plan;
(i) To engage an independent actuary on behalf of the Plan and to
cause the liabilities of the Plan to be evaluated by the actuary; and
(j) To have all such other powers as may be necessary to discharge
its duties hereunder.
6.3 Action by Administrator.
The Administrator may elect a Chairman and Secretary from among
its members and may adopt rules for the conduct of its business. A majority of
the members then serving shall constitute a quorum for the transaction of
business. All resolutions or other action taken by the Administrator shall be by
vote of a majority of those present at such meeting and entitled to vote.
Resolutions may be adopted or other action taken without a meeting upon written
consent signed by at least a majority of the members. All documents,
instruments, orders, requests, directions, instructions and other papers shall
be executed on behalf of the Administrator by either the Chairman or the
Secretary of the Administrator, if any, or by any member or agent of the
Administrator duly authorized to act on the Administrator's behalf.
6.4 Participation by Administrators.
No Administrator shall be precluded from becoming a Participant in
the Plan if he would be otherwise eligible, but he shall not be entitled to vote
or act upon matters or to sign any documents relating specifically to his own
participation under the Plan, except when such matters or documents relate to
benefits generally. If this disqualification results in the lack of a quorum,
then the Boards of Directors, by majority vote of the members of a majority of
such Boards of Directors (a "Majority Vote"), shall appoint a sufficient number
of temporary Administrators, who shall serve for the sole purpose of determining
such a question.
6.5 Agents and Expenses.
The Administrator may employ agents and provide for such clerical,
legal, actuarial, accounting, medical, advisory or other services as it deems
necessary to perform its duties under this Plan. The cost of such services and
all other expenses incurred by the Administrator in connection with the
administration of the Plan shall be allocated to each Fund pursuant to the
method utilized under Section 3.4 hereof with respect to costs related to
benefit accruals. For purposes of the preceding sentence, if an individual
serves as a Director for more than one Fund, he shall be deemed to be a separate
Director for each such Fund in determining the aggregate number of Directors of
the Nations Funds.
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6.6 Allocation of Duties.
The duties, powers and responsibilities reserved to the
Administrator may be allocated among its members so long as such allocation is
pursuant to written procedures adopted by the Administrator, in which case no
Administrator shall have any liability, with respect to any duties, powers or
responsibilities not allocated to him, for the acts or omissions of any other
Administrator.
6.7 Delegation of Duties.
The Administrator may delegate any of its duties to employees of
the Nations Funds' distributor, administrator or adviser, or any of their
affiliates, or to any other person or firm, provided that the Administrator
shall prudently choose such agents and rely in good faith on their actions.
6.8 Records and Reports.
The Administrator shall maintain adequate records of its actions
and proceedings in administering this Plan and shall file all reports and take
all other actions as it deems appropriate in order to comply with any federal or
state law.
6.9 Information from the Nations Funds.
The Nations Funds shall promptly furnish all necessary information
to the Administrator to permit it to perform its duties under this Plan. The
Administrator shall be entitled to rely upon the accuracy and completeness of
all information furnished to it by the Nations Funds, unless it knows or should
have know that such information is erroneous.
6.10 Reservation of Rights by Boards of Directors.
When rights are reserved in this plan to the Boards of Directors,
such rights shall be exercised only by Majority Vote of the Boards of Directors,
except where the Boards of Directors, by unanimous written resolution, delegate
any such rights to one or more persons or to the Administrator. Subject to the
rights reserved to the Boards of Directors as set forth in this Plan, no member
of the Boards of Directors shall have any duties or responsibilities under this
Plan, except to the extent he shall be acting in the capacity of an
Administrator.
6.11 Liability and Indemnification.
(a) The Administrator shall perform all duties required of it
under this Plan in a prudent manner. The Administrator shall not be responsible
in any way for any action or omission of the Nations Funds or any other
fiduciaries in the performance of their duties and obligations as set forth in
this Plan. The Administrator also shall not be responsible for any act or
omission of any of its agents provided that such agents were prudently chosen by
the Administrator and that the Administrator relied in good faith upon the
action of such agents.
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(b) The Administrator shall not be relieved from responsibility or
liability for any responsibility, obligation or duty imposed upon it under this
Plan. Except for its own gross negligence, willful misconduct or willful breach
of the terms of this Plan, the Administrator shall be indemnified and held
harmless by the Nations Funds against liability or losses occurring by reason of
any act or omission of the Administrator.
ARTICLE VII
AMENDMENTS AND TERMINATION
7.1 Amendments.
The Boards of Directors reserve the right at any time and from
time to time, and retroactively, if deemed necessary or appropriate by them, to
amend in whole or in part by Majority Vote any or all of the provisions of this
Plan, provided that:
(a) No amendment shall make it possible for any part of a
Participant's Accrued Benefit or Retirement Benefit to be used for, or diverted
to, purposes other than for the exclusive benefit of Participants or their
surviving spouses, except to the extent otherwise provided in this Plan;
(b) No amendment may reduce any Participant's Accrued Benefit as
of the effective date of the amendment;
Amendments may be made in the form of Board of Directors'
resolutions or separate written document.
7.2 Termination.
Except as provided below, the Boards of Directors reserve the
right to terminate this Plan at any time by Majority Vote by giving to the
Administrator notice in writing of such desire to terminate. The Plan shall
terminate upon the date of receipt of such notice and the rights of all
Participants to their Accrued Benefits (determined as of the date the Plan is
terminated) shall become payable upon the earlier of the effective date of the
termination of the Plan, or, with respect to each Participant, upon his Normal
Retirement Date in quarterly installments or in an actuarially equivalent lump
sump as determined by the Administrator.
7.3 Change in Control.
In the event of the voluntary resignation of, or a vote or action
to replace, or a decision not to stand for re-election by, two or more of the
directors of a Nations Fund, in connection with a transaction that involves a
change in control or management of a Nations Fund or an affiliated person of a
Nations Fund, the Plan shall terminate with respect to the directors of the
Nations Fund who have resigned, been replaced or declined to stand for
re-election, on the date they cease being directors and the rights of all such
directors to their Accrued Benefits (determined as of the date of termination of
the Plan) shall become payable in quarterly installments or in an actuarially
equivalent lump sum as determined by the Administrator.
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ARTICLE VIII
MISCELLANEOUS
8.1 Rights of Creditors.
(a) The Plan is unfunded. Neither the Participant nor any other
persons shall have any interest in any fund or in any specific asset or assets
of any of the Nations Funds by reason of any Accrued Benefit or Retirement
Benefit hereunder, nor any rights to receive distribution of any Retirement
Benefit except as and to the extent expressly provided hereunder.
(b) The Accrued Benefits and Retirement Benefits of each
Participant are unsecured and shall be subject to the claims of the general
creditors of the Nations Funds.
8.2 Liability Limited.
Neither the Nations Funds, the Administrator, nor any agents,
employees, officers, directors or shareholders of any of them, nor any other
person shall have any liability or responsibility with respect to this Plan,
except as expressly provided herein.
8.3 Incapacity.
If the Administrator shall receive evidence satisfactory to it
that a Participant or surviving spouse entitled to any benefit under the Plan
is, at the time when such benefit becomes payable, physically or mentally
incompetent to give a valid release therefor, and that another person or an
institution is then maintaining or has custody of such Participant or surviving
spouse and that no guardian, committee or other representative of the estate of
such Participant or surviving spouse shall have been duly appointed, the
Administrator may make payment of such benefit otherwise payable to such
Participant or surviving spouse to such other person or institution, and the
release of such other person or institution shall be a valid and complete
discharge for the payment of such benefit.
8.4 Cooperation of Parties.
All parties to this Plan and any person claiming any interest
hereunder agree to perform any and all acts and execute any and all documents
and papers which are necessary or desirable for carrying out this Plan or any of
its provisions.
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8.5 Governing Law.
This Plan has been adopted in the State of North Carolina and all
questions pertaining to its validity, construction and administration shall be
determined in accordance with the laws of that State.
8.6 No Guarantee of Directorship.
Nothing contained in this Plan shall be construed as a guaranty or
right of any Participant to be continued as a Director of one or more of the
Nations Funds (or of a right of a Director to any specific level of
Compensation) or as a limitation of the right of any of the Nations Funds, by
shareholder action or otherwise, to remove any of its directors.
8.7 Counsel.
The Administrator may consult with legal counsel, who may be
counsel for one or more of the Board of Directors of the Nations Funds and for
the Administrator, with respect to the meaning or construction of this Plan, its
obligations or duties hereunder or with respect to any action or proceeding or
any question of law, and they shall be fully protected with respect to any
action taken or omitted by them in good faith pursuant to the advice of legal
counsel.
8.8 Spendthrift Provision.
A Participant's interest in his Accrued Benefit or Retirement
Benefit and the interest of a surviving spouse of a Participant in any benefit
payable under Article IV hereof shall not be subject to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, or charges and any
attempt so to anticipate, alienate, sell, transfer, assign, pledge, encumber or
charge the same shall be void; nor shall any portion of any such right hereunder
be in any manner payable to any assignee, receiver or trustee, or be liable for
such person's debts, contracts, liabilities, engagements or torts, or be subject
to any legal process to levy upon or attach.
8.9 Forfeiture for Cause.
Notwithstanding any other provision of this Plan to the contrary,
any benefits to which a Participant (or his surviving spouse) may otherwise be
entitled hereunder will be forfeited in the event the Administrator, in its sole
discretion, determines that a Participant's termination of Service is due to
such Participant's willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of the office of Director.
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ARTICLE IX
CLAIMS PROCEDURE
9.1 Notice of Denial.
If a Participant is denied any Retirement Benefit (or a surviving
spouse is denied a survivor's benefit) under this Plan, either in total or in an
amount less than the full Retirement Benefit to which he would normally be
entitled, the Administrator shall advise the Participant (or surviving spouse)
in writing of the amount of his Retirement Benefit (or survivor's benefit), if
any, and the specific reasons for the denial. The Administrator shall also
furnish the Participant (or surviving spouse) at that time with a written notice
containing:
(a) A specific reason with reference to pertinent Plan
provisions.
(b) A description of any additional material or information
necessary for the Participant (or surviving spouse) to perfect his claim, if
possible, and an explanation of why such material or information is needed.
(c) An explanation of the Plan's claim review procedure.
9.2 Right to Reconsideration.
Within 60 days of receipt of the information stated in Section 9.1
above, the Participant (or surviving spouse) shall, if he desires further
review, file a written request for reconsideration with the Administrator.
9.3 Review of Documents.
So long as the Participant's (or surviving spouse's) request for
review is pending (including the 60-day period in 9.2 above), the Participant
(or surviving spouse) or his duly authorized representative may review pertinent
Plan documents and may submit issues and comments in writing to the
Administrator.
9.4 Decision by Administrator.
A final and binding decision shall be made by the Administrator
within 60 days of the filing by the Participant (or surviving spouse) of his
request for reconsideration, provided, however, that if the Administrator, in
its discretion, feels that a hearing with the Participant (or surviving spouse)
or his representative present is necessary or desirable, this period shall be
extended an additional 60 days.
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9.5 Notice by Administrator.
The Administrator's decision shall be conveyed to the Participant
(or surviving spouse) in writing and shall include specific reasons for the
decision and the provisions of the Plan on which the decision is based.
Adopted on January 26, 1995 by:
Nations Fund, Inc.
Nations Fund Trust
The Capitol Mutual Funds
Adopted on January 25, 1995 by:
Nations Fund Portfolios, Inc.
Amended on July 13, 1995 by:
Nations Fund, Inc.
Nations Fund Trust
The Capitol Mutual Funds
Nations Fund Portfolios, Inc.
Adopted on August 6, 1997 by:
Nations Annuity Trust
Adopted on February 24, 1999 by:
Nations Master Investment Trust
Adopted on December 9, 1999 by:
Nations Funds Trust
14
CUSTODY AGREEMENT
THIS AGREEMENT is made as of the 19th day of October, 1998 by
and between The Bank of New York, a New York corporation authorized to do a
banking business ("Custodian"), and Nations Fund, Inc., a Maryland corporation
(the "Company").
W I T N E S S E T H
WHEREAS, the Company is a registered open-end management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Company desires to retain Custodian to serve as
custodian for the Company, on behalf of its portfolios listed on Schedule I
(individually a "Fund" and collectively the "Funds") and to provide the services
described herein, and Custodian is willing to serve and to provide such
services; and
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, the Company and Custodian hereby agree as follows:
1. Appointment. The Company hereby appoints Custodian to act as
custodian of its portfolio securities, cash and other property on the terms set
forth in this Agreement. Custodian accepts such appointment and agrees to
furnish the services herein set forth in return for the compensation as provided
in Paragraph 23 hereof. Custodian agrees to comply with all relevant provisions
of the 1940 Act and applicable rules and regulations thereunder.
The Company may from time to time issue separate series or classes, and
classify and reclassify shares of any such series or class. The Company shall
promptly specify to Custodian in writing such series or classes, or any
reclassification and thereafter Custodian shall identify to each such series or
class Property, as hereinafter defined, belonging to such series or class, and
such reports, confirmations and notices to the Company as are called for under
this Agreement shall identify the series or class to which such report,
confirmation or notice pertains.
2. Delivery of Documents. The Company has furnished Custodian with
copies properly certified or authenticated of each of the following:
(a) resolutions of the Company's Board of Directors
authorizing the appointment of Custodian as custodian of portfolio securities,
cash and other property of the Company, respectively, and approving and
consenting to this Agreement;
(b) schedules identifying and containing the signatures of all
of the Company's officers and any other persons authorized to issue Oral
Instructions and to sign Written Instructions, as hereinafter defined, on behalf
of the Funds of the Company;
(c) the Company's current Registration Statement on Form N-1A
under the 1940 Act and the Securities Act of 1933, as amended (the "1933 Act"),
as filed with the Securities and Exchange Commission (the "SEC"), relating to
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shares of beneficial interest of the Company, without par value (the "Shares");
(d) the current prospectuses and statement of additional
information of each of the Funds, including all amendments and supplements
thereto (the "Prospectuses"); and
(e) a copy of the opinion of counsel for the Company, filed
with the SEC as part of the Company's current registration statement.
The Company will furnish Custodian from time to time with
copies, properly certified or authenticated, of all amendments of or supplements
to any of the foregoing, if any.
3. Definitions.
(a) "Authorized Person". As used in this Agreement, the term
"Authorized Person" means any of the Company's officers, and any other person,
whether or not any such person is an officer or employee of the Company, duly
authorized by the Board of Directors of the Company to give Oral and Written
Instructions to Custodian on behalf of the Company and listed on a schedule
provided to Custodian pursuant to Section 2 of this Agreement. Authorized
Persons duly authorized by the Board of Directors of the Company to buy and sell
foreign currency on a spot and forward basis and options to buy and sell foreign
currency are denoted by an asterisk thereon.
(b) "Book-Entry System". As used in this Agreement, the term
"Book-Entry System" means the Federal Reserve/Treasury book-entry system for
United States and federal agency securities, its successor or successors and its
nominee or nominees and any book-entry system maintained by a clearing agency
registered with the SEC under Section 17A of the Securities Exchange Act of 1934
(the "1934 Act").
(c) "Composite Currency Unit". Shall mean the European
Currency Unit or any other composite unit consisting of the aggregate of
specified amounts of specified Currencies as such unit may be constituted from
time to time.
(d) "Currency". Shall mean money denominated in a lawful
currency of any country or the European Currency Unit.
(e) "FX Transaction". Shall mean any transaction for the
purchase by one party of an agreed amount in one Currency against the sale by it
to the other party of an agreed amount in another Currency.
(f) "Instructions". Shall mean instruction communications
transmitted by appropriately safeguarded (whether by password protection or
other means) electronic or telecommunications media including but not limited to
S.W.I.F.T., LASER, computer-to-computer interface, dedicated transmission line
and tested telex.
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(g) "Oral Instructions". As used in this Agreement, the term
"Oral Instructions" means oral instructions actually received by Custodian from
an Authorized Person or from a person reasonably believed by Custodian to be an
Authorized Person.
(h) "Officer's Certificate". The term "Officer's Certificate"
as used in this Agreement means instructions delivered by hand, mail, tested
telegram, cable, telex, or facsimile sending device, and actually received by
Custodian signed or reasonably believed by Custodian to be signed by two
officers of the Company listed on a schedule provided to Custodian pursuant to
Section 2 of this Agreement.
(i) "Property". The term "Property", as used in this
Agreement, means:
(i) any and all securities and other property of the
Company which the Company may from time to time deliver to Custodian, as
applicable, or which Custodian may from time to time hold for the Company;
(ii) all income in respect of any securities or other
property described in immediately preceding clause (i);
(iii) all proceeds of sales of any of such securities
or other property described in preceding clause (i) actually received by
Custodian; and
(iv) proceeds of the sale of Shares received by
Custodian from time to time from or on behalf of the Company.
(j) "Securities Depository". As used in this Agreement, the
term "Securities Depository" shall mean The Depository Trust Company, a clearing
agency registered with the SEC or its successor or successors and its nominee or
nominees; and shall also mean any other registered clearing agency, its
successor or successors specifically identified in a certified copy of a
resolution of the Company's Board of Directors approving deposits by Custodian
therein.
(k) "Written Instructions". As used in this Agreement,
"Written Instructions" means instructions delivered by hand, mail, tested
telegram, cable, telex, or facsimile sending device, and actually received by
Custodian, signed or reasonably believed by Custodian to be signed by an
appropriate number of Authorized Person(s), and the term Written Instructions
shall also include Instructions, except that Instructions need not be signed or
reasonably believed to be signed by any Authorized Person(s) where such
Instructions are transmitted by Software pursuant to Paragraph 26A. A fax
receipt or comparable confirmation of transmission of any Written Instructions
shall be deemed evidence of actual receipt by Custodian.
4. Delivery and Registration of the Property. The Company shall deliver
or cause to be delivered to Custodian all securities and all monies owned by the
Funds, including cash received for the issuance of Shares, at any time during
the period of this Agreement, except for securities and monies to be delivered
to any sub-custodian appointed, with approval of the Company, by Custodian
pursuant to Paragraphs 7, 27, or 28(g) hereof. Custodian will not be responsible
for such securities and such monies until actually received by it. All
securities delivered to Custodian or any such sub-custodian (other than in
bearer form) shall be registered in the name of the Fund or in the name of a
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nominee of a Fund or in the name of Custodian or any nominee of Custodian (with
or without indication of fiduciary status) or in the name of any sub-custodian
or any nominee of such sub-custodian appointed, with approval of the Company,
pursuant to Paragraphs 7, 27, or 28(g) hereof or shall be properly endorsed and
in form for transfer satisfactory to Custodian.
5. Voting and Other Rights. With respect to all securities, however
registered, it is understood that the voting and other rights and powers shall
be exercised by the Company. Custodian's only duty with respect to such rights
shall be to mail to the Company within two (2) business days following receipt
by Custodian any documents received by Custodian as custodian, including notices
of corporate action, proxies, proxy soliciting materials and offering circulars,
with any elections or proxies for securities registered in a nominee name
executed by such nominee. In addition, Custodian shall provide notice of
Custodian's receipt of such documents by electronic means (e.g., posting notice
on LASER), as agreed between the parties. Where warrants, options, tenders or
other securities have fixed expiration dates, the Company understands that in
order for Custodian to act, Custodian must receive the Company's instructions at
its offices in New York, addressed as Custodian may from time to time request,
by no later than noon (New York City time) at least one (1) business day prior
to the last scheduled date to act with respect thereto (or such earlier date or
time as Custodian may reasonably notify the Company). Absent Custodian's timely
receipt of such instructions, such instructions will expire without liability to
Custodian. Custodian shall have no duty to forward to the Company any annual,
quarterly or special reports issued by companies whose securities are held by
Custodian hereunder.
6. Receipt and Disbursement of Money.
(a) Custodian shall open and maintain a custody account for
each Fund of the Company, subject only to draft or order by Custodian acting
pursuant to the terms of this Agreement, and, subject to Paragraphs 7, 27, or
28(g) hereof, shall hold in such account, subject to the provisions hereof, all
cash received by it from or for the Funds. Custodian shall make payments of cash
to, or for the account of, each Fund from such cash only (i) for the purchase of
securities for the Funds as provided in Paragraph 14 hereof; (ii) upon receipt
of an Officer's Certificate for the payment of dividends or other distributions
on or with respect to Shares, or for the payment of interest, taxes,
administration, distribution or advisory fees or expenses which are to be borne
by the Funds under the terms of this Agreement and, with respect to each Fund,
and under the terms of any investment advisory agreements, administration
agreements or distribution agreements; (iii) upon receipt of Written
Instructions for payments in connection with the conversion, exchange or
surrender of securities owned or subscribed to by the Funds and held by or to be
delivered to Custodian; (iv) to a sub-custodian pursuant to Paragraphs 7, 27, or
28(g) hereof; or (v) for the redemption of Shares; or (vi) upon receipt of an
Officer's Certificate for other corporate purposes.
(b) Custodian is hereby authorized to endorse and collect all
checks, drafts or other orders for the payment of money received as Custodian
for the Funds.
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7. Receipt of Securities.
(a) Except as provided by Paragraphs 7(c), 8, 27, or 28(g)
hereof, and except as otherwise directed by Oral or Written Instructions
described in Paragraph 11 hereof, Custodian shall hold and physically segregate
in a separate account with respect to each Fund, identifiable from those of any
other person, all securities and non-cash property received by it for the Funds.
All such securities and non-cash property are to be held or disposed of by
Custodian for each Fund pursuant to the terms of this Agreement. In the absence
of Written Instructions accompanied by a certified resolution authorizing the
specific transaction by the Company's Board of Directors, and subject to
Paragraph 25 hereof, Custodian shall have no power or authority to withdraw,
deliver, assign, hypothecate, pledge or otherwise dispose of any such securities
and investments, except in accordance with the express terms provided for in
this Agreement. In no case may any director, officer, employee or agent of the
Company withdraw any securities. In connection with its duties under this
Paragraph 7(a), Custodian may enter into sub-custodian agreements with other
banks or trust companies for the receipt of certain securities and cash to be
held by Custodian for the account of a Fund pursuant to this Agreement, provided
Custodian obtains the prior written approval of the Company to any such
sub-custody arrangement. Custodian will provide the Company with a copy of each
sub-custodian agreement it executes pursuant to this Paragraph 7(a). Custodian
shall be liable for acts or omissions of any such sub-custodian selected by it
pursuant to this Paragraph 7(a), under the standards of care provided for
herein, except for any such sub-custodian engaged at the specific direction of
the Funds. Notwithstanding anything herein to the contrary, this Paragraph 7(a)
shall not apply to Custodian's engagement of foreign sub-custodians, which shall
instead be governed by Paragraph 27 hereof.
(b) Promptly after the close of business on each day,
Custodian shall furnish the Company with confirmations and a summary of all
transfers to or from the account of each Fund during said day. Where securities
are transferred to the account of any Fund established at a Securities
Depository or the Book Entry System pursuant to Paragraph 8 herein, Custodian
shall also, by book-entry or otherwise, identify as belonging to such Fund the
quantity of securities in a fungible bulk of securities registered in the name
of Custodian (or its nominee) or shown in Custodian's account on the books of a
Securities Depository or the Book-Entry System. At least monthly and from time
to time, Custodian shall furnish the Company with a detailed statement of the
Property held for each Fund under this Agreement.
(c) Notwithstanding any provision elsewhere contained herein,
Custodian shall not be required to obtain possession of any instrument or
certificate representing any futures contract, any option, or any futures
contract option until after it shall have determined, or shall have received an
Officer's Certificate from the Company stating that any such instruments or
certificates are available. The Company shall deliver to Custodian such an
Officer's Certificate no later than the business day preceding the availability
of any such instrument or certificate. Prior to such availability, Custodian
shall comply with the 1940 Act in connection with the purchase, sale,
settlement, closing out or writing of futures contracts, options, or futures
contract options by making payments or deliveries specified in such Officer's
Certificates or Written Instructions received by Custodian in connection with
any such purchase, sale, writing, settlement or closing out upon its receipt
from a broker, dealer, or futures commission merchant of a statement or
confirmation reasonably believed by Custodian to be in the form customarily used
by brokers, dealers, or future commission merchants with respect to such futures
contracts, options, or futures contract options, as the case may be, confirming
that the same is held by such broker, dealer or futures commission merchant, in
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book-entry form or otherwise, in the name of Custodian (or any nominee of
Custodian) as Custodian for the Fund, provided, however, that notwithstanding
the foregoing, and subject to Paragraph 13(b) hereof, payments to or deliveries
from any margin account, and payments with respect to future contracts, options,
or future contract options to which a margin account relates, shall be made in
accordance with the terms and conditions of the Company's relevant margin
account agreement. Whenever any such instruments or certificates are available,
Custodian shall, notwithstanding any provision in this Agreement to the
contrary, make payment for any futures contract, option, or futures contract
option for which such instruments or such certificates are available against the
delivery to Custodian of such instrument or such certificate, and deliver any
futures contract, option or futures contract option for which such instruments
or such certificates are available only against receipt by Custodian of payment
therefor. Any such instrument or certificate delivered to Custodian shall be
held by Custodian hereunder in accordance with, and subject to, the provisions
of this Agreement.
8. Use of Securities Depository or the Book-Entry System. The Company
shall deliver to Custodian a certified resolution of the Board of Directors of
the Company approving, authorizing and instructing Custodian on a continuous and
ongoing basis until instructed to the contrary by Written Instructions (i) to
deposit in a Securities Depository or the Book-Entry System all securities of
the Funds held hereunder eligible for deposit therein and (ii) to utilize a
Securities Depository or the Book-Entry System to the extent possible in
connection with the performance of its duties hereunder, including without
limitation settlements of purchases and sales of securities by the Funds, and
deliveries and returns of securities loaned, subject to repurchase agreements or
used as collateral in connection with borrowings. Without limiting the
generality of such use, the following provisions shall apply thereto:
(a) Securities and any cash of the Funds deposited by
Custodian in a Securities Depository or the Book-Entry System will at all times
be segregated from any assets and cash controlled by Custodian in other than a
fiduciary or custodian capacity. Subject to Paragraph 28(m) hereof, Custodian
and its sub-custodians, if any, will pay out money only upon receipt of
securities and will deliver securities only upon receipt of money, absent
Written Instructions to the contrary.
(b) All books and records maintained by Custodian that relate
to the Funds' participation in a Securities Depository or the Book-Entry System
will at all times during Custodian's regular business hours be open to
inspection by the Company's duly authorized employees or agents and the
Company's independent auditors in accordance with applicable regulations, it
being understood, however, that such records may be kept in an off site
Custodian storage location and the Company will be furnished with all
information in respect of the services rendered to it as it may require.
(c) Custodian will provide the Company with copies of any
report obtained by Custodian on the system of internal accounting control of the
Securities Depository or Book-Entry System promptly after receipt of such a
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report by Custodian. Custodian will also provide the Company with such reports
on its own system of internal control as the Company may reasonably request from
time to time.
9. Instructions Consistent With the Charter, Etc. Unless otherwise
provided in this Agreement, Custodian shall act only upon Officer's
Certificates, Oral Instructions and/or Written Instructions. Custodian may
assume that any Officer's Certificate, Oral Instructions or Written Instructions
received hereunder are not in any way inconsistent with any provision of the
Charter or Code of Regulations or any resolution of the Company's Board of
Directors, or any committee thereof. Custodian shall be entitled to rely upon
any Oral Instructions or Written Instructions actually received by Custodian
pursuant to this Agreement, and upon any certificate, oral instructions, or
written instructions reasonably believed by Custodian to be an Officer's
Certificate, Oral Instructions or Written Instructions. The Company agrees to
forward to Custodian Written Instructions confirming Oral Instructions in such
manner that the Written Instructions are received by Custodian at the close of
business of the same day that such Oral Instructions are given to Custodian. The
Company agrees that the fact that such confirming Written Instructions are not
received by Custodian shall in no way affect the validity of any of the
transactions authorized by the Company by giving Oral Instructions, and that
Custodian's records with respect to the content of Oral Instructions shall be
controlling.
10. Transactions-Not Requiring Instructions. Custodian is authorized to
take the following action without Oral Instructions, Written Instructions, or an
Officer's Certificate:
(a) Collection of Income and Other Payments. Custodian shall,
subject to Paragraph 28(f) hereof:
(i) Collect and receive for the account of any Fund,
all income and other payments and distributions, including (without limitation)
stock dividends, rights, warrants and similar items, included or to be included
in the Property of any Fund, and promptly advise the Company of such receipt and
shall credit such income, as collected, to such Fund of the Company. From time
to time, Custodian may elect, but shall not be so obligated, to credit the
account with interest, dividends or principal payments on payable or contractual
settlement date, in anticipation of receiving same from a payor, central
depository, Securities Depository, broker or other agent employed by the Company
or Custodian. Any such crediting and posting shall be at the Company's sole
risk, and Custodian shall be authorized to reverse (A) any such advance posting
in the event it does not receive good funds from any such payor, central
depository, Securities Depository, broker or agent, and (B) any other payment or
crediting, including, without limitation, payments made by check or draft, in
the event it does not receive good funds or final payment;
(ii) With respect to securities of foreign issue, and
subject to Paragraph 27 hereof, effect collection of dividends, interest and
other income, and to promptly transmit to the Company all reports, written
information or notices actually received by Custodian as Custodian, including
notices of any call for redemption, offer of exchange, right of subscription,
reorganization, or other proceedings affecting such securities, or any default
in payments due thereon. It is understood, however, that Custodian shall be
under no responsibility for any failure or delay in effecting such collections
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or giving such notice with respect to securities of foreign issue, regardless of
whether or not the relevant information is published in any financial service
available to it unless such failure or delay is due to Custodian's own
negligence. Collections of income in foreign currency are, to the extent
possible, to be converted into United States dollars unless otherwise instructed
in writing, and in effecting such conversion Custodian may use such methods or
agencies as it may see fit, including the facilities of its own foreign division
at customary rates. All risk and expenses incident to such collection and
conversion are for the account of the Funds and Custodian shall have no
responsibility for fluctuations in exchange rates affecting any such
conversions;
(iii) Endorse and deposit for collection in the name
of the Company and each of its Funds, checks, drafts, or other orders for the
payment of money on the same day as received;
(iv) Receive and hold for the account of each of the
Fund's securities received by the Funds as a result of a stock dividend, share
split-up or reorganization, recapitalization, readjustment or other
rearrangement or distribution of rights or similar securities issued with
respect to any portfolio securities of the Funds held by Custodian hereunder;
(v) Present for payment and collect the amount
payable upon all securities which may mature or be called, redeemed or retired,
or otherwise become payable on the date such securities become payable, but,
with respect to calls, early redemptions, or early retirements, only if
Custodian either (i) receives a written notice of the same or (ii) notice of the
same appears in one or more of the publications then listed in Schedule II
hereto, which Schedule may be amended to add other publications at any time by
Custodian without prior notice to or consent from the Company and which may be
amended to delete a publication with the prior notice and consent from the
Company;
(vi) Subject to Paragraphs 28(e) and (f) hereof, take
any action which may be necessary and proper in connection with the collection
and receipt of such income and other payments and the endorsement for collection
of checks, drafts and other negotiable instructions; and
(vii) With respect to domestic securities, to
exchange securities in temporary form for securities in definitive form, to
effect an exchange of the shares where the par value of stock is changed, and to
surrender securities at maturity or when advised by the Company or the
investment adviser to the Company of an earlier call for redemption, against
payment therefor in accordance with accepted industry practice. When fractional
shares of stock of a declaring corporation are received as a stock distribution,
Custodian is authorized to sell the fraction received and credit the Company's
account. Unless specifically instructed to the contrary in writing, Custodian is
authorized to exchange securities in bearer form for securities in registered
form. If any Property registered in the name of a nominee of Custodian is called
for partial redemption by the issuer of such Property, Custodian is authorized
to allot the called portion to the respective beneficial holders of the Property
in such manner deemed to be fair and equitable by Custodian in its reasonable
discretion.
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(b) Miscellaneous Transactions. Custodian is authorized to
deliver or cause to be delivered Property against payment or other consideration
or written receipt therefor in the following cases:
(i) for examination by a broker selling for the
account of the Company in accordance with street delivery custom;
(ii) for the exchange for interim receipts or
temporary securities for definitive securities;
(iii) for transfer of securities into the name of the
Funds or Custodian or a nominee of either, or for exchange of securities for a
different number of bonds, certificates, or other evidence, representing the
same aggregate face amount or number of units bearing the same interest rate,
maturity date and call provisions, if any; provided that, in any such case, the
new securities are to be delivered to Custodian.
11. Transactions Requiring Instructions. Upon receipt of Oral or
Written Instructions, and not otherwise, Custodian, directly or through the use
of a Securities Depository or the Book-Entry System, shall:
(a) execute and deliver to such persons as may be designated
in such Oral or Written Instructions, proxies, consents, authorizations, and any
other instruments whereby the authority of the Funds as owners of any securities
may be exercised;
(b) deliver any securities held for any Fund against receipt
of other securities or cash issued or paid in connection with the liquidation,
reorganization, refinancing, merger, consolidation or recapitalization of any
corporation, or the exercise of any conversion privilege;
(c) deliver any securities held for any Fund to any protective
committee, reorganization committee or other person in connection with the
reorganization, refinancing, merger, consolidation, recapitalization or sale of
assets of any corporation, against receipt of such certificates or deposit,
interim receipts or other instruments or documents as may be issued to it to
evidence such delivery;
(d) make such transfers or exchanges of the assets of any Fund
and take such other steps as shall be stated in said instructions to be for the
purposes of effectuating any duly authorized plan of liquidation,
reorganization, merger, consolidation or recapitalization of the Funds;
(e) subject to Paragraph 25(b) hereof, release securities
belonging to any Fund to any bank or trust company for the purpose of pledge or
hypothecation to secure any loan incurred by such Fund; provided, however, that
securities shall be released only upon payment to Custodian of the monies
borrowed, except that in cases where additional collateral is required to secure
a borrowing already made, subject to proper prior authorization, further
securities may be released for that purpose; and pay such loan upon redelivery
to it of the securities pledged or hypothecated therefor and upon surrender of
the note or notes evidencing the loan;
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(f) deliver any securities held for any Fund upon the exercise
of a covered call option written by such Fund on such securities;
(g) release and deliver securities owned by a Fund in
connection with any repurchase agreement entered into on behalf of such Fund,
but subject to Paragraph 28(m) hereof, only on receipt of payment therefor; and
pay out monies of such Fund in connection with such repurchase agreements, but
only upon the delivery of the securities;
(h) otherwise transfer, exchange or deliver securities in
accordance with Oral or Written Instructions specifying the purpose of such
transfer, including without limitation, loans of securities, short sales, or
reverse repurchase agreements, and subject to Paragraph 7(a) hereof.
12. Segregated Accounts. Custodian shall upon receipt of Written or
Oral Instructions establish and maintain a segregated account or accounts on its
records for and on behalf of any Fund, into which account or accounts shall be
credited, but only pursuant to an Officer's Certificate or Written Instructions
specifying the particular securities and/or amount of cash, cash and/or
securities, including securities in the Book-Entry System (i) for the purposes
of compliance by the Funds and the Company with the procedures required by a
securities or option exchange, (ii) for the purpose of compliance by the Funds
and the Company with the 1940 Act and Release No. 10666 or any subsequent
release or releases of the SEC relating to the maintenance of segregated
accounts by registered investment companies, and (iii) for other proper
corporate purposes.
13. Dividends and Distributions.
(a) The Company shall furnish Custodian with appropriate
evidence of action by the Company's Board of Directors declaring and authorizing
the payment of any dividends and distributions. Upon receipt by Custodian of an
Officer's Certificate with respect to dividends and distributions declared by
the Company's Board of Directors and payable to shareholders of any Fund who are
entitled to receive cash for fractional shares and those who have elected in the
proper manner to receive their distributions on dividends in cash, and in
conformance with procedures mutually agreed upon by Custodian and the Company,
and the Company's administrator or transfer agent, Custodian shall pay to the
Fund's transfer agent, as agent for the shareholders, an amount equal to the
amount indicated in said Officer's Certificate as payable by the Fund to such
shareholders for distribution in cash by the transfer agent to such
shareholders.
(b) Custodian may enter into separate custodial agreements
with various futures commission merchants ("FCMs") that the Company uses (each
an "FCM Agreement"), pursuant to which the Funds' margin deposits in any
transactions involving futures contracts and options on futures contracts will
be held by Custodian in accounts (each an "FCM Account") subject to the
disposition by the FCM involved in such contracts in accordance with the
customer contract between the FCM and the Company ("FCM Contract"), SEC rules
governing such segregated accounts, Commodity Futures Trading Commission
("CFTC") rules and the rules of the applicable commodities exchange. Such FCM
Agreements shall only be entered into by Custodian upon receipt by Custodian of
Written Instructions from the Company which state that (i) an FCM Contract has
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been entered into; (ii) the Company is in compliance with all the rules and
regulations of the CFTC; and (iii) the FCM Agreement is acceptable to the
Company. Transfers of initial margin shall be made into an FCM Account only upon
Written Instructions; transfers of premium and variation margin may be made into
an FCM Account pursuant to Oral Instructions. Transfers of funds from an FCM
Account to the FCM for which Custodian holds such an account may only occur in
accordance with the terms of the FCM Agreement.
14. Purchase of Securities. Promptly after each purchase of securities
by the Company on behalf of any Fund, the Company shall deliver to Custodian
Oral or Written Instructions specifying with respect to each such purchase: (a)
the name of the issuer and the title of the securities, (b) the number of shares
of the principal amount purchased and accrued interest, if any, (c) the dates of
purchase and settlement, (d) the purchase price per unit, (e) the total amount
payable upon such purchase, (f) the name of the person from whom or the broker
through whom the purchase was made and (g) the Fund for which the purchase was
made. Custodian shall upon receipt of securities purchased by or for the Company
pay out of the monies held for the account of the Company the total amount
payable to the person from whom or the broker through whom the purchase was
made, provided that the same conforms to the total amount payable as set forth
in such Oral or Written Instructions.
15. Sales of Securities. Promptly after each sale of securities by the
Funds or the Company shall deliver to Custodian Oral or Written Instructions,
specifying with respect to each such sale: (a) the name of the issuer and the
title of the security, (b) the number of shares or principal amount sold, and
accrued interest, if any, (c) the dates of sale, (d) the sale price per unit,
(e) the total amount payable to the Company upon such sale, (f) the name of the
broker through whom or the person to whom the sale was made and (g) the Fund for
which the sale was made. Custodian shall, subject to Paragraph 28(m) hereof,
deliver the securities against payment of the total amount payable to the
Company upon such sale, provided that the same conforms to the total amount
payable as set forth in such Oral and Written Instructions.
16. Records. The books and records pertaining to the Funds and the
Company which are in the possession of Custodian shall be the property of the
Company. Such books and records shall be prepared and maintained as required by
the 1940 Act and other applicable securities laws and rules and regulations. The
SEC, the Company, or the Company's authorized representatives, shall have access
to such books and records at all times during Custodian's normal business hours.
Upon the reasonable request of the Company, copies of any such books and records
shall be provided by Custodian to the Company or the Company's authorized
representative, and the Company shall reimburse Custodian reasonable expenses
for providing such copies. Upon reasonable request of the Company, Custodian
shall provide in hard copy, tape or on micro-film, or such other medium as
agreed to among the Company and Custodian, and any books and records maintained
by Custodian.
17. Reports.
(a) Custodian shall furnish the Company the following reports:
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(i) such periodic and special reports as the Company
may reasonably request from time to time;
(ii) a monthly statement summarizing all transactions
and entries for the account of each Fund;
(iii) a monthly report of portfolio securities
belonging to each Fund showing the adjusted average cost of each issue and
market value at the end of such month;
(iv) a monthly report of the cash account of each
Fund showing disbursements;
(v) the reports to be furnished to the Company
pursuant to Rule 17f-4 under the 1940 Act; and
(vi) such other information as may be agreed upon
from time to time between the Company and Custodian.
(b) Subject to Paragraphs 5 and 27(g) hereof, Custodian shall
transmit promptly to the Company any proxy statement, proxy materials, notice of
a call or conversion or similar communications actually received by Custodian as
custodian of the Property.
(c) Custodian shall report as the market value at the end of
each month the last closing bid, offer or sale price to the extent, and as the
same, is furnished to Custodian by a pricing or similar service utilized or
subscribed to by Custodian. Custodian shall not be responsible for, have any
liability with respect to, or be under any duty to inquire into, nor deemed to
make any assurances with respect to, the accuracy or completeness of such
information, even if The Bank of New York in performing services for others,
including services similar to those performed hereunder, receives different
valuations of the same or different securities of the same issuer.
18. Cooperation with Accountants. Custodian shall cooperate with the
Company's independent certified public accountants and shall take all reasonable
action in the performance of its obligations under this Agreement, to assure
that the necessary information is made available to such accountants.
19. Confidentiality. Custodian agrees on behalf of itself and its
employees to treat all record and other information relative to the Company, its
prior, present or potential shareholders, its service providers and its prior,
present or potential customers, as confidential information, and to protect and
safeguard the same to the extent required by applicable law, provided, however,
that Custodian may make such disclosure as required by applicable law,
regulation, court order, decrees or legal process and upon receipt of any of the
foregoing requiring such disclosure, Custodian's only obligation shall be to
notify the Company thereof. Custodian further agrees not to otherwise use such
records and information for any purpose other than performance of its
responsibilities and duties hereunder, except after prior notification to and
approval in writing by the Company.
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20. Equipment Failures. In the event of equipment failures beyond
Custodian's control, Custodian shall take reasonable steps to minimize service
interruptions but shall not have any further liability with respect thereto.
Notwithstanding the foregoing, Custodian shall maintain sufficient back up
electronic data processing equipment to enable Custodian to fulfill its
obligations under this Agreement consistent with standard industry practices.
21. Right to Receive Advice.
(a) Advice of Fund. If Custodian shall be in doubt as to any
action to be taken or omitted by it, either may request, and shall receive, from
the Company clarification or advice, including Oral or Written Instructions.
(b) Advice of Counsel. If Custodian shall be in doubt as to
any question of law involved in any action to be taken or omitted by Custodian,
it may request at its option advice from its own counsel, at its own expense, or
advice from the Company's counsel.
(c) Conflicting Advice. In case of conflict between
directions, advice or Oral or Written Instructions received by Custodian
pursuant to subparagraph (a) of this paragraph and advice received by Custodian
pursuant to subparagraph (b) of this paragraph, Custodian shall be entitled to
rely on and follow the advice received pursuant to subparagraph (b) alone.
(d) Protection of Custodian. Custodian shall be protected in
any action or inaction which it takes or omits to take in reliance on any
directions, advice or Oral or Written Instructions received pursuant to
subparagraphs (a) or (b) of this section which it, after receipt of any such
directions, advice or Oral or Written Instructions, in good faith reasonably
believes to be consistent with such directions, advice or Oral or Written
Instructions, as the case may be. Nothing in this Paragraph 21 shall be
construed as imposing upon Custodian any obligation (i) to seek such directions,
advice or Oral or Written Instructions, or (ii) to act in accordance with such
directions, advice or Oral or Written Instructions when received, unless, under
the terms or another provision of this Agreement, the same is a condition to
Custodian's properly taking or omitting to take such action. Nothing in this
Paragraph 21(d) shall excuse Custodian when an action or omission on the part of
Custodian constitutes willful misfeasance or bad faith, or negligence or
reckless disregard by Custodian of its duties under this Agreement.
22. Compliance with Governmental Rules and Regulations. Custodian
undertakes to comply with the laws, rules and regulations of governmental
authorities having jurisdiction over Custodian and its express duties hereunder.
23. Compensation. As compensation for the services rendered by
Custodian during the term of this Agreement, the Company shall pay to Custodian,
in addition to reimbursement of its out-of-pocket expenses, such compensation as
may be agreed upon from time to time in writing by the Company and Custodian as
set forth in Schedule III.
24. Indemnification. The Company agrees to indemnify Custodian against,
and hold harmless from all taxes, charges, expenses (including reasonable fees
and expenses of counsel), assessments, claims, losses, demands and liabilities
whatsoever (including, without limitation, liabilities arising under the 1933
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Act, the 1934 Act and the 1940 Act, and any state and foreign securities laws,
all as currently in effect or as may be amended from time to time) and expenses,
including without limitation, reasonable attorney's fees and disbursements,
howsoever arising or incurred because of or in connection with this Agreement,
except for such liability, claim, loss, demand, charge, expense, tax or
assessment arising out of Custodian's, or such nominees', willful misconduct or
negligence or reckless disregard of its duties under this Agreement. For the
purposes of this Agreement, including, without limitation, for purposes of
Paragraphs 24 and 28, neither Custodian's acceptance of Instructions in
accordance with Paragraph 26A nor Custodian's use of Foreign Sub-Custodians
pursuant to agreements that do not permit actual examination by independent
public accountants, nor the denial of examination by any Foreign Sub-Custodian
as defined in Paragraph 27, shall, in and of itself, constitute, or be deemed to
constitute, a breach by Custodian of this Agreement or negligence, willful
misconduct, or reckless disregard of its duties by Custodian, provided the
relevant agreement between Custodian and a Foreign Sub-Custodian satisfies the
requirements of Rule 17f-5.
25. Overdrafts or Indebtedness.
(a) Custodian shall advance funds under this Agreement with
respect to any Fund which results in an overdraft because the moneys held by
Custodian in the separate account for such Fund shall be insufficient to pay the
total amount payable upon a purchase of securities by such Fund, as set forth in
an Officer's Certificate or Oral or Written Instructions, or which results in an
overdraft in the separate account of such Fund for some other reason, or if the
Company is for any other reason indebted to Custodian, including any
indebtedness to The Bank of New York under the Company's Cash Management and
Related Services Agreement, (except a borrowing for investment or for temporary
or emergency purposes using securities as collateral pursuant to a separate
agreement and subject to the provisions of Paragraph 25(b) hereof), such
overdraft or indebtedness shall be deemed to be a loan made by Custodian to the
Company for such Fund payable on demand and shall bear interest from the date
incurred at a rate per annum (based on a 360-day year for the actual number of
days involved) equal to the overdraft rate specified in Schedule IV to this
Agreement. In addition, the Company hereby agrees that Custodian shall have a
continuing lien, security entitlement and security interest in and to any
property at any time held by it for the benefit of such Fund or in which the
Fund may have an interest which is then in Custodian's possession or control or
in possession or control of any third party acting on Custodian's behalf. The
Company authorizes Custodian, in its sole discretion, at any time to charge any
such overdraft or indebtedness together with interest due thereon against any
balance of account standing to such Fund's credit on Custodian's books. In
addition, the Company hereby covenants that on each Business Day on which either
it intends to enter a Reverse Repurchase Agreement and/or otherwise borrow from
a third party, or which next succeeds a Business Day on which at the close of
business the Company had outstanding a Reverse Repurchase Agreement or such a
borrowing, it shall prior to 1:00 p.m., New York City time, advise Custodian, in
writing, of each such borrowing, shall specify the Fund to which the same
relates, and shall not incur any indebtedness not so specified other than from
Custodian.
(b) The Company will cause to be delivered to Custodian by any
bank (including, if the borrowing is pursuant to a separate agreement,
Custodian) from which it borrows money for investment or for temporary or
emergency purposes using securities held by Custodian hereunder as collateral
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for such borrowings, a notice or undertaking in the form currently employed by
such bank setting forth the amount which such bank will loan to the Company
against delivery of a stated amount of collateral. The Company shall promptly
deliver to Custodian Written Instruction specifying with respect to each such
borrowing: (a) the Fund to which such borrowing relates; (b) the name of the
bank, (c) the amount and terms of the borrowing, which may be set forth by
incorporating by reference an attached promissory note, duly endorsed by the
Fund, or other loan agreement, (d) the time and date, if known, on which the
loan is to be entered into, (e) the date on which the loan becomes due and
payable, (f) the total amount payable to the Fund on the borrowing date, (g) the
market value of securities to be delivered as collateral for such loan,
including the name of the issuer, the title and the number of shares or the
principal amount of any particular securities, and (h) a statement specifying
whether such loan is for investment purposes or for temporary or emergency
purposes and that such loan is in conformance with the 1940 Act and the Fund's
prospectus. Custodian shall deliver on the borrowing date specified in Written
Instructions the specified collateral and the executed promissory note, if any,
against delivery by the lending bank of the total amount of the loan payable,
provided that the same conforms to the total amount payable as set forth in such
Written Instructions. Custodian may, at the option of the lending bank, keep
such collateral in its possession, but such collateral shall be subject to all
rights therein given the lending bank by virtue of any promissory note or loan
agreement. Custodian shall deliver such securities as additional collateral as
may be specified in Written Instructions to collateralize further any
transaction described in this Paragraph 25(b). The Company shall cause all
securities released from collateral status to be returned directly to Custodian,
and Custodian shall receive from time to time such return of collateral as may
be tendered to it. In the event that the Company fails to specify in Written
Instructions the Fund, the name of the issuer, the title and number of shares or
the principal amount of any particular securities to be delivered as collateral
by Custodian, Custodian shall not be under any obligation to deliver any
securities.
26A. Instructions
(a) It is understood and agreed that Custodian may, from time
to time, provide software to the Company for purposes of enabling a Fund to
transmit Instructions to Custodian (the "Software"). Such Software has been
designed to include password protection or other features to restrict the use of
the Software to Authorized Persons; provided, however, that the Custodian makes
no warranty or representations of any kind with respect to such protections or
features, express or implied, including, but not limited to, any implied
warranties of merchantability or fitness for a particular purpose. The Company
and the Custodian shall use commercially reasonable efforts to develop other
mechanisms (i) to enable the Company to restrict the use of the Software to
Authorized Persons, (ii) to identify transmissions from a terminal other than an
authorized terminal, and (iii) for the prompt and accurate transmission of
Instructions by Authorized Persons to Custodian. It is further understood and
agreed that Custodian may provide specialized hardware or other equipment to
enable the Company and the Funds to utilize the Software. With respect to any
such Software, Custodian grants to the Company and its service providers a
personal, nontransferable and nonexclusive license to use the Software solely
for the purpose of transmitting Instructions to, and receiving communications
from, Custodian in connection with its account(s). The Company and its service
providers agree not to sell, reproduce, lease or otherwise provide, directly or
indirectly, the Software or any portion thereof to any third party without the
prior written consent of Custodian. At no time shall the Company be obligated to
use the Software to transmit Instructions to Custodian.
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(b) The Company shall obtain and maintain at its own cost and
expense all equipment and services, including but not limited to communications
services, necessary for it to utilize the Software and transmit Instructions to
Custodian; provided, however, that the parties acknowledge and agree that if any
specialized equipment is necessary to enable the Company to utilize the
Software, Custodian shall, at its own expense, provide and maintain such
equipment.
(c) The Company acknowledges that the Software, all data bases
made available to the Company by utilizing the Software (other than data bases
relating solely to the assets of the Funds and transactions with respect
thereto), and any proprietary data, processes, information and documentation
(other than those which are or become part of the public domain or are legally
required to be made available to the public) (collectively, the "Information"),
are the exclusive and confidential property of Custodian. The Company shall keep
the Information confidential by using the same care and discretion that the
Company uses with respect to its own confidential property and trade secrets and
shall neither make nor permit any disclosure without the prior written consent
of Custodian. Upon termination of this Agreement or the Software license granted
hereunder for any reason, the Company shall return to Custodian all copies of
the Information which are in its possession or under its control or which the
Company distributed to third parties.
(d) Custodian reserves the right to modify the Software from
time to time upon reasonable prior notice and the Company shall, if it desires
in its sole discretion to continue to use the Software, install new releases of
the Software as Custodian may direct. The Company agrees not to modify or
attempt to modify the Software without Custodian's prior written consent. The
Company acknowledges that any modifications to the Software, whether by the
Company or Custodian and whether with or without Custodian's consent, shall
become the property of Custodian.
(e) Where the method for transmitting Instructions by the
Company involves an automatic systems acknowledgment to the Company by Custodian
of its receipt of such Instructions, including any transmission of Instructions
using the Software, then (i) if an acknowledgment is not actually received by
the Company, Custodian shall not be deemed to have received any such
Instructions, and (ii) if an acknowledgment is actually received by the Company,
the Custodian shall be deemed to have received such Instructions and shall be
responsible for any error, omission, interruption or delay in connection with
the transmission of such Instructions; provided, however, that the Company shall
promptly review all acknowledgments actually received and notify the Custodian
in the event of any apparent discrepancy.
(f) (i) The Company agrees that where it delivers to Custodian
Instructions hereunder using the Software, it shall be the Company's sole
responsibility to ensure that only persons duly authorized by the Company and
the correct number of such persons transmit such Instructions to Custodian and
the Company will cause all such persons to treat applicable use and
authorization codes, passwords and authentication keys with extreme care, and
authorizes Custodian to act in accordance with and rely upon Instructions
received by it pursuant hereto using the Software.
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(ii) The Company hereby represents, acknowledges and agrees
that it is fully informed of the protections and risks associated with the
various methods of transmitting Instructions to Custodian and that there may be
more secure methods of transmitting Instructions to Custodian than the method(s)
selected by the Company.
(iii) With respect to all Oral Instructions and all Written
Instructions other than Instructions delivered to Custodian using the Software
provided by Custodian, Custodian shall exercise all commercially reasonable
efforts to form a reasonable belief that each such instruction has been given by
an Authorized Person and, where required, signed by an appropriate number of
Authorized Person(s).
(g) The Company shall notify Custodian of any errors,
omissions or interruptions in, or delay or unavailability of, its ability to
send Instructions using the Software provided by Custodian as promptly as
practicable, and in any event within 24 hours after the earliest of (i)
discovery thereof, (ii) the business day on which discovery should have occurred
through the exercise of reasonable care and (iii) in the case of any error, the
date of actual receipt of the earliest notice which reflects such error, it
being agreed that discovery and receipt of notice may only occur on a business
day. Custodian shall, as promptly as practicable, and in any event within 24
hours after the earliest of (i) discovery thereof, (ii) the business day on
which discovery should have occurred through the exercise of reasonable care and
(iii) in the case of any error, the date of actual receipt of the earliest
notice which reflects such error, it being agreed that discovery and receipt of
notice may only occur on a business day, advise the Company whenever Custodian
learns or reasonably should have learned, of any errors, omissions or
interruption in, or delay or unavailability of, the Company's ability to send
Instructions using the Software provided by Custodian.
26B. FX Transactions
(a) Whenever a Fund shall enter into an FX Transaction, the
Fund shall promptly deliver to Custodian a Certificate or Oral Instructions
specifying with respect to such FX Transaction: (a) the Series to which such FX
Transaction is specifically allocated; (b) the type and amount of Currency to be
purchased by the Fund; (c) the type and amount of Currency to be sold by the
Fund; (d) the date on which the Currency to be purchased is to be delivered; (e)
the date on which the Currency to be sold is to be delivered; and (f) the name
of the person from whom or through whom such Currencies are to be purchased and
sold. Unless otherwise instructed by a Certificate or Oral Instructions,
Custodian shall deliver, or shall instruct a Foreign Sub-Custodian to deliver,
the Currency to be sold on the date on which such delivery is to be made, as set
forth in the Certificate, and shall receive, or instruct a Foreign Sub-Custodian
to receive, the Currency to be purchased on the date as set forth in the
Certificate.
(b) Where the Currency to be sold is to be delivered on the
same day as the Currency to be purchased, as specified in the Certificate or
Oral Instructions, Custodian or a Foreign Sub-Custodian may arrange for such
deliveries and receipts to be made in accordance with the customs prevailing
from time to time among brokers or dealers in Currencies, and such receipt and
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delivery may not be completed simultaneously. The Fund assumes all
responsibility and liability for all credit risks involved in connection with
such receipts and deliveries, which responsibility and liability shall continue
until the Currency to be received by the Fund has been received in full.
(c) Any foreign exchange transaction effected by Custodian in
connection with this Agreement may be entered with Custodian, any office, branch
or subsidiary of The Bank of New York, or any Foreign Sub-Custodian (as defined
below) acting as principal or otherwise through customary banking channels. The
Fund may issue a standing Certificate with respect to foreign exchange
transactions but Custodian may establish rules or limitations concerning any
foreign exchange facility made available to the Fund. The Fund shall bear all
risks of investing in securities or holding Currency. Without limiting the
foregoing, the Fund shall bear the risks that rules or procedures imposed by a
Foreign Sub-Custodian or foreign depositories, exchange controls, asset freezes
or other laws, rules, regulations or orders shall prohibit or impose burdens or
costs on the transfer to, by or for the account of the Fund of Securities or any
cash held outside the Fund's jurisdiction or denominated in Currency other than
its home jurisdiction or the conversion of cash from one Currency into another
Currency. Custodian shall not be obligated to substitute another Currency for a
Currency (including a Currency that is a component of a Composite Currency Unit)
whose transferability, convertibility or availability has been affected by such
law, regulation, rule or procedure. Neither Custodian nor any Foreign
Sub-Custodian shall be liable to the Fund for any loss resulting from any of the
foregoing events.
27. Duties of Custodian with Respect to Property of any Fund Held
Outside of the United States.
(a) Custodian is authorized and instructed to employ, as
sub-custodian for each Fund's foreign securities and other assets, the foreign
banking institutions and foreign securities depositories and clearing agencies
selected from time to time by Custodian as the Foreign Custody Manager appointed
by the Company's Board of Directors ("Foreign Sub-Custodians") to carry out
their respective responsibilities in accordance with the terms of the
sub-custodian agreement between each such Foreign Sub-Custodian and Custodian
(each such agreement, a "Foreign Sub-Custodian Agreement"). Upon receipt of an
Officer's Certificate, the Company may designate any additional foreign
sub-custodian with which Custodian has an agreement for such entity to act as
Custodian's agent, as its sub-custodian and any such additional foreign
sub-custodian shall be deemed a Foreign Sub-Custodian hereunder. Upon receipt of
an Officer's Certificate, Custodian shall cease using any one or more Foreign
Sub-Custodians for the Fund's assets.
(b) Each Foreign Sub-Custodian Agreement shall be
substantially in the form delivered to the Company herewith and will not be
amended in a way that materially adversely affects the Company without the
Company's prior written consent.
(c) Custodian shall identify on its books as belonging to each
Fund the Foreign Securities of such Fund held by each Foreign Sub-Custodian. At
the election of the Company, it shall be entitled to be subrogated to any claims
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by the Company or any Fund against a Foreign Sub-Custodian as a consequence of
any loss, damage, cost, expense, liability or claim sustained or incurred by the
Company or any Fund if and to the extent that the Company or such Fund has been
made whole by Custodian for any such loss, damage, cost, expense, liability or
claim.
(d) Upon request of the Company, Custodian will, consistent
with the terms of the applicable Foreign Sub-Custodian Agreement, use reasonable
efforts to arrange for the independent accountants of the Company to be afforded
access to the books and records of any Foreign Sub-Custodian insofar as such
books and records relate to the performance of such Foreign Sub-Custodian under
its agreement with Custodian on behalf of the Company.
(e) Custodian will supply to the Company from time to time, as
mutually agreed upon, statements in respect of the securities and other assets
of each Fund held by Foreign Sub-Custodians, including but not limited to, an
identification of entities having possession of each Fund's Foreign Securities
and other assets, and advices or notifications of any transfers of Foreign
Securities to or from each custodial account maintained by a Foreign
Sub-Custodian for Custodian on behalf of the Fund.
(f) Custodian agrees that it will use reasonable care in
monitoring compliance by each Foreign Sub-Custodian with the terms of the
relevant Foreign Sub-Custodian Agreement and that if it learns of any breach of
such Foreign Sub-Custodian Agreement believed by Custodian to have a material
adverse effect on the Company or any Fund it will promptly notify the Company in
writing of such breach. Custodian also agrees to use reasonable and diligent
efforts to enforce its rights under the relevant Foreign Sub-Custodian
Agreement.
(g) Custodian shall transmit promptly to the Company all
notices, reports or other written information received pertaining to the
Company's Foreign Securities, including without limitation, notices of corporate
action, proxies and proxy solicitation materials.
(h) Notwithstanding any provision of this Agreement to the
contrary, settlement and payment for securities received for the account of the
Company or any Fund and delivery of securities maintained for the account of the
Company or any Fund may be effected in accordance with the customary or
established securities trading or securities processing practices and procedures
in the jurisdiction or market in which the transaction occurs, including,
without limitation, delivery of securities to the purchaser thereof or to a
dealer therefor (or an agent for such purchaser or dealer) against a receipt
with the expectation of receiving later payment for such securities from such
purchaser or dealer.
(i) With respect to any losses or damages arising out of or
relating to any actions or omissions of any Foreign Sub-Custodian, the sole
responsibility and liability of Custodian shall be to take all appropriate and
reasonable action at the Company's expense to recover such loss or damage from
the Foreign Sub-Custodian. It is expressly understood and agreed that
Custodian's sole responsibility and liability shall be limited to amounts so
recovered from the Foreign Sub-Custodian.
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28. Concerning Custodian.
(a) (i) Custodian shall exercise care and diligence and act in
good faith and use all commercially reasonable efforts in the performance of its
duties hereunder. Custodian shall be responsible to the Company for its own
failure, or the failure of any sub-custodian that it shall appoint (other than a
foreign sub-custodian referred to in Paragraph 27 or a sub-custodian appointed
by Custodian at the specific direction of the Company) or that of its employees
or agents, to perform its duties, obligations or responsibilities in accordance
with this Agreement, but only to the extent that such failure results from acts
or omissions that constitute willful misfeasance, bad faith or negligence on the
part of Custodian, or on the part of its employees or agents, or reckless
disregard of such duties, obligations and responsibilities.
(ii) Without limiting the generality of the foregoing
or any other provision of this Agreement, in no event shall Custodian be liable
to the Fund or any third party nor, except as otherwise provided in this
subparagraph for special, indirect or consequential damages or lost profits or
loss of business, arising under or in connection with this Agreement, even if
previously informed of the possibility of such damages and regardless of the
form of action. Custodian may, with respect to questions of law arising under
any FCM Agreement, apply for and obtain the advice and opinion of counsel to the
Company at the expense of the Company, or of its own counsel at its own expense,
and shall be fully protected with respect to anything done or omitted by it in
good faith in conformity with such advice or opinion. Custodian shall be liable
to the Company for any loss or damage resulting from the use of the Book-Entry
System or any Securities Depository arising by reason of any negligence or
willful misconduct on the part of Custodian or any of its employees or agents.
(iii) Custodian's liability pursuant to the last
sentence of subparagraph (a)(i) shall include, but not be limited to,
reimbursing the Company for court-ordered damage awards, fines, penalties, and
judicially-approved settlements (and attorney's fees and disbursements relating
thereto) arising out of or in connection with the conduct giving rise to such
liability.
(iv) If the Company receives notice of the
commencement of any action, suit, or proceeding (an "Action"), or notice that
any Action may be commenced, for which Custodian may be liable to the Company
pursuant to this Paragraph 28, the Company shall give notice to Custodian of the
commencement of the Action or of the possibility that an Action will be
commenced. Any omission to notify Custodian will not relieve Custodian from any
liability which it may have under this Paragraph, except to the extent the
failure to notify Custodian prejudices the rights of Custodian. Custodian will
be entitled at its sole expense and liability, to exercise full control of the
defense, compromise or settlement of any such Action, provided that Custodian
(1) notifies the Company in writing of Custodian's intention to assume such
defense; and (2) retains legal counsel reasonably satisfactory to the Company to
conduct the defense of such Action. If Custodian advises the Company that it
does not wish to exercise full control of any defense, compromise or settlement
of any Action, Custodian shall be responsible for the fees and expenses of
counsel selected by the Company, in addition to any other amounts for which
Custodian may be liable pursuant to this Paragraph 28. The other person will
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cooperate with the person assuming the defense, compromise or settlement of any
Action in accordance with this Paragraph in any manner that such person
reasonably may request. If Custodian so assumes the defense of any such Action,
the Company will have the right to employ a separate counsel and to participate
in (but not control) the defense, compromise or settlement of the Action, but
the fees and expenses of such counsel will be at the expense of the Company
unless (a) Custodian has agreed to pay such fees and expenses, (b) any relief
other than the payment of money damages is sought against the Company, or (c)
the Company has been advised by its counsel that there may be one or more
defenses available to it which are different from or additional to those
available to Custodian and that a conflict of interest therefore exists, and in
any such case that portion of the fees and expenses of such separate counsel
that are reasonably related to matters for which Custodian is liable pursuant to
this Paragraph will be paid by Custodian. The Company will not settle or
compromise any such Action for which Custodian is liable pursuant to this
Paragraph without the prior written consent of Custodian, unless Custodian has
failed, after reasonable notice, to undertake control of such Action in the
manner provided in this Paragraph. Custodian will not settle or compromise any
such Action in which any relief other than the payment of money damages is
sought against the Company without the consent of the Company, such consent not
to be unreasonably withheld. In the event that Custodian intends to settle or
compromise any Action in which solely money damages are sought, Custodian shall
give the Company fifteen (15) business days prior written notice.
(b) Without limiting the generality of the foregoing,
Custodian shall be under no obligation to inquire into, and shall not be liable
for:
(i) the validity of the issue of any securities
purchased, sold, or written by or for the Company or any Fund, the legality of
the purchase, sale or writing thereof, or the propriety of the amount paid or
received therefor;
(ii) the legality of the sale or redemption of any
Shares, or the propriety of the amount to be received or paid therefor;
(iii) the legality of the declaration or payment of
any dividend by the Company;
(iv) the legality of any borrowing by the Company
using securities as collateral;
(v) the legality of any loan of portfolio securities,
or under any duty or obligation to see to it that any cash collateral delivered
to it by a broker, dealer, or financial institution or held by it at any time as
a result of such loan of portfolio securities is adequate collateral for or
against any loss Custodian, the Company or any Fund might sustain as a result of
such loan. Custodian specifically, but not by way of limitation, shall not be
under any duty or obligation periodically to check or notify the Company or any
Fund that the amount of such cash collateral held by Custodian for the Company
is sufficient collateral for the Company, but such duty or obligation shall be
the sole responsibility of the Company. In addition, Custodian shall be under no
duty or obligation to see that any broker, dealer or financial institution to
which portfolio securities are lent makes payment to it of any dividends or
interest which are payable to or for the account of the Company during the
period of such loan or at the termination of such loan, provided, however, that
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Custodian shall promptly notify the Company in the event that such dividends or
interest are not paid and received when due; or
(vi) the sufficiency or value of any amounts of money
and/or securities held in any segregated account described in Paragraph 12(a)
hereof in connection with transactions by the Funds, or whether such segregated
account provides the compliance intended to be achieved. In addition, Custodian
shall not be under any duty or obligation to see that any broker, dealer, FCM or
Clearing Member makes payment to the Fund of any variation margin payment or
similar payment which the Fund may be entitled to receive from such broker,
dealer, FCM or Clearing Member, to see that any payment received by Custodian
from any broker, dealer, FCM or Clearing Member is the amount the Company is
entitled to receive, or to notify the Company or a Fund of Custodian's receipt
or non-receipt of any such payment.
(c) Custodian shall not be liable for, or considered to be
sub-custodian or custodian of, any money, whether or not represented by any
check, draft, or other instrument for the payment of money, received by
Custodian on behalf of the Company until Custodian actually receives and
collects such money directly or by the final crediting of the account
representing the Fund's interest at the Book-Entry System or a Securities
Depository.
(d) Custodian shall not have any responsibility or be liable
for ascertaining or acting upon any calls, conversions, exchange offers,
tenders, interest rate changes or similar matters relating to securities held in
a Securities Depository, unless Custodian shall have actually received timely
notice from such Securities Depository. In no event shall Custodian have any
responsibility or liability for the failure of any Securities Depository to
collect, or for the late collection or late crediting by a Securities Depository
of any amount payable upon securities deposited in a Securities Depository which
may mature or be redeemed, retired, called or otherwise become payable. Upon
receipt of Written Instructions from the Company of an overdue amount on
securities held in a Securities Depository Custodian shall make a claim against
a Securities Depository on behalf of the Company, except that Custodian shall
not be under any obligation to appear in, prosecute or defend any action suit or
proceeding in respect to any securities held by a Securities Depository which in
its opinion may involve it in expense or liability, unless indemnity
satisfactory to it against all expense and liability be furnished as often as
may be required.
(e) Custodian shall not be under any duty or obligation to
take action to effect collection of any amount due to the Company from a
transfer agent of the Company nor to take any action to effect payment or
distribution by the transfer agent of the Company of any amount paid by
Custodian to the transfer agent of the Company in accordance with this
Agreement.
(f) Custodian shall not be under any duty or obligation to
take action to effect collection of any amount, if the securities upon which
such amount is payable are in default, or if payment is refused after due demand
or presentation, unless and until (i) it shall be directed to take such action
by Written Instructions and (ii) it shall be assured to its reasonable
satisfaction of reimbursement of its costs and expenses in connection with any
such action.
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(g) Custodian may in addition to the employment of Foreign
Sub-Custodians pursuant to Paragraphs 7 and 27, hereof appoint one or more
banking institutions as Depository or Depositories, as a sub-custodian or as
sub-custodians, or as a co-custodian or as co-custodians, including, but not
limited to, banking institutions located in foreign countries, of securities and
moneys at any time owned by the Fund, upon such terms and conditions as may be
approved in an Officer's Certificate or contained in an agreement executed by
Custodian and the Company and the appointed institution.
(h) Custodian shall not be under any duty or obligation (i) to
ascertain whether any securities at any time delivered to, or held by it or by
any Foreign Sub-Custodian, for the account of the Company and specifically
allocated to a Fund are such as properly may be held by the Company or such Fund
under the provisions of its Prospectus, or (ii) to ascertain whether any
transactions by the Fund, whether or not involving Custodian, are such
transactions as may properly be engaged in by the Fund.
(i) Custodian shall charge its compensation and any expenses
with respect to the Funds of the Company incurred by Custodian in the
performance of its duties under this Agreement only against the money of the
Fund or Funds of the Company from which such compensation or expenses is
actually due and payable, and under no circumstances shall any compensation or
expenses due to Custodian be considered to be a joint, or joint and several,
obligation of the Funds of the Company. To the extent that Custodian is entitled
to recover from the Company any loss, damage, liability or expense (including
counsel fees) under this Agreement, Custodian shall charge the amount due in
respect of such loss, damage, liability or expense (including counsel fees) only
against the money held by it for the Fund or Funds of the Company that is/are
identified by the Company in an Officer's Certificate, unless and until the
Company instructs Custodian by an Officer's Certificate to charge against money
held by it for the account of a Fund such Fund's pro rata share (based on such
Fund's net asset value at the time of the charge in proportion to the aggregate
net asset value of all Funds at that time) of the amount of such loss, damage,
liability or expense (including counsel fees).
(j) Custodian shall be entitled to rely upon any Officer's
Certificate, Written Instructions, notice or other instrument in writing
received by Custodian and reasonably believed by Custodian to be an Officer's
Certificate or Written Instructions. Custodian shall be entitled to rely upon
any Oral Instructions actually received by Custodian. The Company agrees to
forward to Custodian Written Instructions confirming such Oral Instructions in
such manner so that such Written Instructions are received by Custodian, whether
by hand delivery, telecopier or other similar device, or otherwise, by the close
of business of the same day that such Oral Instructions are received by
Custodian. The Company agrees that the fact that such confirming instructions
are not received, or that contrary instructions are received, by Custodian shall
in no way affect the validity of the transactions or enforceability of the
transactions hereby authorized by the Company. The Company agrees that Custodian
shall not incur any liability to the Company in acting upon Oral Instructions
given to Custodian hereunder concerning such transactions provided such
instructions reasonably appear to have been received from an Authorized Person.
(k) Custodian shall be entitled to rely upon any instrument,
instruction or notice received by it and reasonably believed by it to be given
in accordance with the terms and conditions of any FCM Agreement. Without
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limiting the generality of the foregoing, Custodian shall not be under any duty
to inquire into, and Custodian shall not be liable for, the accuracy of any
statements or representations contained in any such instrument or other notice
including, without limitation, any specification of any amount to be paid to a
broker, dealer, futures commission merchant or clearing member.
(l) Custodian shall provide the Company with any report
obtained by Custodian on the system of internal accounting control of the
Book-Entry System, any Securities Depository utilized hereunder the Depository
or the Options Clearing Corporation, and with such reports on its own systems of
internal accounting control as the Company may reasonably request from time to
time.
(m) Subject to the foregoing provisions of this Agreement,
including, without limitation, those contained in Paragraph 27 hereof, Custodian
may deliver and receive securities, and receipts with respect to such
securities, and arrange for payments to be made and received by Custodian in
accordance with the customs prevailing from time to time among brokers or
dealers in such securities. When Custodian is instructed to deliver securities
against payment, delivery of such securities and receipt of payment therefor may
not be completed simultaneously. The Fund assumes all responsibility and
liability for all credit risks involved in connection with Custodian's delivery
of securities pursuant to proper instructions of the Fund, which responsibility
and liability shall continue until final payment in full has been received by
Custodian.
(n) Custodian shall not have any duties or responsibilities
whatsoever except such duties and responsibilities as are specifically set forth
in this Agreement, and no covenant or obligation shall be implied in this
Agreement against Custodian.
29. Termination. Any of the parties hereto may terminate this Agreement
by giving to the other parties a notice in writing specifying the date of such
termination, which shall be not less than ninety (90) days after the date of
giving of such notice. Upon the date set forth in such notice this Agreement
shall terminate, and Custodian shall on that date deliver directly to the
Company or a successor custodian designated by the Company all securities and
moneys then owned by the Company and held by Custodian, after deducting all
fees, expenses and other amounts for the payment or reimbursement of which it
shall then be entitled; provided, however, that transaction fees and expenses
payable by the Company in connection with a deconversion to a successor
custodian shall be limited to Custodian's actual direct cost.
30. Notices. All notices and other communications (collectively
referred to as "Notice" or "Notices" in this paragraph) hereunder shall be in
writing or by confirm in telegram, cable, telex, or facsimile sending device.
Notices shall be addressed (a) if to Custodian, at Custodian's address, 90
Washington Street, (22nd Floor), New York, New York 10286, Attention: Frank
Ajosa; (b) if to the Company, at the address of the Company, 111 Center Street,
Little Rock, Arkansas 72201, Attention: Richard H. Blank, Jr., Secretary; or (c)
if to none of the foregoing, at such other address as shall have been notified
to the sender of any such Notice or other communication. Notice shall be deemed
to have been given when actually received by the other party. All postage,
cable, telegram, telex and facsimile sending device charges arising from the
sending of a Notice hereunder shall be paid by the sender.
24
<PAGE>
31. Further Actions. Each party agrees to perform such further acts and
execute such further documents as it deems necessary to effectuate the purposes
hereof.
32. Amendments. This Agreement or any part hereof may be changed or
waived only by an instrument in writing signed by the party against which
enforcement of such change or waiver is sought.
33. Miscellaneous.
(a) The Company agrees that Custodian may be a counterparty in
any purchase or sale of foreign currency by or for the Company on a spot or
forward basis, and on any option to buy or sell foreign currency.
(b) This Agreement embodies the entire Agreement and
understanding between the parties hereto, and supersedes all prior agreements
and understandings relating to the subject matter hereof. The captions in this
Agreement are included for convenience of reference only and in no way define or
delimit any of the provisions hereof or otherwise affect their construction or
effect. This Agreement shall be deemed to be a contract made in New York and
governed by New York law. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected thereby. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors.
34. Release. The names "Nations Funds" and "Directors of Nations Funds"
refer respectively to the Company created and the Directors, as Directors but
not individually or personally, acting from time to time under the Articles of
Incorporation of the Company dated December 13, 1983, which is hereby referred
to and a copy of which is on file at the office of the State Secretary of The
State of Maryland and at the principal office of the Company. The obligations of
"Nations Funds" entered into in the name or on behalf thereof by any of the
Directors, representatives or agents are made not individually, but in such
capacities, and are not binding upon any of the Directors, Shareholders, or
representatives of the Company personally, but bind only the Company Property,
and all persons dealing with any class of Shares of the Company Property, and
all persons dealing with any class of Shares of the Company must look solely to
the Company Property belonging to such class for the enforcement of any claims
against the Company.
35. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers designated below as of the day and
year first above written.
THE BANK OF NEW YORK
25
<PAGE>
By: /s/ Stephen E. Grunston
-------------------------
Stephen E. Grunston
Vice-President
NATIONS FUND, INC.
By: /s/ Richard H. Blank, Jr.
-------------------------
Richard H. Blank, Jr.
Secretary
26
<PAGE>
SCHEDULE I
The Custody Agreement among Nations Fund, Inc. and Custodian applies to
the following funds of the Company:
Nations Prime Fund
Nations Treasury Fund
Nations Equity Income Fund
Nations Small Company Growth Fund
Nations Government Securities Fund
Nations U.S. Government Bond Fund
Nations International Growth Fund
Last Amended: August 25, 1999
IN WITNESS WHEREOF, the parties hereto have caused this
amended Schedule I to be executed by their duly authorized officers designated
below as of the 25th day of August, 1999.
NATIONS FUND, INC.
By: /s/ James E. Banks, Jr.
------------------------
James E. Banks, Jr.
Assistant Secretary
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
------------------------
Stephen E. Grunston
Vice President
27
<PAGE>
SCHEDULE II
PUBLICATIONS
I, Ira Rosner, a Vice President with THE BANK OF NEW YORK do hereby
designate the following publications:
The Bond Buyer
Depository Trust Company Notices
Financial Daily Card Service
JJ Kenney Municipal Bond Service
London Financial Times
New York Times
Standard & Poor's Called Bond Record
Wall Street Journal
28
<PAGE>
SCHEDULE III
COMPENSATION
Domestic Custodian Fee Schedule
For
Nations Fund Inc.
Money Market Funds
Safekeeping/Income Collection/Reporting DTC-ID
Affirmation All Systems Development and Usage Charges
1/2 of one basis point per annum on the aggregate net assets of all
Nations' Money Market Funds.
Security Transaction Charges
$ 7 DTC/FRB/PTC
$ 15 Physicals
$ 40 Euro C/D's
Other Charges
$ 5 Bank official checks
$ 2 Money transfers in/out of the Fund's custodian account not
related to securities transactions.
Earnings Credits on Balances/Interest on Overdrafts
Earnings credits are provided to each Fund on 80% of the daily balance in the
domestic custodian account computed at the 90-day T-bill rate on the day of the
balance.
Overdrafts, excluding bank errors, will cause a reduction of earnings credits
daily, computed at 1% above the average Federal Funds rate on the day of the
overdraft.
Credits and debits will be accumulated daily and offset monthly against the
Bank's domestic custodian fees. To the extent a net debit is accumulated, each
Fund will be billed for the expense. To the extent a net earnings credit is
generated, such excess earnings credit can be carried forward to the next
succeeding month. However, no earnings credit will be carried forward after
year-end.
<PAGE>
Out-of-Pocket Expenses
- -----------------------
None.
Billing Cycle
- --------------
The above fees are billed monthly.
Nations Fund Inc. The Bank of New York
- ----------------- --------------------
Approved by: /s/ Richard H. Blank, Jr. Approved by: /s/ Stephen E. Grunston
------------------------- -----------------------
Title: Secretary Title: Vice President
--------- --------------
Date: 10/20/98 Date: 10/19/98
-------- --------
<PAGE>
Domestic Custodian Fee Schedule
For
Nations Fund Inc.
Non-Money Market Funds
Safekeeping/Income Collection/Reporting/DTC-ID Affirmation
All Systems Development and Usage Charges
- -----------------------------------------------------------
3/4ths of one basis point per annum on the aggregate net assets of all
Nations' Non-Money Market Funds up to $10 billion.
1/2 of a basis point on the excess.
Security Transaction Charges/Paydowns
- -------------------------------------
$ 5 Paydowns
$ 7 DTC/FRB/PTC
$ 15 Physicals, options, and futures
$ 40 Euro C/D's
Other Charges
- -------------
$ 5 Bank official checks
$ 2 Money transfer in/out of the Fund's custodian account not
related to securities transactions.
Earnings Credits on Balances/Interest on Overdrafts
- ---------------------------------------------------
Earnings credits are provided to each Fund on 80% of the daily balance in the
domestic custodian account computed at the 90-day T-bill rate on the day of the
balance.
Overdrafts, excluding bank errors, will cause a reduction of earnings credits
daily, computed at 1% above the average Federal Funds rate on the day of the
overdraft.
Credits and debits will be accumulated daily and offset monthly against the
Bank's domestic custodian fees. To the extent a net debit is accumulated, each
Fund will be billed for the expense. To the extent a net earnings credit is
generated, such excess earnings credit can be carried forward to the next
succeeding month. However, no earnings credit will be carried forward after
year-end.
<PAGE>
Out-of-Pocket Expenses
- ----------------------
None.
Billing Cycle
- -------------
The above fees are billed monthly.
Nations Fund Inc. The Bank of New York
- ----------------- --------------------
Approved by: /s/ Richard H. Blank, Jr. Approved by: /s/ Stephen E. Grunston
------------------------- -----------------------
Title: Secretary Title: Vice President
---------- --------------
Date: 10/20/98 Date: 10/19/98
-------- --------
<PAGE>
Domestic Custodian Services
----------------------------
Customer Contact
- ----------------
Portfolio trades are coordinated by a dedicated administrative group
reacting to instructions from your authorized persons.
The group consists of a senior officer in charge, administrators
assigned based on activity and complexity and ample backup on hand to
ensure responsiveness to your needs.
Safekeeping of Securities
- -------------------------
We are a direct member of all major depositor systems, i.e., Depository
Trust Company, Federal Reserve Book Entry, Participants Trust Company,
etc.
Agreements are in place with sub-custodians for book-entry municipal
bond programs.
Arrangements have been completed for numerous multi-party repurchase
transactions.
Vault Operations are constantly monitored via closed-circuit security
systems.
Options/Futures
- ----------------
Issue escrow or depository receipts.
Collect premiums and effect closing purchase transactions for covered
call options.
Issue guarantee letters for put options.
Agreements are in place with numerous Futures Commission Merchants
(FCMs), to settle transactions and service maintenance margin
requirements.
Segregated accounts are maintained to comply with collateral agreements
with contra-brokers.
Income Collection/Paydowns
- --------------------------
Dividends and interest due to the account are pre-posted on the payable
date.
Proceeds from maturing securities are credited on the redemption date.
<PAGE>
Paydowns on GNMA, FNMA, FHLMC, and CMOs are posted on payable date and
credited in Federal Funds on the business day after payable date when
the factor is available (95% of issues held).
Securities requiring registration are held in our nominee name to
facilitate both sales and income collection.
Reports
- -------
The following reports are provided to allow your staff to monitor
portfolio cash and security transactions:
Daily Custodian Account Journal includes portfolio and cash
transactions of the previous business day.
Cash Balance Projection Report includes all trades reported to us that
have not settled through the previous business day. Pending dividends,
interest, maturities and called bonds are also listed on this report.
Daily report of affirmed/unaffirmed trades.
List of Assets reflects securities and cash held in the custodian
account available daily, weekly, monthly, etc.
Monthly Cash Statement - summary of all Daily Custodian Account Journal
activity for the previous month.
Workstation
- -----------
Our workstation will afford you the ability to review, edit, enter, and
transmit all trade settlement instructions to the Bank for processing.
Easily accessed via a PC, using a local telephone number, it increases
your flexibility to input and retrieve information while significantly
reducing your communication costs. The system is accessible 24 hours a
day, 7 days a week.
Our Cash Management Report is another of our on-line systems
capabilities providing real-time settlement data regarding the current
day's activity in your account. The activity would include pending and
settled trades, income, paydowns and maturity payments as well as cash
balances. This information puts effective cash management in your
hands.
Another of our dynamic on-line systems is called Q-TRAK. This on-line
module of our system can be used to notify the bank of any inquiries
regarding securities related problems. You can use Q-TRAK to route your
inquiries directly to your Custody Administrative Team. Q-TRAK allows
for prioritization of each inquiry and response, and permits you to
monitor progress on each item as it is being researched. Many of the
Bank's clients have found Q-TRAK to be an excellent tool in achieving
timely resolutions to their questions.
<PAGE>
General Servicing
- -----------------
Prompt notification of corporate actions.
Corporate literature directly forwarded upon receipt.
Proxies for securities held in our nominee are executed and forwarded
to the Fund for voting.
Payment of your authorized corporate expenses.
<PAGE>
SCHEDULE IV
-----------
OVERDRAFT RATE
Amendment to the
CUSTODY AGREEMENT
THIS AMENDMENT is made as of September 1, 1999, to the Custody
Agreement dated as of October 19, 1998 (the "Agreement"), by and between The
Bank of New York ("Custodian") and Nations Fund, Inc. (the "Company"), on behalf
of its respective portfolios listed on Schedule I attached thereto.
RECITALS
WHEREAS, the parties hereto desire to amend certain schedules
underlying the provisions of the Agreement.
NOW THEREFORE, the Custodian and the Company agree that the Agreement
shall be amended as follows:
1. Pursuant to Paragraph 23 of the Agreement, the underlying Schedule III to the
Custody Agreement for the Company is revised. The revised Schedule III reflects
a modification in fees that the Company will pay for the Custodian's services as
they relate to securities of foreign issue. Specifically, Schedule III is
amended by the addition of the Global Fee Schedule attached hereto, which may be
amended from time to time by mutual consent of the parties hereto.
The terms and provisions of this Amendment shall be deemed a part of
the Agreement for all purposes. To the extent that any provisions of the
Amendment modify or are otherwise inconsistent with any provisions of the
Agreement, the terms of this Amendment shall control. In all other respects, the
Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized officers, as of the day and year first written
above.
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
-----------------------
Stephen E. Grunston
Vice President
NATIONS FUND, INC.
By: /s/ James E. Banks, Jr.
-----------------------
James E. Banks, Jr.
Assistant Secretary
Amendment to the
CUSTODY AGREEMENT
THIS AMENDMENT is made as of February 14, 2000, to the Custody
Agreement dated as of October 19, 1998 (the "Agreement"), by and between The
Bank of New York ("Custodian") and Nations Fund, Inc. (the "Company"), on behalf
of its respective portfolios listed on Schedule I attached thereto.
RECITALS
WHEREAS, the parties hereto desire to amend certain provisions of the
Agreement.
NOW THEREFORE, the Custodian and the Company agree that the Agreement
shall be amended as follows:
1. Paragraph 25 is hereby amended by deleting subsection (a) in its
entirety and inserting the following:
"(a) Custodian shall advance funds under this Agreement with
respect to any Fund which results in an overdraft because the moneys
held by Custodian in the separate account for such Fund shall be
insufficient to pay the total amount payable upon a purchase of
securities by such Fund, as set forth in an Officer's Certificate or
Oral or Written Instructions, or which results in an overdraft in the
separate account of such Fund for some other reason, or if the Company
is for any other reason indebted to Custodian, including any
indebtedness to The Bank of New York under the Company's Cash
Management and Related Services Agreement, (except a borrowing for
investment or for temporary or emergency purposes using securities as
collateral pursuant to a separate agreement and subject to the
provisions of Paragraph 25(b) hereof), such overdraft or indebtedness
shall be deemed to be a loan made by Custodian to the Company for such
Fund payable on demand and shall bear interest from the date incurred
at a rate per annum (based on a 360-day year for the actual number of
days involved) equal to the overdraft rate specified in Schedule III to
this Agreement. In addition, the Company hereby agrees that to the
extent of such overdraft or indebtedness, Custodian shall have a
continuing lien, security entitlement and security interest in and to
any property at any time held by it for the benefit of such Fund or in
which the Fund may have an interest which is then in Custodian's
possession or control or in possession or control of any third party
acting on Custodian's behalf. The Company authorizes Custodian, in its
sole discretion, at any time to charge any such overdraft or
indebtedness together with interest due thereon against any balance of
account standing to such Fund's credit on Custodian's books. In
addition, the Company hereby covenants that on each Business Day on
which either it intends to enter a Reverse Repurchase Agreement and/or
otherwise borrow from a third party, or which next succeeds a Business
Day on which at the close of business the Company had outstanding a
<PAGE>
Reverse Repurchase Agreement or such a borrowing, it shall prior to
1:00 p.m., New York City time, advise Custodian, in writing, of each
such borrowing, shall specify the Fund to which the same relates, and
shall not incur any indebtedness not so specified other than from
Custodian."
The terms and provisions of this Amendment shall be deemed a part of
the Agreement for all purposes. To the extent that any provisions of the
Amendment modify or are otherwise inconsistent with any provisions of the
Agreement, the terms of this Amendment shall control. In all other respects, the
Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized officers, as of the day and year first written
above.
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
-----------------------
Stephen E. Grunston
Vice President
NATIONS FUND, INC.
By: /s/ James E. Banks, Jr.
------------------------
James E. Banks, Jr.
Assistant Secretary
CO-ADMINISTRATION AGREEMENT
This CO-ADMINISTRATION AGREEMENT (the "Agreement") is made as of
December 1, 1998 by and among STEPHENS INC. ("Stephens"), NATIONSBANC ADVISORS,
INC. ("NBAI") and NATIONS FUND, INC. (the "Company").
WHEREAS, the Company is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Company desires to retain Stephens and NBAI to render
certain administrative services for the investment portfolios of the Company
listed on Schedule I (individually, a "Fund" and collectively, the "Funds"), and
Stephens and NBAI are willing to render such services.
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed among the parties hereto as follows:
1. Appointment.
(a) The Company hereby appoints Stephens to act as
Co-Administrator of the Funds and Stephens hereby accepts such appointment and
agrees to render such services and duties set forth in Paragraph 3, for the
compensation and on the terms herein provided. Absent written notification to
the contrary by the Company, NBAI or Stephens, each new investment portfolio
established in the future by the Company shall automatically become a "Fund" for
all purposes hereunder as if listed on Schedule I.
(b) The Company also hereby appoints NBAI to act as
Co-Administrator of the Funds, and NBAI hereby accepts such appointment and
agrees to render such services and duties set forth in Paragraph 4, for the
compensation and on the terms herein provided. Absent written notification to
the contrary by either the Company or NBAI, each new investment portfolio
established in the future by the Company shall automatically become a "Fund" for
all purposes hereunder as if listed on Schedule I.
2. Delivery of Documents. The Company has furnished Stephens and NBAI
with copies properly certified or authenticated of each of the following:
(a) The Company's most recent Post-Effective Amendment to its
Registration Statement on Form N-1A (the "Registration Statement") under the
Securities Act of 1933, as amended, and under the 1940 Act (File Nos. 33-4038
and 811-4614), as filed with the Securities and Exchange Commission (the "SEC")
relating to the Funds' shares (the "Shares");
(b) The Funds' most recent Prospectus(es); and
(c) The Funds' most recent Statement(s) of Additional Information.
1
<PAGE>
The Company will furnish Stephens and NBAI from time to time with
copies, properly certified or authenticated, of all amendments of or supplements
to the foregoing. Furthermore, the Company will provide Stephens and NBAI with
any other documents that Stephens and NBAI may reasonably request and will
notify Stephens and NBAI as soon as possible of any matter materially affecting
either Stephens' or NBAI's performance of its services under this Agreement.
3. Duties as Co-Administrator. Subject to the supervision and direction
of the Board of Directors of the Company, Stephens, as Co-Administrator, will
assist in supervising various aspects of the Company's administrative operations
and undertakes to perform the following specific services from and after the
effective date of this Agreement:
(a) Maintaining office facilities for the Company (which may be in
the offices of Stephens or a corporate affiliate);
(b) Furnishing clerical services, internal executive and
administrative services and stationery and office supplies in connection with
the foregoing;
(c) Assist in furnishing statistical and research data and data
processing services in connection with the foregoing;
(d) Furnishing corporate secretarial services, including assisting
in the coordination of the preparation and distribution of materials for Board
of Directors meetings;
(e) Providing the services of certain persons who may be appointed
as officers of the Company by the Company's Board of Directors;
(f) Assist in coordinating the provision of legal advice and
counsel to the Company with respect to regulatory matters, including monitoring
regulatory and legislative developments which may affect the Company and
assisting in the strategic response to such developments, counseling and
assisting the Company in routine regulatory examinations or investigations of
the Company, and working closely with outside counsel to the Company in
connection with any litigation in which the Company is involved;
(g) Assist in coordinating the preparation of reports to the
Company's shareholders of record and the SEC including, but not necessarily
limited to, Annual Reports and Semi-Annual Reports to Shareholders and on Form
N-SAR and Notices pursuant to Rule 24f-2 under the 1940 Act;
(h) Coordinating with the Company regarding the jurisdictions in
which the Shares shall be registered or qualified for sale and, in connection
therewith, being responsible for the registration or qualification and the
maintenance of such registration or qualification of Shares for sale under the
securities laws of any state. Payment of share registration fees and any fees
for qualifying or continuing the qualification of the Company or any Fund as a
2
<PAGE>
dealer or broker shall be made or reimbursed by the Company or that Fund,
respectively;
(i) Assisting in the preparation and filing on a timely basis of
various reports, registration statements and post-effective amendments thereto,
and other documents required by federal, state and other applicable laws and
regulations, other than those filed or required to be filed by NBAI or the
Funds' Sub-Advisers, Transfer Agent, Sub-Transfer Agent or Custodian;
(j) Performing certain compliance procedures for the Company which
will include, among other matters, monitoring compliance with personal trading
guidelines by the Company's Board of Directors; and
(k) Generally assisting in all aspects of the Company's
operations.
In performing all services under this Agreement, Stephens shall (i) act
in conformity with: the Company's Articles of Incorporation and Bylaws, the 1940
Act and the rules thereunder, and other applicable laws and regulations, as the
same may be amended from time to time, and the Company's Registration Statement,
as such Registration Statement may be amended from time to time; (ii) consult
and coordinate with the Company, as necessary and appropriate; and (iii) advise
and report to the Company, as necessary or appropriate, with respect to any
compliance matters that come to its attention.
Stephens represents and warrants to the Company that it will use
reasonable efforts to perform its duties and obligations under this Agreement
without: (a) any failure of its computer systems, or those used by it in the
performance of its duties hereunder, to properly record, store, process,
calculate or present calendar dates falling on and after, and time spans
including, January 1, 2000 as a result of the occurrence of, or use of data
containing, such date; (b) any failure of its computer systems, or those used by
it in the performance of its duties hereunder, to calculate any information
dependent on or relating to dates on or after January 1, 2000; or (c) any loss
of functionality or performance with respect to the maintenance of records or
processing of data containing dates falling on or after January 1, 2000 ((a),
(b), and (c) above shall be referred to as "Y2K Failures"). Notwithstanding the
above, Stephens shall not be liable for any Y2K Failures caused by Y2K Failures
in a third party system with which Stephens interfaces or from which Stephens
receives data in connection with the performance of its duties hereunder.
In performing its services under this Agreement, Stephens shall
cooperate and coordinate with NBAI as necessary and appropriate and shall
provide such information as is reasonably necessary or appropriate for NBAI to
perform its responsibilities to the Company.
4. Duties as Co-Administrator. Subject to the supervision and direction
of the Board of Directors of the Company, NBAI, as Co-Administrator, will assist
in supervising various aspects of the Company's administrative operations and
3
<PAGE>
undertakes to perform the following specific services, from and after the
effective date of this Agreement:
(a) providing accounting and bookkeeping services (including the
maintenance for the periods prescribed by Rule 31a-2 under the 1940 Act of such
accounts, books and records of the Company as may be required by Section 31(a)
of the 1940 Act and the rules thereunder). NBAI further agrees that all such
records which it maintains for the Company are the property of the Company and
further agrees to surrender promptly to the Company any of such records upon the
Company's request;
(b) valuing each Fund's assets and calculating the net asset value
and the net income of the shares of each Fund in accordance with the Company's
current Prospectus(es), applicable pricing procedures and resolutions of the
Company's Board of Directors, provided, that in performing such services, NBAI
shall obtain security market quotes from independent pricing services, or if
such quotes are unavailable, obtain such prices from the Funds' Sub-Advisers;
(c) accumulating information for reports to the Company's
shareholders of record and the SEC including, but not necessarily limited to,
Annual Reports and Semi-Annual Reports to Shareholders and on Form N-SAR and
Notices pursuant to Rule 24f-2 under the 1940 Act;
(d) preparing and filing on a timely basis the Company's tax
returns and other tax filings;
(e) monitoring the development and implementation of certain
compliance procedures for the Company including, but not limited to, monitoring
(i) each Fund's status as a regulated investment company under Sub-Chapter M of
the Internal Revenue Code of 1986, as amended, including performing, on a
monthly basis and based upon information provided by the Fund's Sub-Advisers,
the 90% gross income and asset diversification tests derived from such
Sub-Chapter; and (ii) compliance by each Fund with its investment objective,
policies and restrictions, and applicable laws and regulations;
(f) preparing and furnishing to the Company monthly broker
security transaction summaries and monthly security transaction listings and (at
the Company's request) performance information (including yield and total return
information) calculated in accordance with applicable U.S. securities laws and
reporting to external databases such information as may reasonably be requested;
(g) assisting the Company and its agents in their accumulation and
preparation of materials for the Board of Directors' meetings and for regulatory
examinations and inspections of the Company, to the extent such materials relate
to the services being performed for the Company by NBAI; and
(h) coordinate the provision of services to the Company by other
service providers to the Company, including the transfer agent, sub-transfer
agent and custodian.
4
<PAGE>
In performing all services under this Agreement, NBAI shall (i) act in
conformity with the Company's Articles of Incorporation and Bylaws; the 1940 Act
and the rules thereunder, and other applicable laws and regulations, as the same
may be amended from time to time; and the Company's Registration Statement, as
such Registration Statement may be amended from time to time, (ii) consult and
coordinate with the Company, as necessary and appropriate, and (iii) advise and
report to the Company, as necessary or appropriate, with respect to any
compliance matters that come to its attention.
NBAI represents and warrants to the Company that it will use reasonable
efforts to perform its duties and obligations under this Agreement without: (a)
any failure of its computer systems to properly record, store, process,
calculate or present calendar dates falling on and after, and time spans
including, January 1, 2000 as a result of the occurrence of, or use of data
containing, such date; (b) any failure of its computer systems to calculate any
information dependent on or relating to dates on or after January 1, 2000; or
(c) any loss of functionality or performance with respect to the maintenance of
records or processing of data containing dates falling on or after January 1,
2000 ((a), (b), and (c) above shall be referred to as "Y2K Failures").
Notwithstanding the above, NBAI shall not be liable for any Y2K Failures caused
by Y2K Failures in a third party system with which NBAI interfaces or from which
NBAI receives data in connection with the performance of its duties hereunder
including, without limitation, the system of any sub-administrator engaged
pursuant to Paragraph 4.
In connection with its duties under this Paragraph 4, it is understood
and agreed that NBAI may, at its own expense, enter into sub-administration
agreements with other service providers and the Fund(s), provided that each such
service provider agrees with NBAI and the Fund(s) to comply with all relevant
provisions of the 1940 Act and applicable rules and regulations thereunder. In
addition, upon notice to the Board of Directors of the Company, the parties
agree that NBAI may from time to time assume some or all of Stephens' duties set
forth in Paragraph 3 above.
In performing its responsibilities under this Agreement, NBAI shall
cooperate and coordinate with Stephens as necessary and appropriate and shall
provide such information within its possession or control as is reasonably
necessary or appropriate to Stephens to enable it to perform its
responsibilities to the Company.
5. Compensation.
(a) Stephens shall bear all expenses in connection with the
performance of its services under this Agreement, except those enumerated in
Paragraph 5(a)(2) below.
(1) Stephens will from time to time employ or associate with such
person or persons as Stephens may believe to be particularly suited to assist it
in performing services under this Agreement. Such person or persons may be
officers and employees of both Stephens and the Company. The compensation of
such person or persons shall be paid by Stephens and no obligation shall be
incurred on behalf of the Company or NBAI in such respect.
5
<PAGE>
(2) Stephens shall not be required to pay any of the following
expenses incurred by the Company: investment advisory expenses; costs of
printing and mailing stock certificates, prospectuses, reports and notices;
interest on borrowed money; brokerage fees and commissions; taxes and fees
payable to federal, state and other governmental agencies; fees of Directors of
the Company who are not affiliated with Stephens; outside auditing expenses;
outside legal expenses; fees of any other service provider to the Company; or
other expenses not specified in this Section 5(a) which may be properly payable
by the Company and which are approved by the Company's President or Treasurer.
(3) The Company will compensate Stephens for its services
rendered pursuant to this Agreement in accordance with Schedule A. In addition,
the Company shall reimburse Stephens for certain reasonable out-of pocket
distributions made in connection with fulfilling its obligations under the
Agreement. The items eligible for reimbursement are set forth on Schedule A.
(b) NBAI shall bear all expenses in connection with the
performance of its services under this Agreement, except those enumerated in
5(b)(2) below.
(1) NBAI will from time to time employ or associate with such
person or persons as NBAI may believe to be particularly suited to assist it in
performing services under this Agreement. Such person or persons may be officers
and employees of both NBAI and the Company. The compensation of such person or
persons shall be paid by NBAI and no obligation shall be incurred on behalf of
the Company or Stephens in such respect.
(2) NBAI shall not be required to pay any of the following
expenses incurred by the Company: investment advisory expenses; costs of
printing and mailing stock certificates, prospectuses, reports and notices;
interest on borrowed money; brokerage fees and commissions; taxes and fees
payable to federal, state and other governmental agencies; fees of Directors of
the Company who are not affiliated with NBAI; outside auditing expenses; outside
legal expenses; fees of independent pricing services utilized by NBAI to value
each Fund's assets; fees of any other service provider to the Company (other
than a sub-administrator engaged pursuant to Paragraph 4); or other expenses not
specified in this Section 5(b) which may be properly payable by the Company and
which are approved by the Company's President or Treasurer.
(3) The Company will compensate NBAI for its services rendered
pursuant to this Agreement in accordance with Schedule A. In addition, the
Company shall reimburse NBAI for certain reasonable out-of pocket distributions
made in connection with fulfilling its obligations under the Agreement. The
items eligible for reimbursement are set forth on Schedule A.
6. Limitation of Liability; Indemnification.
(a) Stephens shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Company in connection with the
performance of its obligations and duties under this Agreement, except a loss
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resulting from Stephens' willful misfeasance, bad faith or gross negligence in
the performance of such obligations and duties, or by reason of its reckless
disregard thereof.
(b) NBAI shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Company in connection with the
performance of its obligations and duties under this Agreement, except a loss
resulting from NBAI's willful misfeasance, bad faith or gross negligence in the
performance of such obligations and duties, or by reason of its reckless
disregard thereof.
(c) The Company, on behalf of each Fund, will indemnify Stephens
and/or NBAI against and hold each harmless from any and all losses, claims,
damages, liabilities or expenses (including reasonable counsel fees and
expenses) resulting from any claim, demand, action or suit relating to the
particular Fund and not resulting from the willful misfeasance, bad faith or
gross negligence of Stephens and/or NBAI in the performance of such obligations
and duties or by reason of their reckless disregard thereof. Stephens and/or
NBAI will not confess any claim or settle or make any compromise in any instance
in which the Company will be asked to provide indemnification, except with the
Company's prior written consent. Any amounts payable by the Company under this
Section 6(c) shall be satisfied only against the assets of the Fund involved in
the claim, demand, action or suit and not against the assets of any other
investment portfolio of the Company.
7. Effective Date; Termination of Agreement.
(a) This Agreement shall become effective, on a Fund by Fund
basis, upon the completion of the transfer of a Fund's accounting function to
The Bank of New York, notice of which shall be provided by the Company to
Stephens and NBAI for each Fund. This Agreement shall remain in full force and
effect with respect to such Fund(s) unless terminated pursuant to the provisions
of Section 7(c).
(b) The parties agree that the administration arrangements between
Stephens and the Company, dated September 1, 1993, and the sub-administration
arrangements between Stephens and NBAI, dated November 18, 1997, with respect to
the Funds shall be terminated on a Fund by Fund basis upon the effectiveness of
this Agreement.
(c) This Agreement may be terminated at any time without payment
of any penalty, upon 60 days' written notice, by vote of the Board of Directors
of the Company, by Stephens or by NBAI. Stephens and NBAI will each cooperate
with and assist the Company, its agents and any successor administrator or
administrators in the substitution/conversion process.
(d) Sections 6 and 9 shall survive this Agreement's termination.
8. Amendments. No provision of this Agreement may be changed,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, discharge or termination is
sought.
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9. Confidentiality. All books, records, information and data pertaining
to the business of the Company, its prior, present or potential shareholders and
NBAI's customers that are exchanged or received pursuant to the performance of
Stephens' and/or NBAI's duties under this Agreement shall remain confidential
and shall not be disclosed to any other person, except as specifically
authorized by the Company or as may be required by law, and shall not be used
for any purpose other than performance of NBAI's and Stephens' responsibilities
and duties hereunder.
10. Service to Other Companies or Accounts. The Company acknowledges
that both Stephens and NBAI now act, will continue to act and may act in the
future as investment adviser to fiduciary and other managed accounts, and as
investment adviser, investment sub-adviser and/or administrator to other
investment companies or series of investment companies, and the Company has no
objection to either Stephens or NBAI so acting. The Company further acknowledges
that the persons employed by both Stephens and NBAI to assist in the performance
of their duties under this Agreement may not devote their full time to such
service and nothing contained in this Agreement shall be deemed to limit or
restrict the right of Stephens or NBAI or any affiliate of either to engage in
and devote time and attention to other businesses or to render services of
whatever kind or nature.
11. Miscellaneous.
(a) Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Company, Stephens or NBAI shall be
sufficiently given if addressed to that party and received by it at its office
set forth below or at such other place as it may from time to time designate in
writing.
To the Company:
Nations Fund, Inc.
111 Center Street, Suite 3000
Little Rock, Arkansas 72201
Attention: Secretary
To Stephens:
Stephens Inc.
111 Center Street, Suite 3000
Little Rock, Arkansas 72201
Attention: Richard H. Blank, Jr.
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To NBAI:
NationsBanc Advisors, Inc.
One Bank of America Plaza
33rd Floor
Charlotte, NC 28255
Attention: Edward D. Bedard
(b) This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable without the written consent of the
other parties.
(c) This Agreement shall be construed in accordance with the laws
of the State of Maryland.
(d) This Agreement may be executed in any number of counterparts
each of which shall be deemed to be an original and which collectively shall be
deemed to constitute only one instrument.
(e) The captions of this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect.
(f) This Agreement constitutes the entire agreement between the
parties hereto with respect to the matters described herein.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly executed and delivered by their duly authorized officers as of the date
first written above.
STEPHENS INC.
By: /s/ Richard H. Blank, Jr.
-----------------------------------
Name: Richard H. Blank, Jr.
Title: Senior Vice President
NATIONSBANC ADVISORS, INC.
By: /s/ Edward D. Bedard
-----------------------------------
Name: Edward D. Bedard
Title: Senior Vice President and
Chief Operating Officer
NATIONS FUND, INC.
By /s/ James E. Banks, Jr.
-----------------------------------
Name: James E. Banks, Jr.
Title: Assistant Secretary
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SCHEDULE I
1. Nations Prime Fund
2. Nations Treasury Fund
3. Nations Equity Income Fund
4. Nations Small Company Growth Fund
5. Nations Government Securities Fund
6. Nations U.S. Government Bond Fund
7. Nations International Growth Fund
Last Amended: August 19, 1999
IN WITNESS WHEREOF, the parties hereto have caused this amended
Schedule I to be executed by their duly authorized officers designated below as
of the 19th day of August, 1999.
STEPHENS INC.
By: /s/ Richard H. Blank, Jr.
----------------------------
Name: Richard H. Blank, Jr.
Title: Senior Vice President
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
----------------------------
Name: Robert H. Gordon
Title: President
NATIONS FUND, INC.
By: /s/ James E. Banks, Jr.
----------------------------
Name: James E. Banks, Jr.
Title: Assistant Secretary
I-1
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SCHEDULE A
For services rendered pursuant to this Agreement, the Company will pay
Stephens and NBAI, in the aggregate, an administration fee, computed daily and
payable monthly, based on annual rate of each Fund's daily net assets as
follows:
1. Money Market Funds: 0.10%
2. Fixed Income Funds: 0.22%
3. International Funds: 0.22%
4. Domestic Equity Funds: 0.23%
It is understood and agreed among the parties that the aggregate
administration fee payable hereunder shall be divided by and between Stephens
and NBAI, as they may agree from time to time.
In addition to the asset-based fee set forth above, the Company shall
reimburse Stephens, NBAI and any sub-administrator engaged pursuant to Paragraph
4 for certain reasonable out-of-pocket expenses incurred by them in connection
with the performance of their respective duties hereunder. Reimbursable
out-of-pocket expenses shall include the following: reasonable costs associated
with postage (including overnight services), telephone, telecommunications
(including facsimiles), duplicating, pricing services, and forms and supplies.
A-1
SUB-ADMINISTRATION AGREEMENT
This SUB-ADMINISTRATION AGREEMENT (the "Agreement") is made as of
December 1, 1998 by and among THE BANK OF NEW YORK ("BNY"), NATIONSBANC
ADVISORS, INC. ("NBAI") and NATIONS FUND, INC. (the "Company").
WHEREAS, the Company is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, NBAI serves as the Co-Administrator for the investment
portfolios of the Company pursuant to a separate Co-Administration Agreement;
and
WHEREAS, NBAI desires to retain BNY to render certain
sub-administrative services to the Company and to NBAI, as Co-Administrator of
the Company, and BNY is willing to render such services.
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed among the parties hereto as follows:
1. Appointment and Duties as Sub-Administrator.
(a) NBAI hereby appoints BNY to act as Sub-Administrator of the Company
and to render sub-administrative services for each portfolio of the Company
listed on Schedule I (individually, a "Fund" and collectively, the "Funds") and
BNY hereby accepts such appointment and agrees to render the services and duties
set forth in Schedule II as it may be amended from time to time, for the
compensation and on the terms herein provided. Each new investment portfolio
established in the future by the Company or NBAI will become a "Fund" for all
purposes hereunder when BNY receives a revised Schedule I from NBAI or the
Company that includes such new portfolio.
(b) Subject to the other provisions of this Section 1, in performing
all services under this Agreement, BNY shall (i) act in conformity with the
Company's Articles of Incorporation and Bylaws (the "Bylaws"), the 1940 Act and
the rules thereunder, including but not limited to Rules 31a-1 to 31a-3, and
other applicable laws and regulations, as the same may be amended from time to
time, and the Company's Registration Statement, as such Registration Statement
may be amended from time to time; (ii) consult and coordinate with NBAI and the
Company, as necessary and appropriate; and (iii) advise and report to NBAI and
the Company, as necessary or appropriate, with respect to any compliance matters
that come to its attention. In performing all services under this Agreement BNY
shall meet the minimum quality of service standards set forth on Schedule III.
(c) The Company has furnished BNY and NBAI with copies properly
certified or authenticated of each of the following: (i) the Company's Articles
of Incorporation or other organizational document and all amendments thereto
(the "Charter"); (ii) the Company's Bylaws; (iii) resolutions of the Company's
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Board of Directors or other governing body (the "Board") authorizing the
execution, delivery and performance of this Agreement by the Company; (iv) the
Company's most recent Post-Effective Amendment to its Registration Statement on
Form N-1A (the "Registration Statement") under the Securities Act of 1933, as
amended, and under the 1940 Act (File Nos. 33-4038 and 811-4614), as filed with
the Securities and Exchange Commission (the "SEC") relating to the Funds' shares
(the "Shares"); (iv) the Funds' current Prospectus(es); (v) the Funds' current
Statement(s) of Additional Information; and (vi) the pricing procedures
applicable to the calculation of the Funds' net asset values as approved by the
Company's Board (the "Pricing Procedures"). It is solely the Company's
responsibility to furnish BNY from time to time with copies, properly certified
or authenticated, of all amendments of or supplements to the foregoing, and BNY
will not be held to have knowledge of any such amendments or supplements until
the same are actually received by BNY. Furthermore, the Company will provide BNY
with any other documents that BNY and NBAI may reasonably request and will
notify BNY and NBAI as soon as possible of any matter materially affecting
either BNY's or NBAI's performance of its services under this Agreement.
(d)(i) BNY undertakes to report on a regular basis to NBAI and the
Company regarding: (A) the readiness of its computer systems, or those used by
it in the performance of its duties hereunder, properly to record, store,
process, calculate or present calendar dates falling on and after, and time
spans including, September 9, 1999, January 1, 2000 or February 29, 2000 (the
"Subject Dates") as a result of the occurrence, or use of data containing any
such Subject Dates; (B) the readiness of its computer systems or those used by
it in the performance of its duties hereunder, to calculate any information
dependent on or relating to dates on or after the Subject Dates; and (C) its
ability to perform the administration and fund accounting services set forth in
Schedule II (the "Services") in accordance with any applicable performance
standards set forth in Schedule III (the "Standards") with respect to the
maintenance of records or processing of data containing dates falling on or
after the Subject Dates, provided that, with respect to computers used but not
owned by BNY and third-party computer systems other than InvestOne, BNY's
responsibility shall be limited to seeking similar reports from such owners or
third parties and promptly forwarding such reports to NBAI. Without limiting the
foregoing, BNY undertakes to notify NBAI and the Company, in writing, of any
concerns believed by BNY to be material regarding the events described in this
paragraph, provided that, with respect to computers owned by others and
third-party computer systems other than InvestOne, BNY's responsibility shall be
limited to seeking similar notice from such owners or third parties and promptly
forwarding such notifications to NBAI.
(ii) NBAI or the Company shall have the right to terminate this
Agreement if there is a "material failure" by BNY to perform any of the Services
in accordance with the Standards due to a failure by computers owned or used by
BNY in performing its duties hereunder to properly process the occurrence of the
Subject Dates or data containing the Subject Dates. As used in this Section
1(d), the term "material failure" shall be limited to a failure to provide any
of the Services in accordance with the Standards, provided that no such failure
shall be deemed a "material failure" if such failure occurs at or about the time
other major financial institutions similar to BNY providing similar services in
a similar volume to investment companies similar to the Company are experiencing
similar failures, and, provided further, that no failure by BNY shall be or be
2
<PAGE>
deemed a "material failure" if BNY substantially provides the Services under a
contingency plan, it being agreed that, to the extent that the parties mutually
agree, the time frames and deadlines set forth in Schedule III of this Agreement
and elsewhere shall not be considered in determining whether BNY is
substantially providing the Services in accordance with the Standards. NBAI and
the Company agree to act reasonably and in good faith in considering any request
by BNY to extend time frames and deadlines.
(iii) In the event there is a "material failure" by BNY to provide the
Services and such "material failure" is not cured by BNY within 10 days after
such material failure arises, NBAI or the Company shall have the right to
terminate this Agreement upon the giving of 60 days written notice to BNY. BNY
shall, notwithstanding any other provision contained in this Agreement, have no
liability to the Company or NBAI under this Agreement if such "material failure"
initially arose out of or was caused by a failure of a computer used but not
owned by BNY or owned by a third party (other than InvestOne) to properly
process the Subject Dates or data containing the Subject Dates, and BNY shall be
entitled to any compensation and reimbursement for out-of-pocket expense as may
then be due and payable, as well as agreed-upon out-of-pocket expenses incurred
in connection with such a termination. If such a termination is the result of a
"material failure" initially arising out of, or caused by a failure of computers
owned by BNY or a failure by InvestOne, then, first, BNY's liability hereunder
for such failure shall, notwithstanding any other provision contained in this
Agreement to the contrary, be limited to the lesser of (x) the fees paid to a
successor service provider during the six months next succeeding the date of
termination to the extent such fees exceed the fees that would have been paid to
BNY hereunder, and (y) $1,000,000; and second, BNY shall not be entitled to
out-of-pocket expenses incurred in connection with such a termination.
(iv) In the event of conflict between this Section 1(d) and any other
provision contained in this Agreement, this Section 1(d) shall control.
(v) NBAI and the Company each agree to hold all of the provisions of
this Section 1(d) in strict confidence and not to disclose, nor permit
disclosure of, such provisions.
(e) Subject to the direction and approval of the Company's Board and
appropriate officers and the provisions of this Agreement, BNY shall provide to
each Fund the administrative services set forth on Schedule II attached hereto.
In performing such services hereunder, BNY shall provide, at its expense, office
space, facilities, equipment and personnel. BNY shall not provide any services
relating to the management, investment advisory or sub-advisory functions of any
Fund, distribution of shares of any Fund, maintenance of any Fund's financial
records (except as otherwise agreed by the parties) or any services normally
performed by the Funds' counsel or independent accountants. Upon receipt of the
Company's prior written consent, BNY may delegate any of its duties and
obligations hereunder to any delegee or agent whenever and on such terms and
conditions as it deems necessary or appropriate. Unless expressly agreed in
writing, BNY shall not be relieved of liability or responsibility for the
performance of any duties or obligations delegated to a delegee or agent,
provided that BNY shall have no liability for duties or obligations that are
delegated to a delegee or agent at the instruction of the Company or NBAI. The
Company and NBAI shall cause their respective officers, and shall use reasonable
efforts to cause the Company's or NBAI's legal counsel, independent accountants,
3
<PAGE>
and transfer agent to cooperate with BNY and to provide BNY, upon BNY's
reasonable written request, such information, documents and advice relating to
such Fund as is within the possession or knowledge of such persons, in order to
enable BNY to perform its duties hereunder. Such cooperation or provision of
information, documents or advice shall be at no cost to BNY, provided BNY's
request is reasonable and NBAI shall have been notified of the request. In
connection with its duties hereunder, BNY shall be entitled to reasonably rely
upon any documents relating to a Fund provided to BNY by any of the
aforementioned persons. BNY may apply to the Company or NBAI for written
instructions with respect to any matter arising in connection with BNY's
performance hereunder. If, after a reasonable period of time, BNY receives no
response to any such application, BNY may then notify the Company or NBAI of
reasonable action that BNY shall take if written instructions are not received
within a stated period of time after such notice, and then BNY shall not be
liable for taking such reasonable action as if written instructions had been
provided. BNY is entitled to reasonably rely and act in accordance with written
instructions believed to have been given by authorized persons and shall incur
no costs for such reasonable reliance. BNY shall have no duties or
responsibilities whatsoever except such duties and responsibilities as are
specifically set forth in this Agreement and Schedule II hereto, and no covenant
or obligation shall be implied against BNY in connection with this Agreement.
(f) The Company and NBAI, for itself and not for the others, hereby
represents and warrants to the BNY, which representations and warranties shall
be deemed to be continuing, that: (i) it is duly organized and existing under
the laws of the jurisdiction of its organization, with full power to carry on
its business as now conducted, to enter into this Agreement and to perform its
obligations hereunder; (ii) this Agreement has been duly authorized, executed
and delivered by it in accordance with all requisite action and constitutes a
valid and legally binding obligation, enforceable in accordance with its terms;
(iii) it is conducting its business substantially in compliance with all
applicable laws and regulations, both state and federal, and has obtained all
regulatory licenses, approvals and consents necessary to carry on its business
as now conducted; (iv) there is no statute, regulation, rule, order or judgment
binding on it and no provision of its Charter or Bylaws, nor of any mortgage,
indenture, credit agreement or other contract binding on it or affecting its
property which would prohibit its execution or performance of this Agreement;
and (v) the Company and NBAI will use reasonable efforts to promptly notify BNY
of any errors or omissions contained in any reports, calculations, valuations
and other items of information, provided that any failure by the Company or NBAI
to detect any such errors or omissions shall not relieve BNY of any resulting
liability therefrom. To the extent that NBAI has actual knowledge of any such
error or omission and fails to use reasonable efforts to promptly notify BNY,
BNY shall be relieved of any liability that BNY may have mitigated had NBAI
provided notice of such error or omission to BNY.
(g) BNY hereby represents and warrants to the Company and NBAI, which
representations and warranties shall be deemed to be continuing, that: (i) it is
duly organized and existing under the laws of the jurisdiction of its
organization, with full power to carry on its business as now conducted, to
enter into this Agreement and to perform its obligations hereunder; (ii) this
Agreement has been duly authorized, executed and delivered by it in accordance
with all requisite action and constitutes a valid and legally binding
obligation, enforceable in accordance with its terms; and (iii) it is conducting
its business substantially in compliance with all applicable laws and
regulations, both state and federal, and has obtained all regulatory licenses,
approvals and consents necessary to carry on its business as now conducted;
there is no statute, regulation, rule, order or judgment binding on it and no
provision of its Charter or Bylaws, nor of any mortgage, indenture, credit
agreement or other contract binding on it or affecting its property which would
prohibit its execution or performance of this Agreement.
4
<PAGE>
2. Compensation. For the services to be rendered, the facilities to be
furnished and the compensation and other expenses to be borne by BNY, as
provided for in this Agreement, BNY shall be entitled to receive a monthly fee
from NBAI and reimbursement for out-of-pocket expenses as set forth in Schedule
IV to this Agreement. It is understood that NBAI shall be responsible for BNY's
monthly fee for its services hereunder, and BNY agrees that it shall have no
claim against the Company or the Funds with respect to compensation under this
Agreement.
3. Recordkeeping. BNY shall, as agent for the Company, and subject to
the direction and approval of the Company's Board and the provisions of this
Agreement, maintain and keep current the books, accounts and other documents, if
any, pursuant to the services and duties provided by BNY as set forth in
Schedule II of this Agreement, and preserve any such books, accounts and other
documents in accordance with the applicable provisions of Rule 31a-2 of the 1940
Act. Such books, accounts and other documents shall be made available upon
reasonable request for inspection by officers, employees and auditors of the
Company and NBAI during BNY's normal business hours. All records maintained and
preserved by BNY pursuant to this Agreement which the Company is required to
maintain and preserve in accordance with Rule 31a-2 of the 1940 Act shall be and
remain the property of the Company and shall be surrendered to the Company
promptly upon request in the form in which such records have been maintained and
preserved. Upon reasonable request of the Company, BNY shall provide in data
files or hard copy, whichever the Company shall reasonably elect, any records
included in any such delivery which are maintained by BNY on a computer disc, or
are similarly maintained, and the Company shall reimburse BNY for its expenses
of providing such hard copy.
4. Standard of Care; Indemnification.
(a) BNY shall at all times act in good faith and agrees to use its best
efforts to fulfill its obligations under this Agreement, but assumes no
responsibility for loss or damage to the Company unless such loss or damages is
caused by BNY's own negligence, bad faith or willful misconduct or that of its
directors, officers or employees. BNY shall be responsible hereunder for all
direct damages resulting from its own negligence, bad faith or willful
misconduct, provided however that it shall not be responsible for lost profits
or lost business arising under or in connection with this Agreement. It is
understood and agreed that for purposes of this Section 4(a), "direct damages"
shall include, but shall not be limited to, all legal costs, penalties,
reimbursement for excess distribution and redemption payments, repurchasing
costs for servicing agents and reimbursement to the Funds for net asset value
breaks (as calculated under the Pricing Procedures).
(b) The Company, on behalf of each Fund, will indemnify BNY against and
hold it harmless from any and all losses, claims, damages, liabilities or
expenses (including reasonable counsel fees and expenses of a defense against
any claim, demand, action or suit), relating to the particular Fund and arising
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from any one or more of the following: (i) errors in records or instructions,
explanations, information, specifications or documentation of any kind, as the
case may be, supplied to BNY by any person described in Section 1 hereof or by
any third party described in Section 5; (ii) action or inaction taken or omitted
to be taken by BNY pursuant to written or oral instructions described in this
Agreement (or otherwise without bad faith, negligence or willful misconduct);
(iii) any action taken or omitted to be taken by BNY in good faith in accordance
with the advice or opinion of counsel for a Fund, the Company, NBAI (obtained in
accordance with the procedures set forth in this Agreement) or its own counsel;
(iv) any improper use by the Fund, the Company, NBAI or their respective agents,
of any valuations or computations supplied by BNY pursuant to this Agreement;
(v) the method of valuation of the securities and the method of computing a
Fund's net asset value or any other amount computed by BNY hereunder, provided
BNY has followed the Pricing Procedures; and (vi) any valuation of securities,
net asset value or other amount provided by a Fund or NBAI. BNY will not confess
any claim or settle or make any compromise in any instance in which the Company
will be asked to provide indemnification, except with the Company's prior
written consent. Any amounts payable by the Company under this Section 4(b)
shall be satisfied only against the assets of the Fund involved in the claim,
demand, action or suit and not against the assets of any other investment
portfolio of the Company.
5. Fund Accounting Services.
(a) BNY, in performing the services required of it under the terms of
this Agreement, shall be entitled to rely fully on the accuracy and validity of
any and all instructions, explanations, information, specifications and
documentation furnished to it by a Fund and shall have no duty or obligation to
review the accuracy, validity or propriety of such instructions, explanations,
information, specifications or documentation, including, without limitation,
evaluations of securities; the amounts or formula for calculating the amounts
and times of accrual of Fund's liabilities and expenses; the amounts receivable
and the amounts payable on the sale or purchase of securities; and amounts
receivable or amounts payable for the sale or redemption of Fund shares effected
by or on behalf of the Fund. In the event BNY's computations hereunder rely, in
whole or in part, upon information, including, without limitation, bid, offer or
market values of securities or other assets, or accruals of interest or earnings
thereon, from a pricing or similar service utilized, or subscribed to, by BNY
which BNY in its judgment deems reliable, or any other third party pricing
source designated by the Company, BNY shall not be responsible for, under any
duty to inquire into, or deemed to make any assurances with respect to, the
accuracy or completeness of such information. BNY shall not be required to
inquire into any valuation of securities or other assets by the Fund or any
third party described in this Section, even though BNY in performing services
similar to the services provided pursuant to this Agreement for others may
receive different valuations of the same or different securities of the same
issuers.
(b) Subject to the provisions of this Agreement and the direction and
approval of the Company's Board, BNY shall perform the computations described in
Schedule II at such times and dates and in the manner specified or described in
the then-current Prospectus(es) of a Fund. To the extent valuation of securities
or a computation specified or described in a Fund's Pricing Procedures or
then-current effective Prospectus is at any time inconsistent with any
applicable laws or regulations, the Company or NBAI shall immediately so notify
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BNY in writing and thereafter shall furnish BNY at all appropriate times with
the values of such securities and such Fund's net asset value or other amounts
otherwise to be calculated by BNY, or, subject to the prior approval of BNY,
instruct BNY in writing to value securities and make such computations in a
manner which the Company or NBAI then represents in writing to be consistent
with all applicable laws and regulations. The Company or NBAI may also from time
to time, subject to the prior approval of BNY, instruct BNY in writing to make
computations other than as specified in this Section of this Agreement. By
giving such instruction, the Company or NBAI shall be deemed to have represented
that such instruction is consistent with all applicable laws and regulations and
the then-current effective Prospectus of the particular Fund. The Company or
NBAI shall have sole responsibility for determining the method of valuation of
securities and the method of computations, and all computations, valuation of
securities and the method of computing each Fund's net asset value shall be
subject to approval by the Company and NBAI. BNY shall not be liable for relying
on any price provided by any pricing service believed by BNY to be reliable, and
the Company or NBAI shall furnish values when the same are not available from a
pricing service utilized by BNY, with such furnishing to constitute an
instruction to BNY to rely on the provided values.
(c) BNY shall be responsible for determining and properly reflecting in
the computations made by it made by it under this Agreement: (i) the taxable
nature of any distribution or amount received or deemed received by, or payable
to, a Fund; (ii) the taxable nature or effect on a Fund or its shareholders of
any corporate actions, class actions, tax reclaims, tax refunds, or similar
events; (iii) the taxable nature or taxable amount of any distribution or
dividend paid, payable or deemed paid, by a Fund to its shareholders; (iv) the
effect under any federal, state, or foreign income tax laws of a Fund making or
not making any distribution or dividend payment, or any election with respect
thereto; or (v) any tax accounting; provided, however, that if BNY is not
certain of the taxable nature, amount or effect of any such item, it may seek
instructions regarding the proper treatment of such item from the Company or
NBAI in accordance with the procedures set forth in Section 1(e), above, and
shall have no liability for acting in reliance on such instructions.
6. Termination of Agreement.
(a) This Agreement shall become effective as of the date first set
forth above and shall remain in full force and effect unless terminated pursuant
to the provisions of Section 6(b).
(b) This Agreement may be terminated at any time without payment of any
penalty, upon 60 days' written notice to BNY by NBAI or by vote of the Board of
the Company; or upon 180 days' written notice to NBAI and the Company by BNY.
Upon any such termination, BNY will cooperate with and assist the Company, NBAI,
their agents and any successor administrator(s) or sub-administrator(s) in the
substitution/conversion process. In connection with any termination of this
Agreement, unless BNY is in breach of this Agreement, the Funds and NBAI agree
to pay BNY any compensation and reimbursement for out-of-pocket expenses as may
then be due and payable, as well as agreed-upon out-of-pocket expenses incurred
in connection with a termination. If BNY is in breach of this Agreement, the
Funds and NBAI may offset any compensation or reimbursement amounts owed to BNY
by the amount of damages, costs and expenses incurred as a result of BNY's
7
<PAGE>
breach, including costs, expenses and reasonable incremental fees for a period
not to exceed one year incurred in connection with a conversion by the Company
and NBAI to a successor service provider. In the event of a dispute as to the
amount of such damages, the Funds and NBAI agree to escrow the set-off amount.
(c) Sections 4 and 8 shall survive this Agreement's termination.
7. Amendments. Except as expressly provided in the first paragraph of
Section 1, no provision of this Agreement may be amended or modified orally, but
only by an instrument in writing signed by the party against which enforcement
of the amendment or modification is sought.
8. Confidentiality. All books, records, information and data pertaining
to the business of the Company, or its prior, present or potential shareholders
that are exchanged or received in connection with the performance of BNY's
duties under this Agreement shall remain confidential and shall not be disclosed
to any other person, except as specifically authorized by the Company or as may
be required by law, and shall not be used for any purpose other than performance
of its responsibilities and duties hereunder, and except that BNY retains the
right to disclose matters subject to confidentiality to its examiners,
regulators, internal or external auditors, its accountants, its internal and
external counsel, and to any other entity whenever it is advised by its internal
or external counsel that it is reasonably likely that BNY would be liable for a
failure to do so. BNY will endeavor to provide written notice to the Company and
NBAI at least five business days prior to any disclosures pursuant to this
Section 8, but, provided it shall have provided as much notice as is reasonably
practicable under the circumstances, BNY shall have no liability for any failure
to do so.
9. Service to Other Companies. The Company and NBAI acknowledge that
BNY now provides, will continue to provide and may in the future provide
administrative or other services to other investment companies or series of
investment companies, and the Company and NBAI have no objection to BNY so
doing. The Company and NBAI further acknowledge that the persons employed by BNY
to assist in the performance of BNY's duties under this Agreement may not devote
their full time to such service and nothing contained in this Agreement shall be
deemed to limit or restrict the right of BNY or any affiliate of BNY to engage
in and devote time and attention to other businesses or to render services of
whatever kind or nature.
10. Conversion Schedule. If the Company and NBAI, in the exercise of
their reasonable judgment, cannot meet the conversion schedule set forth in
Schedule VI as a result of BNY's inability to provide, or to confirm that it is
capable of providing, the services described in Schedule II or to meet the
quality of service standards set forth in Schedule III with respect to one or
more Funds in accordance with the conversion schedule attached as Schedule VI,
then BNY shall be obligated to pay any resulting incremental costs incurred by
the Company or NBAI, including any incremental fees payable to First Data
Investors Services Group by the Company or NBAI.
11. Miscellaneous.
8
<PAGE>
(a) This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflict of laws principles thereof.
Each Fund, the Company and NBAI hereby consent to the jurisdiction of a state or
federal court situated in New York City, New York in connection with any dispute
arising hereunder. To the extent that in any such jurisdiction any of the
aforementioned persons may now or hereafter be entitled to claim, for itself or
its assets, immunity from suit, execution, attachment (before or after judgment)
or other legal process, each irrevocably agrees not to claim, and it hereby
waives, such immunity.
(b) In case any provision in or obligation under this Agreement shall
be invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations shall not in any
way be affected or impaired thereby, and if any provision is inapplicable to any
person or circumstances, it shall nevertheless remain applicable to all other
persons and circumstances.
(c) Each and every right granted to BNY, the Company or NBAI hereunder
or under any other document delivered hereunder or in connection herewith, or
allowed it by law or equity, shall be cumulative and may be exercised from time
to time. No failure on the part of BNY, the Company or NBAI to exercise, and no
delay in exercising, any right will operate as a waiver thereof, nor will any
single or partial exercise by BNY, the Company or NBAI of any right preclude any
other or future exercise thereof or the exercise of any other right.
(d) BNY shall not be responsible for delays or errors that occur by
reason of circumstances beyond its reasonable control in the performance of its
duties under this Agreement, provided that reasonable back-up and disaster
recovery systems are in place, including, without limitation, labor
difficulties, mechanical breakdowns, computer breakdowns or malfunctions
(hardware or software), flood or catastrophe, acts of God, failures of
transportation, communication or power supply, or other similar circumstances.
Nor shall BNY be responsible for delays or failures to supply the information or
services specified in this Agreement where such delays or failures are caused by
the failure of any person(s) other than BNY to supply any instructions,
explanations, information, specifications or documentation deemed necessary by
BNY in the performance of its duties under this Agreement.
(e) Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Company, BNY and/or NBAI shall be
sufficiently given if addressed to that party and received by it at its office
set forth below or at such other place as it may from time to time designate in
writing.
To the Company:
Nations Fund, Inc.
111 Center Street
Little Rock, Arkansas 72201
Attention: Richard H. Blank, Jr.
9
<PAGE>
To NBAI:
NationsBanc Advisors, Inc.
One Bank of America Plaza
101 South Tryon Street, NC1-002-33-31
Charlotte, NC 28255-0001
Attention: Edward D. Bedard
To BNY:
The Bank of New York
90 Washington Street
22nd Floor
New York, NY 10286
Attention: Stephen E. Grunston
(f) This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement may not be assigned by BNY, nor may BNY delegate
responsibility for the performance of any of its duties hereunder, without the
written consent of the other parties hereto.
(g) This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original and which collectively shall be
deemed to constitute only one instrument.
(h) The captions of this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect.
(i) This Agreement constitutes the entire agreement between the parties
hereto with respect to the provision by BNY of sub-administrative services and
the receipt of fees therefor, and supersedes all prior arrangements or
understandings, written or oral, with respect to the provision by BNY of such
services and the receipt of fees therefor.
10
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly executed and delivered by their duly authorized officers as of the date
first written above.
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
---------------------------------
Name: Stephen E. Grunston
Title: Vice President
NATIONSBANC ADVISORS, INC.
By: /s/ Edward D. Bedard
---------------------------------
Name: Edward D. Bedard
Title: Senior Vice President and
Chief Operating Officer
NATIONS FUND, INC.
By: /s/ James E. Banks, Jr.
---------------------------------
Name: James E. Banks, Jr.
Title: Assistant Secretary
11
<PAGE>
SCHEDULE I
1. Nations Prime Fund
2. Nations Treasury Fund
3. Nations Equity Income Fund
4. Nations Small Company Growth Fund
5. Nations Government Securities Fund
6. Nations U.S. Government Bond Fund
7. Nations International Growth Fund
Last Amended: August 19, 1999
IN WITNESS WHEREOF, the parties hereto have caused this amended
Schedule I to be duly executed and delivered by their duly authorized officers
designated below as of the 19th day of August, 1999.
THE BANK OF NEW YORK
By: /s/ Stephen E. Grunston
------------------------------
Name: Stephen E. Grunston
Title: Vice President
NATIONSBANC ADVISORS, INC.
By: /s/ Robert H. Gordon
------------------------------
Name: Robert H. Gordon
Title: President
NATIONS FUND, INC.
By: /s/ James E. Banks, Jr.
------------------------------
Name: James E. Banks, Jr.
Title: Assistant Secretary
I-1
<PAGE>
SCHEDULE II
FUND ADMINISTRATION SERVICES
BNY shall perform the following sub-administrative services, in
addition to any other services agreed to from time to time:
o Monitor and document compliance by the Funds with their policies and
restrictions as delineated in their Prospectuses and Statements of
Additional Information, including any supplements or amendments thereto,
and with the rules and regulations under the 1940 Act utilizing Charles
River Development's compliance monitoring system or by such other means as
the parties may agree. NBAI shall be responsible for communicating such
policies and restrictions, including any changes thereto, to BNY by such
means as the parties agree.
o Provide income attribution summary schedules necessary for year-end tax
reporting, including the attached examples. Provide a gross up for foreign
taxes on a per share basis and the redesignation of income and capital
gains on a per share basis.
o Prepare federal, state, excise and local income tax returns for the Funds
and file such returns upon the approval of the Funds' independent
accountants; monitor, report on and prepare periodic worksheet and tax
provision packages and minimum required distributions with respect to
Sub-Chapter M qualifications and excise tax requirements; prepare and file
all Form 1099s with respect to the Funds' Directors; monitor compliance
with Section 4982 of the Internal Revenue Code; calculate and maintain
records pertaining to original issue discount and premium amortization as
required; identify potential wash sales and all other book/tax differences,
and report results to the Funds' independent accountants and Funds
management; and such other duties relating to federal and/or state tax
compliance as the parties may agree. BNY shall be responsible for providing
all pertinent tax information to the Funds' independent accountants.
o Prepare Return of Capital Statement of Position 93-2 adjustments.
o Support NBAI in its preparation of the schedules and provide NBAI unaudited
quarterly and semi-annual and audited annual financial statements and
schedules of Fund investments by providing, without limitation, each Funds'
schedule of investments and general ledger in electronic format and/or hard
copy, as required, and such other information as may be necessary to
complete such financial reports.
o Prepare statistical reports for outside information services (referenced in
Schedule V), and such other information services as the parties may agree.
o Attend Fund shareholder and Board of Directors meetings as requested by
NBAI, including making such presentations as are appropriate, and, with
respect to the Fund administration services described herein, provide such
periodic and special reports to the Company and NBAI as the Company and
NBAI shall reasonably request.
II-1
<PAGE>
FUND ACCOUNTING SERVICES
BNY shall provide all accounting and recordkeeping services necessary
and appropriate for the business of the Funds, including but not limited to
those set forth below.
Required Records; Ledgers and Journals
BNY shall keep current the following accounts and records relating to
the business of the Funds, in such form as is required by the 1940 Act and the
rules thereunder and generally accepted accounting principles, to support all
filings under applicable federal and state tax laws and regulations and as may
be mutually agreed to among the Company, NBAI and BNY, and shall make available
to NBAI and/or the Company upon request:
1. Cash Receipts Journal
2. Cash Disbursements Journal
3. Dividends Paid and Payable Schedule (book vs. tax basis)
4. Purchase and Sales Journals - Portfolio Securities
5. Realized/Unrealized Gain (Loss) Reports
6. Subscription and Redemption Journals
7. Security Ledgers - Transaction Report and Tax Lot Holdings Report
8. Broker Ledger - Commission Report
9. Daily Expense Accruals
10. Daily Interest Accruals
11. Daily Trial Balance
12. Portfolio Interest Receivable and Income Journal
13. Portfolio Dividend Receivable and Income Register
14. Listing of Portfolio Holdings - showing cost, market value and
percentage of portfolio comprised of each security
15. Aged Receivables (dividends, interest, tax reclaiming)
16. Portfolio Turnover Rate
17. Cash reconciliations
18. Position reconciliations
BNY will be responsible for maintaining, in accordance with Section 31
and the rules thereunder of the 1940 Act, all books and records so required and
generated in the course of performing their duties under this agreement.
Further, at a minimum, BNY shall maintain on-site the above referenced reports
as of each month end for the most recent fiscal year-ended and the current
fiscal year.
II-2
<PAGE>
Daily Accounting Services
BNY shall perform the following services on each Business Day:
1. Calculate Net Asset Value (NAV), and Public Offering Price (POP) Per Share
Pursuant to SEC formulas:
o Update the valuation of security positions held by each Fund's
portfolio in accordance with the Fund's Pricing Procedures and any
other appropriate procedures established by the Board and NBAI as NBAI
shall provide BNY in writing
o When instructed by NBAI, enter manual prices supplied by broker and
link to pricing procedures
o Calculate each Fund's NAV/POP in accordance with the applicable Pricing
Procedures approved by the Company's Board of Directors and prepare NAV
proof sheet. Review components of change in NAV for reasonableness
based on the tolerance levels as NBAI shall direct BNY in writing
o Review variance reporting for price changes in individual securities
using variance levels established by Fund and report to Fund portfolio
managers and to NBAI
o Review for ex-dividend items indicated by pricing sources; trace to
general ledger for agreement
o Communicate required pricing and yield information (NAV/POP), as
appropriate, to NBAI, the Funds' Transfer Agent and Sub-Transfer Agent
and, electronically, to NASDAQ and to such other third parties as
designated by the Funds with respect to its various distribution
channels. In addition, provide Fund share activity to NBAI.
2. Dividend Rates/Yields/Dollar Weighted Average Maturity:
o Calculate, subject to the approval of NBAI, net investment income
available for distribution daily as appropriate
o Calculate daily dividend rate, and 1, 7, 30-day yields/SEC yields
o Calculate dollar weighted average maturity
3. Determine and Report Cash Availability:
o Receive daily cash and transaction statements from the Funds' Custodian
o Complete daily bank cash reconciliations (including documentation of
any reconciling items) and notify the Funds' Custodian
o Report investable cash to NBAI and Fund sub-advisers
4. Daily Expense Accruals:
o Accrue individual expenses on a daily basis based on Instructions
provided by NBAI, except for those instances where such an adjustment
would cause a full penny break in NAV, in which case such adjustment
will be included in the calculation of NAV on the day received
o If applicable, accrue daily amortization of organization expense as
instructed by NBAI
II-3
<PAGE>
o If applicable, accrue daily Rule 12b-1 Plan expenses
o Adjust expense accruals as instructed by NBAI and provide reports as
requested by NBAI
5. Verify and Record All Daily Income Accruals for Debt Issues:
o Track income and provide year end tax schedules
o Review and verify all interest and amortization reports
o Periodic tie-out of receivables
o Ensure security masters denote proper interest and amortization methods
as per the fund set up sheets as instructed by NBAI
6. Monitor Securities:
o Review each funds portfolio holding and current days security trades
for dividend activity
o Interface with Funds' Custodian for timely collection and postings of
corporate actions, dividends and interest pre-payments
7. Enter All Security Trades:
o Review verification of trade and interest calculations
o Verify settlement through custodian statements
o Maintain security ledger transaction reporting
o Maintain tax lot holdings
o Determine realized gains or losses on security trades
o Provide broker commission information
8. Enter All Fund Share Transactions:
o Periodically reconcile dividend payable amounts with the Funds'
Transfer Agent
o Process activity identified on transfer agent reports
o Verify settlement through custodian statements
o Reconcile to transfer agency report balances
o Process and track capital stock gain/loss activity
9. Prepare Daily Trial Balance:
o Post manual entries to general ledger
o Post custodian bank activity
o Require automated settled transactions between custody and activity
records (prepare, clear and post)
o Post shareholder and security transactions
o Post and verify income and expense accruals and resolve differences
o Prepare general ledger
o Post corporate action activity
II-4
<PAGE>
10. Review and Reconcile Custodian Statements:
o Verify all posted interest, dividends, expenses, and shareholder and
security payments/receipts, etc. when requested
o Post all cash settlement activity to trial balance
o Reconcile to ending cash balance accounts
o Report to NBAI the status of past due items and failed trades with the
custodian
o Reconcile cash exception Income items, tax reclaims and past due income
items with custody area
11. Preparation of Accounting Reports:
o Price Variance Report
o Trial Balance
o Portfolio Valuation
o NAV Calculation Report
o Cash Availability
o Change in NAV
o Non-standard entries
o Stale Price Report
o Other such reports as may be reasonably be requested by NBAI
Monthly/Quarterly Services
BNY shall provide the following services on a monthly or quarterly
basis, within such timeframe as may be mutually agreed upon by BNY, the Company
and NBAI:
1. Submission of Monthly Accounting Reports as mutually agreed upon
2. Reconcile Asset Listing to Custodian Asset Listing
3. Provide Monthly Analysis and Reconciliation of Trial Balance Accounts
4. Prepare Documentation Supporting the Preparation of:
o SEC yield reporting
o Income by state reporting
o Standard Industry Code Valuation Report
o Alternative Minimum Tax Income segregation schedule
II-5
<PAGE>
5. Provide Upon Request Broker Commission and Net Trade Reports
Annual (and Semi-Annual) Accounting Services
BNY shall provide the following services on an annual and semi-annual
basis:
1. Supply auditors InvestOne reports supporting securities and shareholder
transactions, income and expense accruals, etc. during the year in
accordance with standard audit assistance requirements
2. Provide NBAI with information to assist NBAI in the preparation of
NSAR filings
Other Core Services
BNY shall provide the following services:
o Accrete discounts and amortize premiums to put and call events as
directed by NBAI and in a manner acceptable under generally accepted
accounting principles
o Process principal repayments on mortgage backed securities
o Update variable securities with current rates
o Process corporate action events through a primary vender feed, and
monitor results via Reuters, Bloomberg, or other available sources as
the parties may agree
o Perform automated portfolio pricing with a second vendor as requested
by NBAI
o Produce documents and respond to inquiries during account and SEC
examinations
Money Market Funds: Prepare daily mark to market reports and analysis
in compliance with Rule 2a-7 including:
o Calculating the daily portfolio weighted average maturity
o Report portfolio diversification based on trade/security information
provided by NBAI by:
Country, State, Tier, Liquidity, Asset Backed Securities,
Industry, Letter of Credit
o Listing percentage of portfolio maturing in specified intervals (i.e.,
number of days)
o Providing issuer and guarantor diversification exception reporting
International Funds: BNY shall provide the following services:
o Report in base and local currency
II-6
<PAGE>
o Processing of tax liability on foreign income subject to approval of
NBAI
o Daily variance analysis performed on FX rates for security position
held
o Produce automated bifurcation reporting in compliance with IRC Section
988
o Mark to market security receivables and payables on a daily basis
o Determine portfolio exposure by country and currency
In addition to the above, BNY will provide additional support as agreed
upon from time to time (i.e., financial statement production).
II-7
<PAGE>
SCHEDULE III
SERVICE LEVEL PERFORMANCE STANDARDS
<TABLE>
<CAPTION>
- ------------------------------------------------------------ ---------------------------------------------------------------
Service Standard
- ------------------------------------------------------------ ---------------------------------------------------------------
<S> <C> <C>
1. Daily Cash Availability |_| 100% accuracy and delivery by 9:00 a.m. EST for
Money Market Funds and 9:30 a.m. EST for all
others
|_| Compensation for uninvested cash at Nations Cash
Reserves' mill rate
- ------------------------------------------------------------ ---------------------------------------------------------------
2. Calculation of daily NAVs |_| 100% accuracy by 5:00 p.m. EST including pricing,
expense accruals, cash activity, manual entries,
S/H activity. Delivery by 5:45 p.m. EST
- ------------------------------------------------------------ ---------------------------------------------------------------
3. Review of daily NAVs |_| 100% review by 5:30 p.m. EST
|_| Review of NAV components for reasonableness including
analysis of the change in the NAV and the change in
mill rates.
|_| Review of price variance report
|_| Review of manual proof
- ------------------------------------------------------------ ---------------------------------------------------------------
4. NASDAQ Reporting |_| 100% accuracy and communication by 5:45 p.m. EST
- ------------------------------------------------------------ ---------------------------------------------------------------
5. Daily Pricing and Rate Report (DPRR) |_| 100% accuracy in nightly transmission of DPRRs
|_| Money Market Funds-5:30 p.m. EST
|_| All other funds- 6:00 p.m. EST
- ------------------------------------------------------------ ---------------------------------------------------------------
6. FundStation Report (SubM) |_| 100% accuracy and nightly transmission by 7:00 p.m.
EST
- ------------------------------------------------------------ ---------------------------------------------------------------
7. Processing of trade tickets |_| 100% accuracy and processed by T+1 if received by
the following cut-off times:
|_| All Funds (except International) - 10:00 am (T+1)
|_| International - 12:00 pm (T+1)
|_| Same day settlements - 1:30 pm
- ------------------------------------------------------------ ---------------------------------------------------------------
</TABLE>
III-1
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------ ---------------------------------------------------------------
Service Standard
- ------------------------------------------------------------ ---------------------------------------------------------------
<S> <C> <C>
8. Problem Resolution (general) |_| NAV impact analysis within 1 day
|_| Clear and timely communication of 100% of issues
|_| Ongoing Tracking
- ------------------------------------------------------------ ---------------------------------------------------------------
9. Cash reconciliations |_| Performed daily and sent daily to NBAI (Money Market
Funds) and sent weekly to NBAI (all other funds)
|_| Issues communicated to NBAI same day
|_| Outstanding items addressed within 1 business day
- ------------------------------------------------------------ ---------------------------------------------------------------
10. Position Reconciliations |_| Performed daily and sent weekly to NBAI
|_| Issues communicated to NBAI same day
|_| Open issues addressed within 2 business days
- ------------------------------------------------------------ ---------------------------------------------------------------
11. Tax reporting
|_| Federal, state, tax returns |_| Tax provision package prepared within time
parameters as set by NBAI/Independent tax
|_| Tax provision packages including personnel (PWC)
tax amounts/ distributions
|_| Estimates of tax requirements prepared as required
|_| Identification of all book/tax by NBAI for proper tax planning
differences
|_| Capital gain estimate preparations
- ------------------------------------------------------------ ---------------------------------------------------------------
12. Statistical Reports |_| Filed within the time parameters as set forth by
each statistical service
- ------------------------------------------------------------ ---------------------------------------------------------------
13. Expense accruals/payments |_| Payments made on the business day written
instructions from an authorized signator received
|_| Expense accruals made with 100% accuracy based upon
written instructions from NBAI
- ------------------------------------------------------------ ---------------------------------------------------------------
14. Management Reports |_| Provided to NBAI within 10 business days of month end
- ------------------------------------------------------------ ---------------------------------------------------------------
</TABLE>
III-2
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------ ---------------------------------------------------------------
Service Standard
- ------------------------------------------------------------ ---------------------------------------------------------------
<S> <C> <C>
15. Year end tax reports |_| Provided to NBAI within the time frame agreed to
- ------------------------------------------------------------ ---------------------------------------------------------------
16. Annual/Semi-Annual Reports |_| Provide Trial Balance within 5 business days after
annual/semi-annual period
|_| Provide additional financial statement support as
agreed to
- ------------------------------------------------------------ ---------------------------------------------------------------
17. Daily Reports |_| To be provided on the following day
|_| Provide detailed portfolio valuation
|_| Trial Balance
- ------------------------------------------------------------ ---------------------------------------------------------------
18. Daily Cash Sweep |_| 100% accuracy and communication by 2:00 p.m. EST
|_| Nations Cash Reserves
|_| AIM
|_| Nuveen
- ------------------------------------------------------------ ---------------------------------------------------------------
19. Post Dividends / Corporate Actions |_| 100% accuracy and posted on effective date
- ------------------------------------------------------------ ---------------------------------------------------------------
20. Monthly Reconciliations |_| Complete reconciliations within 10 business days
- ------------------------------------------------------------ ---------------------------------------------------------------
21. Reporting to Sub-Advisors |_| Provide nightly and other periodic reporting to
Nations Funds Sub-Advisors
- ------------------------------------------------------------ ---------------------------------------------------------------
22. Compliance |_| Provide compliance reports as requested by NBAI
- ------------------------------------------------------------ ---------------------------------------------------------------
</TABLE>
III-3
<PAGE>
SCHEDULE IV
(Attached)
IV-1
<PAGE>
SCHEDULE V
All Database Companies Quarterly List
---------------------- -------------
AMG Data Services Lipper
Barron's Morningstar
Bloomberg CDA Wiesenberger
CDA Wiesenberger Investment Company Institute
Commerce Clearing House (CCH) S&P Micropal
Forbes Institute for Economic Research
Institute for Economic Research Value Line
Interactive Data Services Media General Financial Services
Investment Company Institute LCG Associates
LCG Associates Closed End Fund Digest (Closed End Only)
Lipper Lipper - International (Closed End Only)
Media General
Moody's Investors Service
Morningstar
S&P Micropal
Strategic Insights
Value Line
V-I
<PAGE>
SCHEDULE VI
Conversion Schedule
- ------------------------------------------------------------------------------
Fund Type Number of Funds No Later Than
- ------------------------------------------------------------------------------
Money Market Funds 9 Funds 12/1/98
- ------------------------------------------------------------------------------
Variable Annuity Funds 8 Funds 12/31/98
- ------------------------------------------------------------------------------
International Funds: 8 Funds 12/31/98
- Global Government
- Emerging Markets
- Pacific Growth
- International Equity
- International Growth
- International Value
- 2 Marsico Funds
- ------------------------------------------------------------------------------
All Remaining Funds 44 Funds 2/15/99
- ------------------------------------------------------------------------------
VI-1
TRANSFER AGENCY AND SERVICES AGREEMENT
(With Facilities Management Arrangement)
THIS AGREEMENT, dated as of this first day of June, 1995 between
NATIONS FUND, INC., a Maryland corporation, NATIONS FUND TRUST, a Massachusetts
business trust, THE CAPITOL MUTUAL FUNDS, a Massachusetts business trust,
NATIONS FUND PORTFOLIOS, INC., a Maryland corporation, and each other investment
company which may become a party hereto pursuant to the terms of this Agreement
(individually a "Fund", and collectively, the "Funds"), each with its principal
place of business at 111 Center Street, Little Rock, Arkansas 72201 and
additional offices at 101 South Tryon Street, Charlotte, North Carolina 28255,
and THE SHAREHOLDER SERVICES GROUP, INC. (the "Transfer Agent"), a Massachusetts
corporation with principal offices at One Exchange Place, 53 State Street,
Boston, Massachusetts 02109.
WITNESSETH
WHEREAS, each Fund desires to appoint the Transfer Agent as its
transfer agent, dividend disbursing agent and agent in connection with certain
other activities and the Transfer Agent desires to accept such appointment;
WHEREAS, each Fund may authorize the issuance of Shares in separate
series, with each such series representing interests in a separate portfolio of
securities and other assets ("Portfolio");
WHEREAS, each Fund and each Portfolio of a Fund subject to this
Agreement, including any investment company or Portfolio as may be added to this
Agreement pursuant to Section 17, shall be identified in the attached Schedule
G; and
WHEREAS, the Transfer Agent and NationsBank, N.A. (Carolinas)
("NationsBank") have entered into a Facilities Management Agreement ("Facilities
Agreement") dated June 1, 1995 pursuant to which the Transfer Agent has
established a servicing and processing center to provide transfer agent services
on behalf of the Funds in Charlotte, North Carolina (the "Charlotte Facility").
NOW THEREFORE, in consideration of the mutual covenants and promises
hereinafter set forth, the Funds and the Transfer Agent agree as follows:
Article 1 Definitions
1.1 Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
(a) "Articles of Incorporation" shall mean the Articles of
Incorporation, Declaration of Trust, or other similar organizational
document as the case may be, of a Fund as the same may be amended from
time to time.
<PAGE>
(b) "Authorized Person" of a Fund shall be deemed to include
(i) any authorized officer of the Fund; (ii) the members of the Joint
Operations Board (as hereinafter defined); or (iii) any person, whether
or not such person is an officer or employee of the Fund, duly
authorized to give Oral Instructions or Written Instructions on behalf
of the Fund as indicated in writing to the Transfer Agent from time to
time.
(c) "Board of Directors" of a Fund shall mean the Board of
Directors or Board of Trustees of the Fund, as the case may be.
(d) "Commission" shall mean the Securities and Exchange
Commission.
(e) "Custodian" of a Fund refers to any custodian or
subcustodian of securities and other property which the Fund may from
time to time deposit, or cause to be deposited or held under the name
or account of such a custodian pursuant to a Custodian Agreement.
(f) "Joint Operations Board" shall mean the joint board
comprised of one senior representative from the Transfer Agent, one
individual designated by the Funds jointly to represent their
respective interests and the most senior Transfer Agent manager of the
Charlotte Facility.
(g) "1940 Act" shall mean the Investment Company Act of 1940
and the rules and regulations promulgated thereunder, all as amended
from time to time.
(h) "Oral Instructions" shall mean instructions, other than
Written Instructions, actually received by the Transfer Agent from a
person reasonably believed by the Transfer Agent to be an Authorized
Person;
(i) "Prospectus" of a Fund shall mean collectively the most
recently dated Fund Prospectuses and Statements of Additional
Information, including any supplements thereto, if any, with respect to
each Portfolio of the Fund which have become effective under the
Securities Act of 1933 and the 1940 Act.
(j) "Shares" of a Fund refers collectively to such shares of
capital stock or beneficial interest, as the case may be, or class
thereof, of the Fund as may be issued from time to time.
(k) "Shareholder" shall mean a record owner of Shares.
(l) "Written Instructions" shall mean a written communication
signed by a person reasonably believed by the Transfer Agent to be an
Authorized Person and actually received by the Transfer Agent. Written
Instructions shall include manually executed originals and authorized
electronic transmissions, including telefacsimile of a manually
executed original or other process.
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Article 2 Appointment of the Transfer Agent
2.1 Each Fund hereby appoints and constitutes the Transfer
Agent as transfer agent and dividend disbursing agent for Shares of the
Fund and the Transfer Agent hereby accepts such appointments and agrees
to perform the duties hereinafter set forth.
Article 3 Duties of the Transfer Agent
3.1 The Transfer Agent shall be responsible for:
(a) Administering and performing the customary services of a
transfer agent; agent in connection with dividend and distribution
functions; and agent in connection with shareholder account and
administrative functions in connection with the issuance, transfer and
redemption or repurchase (including coordination with the Custodian) of
Shares, as more fully described in the written schedule of Duties of
the Transfer Agent annexed hereto as Schedule A and incorporated
herein, and in accordance with the terms of each Fund's Prospectus,
applicable law and the procedures established from time to time between
the Transfer Agent and the Funds.
(b) Recording the issuance of Shares and maintaining pursuant
to Commission Rule 17Ad-10(e) a record of the total number of Shares
which are authorized, based upon data provided to it by each Fund, and
issued and outstanding. The Transfer Agent shall provide each Fund on a
regular basis with the total number of Shares which are authorized and
issued and outstanding and shall have no obligation, when recording the
issuance of Shares, to monitor the issuance of such Shares or to take
cognizance of any laws relating to the legality or validity of the
issue or sale of such Shares, which functions shall be the sole
responsibility of the Fund.
(c) Notwithstanding any of the foregoing provisions of this
Agreement, the Transfer Agent shall be under no duty or obligation to
inquire into, and shall not be liable for: (i) the legality of the
issuance or sale of any Shares or the sufficiency of the amount to be
received therefor; (ii) the legality of the redemption of any Shares,
or the propriety of the amount to be paid therefor; (iii) the legality
of the declaration of any dividend by the Board of Directors, or the
legality of the issuance of any Shares in payment of any dividend; or
(iv) the legality of any recapitalization or readjustment of the
Shares.
3.2 In addition, each Fund shall verify the establishment of shares or
share transactions for each State prior to activation on the Transfer Agent's
system and thereafter monitor the daily activity of shares for each State based
upon daily transactions recorded by the Transfer Agent and transmitted to the
Fund or its designated agent. The responsibility of the Transfer Agent for a
Fund's blue sky State registration status is solely limited to the initial
establishment of shares or share transactions subject to blue sky compliance by
the Fund and the reporting of such transactions to the Fund as provided above.
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3.3 In addition to the duties set forth herein, the Transfer Agent
shall perform such other duties and functions, and shall be paid such amounts
therefor, as may from time to time be agreed upon in writing between the Funds
and the Transfer Agent.
Article 4 Duties of the Joint Operations Board
4.1 The Joint Operations Board will be responsible for the following
with respect to the services to be performed by the Transfer Agent under this
Agreement (the "Services"):
(a) General oversight of the provision of Services by the
Transfer Agent, including, but not limited to, the creation and
quarterly review of quality standards governing the Services pursuant
to Article 5 hereof, the establishment of strategic and/or operational
goals with respect to the Services to be provided at the Charlotte
Facility, and addressing such issues and concerns that may arise from
time to time amongst the Funds and the Transfer Agent under this
Agreement.
(b) Review and approval of, from a technical feasibility
standpoint, imaging and other new technologies proposed to be used by
the Transfer Agent in performing the Services at the Charlotte
facility.
(c) Review and approval of the Charlotte Facility budget and
expense statements, including those costs for which compensation is
sought by the Transfer Agent pursuant to Article 8 hereof.
(d) Review of those costs incurred by the Transfer Agent,
other than in connection with the Charlotte Facility, for which
compensation is sought by the Transfer Agent pursuant to Article 8
hereof.
4.2 With respect to matters described in Section 4.1 above, the
decision of the Funds' representative on the Joint Operations Board shall
control.
4.3 On a monthly basis, the Transfer Agent shall provide to the Joint
Operations Board a statement of the internal and external costs incurred by the
Transfer Agent in connection with the provision of Services for which the
Transfer Agent will seek reimbursement under Article 8 hereof.
Article 5 Quality Standards
5.1 The quality of service provided by the Transfer Agent hereunder
shall be maintained at or above the levels set forth in Schedule B hereto. Such
quality standards shall govern the Services provided by the Transfer Agent until
a new set of quality standards is established pursuant to Section 5.2 hereof.
5.2 As soon as practicable after the first ninety (90) days of
operation of the Charlotte Facility, the Joint Operations Board shall establish
a new set of quality standards reasonably acceptable to the Funds and the
Transfer Agent.
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5.3 The Joint Operations Board shall review and update, if necessary,
the quality standards on a semi-annual basis.
5.4 If, at any time during the term of this Agreement, 20% or more of
the then-current quality standards (e.g., 2 or more out of 10 standards) are not
met by the Transfer Agent during any month (as evidenced by monthly reports),
the Funds shall promptly notify the Transfer Agent in writing of such failure
and the details relating to such failure. If, any of the failed quality
standards are not met by the Transfer Agent during the three month period
commencing thirty (30) days after the Transfer Agent receives such notice, the
Funds shall have the right to terminate this Agreement on thirty (30) days
notice.
5.5 Notwithstanding the foregoing, the Funds shall not have the right
to terminate this Agreement based on the failure by the Transfer Agent to have
satisfied a quality standard if such failure was caused directly by the negative
vote of the Funds' representative on the Joint Operations Board with respect to
a commercially reasonable funding request of the Transfer Agent for the
Charlotte Facility.
Article 6 Recordkeeping and Other Information
6.1 The Transfer Agent shall create and maintain all records required
of it pursuant to its duties hereunder and as set forth in Schedule A in
accordance with all applicable laws, rules and regulations, including records
required by Section 31(a) of the 1940 Act. All records shall be available during
regular business hours for inspection and use by the Funds. Where applicable,
such records shall be maintained by the Transfer Agent for the periods and in
the places required by Rule 31a-2 under the 1940 Act.
6.2 To the extent required by Section 31 of the 1940 Act, the Transfer
Agent agrees that all such records prepared or maintained by the Transfer Agent
relating to the Services are the property of the relevant Fund and will be
preserved, maintained and made available in accordance with such section, and
will be surrendered promptly to such Fund on and in accordance with the Fund's
request.
6.3 In case of any requests or demands for the inspection of
Shareholder records of a Fund, the Transfer Agent will endeavor to notify the
Fund of such request and secure Written Instructions as to the handling of such
request. The Transfer Agent reserves the right, upon prior notice to the Fund,
to exhibit the Shareholder records to any person whenever it is advised by its
counsel that it may be held liable for the failure to comply with such request.
6.4 Upon reasonable notice by a Fund, the Transfer Agent shall make
available during regular business hours such of its facilities and premises
employed in connection with the performance of its duties under this Agreement
for reasonable visitation by the Fund, or any person retained by the Fund as may
be necessary for the Fund to evaluate the quality of the Services performed by
the Transfer Agent pursuant hereto.
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Article 7 Fund Instructions
7.1 The Transfer Agent will have no liability when acting for a Fund in
accordance with Written or Oral Instructions believed to have been executed or
orally communicated by an Authorized Person of the Fund and will not be held to
have any notice of any change of authority of any person until receipt of a
Written Instruction thereof from the Fund. The Transfer Agent will also have no
liability when processing Share certificates for a Fund which it reasonably
believes to bear the proper manual or facsimile signatures of the officers of
the Fund and the proper countersignature of the Transfer Agent.
7.2 The Transfer Agent may request Written Instructions from a Fund and
may seek advice from legal counsel for the Fund with prior notice to the Fund,
or its own legal counsel, with respect to any matter arising in connection with
this Agreement, and it shall not be liable for any action taken or not taken or
suffered by it in good faith in accordance with such Written Instructions or in
accordance with the opinion of counsel for the Fund or for the Transfer Agent.
Written Instructions requested by the Transfer Agent will be provided by the
Fund within a reasonable period of time.
7.3 The Transfer Agent, its officers, agents or employees, shall accept
Oral Instructions or Written Instructions given to them with respect to a Fund
by any person representing or acting on behalf of the Fund only if said
representative is an Authorized Person of the Fund. The Funds agree that all
Oral Instructions shall be followed within one business day by confirming
Written Instructions, and that the Funds' failure to so confirm shall not impair
in any respect the Transfer Agent's right to reply on Oral Instructions.
Article 8 Compensation
8.1 The Funds shall reimburse the Transfer Agent for all the Transfer
Agent's "Costs" incurred in connection with the provision of Services as set
forth in the written Schedule of Costs annexed hereto as Schedule C and
incorporated herein and in addition the Funds shall compensate the Transfer
Agent for the following amounts (the "Margin");
(a) During the first 36 months of the Initial Term (as defined
below), an amount equal to 15% of such Costs during each month.
(b) During the last 24 months of the Initial Term and during
each Renewal Term (as defined below), an amount equal to 12.5% of such
Costs during each month.
8.2 Notwithstanding the foregoing, the charges incurred by the Transfer
Agent under the Facilities Agreement with NationsBank and such other expenses
set forth in the written schedule of Non-Margin Expenses annexed hereto as
Schedule D shall not be included as Costs in connection with the calculation of
the Margin amounts set forth in Subsections 8.1(a) and (b).
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8.3 In addition to the Costs and Margin described above, the Fund shall
reimburse the Transfer Agent, and will be billed separately for, those
out-of-pocket expenses incurred by the Transfer Agent in the performance of its
duties hereunder as specified in the written schedule of out-of-pocket expenses
annexed hereto as Schedule E and incorporated herein.
8.4 The Funds agree to pay all fees and out-of-pocket expenses within
thirty (30) days following the receipt of the respective invoice. The Funds
shall not be obligated to pay amounts that are reasonably in dispute until such
dispute is resolved.
Article 9 Documents
9.1 In connection with the appointment of the Transfer Agent, each Fund
shall, on or before the date this Agreement goes into effect, but in any case
within a reasonable period of time for the Transfer Agent to prepare to perform
its duties hereunder, deliver or cause to be delivered to the Transfer Agent the
documents set forth in the written schedule of Fund Documents annexed hereto as
Schedule F.
Article 10 Transfer Agent System
10.1 The Transfer Agent shall retain title to and ownership of any and
all data bases, computer programs, screen formats, report formats, interactive
design techniques, derivative works, inventions, discoveries, patentable or
copyrightable matters, concepts, expertise, patents, copyrights, trade secrets,
and other related legal rights utilized by the Transfer Agent in connection with
the services provided by the Transfer Agent to the Fund herein (the "Transfer
Agent System").
10.2 The Transfer Agent hereby grants to each Fund a limited license to
the Transfer Agent System for the sole and limited purpose of having the
Transfer Agent provide the services contemplated hereunder and nothing contained
in this Agreement shall be construed or interpreted otherwise and such license
shall immediately terminate upon the termination of this Agreement.
10.3 The Transfer Agent agrees to provide the Funds with full access to
the Transfer Agent System and all enhancements thereto to the same extent that
such is made available to other Transfer Agent clients.
10.4 In the event the Funds desire the Transfer Agent to develop any
enhancements for the Transfer Agent System, the parties shall agree on the
staffing requirements which will be subject to the approval of the Joint
Operations Board.
10.5 In the event the Funds request an enhancement to the Transfer
Agent System which is estimated to require 5,000 programming hours or more
("Enhancement Project") and the Funds agree to assume the cost of such
Enhancement Project, the Funds and the Transfer Agent shall agree in writing on
any restrictions imposed on the Transfer Agent with respect to the use of such
enhancement prior to commencement of the Enhancement Project.
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10.6 Each Fund reserves the right to review and examine "imaging" and
significant other technological developments to be implemented with the Transfer
Agent System from a technical feasibility standpoint.
Article 11 Representations and Warranties of the Transfer Agent
11.1 The Transfer Agent represents and warrants to each Fund that:
(a) It is a corporation duly organized and existing and in
good standing under the laws of the Commonwealth of Massachusetts;
(b) It is empowered under applicable laws and by its Articles
of Incorporation and By-Laws to enter into and perform this Agreement;
(c) All requisite corporate proceedings have been taken to
authorize it to enter into this Agreement;
(d) It is duly registered with the appropriate regulatory
agencies as a transfer agent and such registration will remain in
effect for the duration of this Agreement;
(e) It has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and
obligations under this Agreement.
Article 12 Representations and Warranties of the Funds
12.1 Each Fund represents and warrants to the Transfer Agent that:
(a) It is duly organized and existing and in good standing
under the laws of the jurisdiction in which it is organized;
(b) It is empowered under applicable laws and by its Articles
of Incorporation and By-Laws to enter into this Agreement;
(c) All corporate proceedings required by said Articles of
Incorporation, By-Laws and applicable laws have been taken to authorize
it to enter into this Agreement;
(d) A registration statement under the Securities Act of 1933,
as amended, is currently effective and will remain effective, and all
appropriate state securities law filings have been made and will
continue to be made, with respect to all Shares of the Fund being
offered for sale;
(e) All outstanding Shares are validly issued, fully paid and
non-assessable and that, when Shares are hereafter issued in accordance
with the terms of the Fund's Articles of Incorporation and its
Prospectus, such Shares shall be validly issued, fully paid and
non-assessable.
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Article 13 Indemnification
13.1 The Transfer Agent shall not be responsible for and each Fund
shall indemnify and hold the Transfer Agent harmless from and against any and
all claims, costs, expenses (including reasonable attorneys' fees), losses,
damages, charges, payments and liabilities of any sort or kind which may be
asserted against the Transfer Agent or for which the Transfer Agent may be held
to be liable (a "Claim") arising out of or attributable to any of the following:
(a) Any actions of the Transfer Agent required to be taken
pursuant to this Agreement for the Fund unless such Claim resulted from
a negligent act or failure to act or bad faith by the Transfer Agent in
the performance of its duties hereunder.
(b) The Transfer Agent's reasonable reliance on, or reasonable
use of information, data, records and documents (including but not
limited to magnetic tapes, computer printouts, hard copies and
microfilm copies) received by the Transfer Agent from the Fund, or any
authorized third party acting on behalf of the Fund, including but not
limited to the prior transfer agent for the Fund, in the performance of
the Transfer Agent's duties and obligations hereunder.
(c) The reliance on, or the implementation of, any Written or
Oral Instructions or any other instructions or requests of the Fund
which are deemed to be provided by an Authorized Person of the Fund.
(d) The offer or sales of Shares by the Fund in violation of
any requirement under the securities laws or regulations of any state
that such Shares be registered in such state or in violation of any
stop order or other determination or ruling by any state with respect
to the offer or sale of such Shares in such state.
(e) The Fund's refusal or failure to comply with the terms of
this Agreement, or any Claim which arises out of the Fund's negligence
or misconduct or the breach of any representation or warranty of the
Fund made herein.
13.2 In any case in which a Fund may be asked to indemnify or hold the
Transfer Agent harmless, the Transfer Agent will notify the Fund promptly after
identifying any situation which it believes presents or appears likely to
present a claim for indemnification against the Fund although the failure to do
so shall not prevent recovery by the Transfer Agent, unless the Fund is actually
prejudiced thereby, and the Transfer Agent shall keep the Fund advised with
respect to all developments concerning such situation. The Fund shall have the
option to defend the Transfer Agent against any Claim which may be the subject
of this indemnification, and, in the event that the Fund so elects, such defense
shall be conducted by counsel chosen by the Fund and satisfactory to the
Transfer Agent, and thereupon the Fund shall take over complete defense of the
Claim and the Transfer Agent shall sustain no further legal or other expenses in
respect of such Claim. The Transfer Agent will not confess any Claim or make any
compromise in any case in which the Fund will be asked to provide
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indemnification, except with the Fund's prior written consent. The obligations
of the parties hereto under this Article shall survive the termination of this
Agreement, so long as the Transfer Agent and the Fund act in good faith and are
not negligent in their actions.
Article 14 Standard of Care
14.1 The Transfer Agent shall at all times act in good faith and agrees
to use its best efforts within commercially reasonable limits to ensure the
accuracy of all services performed under this Agreement, but assumes no
responsibility for loss or damage to the Funds unless said errors are caused by
the Transfer Agent's own negligence, bad faith or willful misconduct or that of
its employees.
Article 15 Consequential Damages
15.1 In no event and under no circumstances shall either a Fund or the
Transfer Agent be liable to another party for consequential or indirect loss of
profits, reputation or business or any other special damages under any provision
of this Agreement or for any act or failure to act hereunder.
Article 16 Term and Termination
16.1 This Agreement shall be effective on the date first written above
and shall continue for a period of sixty (60) months (the "Initial Term"),
unless earlier terminated pursuant to the terms of this Agreement. Thereafter,
this Agreement shall automatically be renewed for successive terms of
twenty-four (24) months ("Renewal Terms") each, unless terminated pursuant to
this Agreement.
16.2 The Funds or the Transfer Agent may terminate this Agreement at
the end of the Initial Term or at the end of any subsequent Renewal Term upon
not less than nine (9) months prior written notice to the other parties.
16.3 Upon a minimum of nine (9) months prior written notice from the
Boards of Directors of the Funds, the Funds may terminate this Agreement at the
end of the thirty-sixth (36th) or forty-eighth (48th) month of the Initial Term.
16.4 The Funds shall have the right to terminate this Agreement
immediately upon the insolvency or bankruptcy of the Transfer Agent or the
appointment of a receiver for the Transfer Agent, or with respect to any of its
assets, or any change in the financial condition of the Transfer Agent which
impedes the ability of the Transfer Agent to perform any of its obligations
hereunder which is not cured by the Transfer Agent within thirty (30) days of
such occurrence. The Funds shall have the right to seek to renegotiate this
Agreement and, if such negotiations are not successful within a reasonable
period of time, not to exceed ninety (90) days, to terminate this Agreement upon
the transfer of ownership of a controlling interest in the Transfer Agent by or
to any person other than a person who was an affiliate of the Transfer Agent or
its parent company immediately before the transfer.
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16.5 In the event that the total number of combined Shareholder
accounts for the Funds and any other open-end investment companies affiliated
with the Funds by reason of having a common investment adviser exceeds three
times the 1994 Shareholder account base of 130,000 due to merger or acquisition
activity involving the investment adviser or any affiliates of the adviser, the
Funds shall have the right to terminate this Agreement upon nine (9) months
prior written notice to the Transfer Agent. As used in this Article 16,
"affiliates of the adviser" shall mean (i) a direct or indirect owner of 50% or
more of the outstanding common stock of the adviser (a "parent") or (ii) any
company or association whose outstanding common stock is at least 50% owned,
directly or indirectly, by the adviser or by a parent.
16.6 In the event this Agreement is terminated by the Funds pursuant to
Section 5.4, all expenses associated with the movement of records and materials
to a successor transfer agent will be borne by the Transfer Agent. In the event
of a termination pursuant to any other sections, all expenses associated with
conversion will be borne by the Funds. The Transfer Agent shall cooperate with
any such conversion to a successor transfer agent and shall use its best efforts
to mitigate the costs associated with such transfer.
16.7 If a party hereto is guilty of a material failure to perform its
duties and obligations hereunder (a "Defaulting Party") the other party (the
"Non-Defaulting Party") may give written notice thereof to the Defaulting Party,
and if such material breach shall not have been remedied within thirty (30) days
after such written notice is given, then the Non-Defaulting Party may terminate
this Agreement by giving thirty (30) days written notice of such termination to
the Defaulting Party. If the Transfer Agent is the Non-Defaulting Party, its
termination of this Agreement shall not constitute a waiver of any other rights
or remedies of the Transfer Agent with respect to services performed prior to
such termination or rights of the Transfer Agent to be reimbursed for
out-of-pocket expenses incurred prior to such termination. In all cases,
termination by the Non-Defaulting Party shall not constitute a waiver by the
Non-Defaulting Party of any other rights it might have under this Agreement or
otherwise against the Defaulting Party. The Defaulting Party shall not be
released from any liability with respect to such services performed prior to
such termination.
16.8 In the event of termination of this Agreement by the Funds
pursuant to Sections 16.3 or 16.5:
(a) Prior to the effective date of the termination, the Funds
shall reimburse the Transfer Agent for all unamortized costs incurred
by the Transfer Agent in establishing the Charlotte Facility.
(b) Prior to the effective date of the termination, the Funds
shall assume any and all obligations that the Transfer Agent may have
to third parties arising out of or in connection with the Transfer
Agent's operations at the Charlotte Facility and that the Transfer
Agent is not able to terminate prior to the effective date of the
termination of this Agreement.
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(c) Prior to the effective date of the termination, the Funds
shall pay the Transfer Agent an amount equal to 80% of the cumulative
Margin (as defined in Section 8.1) paid by the Funds to the Transfer
Agent for the twelve months preceding the notice of termination, unless
the Funds' investment adviser or any affiliate of the adviser has
acquired an entity providing comparable transfer agency services to
those provided under this Agreement.
(d) The Funds shall reimburse the Transfer Agent for all
reasonable expenses (other than accrued vacation, sick or other leave)
incurred by the Transfer Agent in connection with the termination of
the Transfer Agent's employees located at the Charlotte Facility, or,
at the option of the Funds, the transfer of such employees to another
entity providing services to the Funds. The Transfer Agent shall be
obligated to seek to minimize any such expenses to the extent
commercially practicable.
(e) The Transfer Agent shall transfer to the Funds all
physical assets located at the Charlotte Facility.
Article 17 Additional Portfolios and Funds
17.1 In the event that a Fund establishes one or more Portfolios in
addition to those identified initially on Schedule G, with respect to which the
Fund desires to have the Transfer Agent render services as transfer agent under
the terms hereof, the Fund shall so notify the Transfer Agent in writing, and if
the Transfer Agent agrees in writing to provide such services (such agreement
not to be withheld unreasonably), Schedule G shall be amended to include such
additional Portfolios.
17.2 Subsequent to the effective date of this Agreement, one or more
registered investment companies (a "New Fund") for which NationsBank or any of
its affiliates acts as investment adviser may become a party to this Agreement
upon execution of a written adoption agreement by such New Fund pursuant to
which such New Fund agrees to be bound by the terms of this Agreement (an
"Adoption Agreement"). Following the execution of an Adoption Agreement by a New
Fund, such New Fund shall be deemed a Fund for all purposes of this Agreement
and shall have all the rights, obligations and duties of a Fund under this
Agreement.
Article 18 Confidentiality
18.1 In connection with the services provided by the Transfer Agent
hereunder, certain confidential and proprietary information regarding the
Transfer Agent and the Fund may be disclosed to the other. In connection
therewith, the parties agree as follows:
(a) "Confidential Information" shall mean:
(i) any data or information that is competitively
sensitive material, and not generally known to the public,
including, but not limited to, information about product
plans, marketing strategies, finance, operations, customer
relationships, customer profiles, sales estimates, business
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plans, and internal performance results relating to the past,
present or future business activities of the Transfer Agent or
the Fund, their respective parent corporation, their
respective subsidiaries and affiliated companies and the
customers, clients and suppliers of any of the foregoing;
(ii) any scientific or technical information, design,
process, procedure, formula, or improvement that is
commercially valuable and secret in the sense that its
confidentiality affords the Transfer Agent or the Fund a
competitive advantage over its competitors; and
(iii) all confidential or proprietary concepts,
documentation, reports, data, specifications, computer
software, source code, object code, flow charts, databases,
inventions, know-how, show-how and trade secrets, whether or
not patentable or copyrightable.
(b) Confidential Information includes, without limitation, all
documents, inventions, substances, engineering and laboratory
notebooks, drawings, diagrams, specifications, bills of material,
equipment, prototypes and models, and any other tangible manifestation
of the foregoing which now exist or come into the control or possession
of the party.
18.2 Except as expressly authorized by prior written consent of the
disclosing party ("Discloser"), the party receiving Confidential Information
("Recipient") shall:
(a) limit access to Discloser's Confidential Information to
Recipient's employees and agent who have a need-to-know in connection
with the subject matter thereof;
(b) advise those employees and agents who have access to the
Confidential Information of the proprietary nature thereof and of the
obligations set forth in this Confidential Agreement;
(c) take appropriate action by instruction or agreement with
the employees and agents having access to Discloser's Confidential
Information to fulfill Recipient's obligations under this
Confidentiality Agreement;
(d) safeguard all of Discloser's Confidential Information by
using a reasonable degree of care, but not less than that degree of
care used by Recipient in safeguarding its own similar confidential
information or material;
(e) use all of Discloser's Confidential Information solely for
purposes for which the Confidential Information was conveyed; and
(f) not disclose any of Discloser's Confidential Information,
or information derived therefrom, to third parties.
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18.3 Upon Discloser's request, Recipient shall surrender to Discloser
all memoranda, notes, records, drawings, manuals, and other documents or
materials (and all copies of same) relating to or containing Discloser's
Confidential Information. When Recipient returns the materials, Recipient shall
certify in writing that it has returned all materials containing or relating to
the Confidential Information.
18.4 The obligations of confidentiality and restriction on use in this
Article 18 shall not apply to any Confidential Information that Recipient
proves:
(a) Was in the public domain prior to the date of this
Agreement or subsequently came into the public domain through no fault
of Recipient; or
(b) Was received by Recipient from a third party without
Recipient's knowledge that the third party was not legally entitled to
disclose such information; or
(c) Was already in Recipient's possession prior to receipt
from Discloser; or
(d) Is required to be disclosed in a judicial or
administrative proceeding after reasonable legal remedies for
maintaining such information in confidence have been exhausted
including, but not limited to, giving Discloser as much advance notice
as practical of the possibility of disclosure to allow Discloser to
take appropriate legal action to seek to prevent such disclosure; or
(e) Is subsequently and independently developed by Recipient's
employees, consultants or agents without reference to Confidential
Information.
18.5 The Funds and the Transfer Agent agree that money damages would
not be a sufficient remedy to an injured party for breach of this Article 18.
Accordingly, in addition to all other remedies that a party may have, a party
shall be entitled to specific performance and injunctive or other equitable
relief against another party as a remedy for any breach of the obligations set
forth in this Article 18. The parties agree to waive any requirement for a bond
in connection with any such injunctive or other equitable relief.
18.6 The rights and obligations established by this Article 18 shall
survive the termination of this Agreement.
Article 19 Force Majeure
19.1 In the event a party is unable to perform its obligations under
the terms of this Agreement because of acts of God or by reason of circumstances
beyond its control, including war, national emergencies, strikes, labor
difficulties, insurrection, riots or the failure or unavailability of
transportation or communication services or power supplies, such party shall not
be liable for damages incurred by any other party resulting from such failure to
perform. The above in no way relieves the Transfer Agent or the Funds of
responsibility for exercising all backup and contingency plans available and in
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effect at such time and does not affect any other remedies that a party may have
under this Agreement.
Article 20 Amendments
20.1 This Agreement may only be amended or modified by a written
instrument executed by all parties except that Schedule A may be amended in the
manner set forth in Section 17.1.
Article 21 Subcontracting
21.1 Each Fund agrees that the Transfer Agent, in its discretion, may
after notification to the Funds, subcontract for certain of the services to be
provided by the Transfer Agent under this Agreement or the Schedules hereto;
provided that the appointment of any such subcontractor shall not relieve the
Transfer Agent of its responsibilities hereunder.
Article 22 Arbitration
22.1 Any claim or controversy arising out of or relating to this
Agreement, or breach hereof, shall be settled by arbitration administered by the
American Arbitration Association in Charlotte, North Carolina in accordance with
its applicable rules, except that the Federal Rules of Evidence and the Federal
Rules of Civil Procedure with respect to the discovery process shall apply.
22.2 The parties hereby agree that judgment upon the award rendered by
the arbitrator may be entered in any court having jurisdiction.
22.3 The parties acknowledge and agree that the performance of the
obligations under this Agreement necessitates the use of instrumentalities of
interstate commerce and, notwithstanding other general choice of law provisions
in this Agreement, the parties agree that the Federal Arbitration Act shall
govern and control with respect to the provisions of this Article 22.
Article 23 Notice
23.1 Any notice or other instrument authorized or required by this
Agreement to be given in writing to a party, shall be sufficiently given if
addressed to that party and received by it at its office set forth below or at
such other place as such party may from time to time designate in writing.
To either of the Funds:
[Name of Applicable Fund]
111 Center Street
Little Rock, Arkansas 72201
Attention: Corporate Secretary
15
<PAGE>
To the Transfer Agent:
The Shareholder Services Group
One Exchange Place
53 State Street
Boston, Massachusetts 02109
Attention: President
with a copy to:
General Counsel (same address)
Article 24 Successors
24.1 This Agreement shall extend to and shall be binding upon the
parties hereto, and their respective successors and assigns, provided, however,
that this Agreement shall not be assigned to any person other than a person
controlling, controlled by or under common control with the assignor without the
written consent of the other party, which consent shall not be unreasonably
withheld.
Article 25 Governing Law
25.1 This Agreement shall be governed exclusively by the laws of the
Commonwealth of Massachusetts without reference to the choice of law provisions
thereof. Subject to Article 22 hereof, each party hereto hereby (i) consents to
the personal jurisdiction of the Commonwealth of Massachusetts courts over the
parties hereto, hereby waiving any defense of lack of personal jurisdiction; and
(ii) appoints the person to whom notices hereunder are to be sent as agent for
service of process.
Article 26 Counterparts
26.1 This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original; but such counterparts shall,
together, constitute only one instrument.
Article 27 Captions
27.1 The captions of this Agreement are included for convenience of
reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.
Article 28 Use of Transfer Agent/Fund Name
28.1 The Funds shall not use the name of the Transfer Agent in any
Prospectus, Statement of Additional Information, Shareholders' report, sales
literature or other material relating to the Fund in a manner not approved prior
thereto in writing by the Transfer Agent; provided, that the Transfer Agent need
only receive notice of all reasonable uses of its name which merely refer in
accurate terms to its appointment hereunder or which are required by any
government agency or applicable law or rule.
16
<PAGE>
28.2 The Transfer Agent shall not use the name of a Fund or material
relating to a Fund on any documents or forms for other than internal use in a
manner not approved prior thereto in writing by such Fund; provided, that the
Fund need only receive notice of all reasonable uses of its name which merely
refer in accurate terms to the appointment of the Transfer Agent as transfer
agent for the Fund or which are required by any government agency or applicable
law or rule.
Article 29 Relationship of Parties
29.1 The parties agree that they are independent contractors and not
partners or co-venturers and nothing contained herein shall be interpreted or
construed otherwise.
29.2 The parties hereby acknowledge and agree that each Fund has
entered into this Agreement independently on behalf of itself and its Portfolios
which are now or may hereafter be identified on Schedule G. Notwithstanding
anything to the contrary contained in this Agreement, (i) each Fund individually
shall have the rights and obligations of a Fund as set forth in this Agreement,
(ii) any action by a Fund in violation of this Agreement shall not affect the
rights and obligations of any other Fund under this Agreement, and (iii) the
Transfer agent, in seeking to enforce any provisions of this Agreement with
respect to a Portfolio, shall look solely to the assets and revenues of such
Portfolio and that in no event shall the Transfer Agent in seeking to enforce
such obligation have recourse to the independent assets or revenues of any other
Portfolio.
Article 30 Entire Agreement; Severability
30.1 This Agreement and the Schedules attached hereto constitute the
entire agreement of the parties hereto relating to the matters covered hereby
and supersede any previous agreements. If any provision is held to be illegal,
unenforceable or invalid for any reason, the remaining provisions shall not be
affected or impaired thereby.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers, as of the day and year first above
written.
NATIONS FUND, INC.
By: /s/ Richard H. Blank, Jr.
----------------------------
Title: Secretary
NATIONS FUND TRUST
By: /s/ Richard H. Blank, Jr.
----------------------------
Title: Secretary
17
<PAGE>
THE CAPITOL MUTUAL FUNDS
By: /s/ Richard H. Blank, Jr.
----------------------------
Title: Secretary
NATIONS FUND PORTFOLIOS, INC.
By: /s/ Richard H. Blank, Jr.
----------------------------
Title: Secretary
THE SHAREHOLDER SERVICES
GROUP, INC.
By: /s/ (Illegible)
----------------------------
Title: (Illegible)
18
<PAGE>
Schedule A
DUTIES OF THE TRANSFER AGENT
1. Shareholder Information. The Transfer Agent shall maintain a record
of the number of Shares held by each Shareholder of record which shall include
full registration information, including, but not limited to, name, address and
taxpayer identification number and which shall indicate whether such Shares are
held in certificated or uncertificated form.
2. Shareholder Services. The Transfer Agent shall respond as
appropriate to all inquiries and communications from Shareholders relating to
Shareholder accounts with respect to its duties hereunder and as may be from
time to time mutually agreed upon between the Transfer Agent and the Funds.
3. Share Certificates.
(a) At the expense of the appropriate Fund, each Fund shall supply
the Transfer Agent with adequate supply of blank share certificates to meet the
Transfer Agent's requirements therefor. Such Share certificates shall be
properly signed by facsimile. Each Fund agrees that, notwithstanding the death,
resignation, or removal of any officer of the Fund whose signature appears on
such certificates, the Transfer Agent or its agent may continue to countersign
certificates which bear such signatures until otherwise directed by Written
Instructions.
(b) The Transfer Agent shall issue replacement Share certificates in
lieu of certificates which have been lost, stolen or destroyed, upon receipt by
the Transfer Agent of properly executed affidavits and lost certificate bonds,
in form satisfactory to the Transfer Agent, with the appropriate Fund and the
Transfer Agent as obligees under the bond.
(c) The Transfer Agent shall also maintain a record of each
certificate issued, the number of Shares represented thereby and the Shareholder
of record. With respect to Shares held in open accounts or in uncertificated
form (i.e., no certificate being issued with respect thereto) the Transfer Agent
shall maintain comparable records of the Shareholders thereof, including their
names, addresses and taxpayer identification number. The Transfer Agent shall
further maintain a stop transfer record on lost and/or replaced certificates.
4. Mailing Communications to Shareholders; Proxy Materials. The
Transfer Agent will address and mail to Shareholders of the Funds, all reports
to Shareholders, dividend and distribution notices and proxy material for the
Funds' meetings of Shareholders. In connection with meetings of Shareholders,
the Transfer Agent will prepare Shareholder lists, mail and certify as to the
mailing of proxy materials, process and tabulate returned proxy cards, report on
proxies voted prior to meetings, act as inspector of election at meetings and
certify Shares voted at meetings.
1
<PAGE>
5. Sales of Shares
(a) The Transfer Agent shall not be required to issue any Shares of
a Fund where it has received a Written Instruction from the Fund or official
notice from any appropriate authority that the sale of the Shares of the Fund
has been suspended or discontinued. The existence of such Written Instructions
or such official notice shall be conclusive evidence of the right of the
Transfer Agent to rely on such Written Instructions or official notice.
(b) In the event that any check or other order for the payment of
money is returned unpaid for any reason, the Transfer Agent will endeavor to:
(i) give prompt notice of such return to the Fund or its designee; (ii) place a
stop transfer order against all Shares issued as a result of such check or
order; and (iii) take such actions as the Transfer Agent may from time to time
deem appropriate.
6. Transfer and Repurchase
(a) The Transfer Agent shall process all requests to transfer or
redeem Shares in accordance with the transfer or repurchase procedures set forth
in the Funds' Prospectus.
(b) The Transfer Agent will transfer or repurchase Shares upon
receipt of Oral or Written Instructions or otherwise pursuant to the Prospectus
and Share certificates, if any, properly endorsed for transfer or redemption,
accompanied by such documents as the Transfer Agent reasonably may deem
necessary.
(c) The Transfer Agent reserves the right to refuse to transfer or
repurchase Shares until it is satisfied that the endorsement on the instructions
is valid and genuine. The Transfer Agent also reserves the right to refuse to
transfer or repurchase Shares until it is satisfied that the requested transfer
or repurchase is legally authorized, and it shall incur no liability for the
refusal, in good faith, to make transfers or repurchases which the Transfer
Agent, in its good judgment, deems improper or unauthorized, or until it is
reasonably satisfied that there is no basis to any claims adverse to such
transfer or repurchase.
(d) When Shares are redeemed, the Transfer Agent shall, upon receipt
of the instructions and documents in proper form, deliver to the Custodian and
the appropriate Fund or its designee a notification setting forth the number of
Shares to be redeemed. Such redeemed Shares shall be reflected on appropriate
accounts maintained by the Transfer Agent reflecting outstanding Shares of the
Fund and Shares attributed to individual accounts.
(e) The Transfer Agent, upon receipt of the monies paid to it by the
Custodian for the redemption of Shares, pay such monies as are received from the
Custodian, all in accordance with the procedures described in the Written
Instructions received by the Transfer Agent from the Funds.
2
<PAGE>
(f) The Transfer Agent shall not process or effect any repurchase
with respect to Shares of the Fund after receipt by the Transfer Agent or its
agent of notification of the suspension of the determination of the net asset
value of the Fund.
7. Dividends
(a) Upon the declaration of each dividend and each capital gains
distribution by the Board of Directors of a Fund with respect to Shares of the
Fund, the Fund shall furnish or cause to be furnished to the Transfer Agent
Written Instructions setting forth the date of the declaration of such dividend
or distribution, the ex-dividend date, the date of payment thereof, the record
date as of which Shareholders entitled to payment shall be determined, the
amount payable per Share to the Shareholders of record as of that date, the
total amount payable to the Transfer Agent on the payment date and whether such
dividend or distribution is to be paid in Shares at net asset value.
(b) On or before the payment date specified in such resolution of
the Board of Directors, the Fund will pay to the Transfer Agent sufficient cash
to make payment on such payment date to the Shareholders of record on the record
date.
(c) If, prior to the payment date, the Transfer Agent does not
receive sufficient cash from the Fund to make total dividend and/or distribution
payments to all Shareholders of the Fund of the record date, the Transfer Agent
will, upon notifying the Fund, withhold payment to all Shareholders of record as
of the record date until sufficient cash is provided to the Transfer Agent.
8. In addition to and neither in lieu nor in contravention of the
services set forth above, the Transfer Agent shall: (i) perform all the
customary services of a transfer agent, registrar, dividend disbursing agent and
agent of the dividend reinvestment and cash purchase plan as described herein
consistent with those requirements in effect as at the date of this Agreement.
The detailed definition, frequency, limitations and associated costs (if any)
set out in the attached fee schedule, include but are not limited to:
maintaining all Shareholder accounts, preparing Shareholder meeting lists,
mailing proxies, tabulating proxies, mailing Shareholder reports to current
Shareholders, withholding taxes on U.S. resident and non-resident alien accounts
where applicable, preparing and filing U.S. Treasury Department Forms 1099 and
other appropriate forms required with respect to dividends and distributions by
federal authorities for all Shareholders.
3
<PAGE>
Schedule B
Quality Standards
(Effective October 2, 1995 as updated on September 25, 1995)
For all funds, open-end and closed-end, serviced by TSSG, under the Transfer
Agency and Services Agreement (with Facilities Management Arrangement) dated
June 1, 1995, the following quality standards shall apply. This schedule shall
replace the temporary quality standard Schedule B in the original agreement as
referenced in Section 5.2.
Financials:
- -----------
Subscriptions 98%
Redemptions 98%
Exchanges 98%
Non-Financials:
- --------------
Maintenances 98%
Transfers 98%
Correspondence 98%
Adjustments 98%
Telephone Calls 98%
New Accounts:
- ------------
New Account Set-ups 98%
- --------------------------------------------------------------------------------
Performance Standards
- --------------------------------------------------------------------------------
Telephone Performance Standards
================================================================================
Average speed of answer 20 seconds or less
- ----------------------------------- --------------------------------------------
Calls abandoned 2% of calls that wait 20 second or more
- ----------------------------------- --------------------------------------------
Service level* 80%
- ----------------------------------- --------------------------------------------
Article 1 -------------------------
- --------
* Represents the percentage of calls answered within 20 seconds.
<PAGE>
Schedule B
[List of Initial Quality Standards based on
1994 quarterly senior management reports]
Nations Fund
-------------
Financial Transactions
Subscriptions 98%
Redemptions 98%
Exchanges 98%
Non-Financials
Maintenance 98%
Transfers 98%
New Accounts 98%
% = minimum acceptable levels
Closed End Funds
----------------
Financials 98%
Subscriptions 98%
Redemptions 98%
Exchanges 98%
Non-Financials
Certificate Processing 98%
Maintenance 98%
Transfers 98%
New Accounts 98%
% = minimum acceptable levels
Capitol Funds
-------------
Financials
Subscriptions 98%
Redemptions 98%
Exchanges 98%
Non-Financials
Maintenance 98%
Transfers 98%
1
<PAGE>
New Accounts 98%
% = minimum acceptable levels
2
<PAGE>
Schedule C
Schedule of Costs
1. For purposes of this Agreement, "Costs" shall mean all internal and
external costs incurred by the Transfer Agent in connection with and properly
allocated to the Services provided under the Agreement, including, but not
limited to, the costs involved with the operation of the Charlotte Facility,
those costs reasonably incurred by the Transfer Agent to achieve the quality
standards imposed on it under the terms of this Agreement and the Transfer
Agent's overhead, depreciation and amortization costs, excepting out-of-pocket
expenses and such other costs agreed to in writing by the Transfer Agent and the
Funds.
2. The Funds shall have the right to audit, at their own expense, the
books and records of the Transfer Agent with respect to the Costs for which the
Transfer Agent seeks reimbursement under Article 8 on an annual basis, or more
frequently if the Funds have a reasonable basis to dispute any cost for which
the Transfer Agent seeks reimbursement.
3. The Transfer Agent shall use its best efforts to minimize the costs
incurred by it in connection with the provisions of services under this
Agreement to the extent such action is commercially reasonable and consistent
with the quality standards imposed under this Agreement.
<PAGE>
Schedule D
Non-Margin Expenses
- - Facilities related expenses as incurred by the Transfer Agent
under the Facilities Management Agreement between the Transfer
Agent and NationsBank
- - Out-of-Pocket expenses
- - Sub-Transfer Agent Fees and Expenses
- - Any other expenses agreed to in writing by the Transfer Agent and the Funds
<PAGE>
Schedule E
OUT-OF-POCKET EXPENSES
The Funds shall reimburse the Transfer Agent monthly for reasonable
out-of-pocket expenses incurred in connection with the provision of Services
under this Agreement, including, but not limited to the following items:
- Microfiche/microfilm production
- Magnetic media tapes and freight
- Printing costs, including certificates, envelopes, checks and
stationery
- Postage (bulk, pre-sort, ZIP+4, barcoding, first class) direct
pass through to the Funds
- Due diligence mailings
- Telephone and telecommunication costs, including all lease,
maintenance and line costs (excluding such telephone and
telecommunications costs provided by NationsBank pursuant to the
Facilities Agreement)
- Ad hoc reports
- Proxy solicitations, mailings and tabulations
- Daily & Distribution advice mailings (including all periodic
statements)
- Shipping, Certified and Overnight mail and insurance
- Year-end form production and mailings
- Terminals, communication lines, printers and other equipment and
any expenses incurred in connection with such terminals and lines
- Duplicating services
- Courier services
- Incoming and outgoing wire charges
- Federal Reserve charges for check clearance
- Overtime, as approved by the Funds
- Temporary staff, as approved by the Funds
- Travel and entertainment, as approved by the Funds
- Record retention, retrieval and destruction costs, including, but
not limited to exit fees charged by third party record keeping
vendors
- Third party audit reviews
- All conversion costs: including System start up costs
- Insurance
- Such other miscellaneous expenses reasonably incurred by the
Transfer Agent in performing its duties and responsibilities
under this Agreement.
- Systems Programming utilizing non-dedicated systems resources at
$100 per hour
The Funds agree that postage and mailing expenses will be paid on the
day of or prior to mailing as agreed with the Transfer Agent. In addition, the
Funds will promptly reimburse the Transfer Agent for any other unscheduled
expenses incurred by the Transfer Agent whenever the Funds and the Transfer
1
<PAGE>
Agent mutually agree that such expenses are not otherwise properly borne by the
Transfer Agent as part of its duties and obligations under the Agreement.
2
<PAGE>
Schedule F
Fund Documents
--------------
- Certified copy of the Articles of Incorporation of the Fund, as
amended
- Certified copy of the By-laws of the Fund, as amended
- Copy of the resolution of the Board of Directors authorizing the
execution and delivery of this Agreement
- Specimens of the certificates for Shares of the Fund, if
applicable, in the form approved by the Board of Directors of the
Fund, with a certificate of the Secretary of the Fund as to such
approval
- All account application forms and other documents relating to
Shareholder accounts or to any plan, program or service offered
by the Fund
- Certified list of Shareholders of the Fund with the name, address
and taxpayer identification number of each Shareholder, and the
number of Shares of the Fund held by each, certificate numbers
and denominations (if any certificates have been issued), lists
of any accounts against which stop transfer orders have been
placed, together with the reasons therefore, and the number of
Shares redeemed by the Fund.
- All notices issued by the Fund with respect to the Shares in
accordance with and pursuant to the Articles of Incorporation or
By-laws of the Fund or as required by law and shall perform such
other specific duties as are set forth in the Articles of
Incorporation including the giving of notice of any special or
annual meetings of shareholders and any other notices required
thereby.
<PAGE>
SCHEDULE G
FUND PORTFOLIOS
NATIONS FUND TRUST:
1. Nations Government Money Market Fund
2. Nations Tax Exempt Fund
3. Nations Value Fund
4. Nations Strategic Growth Fund
5. Nations Capital Growth Fund
6. Nations Emerging Growth Fund
7. Nations Equity Index Fund
8. Nations Managed Index Fund
9. Nations Managed SmallCap Index Fund
10. Nations Managed Value Index Fund
11. Nations Managed SmallCap Value Index Fund
12. Nations Disciplined Equity Fund
13. Nations Balanced Assets Fund
14. Nations Short-Intermediate Government Fund
15. Nations Short-Term Income Fund
16. Nations Diversified Income Fund
17. Nations Strategic Fixed Income Fund
18. Nations Municipal Income Fund
19. Nations Short-Term Municipal Income Fund
20. Nations Intermediate Municipal Bond Fund
21. Nations Florida Intermediate Municipal Bond Fund
22. Nations Florida Municipal Bond Fund
23. Nations Georgia Intermediate Municipal Bond Fund
24. Nations Georgia Municipal Bond Fund
25. Nations Maryland Intermediate Municipal Bond Fund
26. Nations Maryland Municipal Bond Fund
27. Nations North Carolina Intermediate Municipal Bond Fund
28. Nations North Carolina Municipal Bond Fund
29. Nations South Carolina Intermediate Municipal Bond Fund
30. Nations South Carolina Municipal Bond Fund
31. Nations Tennessee Intermediate Municipal Bond Fund
32. Nations Tennessee Municipal Bond Fund
33. Nations Texas Intermediate Municipal Bond Fund
34. Nations Texas Municipal Bond Fund
35. Nations Virginia Intermediate Municipal Bond Fund
36. Nations Virginia Municipal Bond Fund
NATIONS FUND, INC.:
1. Nations Prime Fund
2. Nations Treasury Fund
1
<PAGE>
3. Nations Equity Income Fund
4. Nations U.S. Government Bond Fund
5. Nations Small Company Growth Fund
6. Nations Government Securities Fund
7. Nations International Growth Fund
NATIONS RESERVES:
1. Nations Government Reserves
2. Nations Municipal Reserves
3. Nations Cash Reserves
4. Nations Treasury Reserves
5. Nations Money Market Reserves
6. Nations California Tax Exempt Reserves
7. Nations Asset Allocation Fund
8. Nations Capital Income Fund
9. Nations California Municipal Bond Fund
10. Nations Intermediate Bond Fund
11. Nations Blue Chip Fund
12. Nations Marsico Focused Equities Fund
13. Nations Marsico Growth & Income Fund
14. Nations International Equity Fund
15. Nations International Value Fund
16. Nations Emerging Markets Fund
NATIONS LIFEGOAL FUNDS, INC.
1. Nations LifeGoal Growth Portfolio
2. Nations LifeGoal Balanced Growth Portfolio
3. Nations LifeGoal Income and Growth Portfolio
NATIONS ANNUITY TRUST:
1. Nations Value Portfolio
2. Nations International Growth Portfolio
3. Nations Disciplined Equity Portfolio
4. Nations Marsico Focused Equities Portfolio
5. Nations Marsico Growth & Income Portfolio
6. Nations Managed Index Portfolio
7. Nations Managed SmallCap Index Portfolio
8. Nations Balanced Assets Portfolio
2
<PAGE>
NATIONS FUNDS TRUST:
1. Nations High Yield Bond Fund
2. Nations Kansas Municipal Income Fund
3. Nations MidCap Index Fund
CLOSED END FUNDS:
1. Nations Balanced Target Maturity Fund
2. Nations Government Income Term Trust 2003, Inc.
3. Nations Government Income Term Trust 2004, Inc.
Last Amended: February 14, 2000
3
Amendment to the
TRANSFER AGENCY AND SERVICES AGREEMENT
(With Facilities Management Arrangement)
THIS AMENDMENT dated as of this 1st day of January, 1999 is made to the
Transfer Agency and Services Agreement dated as of June 1, 1995, as amended (the
"Agreement"), by and among Nations Fund, Inc., Nations Fund Trust, the Capitol
Mutual Funds, d/b/a Nations Institutional Reserves, Nations Fund Portfolios,
Inc., Nations Life Goal Funds, Inc. and each other investment company which may
become a party hereto pursuant to the terms of this Agreement (individually a
"Fund", and collectively, the "Funds"), and First Data Investor Services Group,
Inc. f/k/a The Shareholder Services Group, Inc. (the "Transfer Agent").
RECITALS
WHEREAS, the parties hereto desire to amend certain provisions of the
Agreement.
NOW THEREFORE, in consideration of the promises and mutual covenants
herein contained, the Funds and the Transfer Agent agree that the Agreement
shall be amended as follows:
1. Article 3 is hereby amended by adding the following new Section 3.4:
"3.4 In addition, the Transfer Agent shall perform the related
print mail services in connection with the services set forth herein.
Fees for such services shall be agreed upon from time to time by the
parties."
2. Section 8.1 is hereby amended by deleting subsections (a) and (b) in
their entirety and inserting the following:
"(a) For the period December 1, 1998 through December 31, 1999, an
amount equal to 22.5% of such Costs during each month.
(b) For the period from January 1, 2000 through December 31, 2002 and
during each Renewal Term (as defined below), an amount equal to 15% of
such Costs during each month."
3. Article 16 - Term and Termination is hereby amended as follows:
(a) The first sentence of Section 16.1 is deleted in its entirety and
replaced with "This Agreement shall be effective on the date first
written above and shall continue through December 31, 2002 (the
"Initial Term"), unless earlier terminated pursuant to terms of this
Agreement."
(b) Section 16.3 is deleted in its entirety.
(c) Section 16.5 is deleted in its entirety and replaced with the
following new Section 16.5:
"16.5 In the event that the total combined assets of the Funds and any
other open end investment companies affiliated with the Funds by reason
of having a common investment advisor is increase by $18 billion or
more due to a merger or acquisition involving the investment advisor or
any affiliates of the investment advisor, the Funds shall have the
right to terminate this Agreement upon twelve (12) months prior written
notice to the Transfer Agent. As used in this Article 16, "affiliates
of the adviser" shall mean (i) a direct or indirect owner of 50% or
more of the outstanding common stock of the adviser (a "parent") or
(ii) any company or association whose outstanding common stock is at
least 50% owned, directly or indirectly, by the adviser or by a
parent."
(d) Modify Section 16.8 by deleting the phrase "Sections 16.3 or"
and inserting the word "Section".
<PAGE>
4. The following new provision is hereby added to Schedule A - Duties of
the Transfer Agent:
"Cash Management Services. (a) The Transfer Agent shall establish
demand deposit accounts (DDA's) with a cash management provider to facilitate
the receipt of purchase payments and the processing of other Shareholder-related
transactions. The Transfer Agent shall retain any excess balance credits earned
with respect to the amounts in such DDA's ("Balance Credits") after such Balance
Credits are first used to offset any banking service fees charged in connection
with banking services provided on behalf of the Fund. Balance Credits will be
calculated and applied toward the Fund's banking service charges regardless of
the withdrawal of DDA balances described in Section (b) below.
(b) DDA balances which cannot be forwarded on the day of receipt may be
withdrawn on a daily basis and invested in U.S. Treasury and Federal Agency
obligations, money market mutual funds, repurchase agreements, money market
preferred securities (rated A or better), commercial paper (rated A1 or P1),
corporate notes/bonds (rated A or better) and/or Eurodollar time deposits
(issued by banks rated A or better). Investor Services Group bears the risk of
loss on any such investment and shall retain any earnings generated thereby.
Other similarly rated investment vehicles may be used, provided however,
Investor Services Group shall first notify the Fund of any such change.
(c) The Transfer Agent may facilitate the payment of distributions from
the Fund which are made by check ("Distributions") through the "IPS Official
Check" program. "IPS Official Check" is a product and service provided by the
Transfer Agent's affiliate, Integrated Payment Systems ("IPS"). IPS is licensed
and regulated as an "issuer of payment instruments". In the event the IPS
Official Check program is utilized, funds used to cover such Distributions shall
be forwarded to and held by IPS. IPS may invest such funds while awaiting
presentment of items for payment. In return the services provided by IPS, IPS
imposes a $.07 per item charge which shall be paid by the Funds as out-of-pocket
expense and shall retain, and share with the Transfer Agent, the benefit of the
revenue generated from its investment practices."
5. Schedule D - Non-Margin Expenses is amended by adding the following
items:
- Print Mail Fees
- Systems Programming utilizing non-dedicated systems resources
at $100 per/hr
- All conversion costs: including System start up costs
- Overtime, as approved by the Funds
- Travel and Entertainment, as approved by the Funds
6. Schedule E - Out-of-Pocket Expenses is amended by deleting the
following items:
- Printing costs, including certificates, envelopes, checks and
stationary
- Due diligence mailings - Ad hoc reports
- Daily & Distribution advice mailings (including all periodic
reports)
- Year-end for production and mailings
- Incoming and outgoing wire charges
- Federal Reserve charges for check clearance
- All conversion costs: including System start up costs
- Systems Programming utilizing non-dedicated systems resources
at $100 per/hr
- Overtime, as approved by the Funds
- Travel and Entertainment, as approved by the Funds
The terms and provisions of this Amendment shall be deemed a part of
the Agreement for all purposes. To the extent that any provisions of this
Amendment modify or are otherwise inconsistent with any provisions of the
Agreement, the terms of this Amendment shall control. In all other respects, the
Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized officers, as of the day and year first written
above.
2
<PAGE>
FIRST DATA INVESTOR SERVICES GROUP, INC.
By:
Name: /s/ Jylanne M. Dunne
------------------------------------
Title: Jylanne M. Dunne
NATIONS FUND, INC.
By: /s/ James E. Banks, Jr.
------------------------------------
Name: James E. Banks, Jr.
------------------------------------
Title: Assistant Secretary
------------------------------------
NATIONS FUND TRUST
By: /s/ James E. Banks, Jr.
------------------------------------
Name: James E. Banks, Jr.
------------------------------------
Title: Assistant Secretary
------------------------------------
CAPITOL MUTUAL FUNDS, d/b/a NATIONS INSTITUTIONAL
RESERVES
By: /s/ James E. Banks, Jr.
------------------------------------
Name: James E. Banks, Jr.
------------------------------------
Title: Assistant Secretary
------------------------------------
NATIONS FUND PORTFOLIOS, INC.
By: /s/ James E. Banks, Jr.
------------------------------------
Name: James E. Banks, Jr.
------------------------------------
Title: Assistant Secretary
------------------------------------
3
<PAGE>
NATIONS LIFEGOAL FUNDS, INC.
By: /s/ James E. Banks, Jr.
------------------------------------
Name: James E. Banks, Jr.
------------------------------------
Title: Assistant Secretary
------------------------------------
4
SUB-TRANSFER AGENCY AND SERVICES AGREEMENT
THIS AGREEMENT, dated as of this 11th day of September, 1995, is by and
between THE SHAREHOLDER SERVICES GROUP, INC. ("TSSG", also referred to as the
"Transfer Agent"), a Massachusetts corporation and principal offices at One
Exchange Place, 53 State Street, Boston, Massachusetts 02109 and NATIONSBANK OF
TEXAS, N.A. ("NationsBank"), organized under the laws of Texas and having its
principal place of business at 1401 Elm Street, 11th Floor, Dallas, TX 75202.
WITNESSETH
WHEREAS, TSSG has been appointed transfer agent for those open-end
registered investment companies identified on the attached Schedule A
(individually the "Fund" and collectively the "Funds") pursuant to the terms of
the Transfer Agency and Services Agreement (the "Transfer Agent Agreement(s)")
with each such Fund;
WHEREAS, the Funds are authorized to issue shares in separate series,
with each such series representing interests in a separate portfolio of
securities and other assets ("Portfolio"). Each such Portfolio shall also be
identified on Schedule A;
WHEREAS, each Portfolio is authorized to issue multiple classes of
shares including Trust A Shares and, in many cases, Trust B Shares (the "Trust
Shares"); and
WHEREAS, the Funds have authorized TSSG to subcontract with and appoint
NationsBank as its agent to perform certain administrative and ministerial
duties and obligations that the Transfer Agent has to the Funds with respect to
the Trust Shares and NationsBank desires to accept such appointment;
NOW THEREFORE, in consideration of the mutual covenants and promises
hereinafter set forth, TSSG and NationsBank agree as follows:
Article 1 Definitions
1.1 Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
(a) "Articles of Incorporation" shall mean the Articles of
Incorporation, Declaration of Trust, or other similar organizational
document as the case may be, of the Funds as the same may be amended
from time to time;
(b) "Authorized Person" shall be deemed to include (i) any
authorized Officer of the Fund; or (ii) any person, whether or not such
person is an Officer or employee of the Fund, duly authorized to give
Oral Instructions or Written Instructions on behalf of the Fund as
indicated in writing to the Transfer Agent from time to time;
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(c) "Board of Directors" shall mean the Board of Directors or
Board of Trustees of the Fund, as the case may be;
(d) "Commission" shall mean the Securities and Exchange
Commission;
(e) "Custodian" refers to any custodian or subcustodian of
securities and other property which the Fund may from time to time
deposit, or cause to be deposited or held under the name or account of
such a custodian pursuant to a Custodian Agreement;
(f) "1940 Act" shall mean the Investment Company Act of 1940,
and the rules and regulations promulgated thereunder, all as amended
from time to time;
(g) "Oral Instructions" shall mean instructions, other than
Written Instructions, actually received by NationsBank from a person
reasonably believed by NationsBank to be an Authorized Person;
(h) "Prospectus" shall mean the most recently dated Fund
Prospectuses and Statements of Additional Information, including
supplements thereto if any, which have become effective under the
Securities Act of 1933 and the 1940 Act;
(i) "Shares" refers collectively to such Trust Shares of the
Portfolios as may be issued from time to time;
(j) "Shareholder" shall mean a record owner of Shares; and
(k) "Written Instructions" shall mean a written communication
signed by a person reasonably believed by NationsBank to be an
Authorized Person and actually received by the Transfer Agent. Written
Instructions shall include manually executed originals and authorized
electronic transmissions, including telefacsimile of a manually
executed original or other process.
Article 2 Appointment of NationsBank
2.1 TSSG hereby appoints NationsBank as its subcontractor and agent to
perform certain administrative and ministerial duties on behalf of the Funds,
and NationsBank hereby accepts such appointment and agrees to perform the duties
hereinafter set forth.
Article 3 Duties of NationsBank
3.1 NationsBank shall be responsible for administering and/or
performing the customary services of a transfer agent; for performing the
customary services of a service agent in connection with dividend and
distribution functions; and for performing shareholder account and
administrative agent functions in connection with the issuance, transfer and
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redemption or repurchase (including coordination with the Custodian) of Shares,
as more fully described in the written Schedule of Duties of NationsBank annexed
hereto as Schedule B and incorporated herein, and in accordance with the terms
of the Prospectus, applicable law and the procedures established from time to
time between NationsBank and the Transfer Agent and/or the Funds.
3.2 Notwithstanding any of the foregoing provisions of this Agreement,
NationsBank and the Transfer Agent shall be under no duty or obligation to
inquire into, and shall not be liable for: (i) the legality of the issuance or
sale of any Shares or the sufficiency of the amount to be received therefor;
(ii) the legality of the redemption of any Shares, or the propriety of the
amount to be paid therefor; (iii) the legality of the declaration of any
dividend by the Board of Directors, or the legality of the issuance of any
shares in payment of any dividend; or (iv) the legality of any recapitalization
or readjustment of the Shares. It being understood that such shall be the
responsibility of the Funds.
3.3 In addition, the Funds shall verify the establishment of
transactions in Shares for each state on the system prior to activation and
thereafter monitor the daily activity for each state. The responsibility of
NationsBank for the Funds' blue sky state registration status is solely limited
to the initial establishment of transactions in Shares subject to blue sky
compliance by the Funds and the reporting of such transactions to the Funds as
provided above.
Article 4 Recordkeeping and Other Information
4.1 NationsBank shall create and maintain all records required of it
pursuant to its duties hereunder and as set forth in Schedule B in accordance
with all applicable laws, rules and regulations, including records required by
Section 31(a) of the 1940 Act. All records shall be available during regular
business hours for inspection and use by the Transfer Agent and the Funds. Where
applicable, such records shall be maintained by NationsBank for the periods and
in the places required by Rule 31a-2 under the 1940 Act.
4.2 To the extent required by Section 31 of the 1940 Act, NationsBank
agrees that all such records prepared or maintained by NationsBank relating to
the services to be performed by NationsBank hereunder are the property of the
Funds and will be preserved, maintained and made available in accordance with
such section, and will be surrendered promptly to the Funds on and in accordance
with the Funds' request.
4.3 In case of any requests or demands for the inspection of
Shareholder records of the Funds, NationsBank will endeavor to notify the
applicable Fund of such request and secure Written Instructions as to the
handling of such request. NationsBank reserves the right, however, to exhibit
the Shareholder records to any person whenever it is advised by its counsel that
it may be held liable for the failure to comply with such request.
4.4 Upon reasonable notice by the applicable Fund, NationsBank shall
make available during regular business hours such of its facilities and premises
employed in
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connection with the performance of its duties under this Agreement for
reasonable visitation by such Fund, or any person retained by the Fund as may be
necessary for the Fund to evaluate the quality of the services performed by
NationsBank pursuant hereto.
Article 5 Fund Instructions
5.1 NationsBank will have no liability when acting upon Written or Oral
Instructions believed to have been executed or orally communicated by an
Authorized Person and will not be held to have any notice of any change of
authority of any person until it receives Written Instruction thereof from the
Fund. NationsBank will also have no liability when processing Share certificates
which it reasonably believes to bear the proper manual or facsimile signatures
of the Officers of the Fund and the proper countersignature of the Transfer
Agent.
5.2 At any time, NationsBank may request Written Instructions from the
Fund and may seek advice from legal counsel for the Funds, or its own legal
counsel, with respect to any matter arising in connection with this Agreement,
and it shall not be liable for any action taken or not taken or suffered by it
in good faith in accordance with such Written Instructions or in accordance with
the opinion of counsel for the Funds or for NationsBank. Written Instructions
requested by NationsBank will be provided by the Fund within a reasonable period
of time.
5.3 NationsBank, its Officers, agents or employees, shall accept Oral
Instructions or Written Instructions given to them by any person representing or
acting on behalf of a Fund only if said representative is an Authorized Person.
The Fund agrees that all Oral Instructions shall be followed, within one
business day, by confirming Written Instructions, and that the Fund's failure to
so confirm shall not impair in any respect NationsBank's right to reply on Oral
Instructions.
Article 6 Compensation
6.1 Upon receipt of the appropriate payment from the Funds, the
Transfer Agent will compensate NationsBank for the performance of its
obligations hereunder in accordance with the fees set forth in the written Fee
Schedule annexed hereto as Schedule C and incorporated herein. The Transfer
Agent's responsibility under this Section 6.1 is conditioned upon receipt of
such payment from the Funds.
Article 7 Representations and Warranties of NationsBank
7.1 NationsBank represents and warrants to the Transfer Agent that:
(a) it is a corporation duly organized and existing and in
good standing under the laws of Texas;
(b) it is empowered under applicable laws and by its Articles
of Incorporation and By-Laws to enter into and perform this Agreement;
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(c) all requisite corporate proceedings have been taken to
authorize it to enter into this Agreement;
(d) it is duly registered with its appropriate regulatory
agency as a transfer agent and such registration will remain in effect
for the duration of this Agreement;
(e) it has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and
obligations under this Agreement.
Article 8 Representations and Warranties of the Transfer Agent
8.1 The Transfer Agent represents and warrants to NationsBank that:
(a) it is duly organized and existing and in good standing
under the laws of the jurisdiction in which it is organized;
(b) it is empowered under applicable laws and by its Articles
of Incorporation and By-Laws and the Transfer Agent Agreement to enter
into this Agreement;
(c) all corporate proceedings required by said Articles of
Incorporation, By-Laws and applicable laws have been taken to authorize
it to enter into this Agreement.
Article 9 Indemnification
9.1 To, and only to, the extent the Transfer Agent is indemnified by
the Funds pursuant to the terms of the Transfer Agent Agreements, NationsBank
shall not be responsible for and the Transfer Agent shall indemnify and hold
NationsBank harmless from and against any and all claims, costs, expenses
(including reasonable attorneys' fees), losses, damages, charges, payments and
liabilities of any sort or kind which may be asserted against NationsBank or for
which NationsBank may be held to be liable (a "Claim") arising out of or
attributable to any of the following:
(a) Any actions of NationsBank required to be taken pursuant
to this Agreement unless such Claim resulted from a negligent act or
omission to act or bad faith by NationsBank in the performance of its
duties hereunder.
(b) NationsBank's reasonable reliance on, or reasonable use of
information, data, records and documents (including but not limited to
magnetic tapes, computer printouts, hard copies and microfilm copies)
received by NationsBank from the Funds, or any authorized third party
acting on behalf of the Funds, including but not limited to the
Transfer Agent or any prior transfer agent for the Funds, in the
performance of NationsBank's duties and obligations hereunder.
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(c) The reliance on, or the implementation of, any Written or
Oral Instructions or any other instructions or requests which are
provided by an Authorized Person of the Fund.
(d) The offer or sale of shares by the Fund in violation of
any requirement under the securities laws or regulations of any state
that such Shares be registered in such state or in violation of any
stop order or other determination or ruling by any state with the
respect to the offer or sale of such Shares in such state.
(e) The Transfer Agent's refusal or failure to comply with the
terms of this Agreement, or any Claim which arises out of this
Agreement, or any Claim which arises out of the Transfer Agent's
negligence or misconduct or the breach of which any representation or
warranty of the Transfer Agent made herein.
9.2 Notwithstanding the foregoing Section 9.1, the Transfer Agent shall
be responsible for and indemnify and hold NationsBank harmless from and against
any and all claims by third parties, including, costs, expenses (including
reasonable attorneys' fees), losses, damages, charges, payments and liabilities
of any sort or kind which may be asserted against NationsBank or for which
NationsBank may be held to be liable arising out of or attributable to a
negligent act or omission to act or bad faith by the Transfer Agent.
9.3 NationsBank shall indemnify and hold the Transfer Agent harmless
from and against any and all claims, costs, expenses (including reasonable
attorneys' fees), losses, damages, charges, payments and liabilities of any sort
or kind which may be asserted against the Transfer Agent or for which the
Transfer Agent may be held to be liable arising out of or attributable to any
negligent act or failure to act or bad faith or willful misconduct on the part
of NationsBank in connection with the performance of its duties under this
Agreement.
9.4 In any case in which either party (the "Indemnifying Party") may be
asked to indemnify or hold the other (the "Indemnified Party") harmless, the
Indemnified Party will notify the Indemnifying Party promptly after identifying
any situation which it believes presents or appears likely to present a claim
for indemnification against the Indemnifying Party although the failure to do so
shall not prevent recovery by the Indemnified Party and the Indemnified Party
shall keep the Indemnifying Party advised with respect to all developments
concerning such situation. The Indemnifying Party shall have the option to
defend the Indemnified Party against any Claim which may be the subject of this
indemnification, and, in the event that the Indemnifying Party so elects, such
defense shall be conducted by counsel chosen by the Indemnifying Party and
satisfactory to the Indemnified Party, and thereupon the Indemnifying Party
shall take over complete defense of the Claim and the Indemnified Party shall
sustain no further legal or other expenses in respect of such Claim. The
Indemnified Party will not confess any Claim or make any compromise in any case
in which the Indemnifying Party will be asked to provide indemnification, except
with the Indemnifying Party's prior written consent.
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9.5 The obligations of the parties hereto under this Article 9 shall
survive the termination of this Agreement.
Article 10 Standard of Care
10.1 NationsBank shall at all times, act in good faith and agrees to
use its best efforts within commercially reasonable limits to ensure the
accuracy of all services performed under this Agreement, but assumes no
responsibility for loss or damage to the Transfer Agent unless said errors are
caused by NationsBank's own negligence, bad faith or willful misconduct or that
of its employees.
Article 11 Consequential Damages
11.1 In no event and under no circumstances shall either party to this
Agreement be liable to the other party for consequential or indirect loss of
profits, reputation or business or any other special damages under any provision
of this Agreement or for any act or failure to act hereunder.
Article 12 Term and Termination
12.1 This Agreement shall be effective on the date first written above
and shall continue for a period of five (5) years (the "Initial Term"), unless
earlier terminated pursuant to the terms of this Agreement. Thereafter, this
Agreement shall automatically be renewed for successive terms of three (3) years
("Renewal Terms") each.
12.2 Either party may terminate this Agreement at the end of the
Initial Term or any subsequent Renewal Term upon not less than ninety (90) days,
or more than one-hundred eighty (180) days, prior written notice to the other
party.
12.3 In the event a termination notice is given by the Transfer Agent,
all expenses associated with movement of records and materials and conversion
thereof to the Transfer Agent or to a successor subcontractor, will be borne by
the Transfer Agent.
12.4 If a party hereto is guilty of a material failure to perform its
duties and obligations hereunder (a "Defaulting Party") the other party (the
"Non-Defaulting Party") may give written notice thereof to the Defaulting Party,
and if such material breach shall not have been remedied within thirty (30) days
after such written notice is given, then the Non-Defaulting Party may terminate
this Agreement by giving thirty (30) days written notice of such termination to
the Defaulting Party. If NationsBank is the Non-Defaulting Party, its
termination of this Agreement shall not constitute a waiver of any other rights
or remedies of NationsBank with respect to services performed prior to such
termination of rights of NationsBank to be reimbursed for out-of-pocket
expenses. In all cases, termination by the Non-Defaulting Party shall not
constitute a waiver by the Non-Defaulting Party of any other rights it might
have under this Agreement or otherwise against the Defaulting Party.
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12.5 Notwithstanding any provision of this Article 12 to the contrary,
this Agreement shall terminate simultaneously with any termination of the
Transfer Agent Agreement.
Article 13 Confidentiality
13.1 In connection with the services provided by NationsBank hereunder,
certain confidential and proprietary information regarding NationsBank and the
Transfer Agent may be disclosed to the other. In connection therewith, the
parties agree as follows:
(a) Confidential Information disclosed under this Agreement
shall mean:
(i) any data or information that is competitively sensitive
material, and not generally known to the public, including,
but not limited to, information about product plans, marketing
strategies, finance, operations, customer relationships,
customer profiles, sales estimates, business plans, and
internal performance results relating to the past, present or
future business activities of NationsBank, the Transfer Agent
or the Funds, their respective parent corporations, their
respective subsidiaries and affiliated companies and the
customers, clients and suppliers of any of the foregoing;
(ii) any scientific or technical information, design, process,
procedure, formula, or improvement that is commercially
valuable and secret in the sense that its confidentiality
affords NationsBank, the Transfer Agent or the Funds a
competitive advantage over its competitors; and
(iii) all confidential or proprietary concepts, documentation,
reports, data, specifications, computer software, source code,
object code, flow charts, databases, inventions, know-how,
show-how and trade secrets, whether or not patentable or
copyrightable.
(b) Confidential Information also includes, without
limitation, all documents, inventions, substances, engineering and
laboratory notebooks, drawings, diagrams, specifications, bills of
material, equipment, prototypes and models, and any other tangible
manifestation of the foregoing which now exist or come into the control
or possession of the party.
13.2 Except as expressly authorized by prior written consent of the
disclosing party ("Discloser"), the party receiving Confidential Information
("Recipient") shall:
(a) limit access to Discloser's Confidential Information to
Recipient's employees who have a need-to-know in connection with the
subject matter thereof;
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(b) advise those employees who have access to the Confidential
Information of the proprietary nature thereof and of the obligations
set forth in this Confidentiality Agreement;
(c) take appropriate action by instruction or agreement with
the employees having access to Discloser's Confidential Information to
fulfill Recipient's obligations under this Confidentiality Agreement;
(d) safeguard all of Discloser's Confidential Information by
using a reasonable degree of care, but not less than that degree of
care used by Recipient in safeguarding its own similar information or
material;
(e) use all of Discloser's Confidential Information solely for
purposes that it was intended;
(f) not disclose any of Discloser's Confidential Information
to third parties.
13.3 Upon Discloser's request, Recipient shall surrender to Discloser
all memoranda, notes, records, drawings, manuals, records, and other documents
or materials (and all copies of same) relating to or containing Discloser's
Confidential Information. When Recipient returns the materials, Recipient shall
certify in writing that it has returned all materials containing or relating to
the Confidential Information.
13.4 The obligations of confidentiality and restriction on use in this
Article 13 shall not apply to any Confidential Information that Recipient
proves:
(a) Was in the public domain prior to the date of this
Agreement or subsequently came into the public domain through no fault
of Recipient;
(b) Was lawfully received by Recipient from a third party free
of any obligation of confidence to the third party;
(c) Was already in Recipient's possession prior to receipt
from Discloser;
(d) Is required to be disclosed in a judicial or
administrative proceeding after all reasonable legal remedies for
maintaining such information in confidence have been exhausted
including, but not limited to, giving Discloser as much advance notice
as practical of the possibility of disclosure to allow Discloser to
stop such disclosure or obtain a protective order concerning such
disclosure; or
(e) Is subsequently and independently developed by Recipient's
employees, consultants or agents without reference to Confidential
Information.
13.5 NationsBank and the Transfer Agent agree that money damages would
not be a sufficient remedy for breach of this Article 13. Accordingly, in
addition to all other remedies that either party may have, a party shall be
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entitled to specific performance and injunctive or other equitable relief as a
remedy for any breach of this Agreement. The parties agree to waive any
requirement for a bond in connection with any such injunctive or other equitable
relief.
Article 14 Force Majeure
14.1 In the event either party is unable to perform its obligations
under the terms of this Agreement because of acts of God, strikes, labor
difficulties, mechanical breakdowns, equipment or transmission failure or damage
reasonably beyond its control, or other causes reasonably beyond its control,
such party shall not be liable for damages to the other for any damages
resulting from such failure to perform or otherwise from such causes.
Article 15 Amendments
15.1 This Agreement may only be amended or modified by a written
instrument executed by both parties.
Article 16 Subcontracting
16.1 The Transfer Agent agrees that NationsBank may, in its discretion,
subcontract for certain of the services described under this Agreement or the
Schedules hereto; provided that the appointment of any such subcontractor shall
not relieve NationsBank of its responsibilities hereunder.
Article 17 Arbitration
17.1 Any Claim or controversy arising out of or relating to this
Agreement, or breach hereof, shall be settled by arbitration administered by the
American Arbitration Association in Boston, Massachusetts in accordance with its
applicable rules, except that the Federal Rules of Evidence and the Federal
Rules of Civil Procedure with respect to the discovery process shall apply.
17.2 The parties hereby agree that judgment upon the award rendered by
the arbitrator may be entered in any court having jurisdiction.
17.3 The parties acknowledge and agree that the performance of the
obligations under this Agreement necessitates the use of instrumentalities of
interstate commerce and, notwithstanding other general choice of law provisions
in this Agreement, the parties agree that the Federal Arbitration Act shall
govern and control with respect to the provisions of this Article 17.
Article 18 Notice
18.1 Any notice or other instrument authorized or required by this
Agreement to be given in writing to NationsBank or the Transfer Agent, shall be
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sufficiently given if addressed to that party and received by it at its office
set forth below or at such other place as it may from time to time designate in
writing.
To the Transfer Agent:
The Shareholder Services Group, Inc.
One Exchange Place
53 State Street
Boston, Massachusetts 02109
Attention: President
with a copy to TSSG's General Counsel
To: NationsBank
NationsBank
NationsBank Plaza
101 S. Tryon Street, NC1-002-33-31
Charlotte, North Carolina 28255
Attention: Ted Johnson
Article 19 Successors
19.1 This Agreement shall extend to and shall be binding upon the
parties hereto, and their respective successors and assigns, provided, however,
that this Agreement shall not be assigned to any person other than a person
controlling, controlled by or under common control with the assignor without the
written consent of the other party, which consent shall not be unreasonably
withheld.
Article 20 Governing Law
20.1 This Agreement shall be governed exclusively by the laws of the
Commonwealth of Massachusetts without reference to the choice of law provisions
thereof. Subject to Article 17, each party to this Agreement hereby (i) consents
to the personal jurisdiction of the Commonwealth of Massachusetts courts over
the parties hereto, hereby waiving any defense of lack of personal jurisdiction;
and (ii) appoints the person to whom notices hereunder are to be sent as agent
for service of process.
Article 21 Counterparts
21.1 This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original; but such counterparts shall,
together, constitute only one instrument.
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Article 22 Captions
22.1 The captions included in this Agreement are for convenience of
reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.
Article 23 Relationship of Parties
23.1 The parties agree that they are independent contractors and not
partners or co-venturers and nothing contained herein shall be interpreted or
construed otherwise.
Article 24 Entire Agreement; Severability
24.1 This Agreement and the Schedules attached hereto constitute the
entire agreement of the parties hereto relating to the matters covered hereby
and supersede any previous agreements. If any provision is held to be illegal,
unenforceable or invalid for any reason, the remaining provisions shall not be
affected or impaired thereby.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers, as of the day and year written
above.
THE SHAREHOLDER SERVICES
GROUP, INC.
By: /s/ Jack P. Kurt
--------------------------------------
Title: Executive Vice President and Chief
Operating Officer
NATIONSBANK OF TEXAS, N.A.
By: /s/ Mark H. Williamson
--------------------------------------
Title: Senior Vice President
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SCHEDULE A
FUND PORTFOLIOS
NATIONS FUND TRUST:
1. Nations Government Money Market Fund
2. Nations Tax Exempt Fund
3. Nations Value Fund
4. Nations Strategic Growth Fund
5. Nations Capital Growth Fund
6. Nations Emerging Growth Fund
7. Nations Equity Index Fund
8. Nations Managed Index Fund
9. Nations Managed SmallCap Index Fund
10. Nations Managed Value Index Fund
11. Nations Managed SmallCap Value Index Fund
12. Nations Disciplined Equity Fund
13. Nations Balanced Assets Fund
14. Nations Short-Intermediate Government Fund
15. Nations Short-Term Income Fund
16. Nations Diversified Income Fund
17. Nations Strategic Fixed Income Fund
18. Nations Municipal Income Fund
19. Nations Short-Term Municipal Income Fund
20. Nations Intermediate Municipal Bond Fund
21. Nations Florida Intermediate Municipal Bond Fund
22. Nations Florida Municipal Bond Fund
23. Nations Georgia Intermediate Municipal Bond Fund
24. Nations Georgia Municipal Bond Fund
25. Nations Maryland Intermediate Municipal Bond Fund
26. Nations Maryland Municipal Bond Fund
27. Nations North Carolina Intermediate Municipal Bond Fund
28. Nations North Carolina Municipal Bond Fund
29. Nations South Carolina Intermediate Municipal Bond Fund
30. Nations South Carolina Municipal Bond Fund
31. Nations Tennessee Intermediate Municipal Bond Fund
32. Nations Tennessee Municipal Bond Fund
33. Nations Texas Intermediate Municipal Bond Fund
34. Nations Texas Municipal Bond Fund
35. Nations Virginia Intermediate Municipal Bond Fund
36. Nations Virginia Municipal Bond Fund
NATIONS FUND INC.
1. Nations Prime Fund
2. Nations Treasury Fund
3. Nations International Growth Fund
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4. Nations Equity Income Fund
5. Nations U.S. Government Bond Fund
6. Nations Small Company Growth Fund
7. Nations Government Securities Fund
NATIONS RESERVES:
1. Nations Asset Allocation Fund
2. Nations Capital Income Fund
3. Nations California Municipal Bond Fund
4. Nations Intermediate Bond Fund
5. Nations Blue Chip Fund
6. Nations Marsico Focused Equities Fund
7. Nations Marsico Growth & Income Fund
8. Nations International Equity Fund
9. Nations International Value Fund
10. Nations Emerging Markets Fund
NATIONS LIFEGOAL FUNDS, INC.:
1. Nations LifeGoal Growth Portfolio
2. Nations LifeGoal Balanced Growth Portfolio
3. Nations LifeGoal Income and Growth Portfolio
NATIONS FUNDS TRUST:
1. Nations High Yield Bond Fund
2. Nations MidCap Index Fund
3. Nations Kansas Municipal Income Fund
Last Amended: February 14, 2000
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IN WITNESS WHEREOF, the parties hereto have caused the amended Schedule
A to be executed by their Officers designated below as of the 14th day of
February, 2000.
PFPC Inc. (Formerly First Data Investor
Services Group, Inc. f/k/a The Shareholder
Services Group, Inc.)
By: /s/ Jylanne M. Dunne
-------------------------------------
Name: Jylanne M. Dunne
Title: Senior Vice President
BANK OF AMERICA, N.A. (Formerly
NationsBank of Texas, N.A.)
By: /s/ Edward D. Bedard
-------------------------------------
Name: Edward D. Bedard
Title: Senior Vice President
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Schedule B
DUTIES OF NATIONSBANK
1. Shareholder Information. NationsBank shall maintain a record of the
number of Shares held by each Shareholder of record which shall include name,
address, and taxpayer identification number and which shall indicate whether
such Shares are held in certificates or uncertificated form.
2. Shareholder Services. NationsBank shall respond as appropriate to
all inquiries and communications from Shareholders relating to Shareholder
accounts with respect to its duties hereunder and as may be from time to time
mutually agreed upon between NationsBank and the Transfer Agent (or the Funds as
the case maybe).
3. Share Certificates.
(a) At the expense of the Funds, the Funds shall supply NationsBank
with an adequate supply of blank share certificates to meet NationsBank's
requirements therefor. Such Share certificates shall be properly signed by
facsimile. Notwithstanding the death, resignation, or removal of any Officer of
the Fund whose signature appears on such certificates, NationsBank or its agent
may continue to countersign certificates which bear such signatures until
otherwise directed by Written Instructions.
(b) NationsBank shall issue replacement Share certificates in lieu of
certificates which have been lost, stolen or destroyed, upon receipt by
NationsBank of properly executed affidavits and lost certificate bonds, in form
satisfactory to NationsBank, with the applicable Fund and NationsBank as
obligees under the bond.
(c) NationsBank shall also maintain a record of each certificate
issued, the number of Shares represented thereby and the Shareholder of record.
With respect to Shares held in open accounts or uncertificated form (i.e., no
certificate being issued with respect thereto) the Transfer Agent shall maintain
comparable records of the Shareholders thereof, including their names, addresses
and taxpayer identification numbers. NationsBank shall further maintain a stop
transfer record on lost and/or replaced certificates.
4. Mailing Communications to Shareholders; Proxy Materials. NationsBank
will address and mail to Shareholders of the Funds, all reports to Shareholders,
dividend and distribution notices and proxy material for the Funds' meetings of
Shareholders. In connection with meetings of Shareholders, NationsBank will
prepare Shareholder lists, mail and certify as to the mailing of proxy
materials, process and tabulate returned proxy cards, report on proxies voted
prior to meetings, act as inspector of election at meetings and certify Shares
voted at meetings.
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5. Sales of Shares.
(a) NationsBank shall not be required to issue any Shares of the
Funds where it has received a Written Instruction from the applicable Fund or
official notice from any appropriate authority that the sale of the Shares of
such Fund has been suspended or discontinued. The existence of such Written
Instructions or such official notice shall be conclusive evidence of the right
of NationsBank to rely on such Written Instructions or official notice.
(b) In the event that any check or other order for the payment of
money is returned unpaid for any reason, NationsBank will endeavor to: (i) give
prompt notice of such return to the applicable Fund or its designee; (ii) place
a stop transfer order against all Shares issued as a result of such check or
order; and (iii) take such actions as NationsBank may from time to time deem
appropriate.
6. Transfer and Repurchase.
(a) NationsBank shall process all requests to transfer or redeem
Shares in accordance with the transfer or repurchase procedures set forth in the
applicable Fund's Prospectus.
(b) NationsBank will transfer or repurchase Shares upon receipt of
Oral or Written Instructions or otherwise pursuant to the Prospectus and Share
certificates, if any, properly endorsed for transfer or redemption, accompanied
by such documents as NationsBank reasonably may deem necessary.
(c) NationsBank reserves the right to refuse to transfer or
repurchase Shares until it is satisfied that the endorsement on the instructions
is valid and genuine. NationsBank also reserves the right to refuse to transfer
or repurchase Shares until it is satisfied that the requested transfer or
repurchase is legally authorized, and it shall incur no liability for the
refusal, in good faith, to make transfers or repurchases which NationsBank, in
its reasonable judgment, deems improper or unauthorized, or until it is
reasonably satisfied that there is no basis to any claims adverse to such
transfer or repurchase.
(d) When Shares are redeemed, NationsBank shall, upon receipt of the
instructions and documents in proper form, deliver to the Custodian and the
applicable Fund or its designee a notification setting forth the number of
Shares to be redeemed. Such redeemed Shares shall be reflected on appropriate
accounts maintained by NationsBank reflecting outstanding Shares of the
applicable Fund and Shares attributed to individual accounts.
(e) NationsBank shall, upon receipt of the monies paid to it by the
Custodian for the redemption of Shares, pay such monies as are received from the
Custodian, all in accordance with the procedures described in the Written
Instructions received by NationsBank from the Funds.
2
<PAGE>
(f) NationsBank shall not process or effect any repurchase with
respect to Shares of any Fund after receipt by NationsBank or its agent of
notification of the suspension of the determination of the net asset value of
such Fund.
7. Dividends.
(a) Upon the declaration of each dividend and each capital gains
distribution by the Board of Directors of the Funds with respect to Shares of
the Funds, the Funds shall furnish or cause to be furnished to NationsBank
Written Instructions setting forth the date of the declaration of such dividend
or distribution, the ex-dividend date, the date of payment thereof, the record
date as of which Shareholders entitled to payment shall be determined, the
amount payable per Share to the Shareholders of record as of that date, the
total amount payable to NationsBank on the payment date and whether such
dividend or distribution is to be paid in Shares at net asset value.
(b) On or before the payment date specified in such resolution of the
Board of Directors, the applicable Fund will pay to NationsBank sufficient cash
to make payment on such payment date to the Shareholders of record on the record
date.
(c) If, prior to the payment date, NationsBank does not receive
sufficient cash from the applicable Fund to make total dividend and/or
distribution payments to all Shareholders of record of such Fund as of the
record date, NationsBank will, upon notifying such Fund, withhold payment to all
Shareholders of record as of the record date until sufficient cash is provided
to NationsBank.
8. Daily Activity. NationsBank will communicate via fax all "net"
activity for the day to TSSG. TSSG shall update the transfer agent system and
notify fund accounting of money movement based on such information.
9. In addition to and neither in lieu nor in contravention of the
services set forth above, NationsBank shall: (i) perform all the customary
services of a transfer agent, registrar, dividend disbursing agent and agent of
the dividend reinvestment and cash purchase plan as described herein consistent
with those requirements in effect as of the date of this Agreement. The detailed
definition, frequency, limitations and associated costs (if any) set out in the
attached fee schedule, include but are not limited to: maintaining all
Shareholder accounts, preparing Shareholder meeting lists, mailing proxies,
tabulating proxies, mailing Shareholder reports to current Shareholders,
withholding taxes on U.S. resident and non-resident alien accounts where
applicable, preparing and filing U.S. Treasury Department Forms 1099 and other
appropriate forms required with respect to dividends and distributions by
federal authorities for all Shareholders.
3
<PAGE>
Schedule C
Fee Schedule
Upon receipt of the appropriate payment from the Funds, the Transfer Agent will
compensate NationsBank for the performance of its obligations hereunder in
accordance with a flat fee of $251,000 per year ($20,916.67 per month).
NATIONS FUND, INC.
SHAREHOLDER SERVICING
PLAN ("PLAN") FOR PRIMARY B SHARES
Section 1. Each of the proper officers of Nations Fund, Inc. (the
"Company") is authorized to execute and deliver, in the name and on behalf of
the Company, written agreements based substantially on the form attached hereto
as Appendix A or any other form duly approved by the Company's Board of
Directors ("Agreements") with broker/dealers, banks and other financial
institutions that are dealers of record or holders of record or which have a
servicing relationship with the beneficial owners of Primary B Shares (formerly
Trust B Shares ) ("Servicing Agents") in any of the Company's Funds (as defined
on Exhibit I) offering such shares provided that any material modifications of
services listed in the Agreement shall be presented for approval or ratification
by the Directors at the next regularly scheduled Board Meeting. Pursuant to such
Agreements, Servicing Agents shall provide shareholder support services as set
forth therein to their clients who beneficially own Primary B Shares of the
Funds in consideration of a fee, computed monthly in the manner set forth in the
applicable Fund's then current prospectus, at an annual rate of up to 0.25% of
the average daily net asset value of the Primary B Shares beneficially owned by
or attributable to-such clients. Affiliates of the Company's distributor,
administrator, co-administrator and adviser are eligible to become Servicing
Agents and to receive fees under this Plan. All expenses incurred by a Fund in
connection with the Agreements and the implementation of this Plan shall be
borne entirely by the holders of the Primary B Shares of the particular Fund
involved. If more than one Fund is involved and these expenses are not directly
attributable to Primary B Shares of a particular Fund, then the expenses may be
allocated between or among the Primary B Shares of the Funds in a fair and
equitable manner.
Section 2. The Company`s administrator and/or co-administrator shall
monitor the arrangements pertaining to the Company's Agreements with Servicing
Agents. The Company's administrator and co-administrator shall not, however, be
obligated by this Plan to recommend, and the Company shall not be obligated to
execute, any Agreement with any qualifying Servicing Agents.
Section 3. So long as this Plan is in effect, the Company's distributor
shall provide to the Company's Board of Directors, and the Directors shall
review, at least quarterly, a written report of the amounts expended pursuant to
this Plan and the Purposes for which such expenditures were made.
Section 4. Unless sooner terminated, this Plan shall continue in effect
for a period of one year from its date of execution and shall continue
thereafter for successive annual periods, provided that such continuance is
specifically approved by a majority of the Board of Directors, including a
majority of the Directors who are not "interested persons," as defined in the
Investment Company Act of 1940, of the Company and have no direct or indirect
financial interest in the operation of this Plan or in any Agreement related to
this Plan (the "Disinterested Directors") cast in person at a meeting called for
the purpose of voting on this Plan.
<PAGE>
Section 5. This Plan may be amended at any time with respect to any
Fund by the Company's Board of Directors, provided that any material amendment
of the terms of this Plan (including a material increase of the fee payable
hereunder) shall become effective only upon the approvals set forth in Section
4.
Section 6. This Plan is terminable at any time with respect to any Fund
by vote of a majority of the Disinterested Directors.
Section 7. While this Plan is in effect, the selection and nomination
of the Disinterested Directors shall be committed to the discretion of such
Disinterested Directors.
Section 8. The Company will preserve copies of this Plan, Agreements,
and any written reports regarding this Plan presented to the Board of Directors
for a period of not less than six years.
<PAGE>
EXHIBIT I
Nations Prime Fund
Nations Treasury Fund
NATIONS FUND, INC.
SHAREHOLDER SERVICING PLAN ("PLAN")
FOR INVESTOR A SHARES
Section 1. Each of the proper officers of Nations Fund, Inc. (the
"Company") is authorized to execute and deliver, in the name and on behalf of
the Company, written agreements based substantially on the form attached hereto
as Appendix A or any other form that is (a) duly approved by the Company's Board
of Directors or (b) approved and entered into by the officers of the Company
with advice of counsel, and ratified by the Board of Directors ("Agreements")
with broker/dealers, banks and other financial institutions that are dealers of
record or holders of record or which have a servicing relationship with the
beneficial owners of Investor A Shares ("Servicing Agents") in any of the
Company's Funds set forth on Exhibit I attached hereto, provided that any
material modifications of services listed in the Agreement shall be presented
for approval or ratification by the Directors at the next regularly scheduled
Board Meeting. Pursuant to such Agreements, Servicing Agents shall provide
shareholder support services as set forth therein to their clients who
beneficially own Investor A Shares of the Funds in consideration of a fee,
computed monthly in the manner set forth in the applicable Fund's then current
prospectus, at an annual rate of up to 0.25% of the average daily net asset
value of the Investor A Shares beneficially owned by or attributable to such
clients. Affiliates of the Company's distributor, administrator,
co-administrator and adviser are eligible to become Servicing Agents and to
receive fees under this Plan. All expenses incurred by a Fund in connection with
the Agreements and the implementation of this Plan shall be borne entirely by
the holders of the Investor A Shares of the particular Fund involved. If more
than one Fund is involved and these expenses are not directly attributable to
Investor A Shares of a particular Fund, then the expenses may be allocated
between or among the Investor A Shares of the Funds in a fair and equitable
manner.
Section 2. The Company's administrator and/or co-administrator shall
monitor the arrangements pertaining to the Company's Agreements with Servicing
Agents. The Company's administrator and co-administrator shall not, however, be
obligated by this Plan to recommend, and the Company shall not be obligated to
execute, any Agreement with any qualifying Servicing Agents.
Section 3. So long as this Plan is in effect, the Company's
administrator and/or co-administrator shall provide to the Company's Board of
Directors, and the Directors shall review, at least quarterly, a written report
of the amounts expended pursuant to this Plan and the purposes for which such
expenditures were made.
Section 4. This Plan may be amended at any time with respect to any
Fund by the Company's Board of Directors, provided that any material amendment
of the terms of this Plan (including a material increase of the fee payable
hereunder) shall become effective only upon approval by a majority of the Board
of Directors, including a majority of the Directors who are not "interested
persons," as defined in the Investment Company Act of 1940, of the Company and
have no direct or indirect financial interest in the operation of this Plan or
in any Agreement related to this Plan (the "Disinterested Directors") cast in
person at a meeting called for the purpose of voting on this Plan.
<PAGE>
Section 5. This Plan is terminable at any time with respect to any Fund
by vote of a majority of the Disinterested Directors.
Section 6. While this Plan is in effect, the selection and nomination
of the Disinterested Directors shall be committed to the discretion of such
Disinterested Directors.
Section 7. The Company will preserve copies of this Plan, Agreements,
and any written reports regarding this Plan presented to the Board of Directors
for a period of not less than six years.
2
<PAGE>
EXHIBIT I
Nations Prime Fund
Nations Treasury Fund
3
NATIONS FUND, INC.
AMENDED AND RESTATED
SHAREHOLDER SERVICING PLAN ("PLAN")
INVESTOR B SHARES -- MONEY MARKET FUNDS
INVESTOR C SHARES -- NON-MONEY MARKET FUNDS
Section 1. Each of the proper officers of Nations Fund, Inc.
(the "Company") is authorized to execute and deliver, in the name and on behalf
of the Company, written agreements based substantially on the form attached
hereto as Appendix A or any other form duly approved by the Company's Board of
Directors ("Agreements") with broker/dealers, banks and other financial
institutions that are dealers of record or holders of record or which have a
servicing relationship ("Servicing Agents") with the beneficial owners of
Investor B Shares of the Money Market Funds of the Company or Investor C Shares
of the Non-Money Market Funds of the Company (as listed on Schedule 1 hereto)
(collectively, the "Shares") in any of the Company's portfolios listed on
Schedule 1 (the "Funds") provided that any material modifications of services
listed in the Agreement shall be presented for approval or ratification by the
Directors at the next regularly scheduled Board Meeting. Pursuant to such
Agreements, Servicing Agents shall provide shareholder support services as set
forth therein to their clients who beneficially own Shares of the Funds in
consideration of a fee, computed monthly in the manner set forth in the
applicable Fund's then current prospectus, at an annual rate of up to 0.25% of
the average daily net asset value of the Shares beneficially owned by or
attributable to such clients. Affiliates of the Company's distributor,
administrator, co-administrator and adviser are eligible to become Servicing
Agents and to receive fees under this Plan. All expenses incurred by a Fund in
connection with the Agreements and the implementation of this Plan shall be
borne entirely by the holders of the Shares of the particular Fund involved. If
more than one Fund is involved and these expenses are not directly attributable
to Shares of a particular Fund, then the expenses may be allocated between or
among the Shares of the Funds in a fair and equitable manner.
Section 2. The Company's administrator and/or co-administrator
shall monitor the arrangements pertaining to the Company's Agreements with
Servicing Agents. The Company's administrator and co-administrator shall not,
however, be obligated by this Plan to recommend, and the Company shall not be
obligated to execute, any Agreement with any qualifying Servicing Agents.
Section 3. So long as this Plan is in effect, the Company's
distributor shall provide to the Company's Board of Directors, and the Directors
shall review, at least quarterly, a written report of the amounts expended
pursuant to this Plan and the purposes for which such expenditures were made.
Section 4. Unless sooner terminated, this Plan shall continue
in effect for a period of one year from its date of execution and shall continue
thereafter for successive annual periods, provided that such continuance is
specifically approved by a majority of the Board of Directors, including a
majority of the Directors who are not "interested persons," as defined in the
Investment Company Act of 1940, of the Company and have no direct or indirect
financial interest in the operation of this Plan or in any Agreement related to
this Plan (the "Disinterested Directors") cast in person at a meeting called for
the purpose of voting on this Plan.
1
<PAGE>
Section 5. This Plan may be amended at any time with respect
to any Fund by the Company's Board of Directors, provided that any material
amendment of the terms of this Plan (including a material increase of the fee
payable hereunder) shall become effective only upon the approvals set forth in
Section 4.
Section 6. This Plan is terminable at any time with respect to
any Fund by vote of a majority of the Disinterested Directors.
Section 7. While this Plan is in effect, the selection and
nomination of the Disinterested Directors shall be committed to the discretion
of such Disinterested Directors.
Section 8. The Company will preserve copies of this Plan,
Agreements, and any written reports regarding this Plan presented to the Board
of Directors for a period of not less than six years.
2
<PAGE>
SCHEDULE 1
The term "Money Market Funds" used in the Plan shall refer to
the following Funds of the Company:
Nations Prime Fund
Nations Treasury Fund
The term "Non-Money Market Funds" used in the Plan shall refer
to the following Funds of the Company:
Nations Equity Income Fund
Nations Government Securities Fund
Nations International Growth Fund
Nations Small Company Growth Fund
Nations U.S. Government Bond Fund
Last Amended: August 19, 1999
3
NATIONS FUND, INC.
SHAREHOLDER SERVICING PLAN ("PLAN")
INVESTOR C SHARES -- MONEY MARKET FUNDS
INVESTOR B SHARES -- NON-MONEY MARKET FUNDS
Section 1. Each of the proper officers of Nations Fund, Inc.
(the "Company") is authorized to execute and deliver, in the name and on behalf
of the Company, written agreements based substantially on the form attached
hereto as Appendix A or any other form duly approved by the Company's Board of
Directors ("Agreements") with broker/dealers, banks and other financial
institutions that are dealers of record or holders of record or which have a
servicing relationship ("Servicing Agents") with the beneficial owners of
Investor C Shares in any of the Company's Money Market Funds or Investor B
Shares (formerly Investor N Shares) of the Company's Non-Money Market Funds (as
defined on Exhibit I) (collectively, "Shares") provided that any material
modifications of services listed in the Agreement shall be presented for
approval or ratification by the Directors at the next regularly scheduled Board
Meeting. Pursuant to such Agreements, Servicing Agents shall provide shareholder
support services as set forth therein to their clients who beneficially own
Shares of the portfolios listed on Exhibit I (the "Funds") in consideration of a
fee, computed monthly in the manner set forth in the applicable Fund's then
current prospectus, at an annual rate of up to 0.25% of the average daily net
asset value of the Shares beneficially owned by or attributable to such clients.
Affiliates of the Company's distributor, administrator, co-administrator and
adviser are eligible to become Servicing Agents and to receive fees under this
Plan. All expenses incurred by a Fund in connection with the Agreements and the
implementation of this Plan shall be borne either by the holders of the Shares
of the particular Fund involved. If more than one Fund is involved and these
expenses are not directly attributable to Shares of a particular Fund, then the
expenses may be allocated between or among the Shares of the Funds in a fair and
equitable manner.
Section 2. The Company's administrator and/or co-administrator
shall monitor the arrangements pertaining to the Company's Agreements with
Servicing Agents. The Company's administrator and co-administrator shall not,
however, be obligated by this Plan to recommend, and the Company shall not be
obligated to execute, any Agreement with any qualifying Servicing Agents.
Section 3. So long as this Plan is in effect, the Company's
distributor shall provide to the Company's Board of Directors, and the Directors
shall review, at least quarterly, a written report of the amounts expended
pursuant to this Plan and the purposes for which such expenditures were made.
Section 4. Unless sooner terminated, this Plan shall continue
in effect for a period of one year from its date of execution and shall continue
thereafter for successive annual periods, provided that such continuance is
specifically approved by a majority of the Board of Directors, including a
majority of the Directors who are not "interested persons," as defined in the
Investment Company Act of 1940, of the Company and have no direct or indirect
financial interest in the operation of this Plan or in any Agreement related to
this Plan (the "Disinterested Directors") cast in person at a meeting called for
the purpose of voting on this Plan.
1
<PAGE>
Section 5. This Plan may be amended at any time with respect
to any Fund by the Company's Board of Directors, provided that any material
amendment of the terms of this Plan (including a material increase of the fee
payable hereunder) shall become effective only upon the approvals set forth in
Section 4.
Section 6. This Plan is terminable at any time with respect to
any Fund by vote of a majority of the Disinterested Directors.
Section 7. While this Plan is in effect, the selection and
nomination of the Disinterested Directors shall be committed to the discretion
of such Disinterested Directors.
Section 8. The Company will preserve copies of this Plan,
Agreements, and any written reports regarding this Plan presented to the Board
of Directors for a period of not less than six years.
2
<PAGE>
EXHIBIT I
NATIONS FUND, INC.
The term "Money Market Funds" shall refer to the following
Funds of the Company:
Nations Prime Fund
Nations Treasury Fund
The term "Non-Money Market Funds" shall refer to the following
Funds of the Company:
Nations Equity Income Fund
Nations Government Securities Fund
Nations International Growth Fund
Nations Small Company Growth Fund
Nations U.S. Government Bond Fund
Last Amended: August 19, 1999
3
NATIONS FUND INC.
SHAREHOLDER SERVICING PLAN ("PLAN")
FOR MARSICO SHARES
Section 1. Each of the proper officers of Nations Fund Inc. (the
"Company") is authorized to execute and deliver, in the name and on behalf of
the Company, written agreements based substantially on the form attached hereto
as Appendix A or any other form duly approved by the Company's Board of
Directors ("Agreements") with broker/dealers, banks and other financial
institutions that are dealers of record or holders of record or which have a
servicing relationship with the beneficial owners of Marsico Shares ("Servicing
Agents") in any of the Company's Funds set forth on Exhibit I attached hereto,
provided that any material modifications of services listed in the Agreement
shall be presented for approval or ratification by the Directors at the next
regularly scheduled Board Meeting. Pursuant to such Agreements, Servicing Agents
shall provide shareholder support services as set forth therein to their clients
who beneficially own Marsico Shares of the Fund in consideration of a fee,
computed monthly in the manner set forth in the applicable Fund's then current
prospectus, at an annual rate of up to 0.25% of the average daily net asset
value of the Marsico Shares beneficially owned by or attributable to such
clients. Affiliates of the Company's distributor, administrator,
co-administrator and adviser are eligible to become Servicing Agents and to
receive fees under this Plan. All expenses incurred by the Fund in connection
with the Agreements and the implementation of this Plan shall be borne entirely
by the holders of the Marsico Shares of the Fund involved. If more than one Fund
is involved and these expenses are not directly attributable to the Marsico
Shares of a particular Fund, then the expenses may be allocated between or among
the Marsico Shares of the Fund in a fair and equitable manner.
Section 2. The Company's administrator and/or co-administrator shall
monitor the arrangements pertaining to the Company's Agreements with Servicing
Agents. The Company's administrator and co-administrator shall not, however, be
obligated by this Plan to recommend, and the Company shall not be obligated to
execute, any Agreement with any qualifying Servicing Agents.
Section 3. So long as this Plan is in effect, the Company's administrator
and/or co-administrator shall provide to the Company's Board of Directors, and
the Directors shall review, at least quarterly, a written report of the amounts
expended pursuant to this Plan and the purposes for which such expenditures were
made.
Section 4. Unless sooner terminated, this Plan shall continue in effect
for a period of one year from its date of execution and shall continue
thereafter for successive annual periods, provided that such continuance is
specifically approved by a majority of the Board of Directors, including a
majority of the Directors who are not "interested persons," as defined in the
Investment Company Act of 1940, of the Company and have no direct or indirect
financial interest in the operation of this Plan or in any Agreement related to
this Plan (the "Disinterested Directors") cast in person at a meeting called for
the purpose of voting on this Plan.
1
<PAGE>
Section 5. This Plan may be amended at any time with respect to any Fund
by the Company's Board of Directors, provided that any material amendment of the
terms of this Plan (including a material increase of the fee payable hereunder)
shall become effective only upon the approvals set forth in Section 4.
Section 6. This Plan is terminable at any time with respect to any Fund by
vote of a majority of the Disinterested Directors.
Section 7. While this Plan is in effect, the selection and nomination of
the Disinterested Directors shall be committed to the discretion of such
Disinterested Directors.
Section 8. The Company will preserve copies of this Plan, Agreements, and
any written reports regarding this Plan presented to the Board of Directors for
a period of not less than six years.
2
<PAGE>
EXHIBIT I
Nations Prime Fund
3
NATIONS FUND, INC.
SERVICING PLAN ("PLAN")
DAILY SHARES -- MONEY MARKET FUNDS
Section 1. Each of the proper officers of Nations Fund, Inc.
(the "Company") is authorized to execute and deliver, in the name and on behalf
of the Company, written agreements based substantially on the form attached
hereto as Appendix A or any other form duly approved by the Company's Board of
Directors ("Agreements") with broker/dealers, banks and other financial
institutions that are dealers of record or holders of record or which have a
servicing relationship ("Servicing Agents") with the beneficial owners of Daily
Shares (formerly Investor D Shares) in any of the Company's Money Market Funds
(as defined on Exhibit I) (collectively, "Shares") provided that any material
modifications of services listed in the Agreement shall be presented for
approval or ratification by the Directors at the next regularly scheduled Board
Meeting. Pursuant to such Agreements, Servicing Agents shall provide shareholder
support services as set forth therein to their clients who beneficially own
Shares of the portfolios listed on Exhibit I (the "Funds") in consideration of a
fee, computed monthly in the manner set forth in the applicable Fund's then
current prospectus, at an annual rate of up to 0.25% of the average daily net
asset value of the Shares beneficially owned by or attributable to such clients.
Affiliates of the Company's distributor, administrator, co-administrator and
adviser are eligible to become Servicing Agents and to receive fees under this
Plan. All expenses incurred by a Fund in connection with the Agreements and the
implementation of this Plan shall be borne either by the holders of the Shares
of the particular Fund involved. If more than one Fund is involved and these
expenses are not directly attributable to Shares of a particular Fund, then the
expenses may be allocated between or among the Shares of the Funds in a fair and
equitable manner.
Section 2. The Company's administrator and/or co-administrator
shall monitor the arrangements pertaining to the Company's Agreements with
Servicing Agents. The Company's administrator and co-administrator shall not,
however, be obligated by this Plan to recommend, and the Company shall not be
obligated to execute, any Agreement with any qualifying Servicing Agents.
Section 3. So long as this Plan is in effect, the Company's
distributor shall provide to the Company's Board of Directors, and the Directors
shall review, at least quarterly, a written report of the amounts expended
pursuant to this Plan and the purposes for which such expenditures were made.
Section 4. Unless sooner terminated, this Plan shall continue
in effect for a period of one year from its date of execution and shall continue
thereafter for successive annual periods, provided that such continuance is
specifically approved by a majority of the Board of Directors, including a
majority of the Directors who are not "interested persons," as defined in the
Investment Company Act of 1940, of the Company and have no direct or indirect
financial interest in the operation of this Plan or in any Agreement related to
this Plan (the "Disinterested Directors") cast in person at a meeting called for
the purpose of voting on this Plan.
<PAGE>
Section 5. This Plan may be amended at any time with respect
to any Fund by the Company's Board of Directors, provided that any material
amendment of the terms of this Plan (including a material increase of the fee
payable hereunder) shall become effective only upon the approvals set forth in
Section 4.
Section 6. This Plan is terminable at any time with respect to
any Fund by vote of a majority of the Disinterested Directors.
Section 7. While this Plan is in effect, the selection and
nomination of the Disinterested Directors shall be committed to the discretion
of such Disinterested Directors.
Section 8. The Company will preserve copies of this Plan,
Agreements, and any written reports regarding this Plan presented to the Board
of Directors for a period of not less than six years.
<PAGE>
EXHIBIT I
NATIONS FUND, INC.
The term "Money Market Funds" shall refer to the following
Funds of the Company:
Nations Prime Fund
Nations Treasury Fund
CROSS INDEMNIFICATION AGREEMENT
THIS AGREEMENT is made as of the 14th day of February, 2000, by and
among Nations Fund, Inc. (the "Company"), a Maryland corporation, Nations Fund
Trust (the "Trust"), a Massachusetts business trust, Nations Reserves
("Reserves"), a Massachusetts business trust, Nations Master Investment Trust
(the "Master Trust"), a Delaware business trust and Nations Funds Trust ("Funds
Trust"), a Delaware business trust.
WHEREAS, the Company is an open-end management investment company
registered as such under the Investment Company Act of 1940 (the "1940 Act"),
currently consisting of seven operating investment portfolios, but which may
from time to time consist of a greater or lesser number of investment
portfolios; and
WHEREAS, the Trust is an open-end management investment company
registered as such under the 1940 Act, currently consisting of thirty-six
operating investment portfolios, but which may from time to time consist of a
greater or lesser number of investment portfolios; and
WHEREAS, Reserves is an open-end management investment company
registered as such under the 1940 Act, currently consisting of sixteen operating
investment portfolios, but which may from time to time consist of a greater or
lesser number of investment portfolios; and
WHEREAS, the Master Trust is an open-end management investment company
registered as such under the 1940 Act, currently consisting of seven operating
investment portfolios, but which may from time to time consist of a greater or
lesser number of investment portfolios; and
WHEREAS, Funds Trust is an open-end management investment company
registered as such under the Investment Company Act of 1940 (the "1940 Act"),
currently consisting of three operating investment portfolios, but which may
from time to time consist of a greater or lesser number of investment
portfolios; and
WHEREAS, the Company, the Trust, Reserves and Funds Trust plan to
offer, on a continuous basis, shares of common stock, units of beneficial
interest, units of beneficial interests and units of beneficial interests,
respectively, in their investment portfolios ("Securities") in a combined set of
prospectuses ("Prospectuses") and/or preliminary prospectuses ("Preliminary
Prospectuses") (such offering of Securities to be hereinafter referred to as the
"Joint Offering") and plan to file, from time to time, such combined set of
prospectuses and other materials with the Securities and Exchange Commission
("SEC") (such filings with the SEC to be referred to herein as the "Registration
Statements");
WHEREAS, certain information relating to the Master Trust must be
included in the prospectuses of Reserves and Funds Trust and therefore will be
included in the Joint Offerings and Registration Statements;
<PAGE>
NOW THEREFORE, the Company, the Trust, Reserves, the Master Trust and
Funds Trust hereby agree as follows:
(1) (a) The Company will indemnify and hold harmless the Trust,
Reserves, the Master Trust and Funds Trust against any losses,
claims, damages or liabilities, to which the Trust, Reserves,
the Master Trust or Funds Trust may become subject under the
Securities Act of 1933 (the "Act"), the 1940 Act or otherwise,
insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material
fact contained in any Prospectuses, any Preliminary
Prospectuses, the Registration Statements, any other
Prospectuses relating to the Securities, or any amendments or
supplements to the foregoing (hereinafter referred to
collectively as the "Offering Documents"), or arise out of or
are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or
alleged omission was made in the Offering Documents in
reliance upon and in conformity with written information
furnished to the Trust, Reserves, the Master Trust or Funds
Trust by the Company expressly for use therein; and will
reimburse the Trust, Reserves, the Master Trust and Funds
Trust for any legal or other expenses reasonably incurred by
the Trust, Reserves, the Master Trust or Funds Trust in
connection with investigating or defending any such action or
claim; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim,
damage, or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged
omission made in the Offering Documents in reliance upon and
in conformity with written information furnished to the
Company by the Trust, Reserves, the Master Trust or Funds
Trust expressly for use in the Offering Documents.
(b) The Trust will indemnify and hold harmless the Company,
Reserves, the Master Trust and Funds Trust against any losses,
claims, damages or liabilities to which the Company, Reserves,
the Master Trust or Funds Trust may become subject under the
Act, the 1940 Act, or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon and untrue statement or alleged
untrue statement of a material fact contained in the Offering
Documents or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to
be stated or necessary to make the statements therein not
misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in the Offering
Documents in reliance upon and in conformity with written
information furnished to the Company, Reserves, the Master
Trust or Funds Trust by the Trust expressly for use therein;
and will reimburse the Company,
<PAGE>
Reserves, the Master Trust and Funds Trust for any legal or
other expenses reasonably incurred by the Company, Reserves,
the Master Trust or Funds Trust in connection with
investigating or defending any such action or claim; provided,
however, that the Trust shall not be liable in any such case
to the extent that any such loss, claim, damage, or liability
arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the
Offering Documents in reliance upon and in conformity with
written information furnished to the Trust by the Company,
Reserves, the Master Trust or Funds Trust expressly for use in
the Offering Documents.
(c) Reserves will indemnify and hold harmless the Company, the
Trust, the Master Trust and Funds Trust against any losses,
claims, damages or liabilities to which the Company, the
Trust, the Master Trust or Funds Trust may become subject
under the Act, the 1940 Act, or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in the
Offering Documents or arise out of or are based upon the
omission or alleged omission to state therein a material fact
required to be stated or necessary to make the statements
therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the
Offering Documents in reliance upon and in conformity with
written information furnished to the Company, the Trust, the
Master Trust or Funds Trust by Reserves expressly for use
therein; and will reimburse the Company, the Trust, the Master
Trust and Funds Trust for any legal or other expenses
reasonably incurred by the Company, the Trust, the Master
Trust or Funds Trust in connection with investigating or
defending any such action or claim; provided, however, that
Reserves shall not be liable in any such case to the extent
that any such loss, claim, damage, or liability arises out of
or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in the Offering
Documents in reliance upon and in conformity with written
information furnished to Reserves by the Company, the Trust,
the Master Trust or Funds Trust for use in the Offering
Documents.
(d) The Master Trust will indemnify and hold harmless the
Company, the Trust, Reserves and Funds Trust against any
losses, claims, damages or liabilities to which the Company,
the Trust, Reserves or Funds Trust may become subject under
the Act, the 1940 Act, or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the Offering
Documents or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to
be stated or necessary to make the statements therein not
misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in the Offering
Documents in reliance upon and in conformity with written
information furnished to the Company, the Trust, Reserves or
Funds Trust by the Master Trust expressly for use therein; and
will reimburse the Company, the Trust, Reserves and Funds
Trust for any legal or other expenses reasonably incurred by
the Company, the Trust, Reserves or Funds Trust in connection
with investigating or defending any such action or claim;
provided, however, that the Master Trust shall not be liable
in any such case to the extent that any such loss, claim,
damage, or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged
omission made in the Offering Documents in reliance upon and
in conformity with written information furnished to the Master
Trust by the Company, the Trust, Reserves or Funds Trust for
use in the Offering Documents.
<PAGE>
(e) Funds Trust will indemnify and hold harmless the Company,
the Trust, Reserves and the Master Trust against any losses,
claims, damages or liabilities to which the Company, the
Trust, Reserves or the Master Trust may become subject under
the Act, the 1940 Act, or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the Offering
Documents or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to
be stated or necessary to make the statements therein not
misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in the Offering
Documents in reliance upon and in conformity with written
information furnished to the Company, the Trust, Reserves or
the Master Trust by Funds Trust expressly for use therein; and
will reimburse the Company, the Trust, Reserves and the Master
Trust for any legal or other expenses reasonably incurred by
the Company, the Trust, Reserves or the Master Trust in
connection with investigating or defending any such action or
claim; provided, however, that Reserves shall not be liable in
any such case to the extent that any such loss, claim, damage,
or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged
omission made in the Offering Documents in reliance upon and
in conformity with written information furnished to Funds
Trust by the Company, the Trust, Reserves or the Master Trust
for use in the Offering Documents.
(f) Promptly after receipt by an indemnified party under
subsection (a), (b),(c), (d) or (e) above of notice of the
commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against an indemnifying
party or parties under such subsection, notify the
indemnifying party or parties in writing of the commencement
thereof; but the omission to so notify the indemnifying party
or parties shall not relieve it or them from any liability
which it or they may have to any indemnified party otherwise
than under such subsection. In case any such action shall be
brought against any indemnified party and it shall notify the
indemnifying party or parties of the commencement thereof, the
indemnifying party or parties shall be entitled to participate
therein and, to the extent that either indemnifying party or
both shall wish, to assume the defense thereof, with counsel
satisfactory to such indemnified party, and, after notice from
the indemnifying party or parties to such indemnified part of
its or their election so to assume the defense thereof, the
indemnifying party or parties shall not be liable to such
indemnified party under such subsection for any legal expenses
of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection
with the defense thereof other than reasonable costs of
investigation.
<PAGE>
(2) This agreement may be executed simultaneously in five or
more counterparts, each of which shall be deemed an original,
but all of which taken together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly executed by their authorized officers designated below as of the day and
year first written above.
NATIONS FUND, INC.
By: /s/ A. Max Walker
----------------------------------
A. Max Walker
Chairman of the Board of Directors
NATIONS FUND TRUST
By: /s/ A. Max Walker
----------------------------------
A. Max Walker
Chairman of the Board of Trustees
NATIONS RESERVES
By: /s/ A. Max Walker
----------------------------------
A. Max Walker
Chairman of the Board of Trustees
<PAGE>
NATIONS MASTER INVESTMENT TRUST
By: /s/ A. Max Walker
----------------------------------
A. Max Walker
Chairman of the Board of Trustees
NATIONS FUNDS TRUST
By: /s/ A. Max Walker
----------------------------------
A. Max Walker
Chairman of the Board of Trustees
NATIONS FUND, INC.
SHAREHOLDER ADMINISTRATION
PLAN ("PLAN") FOR PRIMARY B SHARES
Section 1. Each of the proper officers of Nations Fund, Inc. (the
"Company") is authorized to execute and deliver, in the name and on behalf of
the Company, written agreements based substantially on the form attached hereto
as Appendix A or any other form duly approved by the Company's Board of
Directors ("Agreements") with broker/dealers, banks and other financial
institutions that are dealers of record or holders of record or which have a
servicing relationship with the beneficial owners of Primary B Shares
("Servicing Agents") in certain of the Company's Funds (as listed on Exhibit I)
offering such shares provided that any material modifications of services listed
in the Agreement shall be presented for approval or ratification by the
Directors at the next regularly scheduled Board Meeting. Pursuant to such
Agreements, Servicing Agents shall provide shareholder support services as set
forth therein to their clients who beneficially own Primary B Shares of the
Funds in consideration of a fee, computed monthly in the manner set forth in the
applicable Fund's then current prospectus, at an annual rate of up to 0.60% of
the average daily net asset value of the Primary B Shares beneficially owned by
or attributable to such clients, provided that in no event may the portion of
such fee that constitutes a "service fee," as that term is defined in Article
III, Section 26(b)(9) of the Rules of Fair Practice of the National Association
of Securities Dealers, Inc., exceed 0.25% of the average daily net asset value
of such Primary B Shares of a Fund. Affiliates of the Company's distributor,
administrator, co-administrator and adviser are eligible to become Servicing
Agents and to receive fees under this Plan. All expenses incurred by a Fund in
connection with the Agreements and the implementation of this Plan shall be
borne entirely by the holders of the Primary B Shares of the particular Fund
involved. If more than one Fund is involved and these expenses are not directly
attributable to Primary B Shares of a particular Fund, then the expenses may be
allocated between or among the Primary B Shares of the Funds in a fair and
equitable manner.
Section 2. The Company's administrator and/or co-administrator shall
monitor the arrangements pertaining to the Company's Agreements with Servicing
Agents. The Company's administrator and co-administrator shall not, however, be
obligated by this Plan to recommend, and the Company shall not be obligated to
execute, any Agreement with any qualifying Servicing Agents.
Section 3. So long as this Plan is in effect, the Company's distributor
shall provide to the Company's Board of Directors, and the Directors shall
review, at least quarterly, a written report of the amounts expended pursuant to
this Plan and the purposes for which such expenditures were made.
Section 4. Unless sooner terminated, this Plan shall continue in effect
for a period of one year from its date of execution and shall continue
thereafter for successive annual periods, provided that such continuance is
specifically approved by a majority of the Board of Directors, including a
majority of the Directors who are not "interested persons," as defined in the
Investment Company Act of 1940 (the "Act"), of the Company and have no direct or
indirect financial interest in the operation of this Plan or in any Agreement
related to this Plan (the "Disinterested Directors") cast in person at a meeting
called for the purpose of voting on this Plan.
<PAGE>
Section 5. This Plan may be amended at any time with respect to any
Fund by the Company's Board of Directors, provided that any material amendment
of the terms of this Plan (including a material increase of the fee payable
hereunder) shall become effective only upon the approvals set forth in Section
4.
Section 6. This Plan is terminable at any time with respect to any Fund
by vote of a majority of the Disinterested Directors.
Section 7. While this Plan is in effect, the selection and nomination
of the Disinterested Directors shall be committed to the discretion of such
Disinterested Directors.
Section 8. To the extent that any portion of the fees payable under the
Agreements is deemed to be for services primarily intended to result in the sale
of Fund shares, such fees are deemed approved and may be paid pursuant to the
Plan and in accordance with Rule 12b-1 under the Act, provided that the
Agreements, to the extent they are deemed to relate to services primarily
intended to result in the sale of Fund shares, are approved and otherwise
treated in all respects as agreements related to the Plan.
Section 9. The Company will preserve copies of this Plan, Agreements,
and any written reports regarding this Plan presented to the Board of Directors
for a period of not less than six years.
2
<PAGE>
EXHIBIT I
NATIONS FUND, INC.
Nations Equity Income Fund
Nations International Growth Fund
Nations Small Company Growth Fund
Nations Government Securities Fund
Nations U.S. Government Bond Fund
Last Amended: August 19, 1999
3
NATIONS FUND, INC.
SHAREHOLDER SERVICING AND DISTRIBUTION PLAN
INVESTOR A SHARES
This amended and restated Investor A Shareholder Servicing and
Distribution Plan (the "Plan") has been adopted by the Board of Directors of
Nations Fund, Inc. (the "Company") in conformance with Rule 12b-1 under the
Investment Company Act of 1940 (the "1940 Act").
Section 1. Payments for Services. Under the terms of this Plan,
the Company may act as a distributor of the Shares of which a Fund is the
issuer, pursuant to Rule 12b-1 under the 1940 Act. The Company may incur as a
distributor of the Investor A Shares of each Fund ("Shares") expenses of up to
(A) twenty-five one-hundredths of one percent (0.25%) per annum of the average
daily net assets of the Company attributable to the Shares of the Non-Money
Market Funds (as defined on Exhibit A) or (B) ten one-hundredths of one percent
(0.10%) attributable to the Shares of the Money Market Funds (as defined on
Exhibit A).
Section 2. Expenses Covered by the Plan. Amounts set forth in
Section 1 may be expended when and if authorized in advance by the Company's
Board of Directors. Such amounts may be used to finance any activity which is
primarily intended to result in the sale of the Shares, including, but not
limited to, expenses of organizing and conducting sales seminars, printing of
prospectuses and statements of additional information (and supplements thereto)
and reports for other than existing shareholders, preparation and distribution
of advertising material and sales literature, supplemental payments to the
Company's distributor (the "Distributor") and the cost of administering this
Plan, as well as, with respect to payments made under Section 1(A), above, the
shareholder servicing activities described below. All amounts expended pursuant
to this Plan shall be paid:
(i) to the Distributor for reimbursements of distribution-related
expenses actually incurred by the Distributor, including, but not limited
to, expenses of organizing and conducting sales seminars, printing of
prospectuses and statements of additional information (and supplements
thereto) and reports for other than existing shareholders, preparation and
distribution of advertising material and sales literature and costs of
administering this Plan, or
(ii) to certain broker/dealers and other financial institutions
("Agents") who offer shares to their customers and who have entered into (A)
Shareholder Servicing Agreements substantially in the form of Exhibit C with
respect to the Non-Money Market Funds, and (B) Sales Support Agreements
substantially in the form of Exhibit B with respect to any of the Funds, for
providing the services contemplated thereunder.
The shareholder servicing activities for which compensation may be
received under this Plan may include, among other things: (i) aggregating and
processing purchase and redemption requests and transmitting promptly net
purchase and redemption orders to the Distributor or transfer agent; (ii)
providing customers with a service that invests the assets of their accounts in
Shares pursuant to specific or pre-authorized instructions; (iii) processing
1
<PAGE>
dividend and distribution payments; (iv) providing information periodically to
customers showing their positions in Shares; (v) arranging for bank wires; (vi)
responding to customers' inquiries concerning their investment in Shares; (vii)
providing subaccounting with respect to Shares beneficially owned by customers
or the information to the Company necessary for subaccounting; (viii) if
required by law, forwarding shareholder communications (such as proxies,
shareholder reports, annual and semi-annual financial statements and dividend,
distribution and tax notices) to customers; (ix) forwarding to customers proxy
statements and proxies containing any proposals regarding the Shareholder
Servicing Agreement; (x) general shareholder liaison services; and (xi)
providing such other similar services as the Company may reasonably request to
the extent such firms are permitted to do so under applicable statutes, rules or
regulations.
Section 3. Money Market Funds -- Expenses under the Plan.
Notwithstanding any of the foregoing, with respect to the Money Market Funds,
payments under Section 1, above, shall not be made for personal services and/or
the maintenance of shareholder accounts as such terms are interpreted by the
National Association of Securities Dealers, Inc.
Section 4. Limitations on Payments. No additional payments are to
be made by the Company on behalf of the Funds with respect to the Shares under
this Plan, provided that the Funds shall not be precluded from making the
payments such Fund is otherwise obligated to make (i) to NationsBank of North
Carolina, N.A. ("NationsBank") and/or NationsBank Panmure Investment Management
Limited ("NationsBank Panmure") pursuant to the Investment Advisory Agreement
and the Sub-Investment Advisory Agreement, (ii) to NationsBank of Texas, N.A.
("NationsBank Texas") pursuant to the Custody Agreement, (iii) to First Data
Investor Services Group, Inc. ("First Data"), formerly The Shareholder Services
Group, Inc., pursuant to the Transfer Agency and Registrar Agreement, (iv) to
Stephens Inc. ("Stephens"), pursuant to the Administration Agreement, (v) to
First Data pursuant to the Co-Administration Agreement, (vi) to Servicing Agents
pursuant to Shareholder Servicing Agreements and (vii) for the expenses
otherwise incurred by a Fund and the Company on behalf of the Shares in the
normal conduct of such Fund's business pursuant to the Investment Advisory
Agreement (and/or Sub-Investment Advisory Agreement), the Custody Agreement, the
Transfer Agency and Registrar Agreement, the Administration Agreement, the
Co-Administration Agreement and the Shareholder Servicing Agreements. However,
to the extent any payments by the Company on behalf of a Fund to NationsBank,
NationsBank Panmure, NationsBank Texas, First Data, Stephens or Servicing
Agents; by NationsBank, NationsBank Panmure, NationsBank Texas, First Data,
Stephens or Servicing Agents or any affiliate thereof, to any party, pursuant to
any agreement; or, generally, by the Company on behalf of a Fund to any party,
are deemed to be payments for the financing of any activity primarily intended
to result in the sale of the Shares within the context of Rule 12b-1 under the
1940 Act, then such payments shall be deemed to be approved pursuant to this
Plan as set forth herein.
Section 5. Reports of Distributor. The officers of the Company
shall report quarterly in writing to the Board of Directors on the amounts and
purpose of payments for any of the activities in Section 2 and shall furnish the
Board of Directors with such other information as the Board may reasonably
request in connection with such payments in order to enable the Board to make an
informed determination on the nature and value of such expenditures.
2
<PAGE>
Section 6. Approval of Plan. This Plan shall continue in effect
for a period of more than one year from the date written below only so long as
such continuance is specifically approved at least annually by the Company's
Board of Directors, including the Directors who are not interested persons of
the Company and have no direct or indirect financial interest in the operation
of this Plan or in any Agreements related to this Plan ("Disinterested
Directors"), by vote cast in person at a meeting called for the purpose of
voting on this Plan.
Section 7. Termination. This Plan may be terminated at any time by
vote of a majority of the Disinterested Directors or with respect to a
particular Fund by vote of a majority of the outstanding voting securities of
the Shares of such Fund, on not more than sixty (60) days' written notice to any
other party to the Plan, and shall terminate automatically in the event of any
act that constitutes an assignment of the Distribution Agreement or the
Investment Advisory Agreement (or with respect to a Fund sub-advised by
NationsBank Panmure, the Sub-Investment Advisory Agreement).
Section 8. Amendments. This Plan may be amended at any time by the
Board of Directors provided that (a) any amendments to increase materially the
costs which a Fund's Investor A Shares may bear for distribution pursuant to
this Plan shall be effective only upon approval by a vote of a majority of the
outstanding Investor A Shares of such Fund, and (b) any material amendments of
the terms of this Plan shall become effective only upon approval as provided in
Section 6 hereof.
Section 9. Selection/Nomination of Directors. So long as this Plan
is in effect, the selection and nomination of the Company's Disinterested
Directors shall be committed to the discretion of such Disinterested Directors.
Section 10. Governing Law. This Plan shall be subject to the laws
of The State of Maryland and shall be interpreted and construed to further
promote the operation of the Company as an open-end management investment
company. As used herein the terms "open-end management investment company,"
"assignment," "principal underwriter," "interested person," and "majority of the
outstanding voting securities" shall have the meanings set forth in the
Securities Act of 1933, as amended or the 1940 Act, and the rules and
regulations thereunder.
Section 11. Scope of Liability. Nothing herein shall be deemed to
protect the parties to any Agreement entered into pursuant to this Plan against
any liability to the Company or its shareholders to which they would otherwise
be subject by reason of willful misfeasance, bad faith or gross negligence in
the performance of their duties hereunder, or by reason of their reckless
disregard of their obligations and duties hereunder.
Section 12. Records. The Company will preserve copies of this
Plan, Agreements and any written reports regarding this Plan presented to the
Board of Directors for a period of not less than six years.
3
<PAGE>
EXHIBIT A
NATIONS FUND, INC.
The term "Non-Money Market Funds" used in the Plan shall refer to
the following Funds of the Company:
Nations Equity Income Fund
Nations Government Securities Fund
Nations International Growth Fund
Nations Small Company Growth Fund
Nations U.S. Government Bond Fund
The term "Money Market Funds" used in the Plan shall refer to the
following Funds of the Company:
Nations Prime Fund
Nations Treasury Fund
Last Amended: August 19, 1999
4
NATIONS FUND, INC.
INVESTOR B DISTRIBUTION PLAN
This Investor B Distribution Plan (the "Plan"), formerly the Investor N
Distribution Plan, has been adopted by the Board of Directors of Nations Fund,
Inc. (the "Company") in conformance with Rule 12b-1 under the Investment Company
Act of 1940 (the "1940 Act").
Section 1. Payments for Distribution-Related Services. The Company may
compensate or reimburse its Distributor for any activities or expenses primarily
intended to result in the sale of Investor B Shares of the Company's Funds, as
listed on Exhibit A (collectively, the "Funds" or, individually, a "Fund").
Payments by the Company under this Section of this Plan will be calculated daily
and paid monthly at a rate or rates set from time to time by the Company's Board
of Directors, provided that no rate set by the Board for any Fund may exceed, on
an annual basis, 0.75% of the average daily net asset value of a Fund's Investor
B Shares.
Section 2. Expenses Covered by Plan. The fees payable under Section 1 of
this Plan shall be used primarily to compensate or reimburse the Distributor for
distribution services provided by it, and related expenses incurred, including
payments by the Distributor to compensate or reimburse banks, broker/dealers or
other financial institutions that have entered into Sales Support Agreements
with the Distributor ("Selling Agents"), for sales support services provided,
and related expenses incurred, by such Selling Agents. Payments under Section 1
of this Plan may be made with respect to: preparation, printing and distribution
of prospectuses, sales literature and advertising materials by the Distributor
or, as applicable, Selling Agents, attributable to distribution or sales support
activities, respectively; commissions, incentive compensation or other
compensation to, and expenses of, account executives or other employees of the
Distributor or Selling Agents, attributable to distribution or sales support
activities, respectively; overhead and other office expenses of the Distributor
or Selling Agents, attributable to distribution or sales support activities,
respectively; opportunity costs relating to the foregoing (which may be
calculated as a carrying charge on the Distributor's or Selling Agents'
unreimbursed expenses incurred in connection with distribution or sales support
activities, respectively); and any other costs and expenses relating to
distribution or sales support activities. The overhead and other office expenses
referenced in this Section 2 may include, without limitation, (i) the expenses
of operating the Distributor's or Selling Agents' offices in connection with the
sale of Fund shares, including lease costs, the salaries and employee benefit
costs of administrative, operations and support personnel, utility costs,
communication costs and the costs of stationery and supplies, (ii) the costs of
client sales seminars and travel related to distribution and sales support
activities, and (iii) other expenses relating to distribution and sales support
activities.
Section 3. Distribution and Sales Support Agreements. Any officer of the
Company is authorized to execute and deliver, in the name and on behalf of the
Company, a written agreement with the Distributor in a form duly approved from
time to time by the Company's Board of Directors. Such agreement shall authorize
the Distributor to enter into written Sales Support Agreements, in substantially
the form attached hereto as Exhibit B ("Agreements"), with Selling Agents.
1
<PAGE>
Section 4. Limitations on Payments. Payment made by a particular Fund
under Section 1 must be for distribution or sales support services rendered for
or on behalf of such Fund. However, joint distribution or sales support
financing with respect to the Funds (which financing may also involve other
investment portfolios or companies that are affiliated persons of such a person,
or affiliated persons of the Distributor) shall be permitted in accordance with
applicable regulations of the Securities and Exchange Commission as in effect
from time to time.
Except for the payments specified in Section 1, no additional payments are
to be made by the Company under this Plan, provided that nothing herein shall be
deemed to preclude the payments such Funds are otherwise obligated to make (i)
to NationsBank of North Carolina, N.A. ("NationsBank") pursuant to the
Investment Advisory Agreement, (ii) to NationsBank of Texas, N.A. ("NationsBank
Texas"), pursuant to the Custody Agreement, (iii) to First Data Investor
Services Group, Inc. ("First Data"), formerly The Shareholders Services Group,
Inc., pursuant to the Transfer Agency and Registrar Agreement, (iv) to Stephens
Inc. ("Stephens"), pursuant to the Administration Agreement, (v) to First Data,
pursuant to the Co-Administration Agreement, (vi) to Servicing Agents pursuant
to Shareholder Servicing Agreements and (vii) for the expenses otherwise
incurred by a Fund and the Company on behalf of the Investor B Shares in the
normal conduct of such Fund's business pursuant to the Investment Advisory
Agreement, the Custody Agreement, the Transfer Agency and Registrar Agreement,
the Administration Agreement, the Co-Administration Agreement and the
Shareholder Servicing Agreements. To the extent any such payments by the Company
on behalf of a Fund to NationsBank, NationsBank Texas, First Data, Stephens or
Servicing Agents; by NationsBank, NationsBank Texas, First Data, Stephens or
Servicing Agents, or any affiliate thereof, to any party pursuant to any
agreement; or, generally, by the Company on behalf of a Fund to any party, are
deemed to be payments for the financing of any activity primarily intended to
result in the sale of the Investor B Shares within the context of Rule 12b-1
under the 1940 Act, then such payments shall be deemed to have been approved
pursuant to this Plan without regard to Section 1.
With respect to Investor B Shares, actual distribution expenses incurred
by the Distributor (or sales support expenses incurred by Selling Agents) in a
given year may exceed the sum of the fees received by the Distributor pursuant
to this Plan and payments received by the Distributor pursuant to contingent
deferred sales charges. Any such excess may be recovered by the Distributor, and
retained by it or paid over to Selling Agents, as applicable, in future years as
long as this Plan is in effect. If this Plan is terminated or not continued, the
Company shall not be obligated to pay the Distributor (or Selling Agents) for
any expenses not previously reimbursed by the Company or recovered through
contingent deferred sales charges.
Notwithstanding anything herein to the contrary, no Fund shall be
obligated to make any payments under this Plan that exceed the maximum amounts
payable under Article III, Section 26 of the Rules of Fair Practice of the
National Association of Securities Dealers, Inc.
Section 5. Reports of Distributor. So long as this Plan is in effect, the
Distributor shall provide to the Company's Officers and Board of Directors, and
the Directors shall review at least quarterly, a written report of the amounts
expended by it pursuant to the Distribution Agreement, or by Selling Agents
pursuant to Sales Support Agreements, and the purposes for which such
expenditures were made.
2
<PAGE>
Section 6. Approval of Plan. This Plan will become effective immediately,
as to any Fund's Investor B Shares, upon its approval by (a) a majority of the
outstanding Investor B Shares of such Fund, and (b) a majority of the Board of
Directors, including a majority of the Directors who are not "interested
persons" (as defined in the 1940 Act) of the Company and who have no direct or
indirect financial interest in the operation of this Plan or in any agreements
entered into in connection with this Plan, pursuant to a vote cast in person at
a meeting called for the purpose of voting on the approval of this Plan.
Section 7. Continuance of Plan. This Plan shall continue in effect for so
long as its continuance is specifically approved at least annually by the
Company's Board of Directors in the manner described in Section 6.
Section 8. Amendments. This Plan may be amended at any time by the Board
of Directors provided that (a) any amendment to increase materially the costs
which a Fund's Investor B Shares may bear for distribution pursuant to this Plan
shall be effective only upon approval by a vote of a majority of the outstanding
Investor B Shares of such Fund, and (b) any material amendments of the terms of
this Plan shall become effective only upon approval as provided in Section 6
hereof.
Section 9. Termination. This Plan is terminable, as to a Fund's Investor B
Shares, without penalty at any time by (a) a vote of a majority of the Directors
who are not "interested persons" (as defined in the 1940 Act) of the Company and
who have no direct or indirect financial interest in the operation of this Plan
or in any agreements entered into in connection with this Plan, or (b) a vote of
a majority of the outstanding Investor B Shares of such Fund.
Section 10. Selection/Nomination of Directors. While this Plan is in
effect, the selection and nomination of those Directors who are not "interested
persons" (as defined in the 1940 Act) of the Company shall be committed to the
discretion of such non-interested Directors.
Section 12. Records. The Company will preserve copies of this Plan, and
any Agreements and written reports regarding this Plan presented to the Board of
Directors for a period of not less than six years.
Section 13. Miscellaneous. The captions in this Plan are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
3
<PAGE>
EXHIBIT A
NATIONS FUND, INC.
Nations Equity Income Fund
Nations Government Securities Fund
Nations International Growth Fund
Nations Small Company Growth Fund
Nations U.S. Government Bond Fund
Last Amended: August 19, 1999
4
NATIONS FUND, INC.
DISTRIBUTION PLAN
INVESTOR B SHARES -- MONEY MARKET FUNDS
INVESTOR C SHARES -- NON-MONEY MARKET FUNDS
This amended and restated Distribution Plan (this "Plan") has been adopted
by the Board of Directors of Nations Fund, Inc. (the "Company") in conformance
with Rule 12b-1 under the Investment Company Act of 1940 (the "1940 Act").
Section 1. Payments for Distribution-Related Services. The Company may pay
its Distributor for certain expenses that are incurred in connection with the
support and distribution of Investor B Shares of the Company's Money Market
Funds and Investor C Shares of the Company's Non-Money Market Funds
(collectively, "Shares"), as listed in Exhibit A (collectively, the "Funds").
Payments by the Company under the Plan will be calculated daily and paid monthly
at a rate or rates set from time to time by the Company's Board of Directors,
provided that no rate set by the Board for any Fund may exceed the annual rate
of: 0.10% of the average daily net asset value of Investor B Shares of the Money
Market Funds; and 0.75% of the average daily net asset value of Investor C
Shares of the Non-Money Market Funds. For purposes of determining the payments
payable under this Plan, the net asset value of the outstanding Shares of the
respective Funds shall be computed in the manner specified in the Company's then
current prospectuses and statement of additional information as amended or
supplemented from time to time for such Shares.
Section 2. Expenses Covered by Plan. Payments to the Distributor under
Section 1 of this Plan will be used by the Distributor (i) to compensate banks,
broker/dealers or other financial institutions that have entered into Sales
Support Agreements with the Distributor ("Selling Agents") for providing
distribution assistance relating to Shares, (ii) for promotional activities
intended to result in the sale of Shares such as by paying for the preparation,
printing and distribution of prospectuses for other than current Shareholders,
and (iii) to compensate Selling Agents for providing distribution services with
regard to their Customers who are, from time to time, beneficial, and record
owners of Shares.
Section 3. Distribution and Sales Support Agreements. Any officer of the
Company is authorized to execute and deliver, in the name and on behalf of the
Company, a written agreement with the Distributor in a form duly approved from
time to time by the Company's Board of Directors. Such agreement shall authorize
the Distributor to enter into written Sales Support Agreements, in substantially
the form attached hereto as Exhibit B ("Agreements"), with Selling Agents.
As used herein, promotional activities include, but are not limited to,
advertising via radio, television, newspapers, magazines and otherwise;
preparing, printing and mailing sales materials, brochures and prospectuses
(except for prospectuses used for regulatory purposes or for distribution to
existing shareholders).
1
<PAGE>
Section 4. Limitations on Payments. Payment made by a particular Fund
under Section 1 must be for distribution or sales support services rendered for
or on behalf of such Fund. However, joint distribution or sales support
financing with respect to the Funds (which financing may also involve other
investment portfolios or companies that are affiliated persons of such a person,
or affiliated persons of the Distributor) shall be permitted in accordance with
applicable regulations of the Securities and Exchange Commission ("SEC") as in
effect from time to time.
Upon proper authorization by the Company's Directors in accordance with
Rule 12b-1 under the Act, expenses covered by this Plan may also include other
expenses the Distributor (or any other person) may incur in connection with the
distribution of the Company's Shares including, without limitation, expenditures
for telephone facilities and in-house telemarketing, or in connection with
shareholder servicing. Distribution service fees will not be used to pay any
interest expenses, carrying charges or other financing costs (except to the
extent permitted by the SEC). Distribution service fees will not be used to pay
any general or administrative expenses of the Distributor.
Except for the payments specified in Section 1, no additional payments are
to be made by the Company under this Plan, provided that nothing herein shall be
deemed to preclude the payments such Funds are otherwise obligated to make to
(i) NationsBank of North Carolina, N.A. ("NationsBank"), pursuant to the
Investment Advisory Agreement (ii) NationsBank of Texas, N.A. ("NationsBank
Texas"), pursuant to the Custody Agreement, (iii) First Data Investor Services
Group, Inc. ("First Data"), formerly The Shareholder Services Group, Inc.,
pursuant to the Transfer Agency and Registrar Agreement, (iv) Stephens Inc.
("Stephens"), pursuant to the Administration Agreement, (v) First Data, pursuant
to the Co-Administration Agreement, (vi) Servicing Agents, pursuant to
Shareholder Servicing Agreements and (vii) for the expenses otherwise incurred
by a Fund and the Company on behalf of the Shares in the normal conduct of such
Fund's business pursuant to the Investment Advisory Agreement, the Custody
Agreement, the Transfer Agency and Registrar Agreement, the Administration
Agreement, the Co-Administration Agreement and the Shareholder Servicing
Agreements. To the extent any such payments by the Company on behalf of a Fund
to NationsBank, NationsBank Texas, First Data, Stephens or Servicing Agents; by
NationsBank, NationsBank Texas, First Data, Stephens or Servicing Agents, or any
affiliate thereof, to any party pursuant to any agreement; or, generally, by the
Company on behalf of a Fund to any party, are deemed to be payments for the
financing of any activity primarily intended to result in the sale of the Shares
within the context of Rule 12b-1 under the 1940 Act, then such payments shall be
deemed to have been approved pursuant to this Plan without regard to Section 1.
With respect to Shares, actual distribution expenses incurred by the
Distributor (or sales support expenses incurred by the Selling Agents) in a
given year may exceed the sum of the fees received by the Distributor pursuant
to this Plan and payments received by the Distributor pursuant to contingent
deferred sales charges. Any such excess may be recovered by the Distributor, and
retained by it or paid over to the Selling Agents, as applicable, in future
years as long as this Plan is in effect. If this Plan is terminated or not
continued, the Company shall not be obligated to pay the Distributor (or Selling
Agents) for any expenses not previously reimbursed by the Company or recovered
through contingent deferred sales charges.
2
<PAGE>
Notwithstanding anything herein to the contrary, no Fund shall be
obligated to make any payments under this Plan that exceed the maximum amounts
payable under Article III, Section 26 of the Rules of Fair Practice of the
National Association of Securities Dealers, Inc.
Section 5. Reports of Distributor. So long as this Plan is in effect, the
Distributor shall provide to the Company's Officers and Board of Directors, and
the Directors shall review, at least quarterly, a written report of the amounts
expended by it pursuant to the Distribution Agreement, or by Selling Agents
pursuant to Sales Support Agreements, and the purposes for which such
expenditures were made.
Section 6. Approval of Plan. The Plan will become effective immediately,
as to any Fund's Shares, upon its approval by (a) a majority of the outstanding
Shares of such Fund, and (b) a majority of the Board of Directors, including a
majority of the Directors who are not "interested persons" (as defined in the
1940 Act) of the Company and who have no direct or indirect financial interest
in the operation of this Plan or in any agreements entered into in connection
with this Plan, pursuant to a vote cast in person at a meeting called for the
purpose of voting on the approval of this Plan.
Section 7. Continuance of Plan. The Plan shall continue in effect for so
long as its continuance is specifically approved at least annually by the
Company's Board of Directors in the manner described in Section 6.
Section 8. Amendments. The Plan may be amended at any time by the Board of
Directors provided that (a) any amendment to increase materially the costs which
a Fund's Shares may bear for distribution pursuant to this Plan shall be
effective only upon approval by a vote of a majority of the outstanding Shares
of such Fund, and (b) any material amendments of the terms of this Plan shall
become effective only upon approval as provided in Section 6 hereof.
Section 9. Termination. The Plan is terminable, as to a Fund's Shares,
without penalty at any time by (a) a vote of a majority of the Directors who are
not "interested persons" (as defined in the 1940 Act) of the Company and who
have no direct or indirect financial interest in the operation of this Plan or
in any agreements entered into in connection with this Plan, or (b) a vote of a
majority of the outstanding Shares of such Fund.
Section 10. Selection/Nomination of Directors. While this Plan is in
effect, the selection and nomination of those Directors who are not "interested
persons" (as defined in the 1940 Act) of the Company shall be committed to the
discretion of such non-interested Directors.
Section 11. Records. The Company will preserve copies of this Plan,
Agreements, and any written reports regarding this Plan presented to the Board
of Directors for a period of not less than six years.
Section 12. Miscellaneous. The captions in this Plan are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
3
<PAGE>
EXHIBIT A
NATIONS FUND, INC.
The term "Non-Money Market Funds" used in the Plan shall refer to the following
Funds of the Company:
Nations Equity Income Fund
Nations Government Securities Fund
Nations International Growth Fund
Nations Small Company Growth Fund
Nations U.S. Government Bond Fund
The term "Money Market Funds" used in the Plan shall refer to the
following Funds of the Company:
Nations Prime Fund
Nations Treasury Fund
Last Amended: August 19, 1999
4
NATIONS FUND, INC.
DAILY CLASS DISTRIBUTION PLAN
This Daily Class Distribution Plan (formerly the "Investor D Distribution
Plan") (the "Plan") has been adopted by the Board of Directors of Nations Fund,
Inc. (the "Company") in conformance with Rule 12b-1 under the Investment Company
Act of 1940 (the "1940 Act").
Section 1. Payments for Distribution-Related Services. The Company may
compensate or reimburse its Distributor for any activities or expenses primarily
intended to result in the sale of Daily Shares of the Company's Money Market
Funds, as listed on Exhibit A (collectively, the "Funds" or, individually, a
"Fund"). Payments by the Company under this Section of this Plan will be
calculated daily and paid monthly at a rate or rates set from time to time by
the Company's Board of Directors, provided that no rate set by the Board for any
Fund may exceed, on an annual basis, 0.45% of the average daily net asset value
of a Fund's Daily Shares.
Section 2. Expenses Covered by Plan. The fees payable under Section 1 of
this Plan shall be used primarily to compensate or reimburse the Distributor for
distribution services provided by it, and related expenses incurred, including
payments by the Distributor to compensate or reimburse banks, broker/dealers or
other financial institutions that have entered into Sales Support Agreements
with the Distributor ("Selling Agents"), for sales support services provided,
and related expenses incurred, by such Selling Agents. Payments under Section 1
of this Plan may be made with respect to: preparation, printing and distribution
of prospectuses, sales literature and advertising materials by the Distributor
or, as applicable, Selling Agents, attributable to distribution or sales support
activities, respectively; commissions, incentive compensation or other
compensation to, and expenses of, account executives or other employees of the
Distributor or Selling Agents, attributable to distribution or sales support
activities, respectively; overhead and other office expenses of the Distributor
or Selling Agents, attributable to distribution or sales support activities,
respectively; opportunity costs relating to the foregoing (which may be
calculated as a carrying charge on the Distributor's or Selling Agents'
unreimbursed expenses incurred in connection with distribution or sales support
activities, respectively); and any other costs and expenses relating to
distribution or sales support activities. The overhead and other office expenses
referenced in this Section 2 may include, without limitation, (i) the expenses
of operating the Distributor's or Selling Agents' offices in connection with the
sale of Fund shares, including lease costs, the salaries and employee benefit
costs of administrative, operations and support personnel, utility costs,
communication costs and the costs of stationery and supplies, (ii) the costs of
client sales seminars and travel related to distribution and sales support
activities, and (iii) other expenses relating to distribution and sales support
activities.
Section 3. Distribution and Sales Support Agreements. Any officer of the
Company is authorized to execute and deliver, in the name and on behalf of the
Company, a written agreement with the Distributor in a form duly approved from
time to time by the Company's Board of Directors. Such agreement shall authorize
the Distributor to enter into written Sales Support Agreements, in substantially
the form attached hereto as Exhibit B ("Agreements"), with Selling Agents.
1
<PAGE>
Section 4. Limitations on Payments. Payment made by a particular Fund
under Section 1 must be for distribution or sales support services rendered for
or on behalf of such Fund. However, joint distribution or sales support
financing with respect to the Funds (which financing may also involve other
investment portfolios or companies that are affiliated persons of such a person,
or affiliated persons of the Distributor) shall be permitted in accordance with
applicable regulations of the Securities and Exchange Commission as in effect
from time to time.
Except for the payments specified in Section 1, no additional payments are
to be made by the Company under this Plan, provided that nothing herein shall be
deemed to preclude the payments such Funds are otherwise obligated to make (i)
to NationsBank, N.A. ("NationsBank") pursuant to the Investment Advisory
Agreement, (ii) to NationsBank of Texas, N.A. ("NationsBank Texas"), and The
Bank of New York ("BONY") pursuant to the Mutual Fund Custody and Sub-Custody
Agreement ("Custody Agreement"), (iii) to First Data Investor Services Group,
Inc. ("First data"), pursuant to the Transfer Agency and Registrar Agreement,
(iv) to Stephens Inc. ("Stephens"), pursuant to the Administration Agreement,
(v) to First Data, pursuant to the Co-Administration Agreement, (vi) to
Servicing Agents pursuant to Shareholder Servicing Agreements and (vii) for the
expenses otherwise incurred by a Fund and the Company on behalf of the Daily
Shares in the normal conduct of such Fund's business pursuant to the Investment
Advisory Agreement, the Custody Agreement, the Transfer Agency and Registrar
Agreement, the Administration Agreement, the Co-Administration Agreement and the
Shareholder Servicing Agreements. To the extent any such payments by the Company
on behalf of a Fund to NationsBank, NationsBank Texas, BONY, First Data,
Stephens, or Servicing Agents; by NationsBank, NationsBank Texas, BONY, First
Data, Stephens or Servicing Agents, or any affiliate thereof, to any party
pursuant to any agreement; or, generally, by the Company on behalf of a Fund to
any party, are deemed to be payments for the financing of any activity primarily
intended to result in the sale of the Daily Shares within the context of Rule
12b-1 under the 1940 Act, then such payments shall be deemed to have been
approved pursuant to this Plan without regard to Section 1.
With respect to Daily Shares, actual distribution expenses incurred by the
Distributor (or sales support expenses incurred by Selling Agents) in a given
year may exceed the sum of the fees received by the Distributor pursuant to this
Plan and payments received by the Distributor pursuant to contingent deferred
sales charges. Any such excess may be recovered by the Distributor, and retained
by it or paid over to Selling Agents, as applicable, in future years as long as
this Plan is in effect. If this Plan is terminated or not continued, the Company
shall not be obligated to pay the Distributor (or Selling Agents) for any
expenses not previously reimbursed by the Company or recovered through
contingent deferred sales charges.
Notwithstanding anything herein to the contrary, no Fund shall be
obligated to make any payments under this Plan that exceed the maximum amounts
payable under Article III, Section 26 of the Rules of Fair Practice of the
National Association of Securities Dealers, Inc.
Section 5. Reports of Distributor. So long as this Plan is in effect, the
Distributor shall provide to the Company's Officers and Board of Directors, and
the Directors shall review at least quarterly, a written report of the amounts
expended by it pursuant to the Distribution Agreement, or by Selling Agents
pursuant to Sales Support Agreements, and the purposes for which such
expenditures were made.
2
<PAGE>
Section 6. Approval of Plan. This Plan will become effective immediately,
as to any Fund's Daily Shares, upon its approval by (a) a majority of the
outstanding Daily Shares of such Fund, and (b) a majority of the Board of
Directors, including a majority of the Directors who are not "interested
persons" (as defined in the 1940 Act) of the Company and who have no direct or
indirect financial interest in the operation of this Plan or in any agreements
entered into in connection with this Plan, pursuant to a vote cast in person at
a meeting called for the purpose of voting on the approval of this Plan.
Section 7. Continuance of Plan. This Plan shall continue in effect for so
long as its continuance is specifically approved at least annually by the
Company's Board of Directors in the manner described in Section 6.
Section 8. Amendments. This Plan may be amended at any time by the Board
of Directors provided that (a) any amendment to increase materially the costs
which a Fund's Daily Shares may bear for distribution pursuant to this Plan
shall be effective only upon approval by a vote of a majority of the outstanding
Daily Shares of such Fund, and (b) any material amendments of the terms of this
Plan shall become effective only upon approval as provided in Section 6 hereof.
Section 9. Termination. This Plan is terminable, as to a Fund's Daily
Shares, without penalty at any time by (a) a vote of a majority of the Directors
who are not "interested persons" (as defined in the 1940 Act) of the Company and
who have no direct or indirect financial interest in the operation of this Plan
or in any agreements entered into in connection with this Plan, or (b) a vote of
a majority of the outstanding Daily Shares of such Fund.
Section 10. Selection/Nomination of Directors. While this Plan is in
effect, the selection and nomination of those Directors who are not "interested
persons" (as defined in the 1940 Act) of the Company shall be committed to the
discretion of such non-interested Directors.
Section 11. Records. The Company will preserve copies of this Plan, and
any Agreements and written reports regarding this Plan presented to the Board of
Directors for a period of not less than six years.
Section 12. Miscellaneous. The captions in this Plan are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
3
<PAGE>
EXHIBIT A
NATIONS FUND, INC.
Nations Prime Fund
Nations Treasury Fund
4
NATIONS FUND, INC.
RULE 18f-3 MULTI-CLASS PLAN
I. Introduction.
Pursuant to Rule 18f-3 under the Investment Company Act of 1940, as
amended (the "1940 Act"), the following sets forth the method for allocating
fees and expenses among each class of shares in the investment portfolios of
Nations Fund, Inc. (the "Company"). In addition, this Rule 18f-3 Multi-Class
Plan (the "Plan") sets forth the maximum initial sales loads, contingent
deferred sales charges, Rule 12b-1 distribution fees, shareholder servicing
fees, conversion features, exchange privileges and other shareholder services,
if any, applicable to a particular class of shares of the portfolios. The Plan
also identifies expenses that may be allocated to a particular class of shares
to the extent that they are actually incurred in a different amount by class or
relate to a different kind or degree of services provided to the class.
The Company is an open-end series investment company registered under
the 1940 Act, the shares of which are registered on Form N-1A under the
Securities Act of 1933 (Registration Nos. 33-4038 and 811-4614). The Company
elects to offer multiple classes of shares in its investment portfolios pursuant
to the provisions of Rule 18f-3 and this Plan.
The Company currently consists of the following seven separate
investment portfolios: Nations Prime Fund and Nations Treasury Fund (the "Money
Market Funds") and Nations Equity Income Fund, Nations Government Securities
Fund, Nations International Growth Fund, Nations Small Company Growth Fund and
Nations U.S. Government Bond Fund (the "Non-Money Market Funds").
The above-listed investment portfolios of the Company (the "Funds") are
authorized to issue the following classes of shares representing interests in
the Funds:
(i) Nations Prime Fund -- Primary A Shares, Primary B Shares,
Investor A Shares, Investor B Shares, Investor C Shares, Daily
Shares and Marsico Shares;
(ii) Nations Treasury Fund -- Primary A Shares, Primary B Shares,
Investor A Shares, Investor B Shares, Investor C Shares and
Daily Shares; and
(iii) Nations Equity Income Fund, Nations Government Securities
Fund, Nations International Growth Fund, Nations Small Company
Growth Fund and Nations U.S. Government Bond Fund -- Primary A
Shares, Primary B Shares, Investor A Shares, Investor B Shares
and Investor C Shares.
II. Allocation of Expenses.
A. Pursuant to Rule 18f-3 under the 1940 Act, the Company shall
allocate to each class of shares in a Fund (i) any fees and expenses incurred by
the Company in connection with the distribution of such class of shares under a
distribution plan adopted for such class of shares pursuant to Rule 12b-1, and
(ii) any fees and expenses incurred by the Company under a shareholder servicing
plan in connection with the provision of shareholder services to the holders of
such class of shares.
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<PAGE>
B. In addition, pursuant to Rule 18f-3, the Company may allocate the
following fees and expenses, if any, to a particular class of shares in a single
Fund:
(i) transfer agent fees identified by the transfer agent
as being attributable to such class of shares;
(ii) printing and postage expenses related to preparing
and distributing materials such as shareholder
reports, prospectuses, reports, and proxies to
current shareholders of such class of shares or to
regulatory agencies with respect to such class of
shares;
(iii) blue sky registration or qualification fees incurred
by such class of shares;
(iv) Securities and Exchange Commission registration fees
incurred by such class of shares;
(v) the expense of administrative personnel and services
(including, but not limited to, those of a portfolio
accountant, custodian or dividend paying agent
charged with calculating net asset values or
determining or paying dividends) as required to
support the shareholders of such class of shares;
(vi) litigation or other legal expenses relating solely to
such class of shares;
(vii) fees of the Company's Directors incurred as result of
issues relating to such class of shares;
(viii) independent accountants' fees relating solely to such
class of shares; and
(ix) any other fees and expenses, not including advisory
or custodial fees or other expenses related to the
management of the Fund's assets, relating to (as
defined below) such class of shares.
C. For all purposes under this Plan, fees and expenses "relating to" a
class of shares are those fees and expenses that are actually incurred in a
different amount by the class or that relate to a different kind or degree of
services provided to the class. The proper officers of the Company shall have
the authority to determine whether any or all of the fees and expenses described
in Section B of this Part II should be allocated to a particular class of
shares. The Board of Directors will monitor any such allocations to ensure that
they comply with the requirements of the Plan.
D. Income and any expenses of Nations Prime Fund, Nations Treasury
Fund, Nations Government Securities Fund and Nations U.S. Government Bond Fund
not allocated to a particular class of any such Fund pursuant to this Plan shall
be allocated to each class of the Fund on the basis of the relative net assets
(settled shares), as defined in Rule 18f-3, of that class in relation to the net
assets of the Fund.
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<PAGE>
Realized and unrealized capital gains and losses of Nations Prime Fund,
Nations Treasury Fund, Nations Government Securities Fund and Nations U.S.
Government Bond Fund not allocated to a particular class of any such Fund
pursuant to this Plan shall be allocated to each class of the Fund on the basis
of the relative net assets (settled shares), as defined in Rule 18f-3, of that
class in relation to the net assets of the Fund.
Income, realized and unrealized capital gains and losses, and any
expenses of Nations Equity Income Fund, Nations Small Company Growth Fund and
Nations International Growth Fund not allocated to a particular class of any
such Fund pursuant to this Plan shall be allocated to each class of the Fund on
the basis of the relative net assets (settled shares), as defined in Rule 18f-3,
of that class in relation to the net assets of the Fund.
E. In certain cases, Banc of America Advisors, Inc., Banc of America
Capital Management, Inc., Gartmore Global Partners, Bank of America, N.A.,
Stephens Inc., PFPC Inc., or another service provider for a Fund may waive or
reimburse all or a portion of the expenses of a specific class of shares of the
Fund. The Board of Directors will monitor any such waivers or reimbursements to
ensure that they do not provide a means for cross-subsidization between classes.
III. Class Arrangements.
The following summarizes the maximum front-end sales charges,
contingent deferred sales charges, Rule 12b-1 distribution fees, shareholder
servicing fees, conversion features, exchange privileges and other shareholder
services, if any, applicable to each class of shares of the Company. Additional
details regarding such fees and services are set forth in the relevant Fund's
(or Funds') current Prospectus(es) and Statement of Additional Information.
A. Primary A Shares -- All Funds.
1. Maximum Initial Sales Load: None
2. Contingent Deferred Sales Charge: None
3. Maximum Rule 12b-1 Distribution Fees: None
4. Maximum Shareholder Servicing Fees: None
5. Conversion Features: None
6. Exchange Privileges:
(a) Primary A Shares of a Fund may be exchanged
for Primary A Shares of any other Nations
Fund. In some cases, the only Money Market
Fund option is Trust Class Shares of Nations
Reserves Money Market Funds.
(b) From time to time, the Board of Directors of
the Company may modify, or ratify
modifications to, the exchange privileges of
Primary A Shares of a Fund without amending
this Plan, provided that such exchange
privileges, as modified, are described in
the then-current prospectus for such shares
of such Fund.
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<PAGE>
7. Other Shareholder Services: None
B. Primary B Shares -- All Funds.
1. Maximum Initial Sales Load: None
2. Contingent Deferred Sales Charge: None
3. Maximum Rule 12b-1 Distribution Fees: None
4. Maximum Shareholder Servicing/Administration Fees:
(a) Money Market Funds: Pursuant to a
Shareholder Servicing Plan, the Primary B
Shares of each Money Market Fund may pay
shareholder servicing fees of up to 0.25% of
the average daily net assets of such shares.
(b) Non-Money Market Funds: Pursuant to a
Shareholder Administration Plan, the Primary
B Shares of Nations Equity Income Fund,
Nations International Equity Fund, Nations
Government Securities Fund, Nations
International Growth Fund, Nations Small
Company Growth Fund and Nations U.S.
Government Bond Fund each may pay
shareholder administration fees of up to
0.60% of the average daily net assets of
such shares, provided that in no event may
the portion of such fee that constitutes a
"service fee," as that term is defined in
Rule 2830 of the Conduct Rules of the
National Association of Securities Dealers,
Inc., exceed 0.25% of the average daily net
asset value of such Primary B Shares of a
Fund.
5. Conversion Features: Primary B Shares of a Fund shall have
such conversion features, if any, as are determined by or
ratified by the Board of Directors of the Company and
described in the then-current prospectus for such shares of
such Fund.
6. Exchange Privileges:
(a) Primary B Shares of a Fund may be exchanged
for Primary B Shares of any other Nations
Fund.
(b) From time to time, the Board of Directors of
the Company may modify, or ratify
modifications to, the exchange privileges of
Primary B Shares of a Fund without amending
this Plan, provided that such exchange
privileges, as modified, are described in
the then-current prospectus for such shares
of such Fund.
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<PAGE>
7. Other Shareholder Services: None
C. Investor A Shares -- Money Market Funds Only.
1. Maximum Initial Sales Load: None
2. Contingent Deferred Sales Charge: None
3. Maximum Rule 12b-1 Distribution Fees: Pursuant to a
Distribution Plan adopted under Rule 12b-1, Investor A
Shares of each Money Market Fund may pay distribution fees
of up to 0.10% of the average daily net assets of such
shares.
4. Maximum Shareholder Servicing Fees: Pursuant to a
Shareholder Servicing Plan, Investor A Shares of each Money
Market Fund may pay shareholder servicing fees of up to
0.25% of the average daily net assets of such shares.
5. Conversion Features: Investor A Shares of a Fund shall have
such conversion features, if any, as are determined by or
ratified by the Board of Directors of the Company and
described in the then-current prospectus for such shares of
such Fund.
6. Exchange Privileges:
(a) Investor A Shares of the Money Market Funds may
be exchanged for Investor A Shares of any other
Nations Fund, except Index Funds.
(b) Investor A Shares of the Money Market Funds
acquired through a Nations Funds Individual
Retirement Account ("IRA") may be exchanged for
Investor B Shares of any other Nations Fund,
except Money Market Funds.
(c) From time to time, the Board of Directors of the
Company may modify, or ratify modifications to,
the exchange privileges of Investor A Shares of a
Fund without amending this Plan, provided that
such exchange privileges, as modified, are
described in the then-current prospectus for such
shares of such Fund.
7. Other Shareholder Services. The Company offers check
writing privileges, a Systematic Investment Plan, an
Automatic Withdrawal Plan and an Automatic Exchange Feature
to holders of Investor A Shares of the Money Market Funds.
D. Investor A Shares -- Non-Money Market Funds Only.
1. Maximum Initial Sales Load:
5
<PAGE>
(a) Nations Equity Income, Nations International
Equity Fund, Nations International Growth Fund,
Nations Small Company Growth Fund and Nations
International Value Fund: maximum of 5.75%.
(b) Nations Government Securities Fund and Nations
U.S. Government Bond Fund: maximum of 4.75%.
2. Contingent Deferred Sales Charge (as a percentage of the
lower of the original purchase price or redemption
proceeds):
(a) 1.00% of purchases made before August 1, 1999 in
amounts over $1 million if redeemed within one
year of purchase, declining to 0.50% in the
second year after purchase and eliminated
thereafter.
(b) 1.00% of purchases made on or after August 1,
1999 in amounts over $1 million if redeemed
within 18 months of purchase and eliminated
thereafter.
3. Redemption Fee:
(a) 1.00% of the current net asset value of shares
purchased in amounts of $1 million or more
between July 31, 1997 and November 15, 1998, and
redeemed within 18 months of purchase.
(b) 1.00% of the current net asset value of shares
purchased by an employee benefit plan that
initially invested in Investor A Shares between
July 31, 1997 and November 15, 1998, and redeemed
within 18 months of purchase in connection with
redemption of all Nations Funds holdings of the
employee benefit plan.
4. Maximum Rule 12b-1 Distribution/Shareholder Servicing Fees:
Pursuant to a Shareholder Servicing and Distribution Plan
adopted under Rule 12b-1, Investor A Shares of each
Non-Money Market Fund may pay a combined distribution and
shareholder servicing fee of up to 0.25% of the average
daily net assets of such shares.
5. Conversion Features: Investor A Shares of a Fund shall have
such conversion features, if any, as are determined by or
ratified by the Board of Directors of the Company and
described in the then-current prospectus for such shares of
such Fund.
6. Exchange Privileges:
(a) Investor A Shares of the Non-Money Market Funds
may be exchanged for Investor A Shares of any
other Nations Fund, except Index Fund.
(b) From time to time, the Board of Directors of the
Company may modify, or ratify modifications to,
the exchange privileges of Investor A Shares of a
Fund without amending this Plan, provided that
such exchange privileges, as modified, are
described in the then-current prospectus for such
shares of such Fund.
6
<PAGE>
7. Other Shareholder Services. The Company offers a Systematic
Investment Plan, an Automatic Withdrawal Plan and an
Automatic Exchange Feature to holders of Investor A Shares
of the Non-Money Market Funds.
E. Investor B Shares -- Money Market Funds Only.
1. Maximum Initial Sales Load: None
2. Contingent Deferred Sales Charge: None
3. Maximum Rule 12b-1 Distribution Fees: Pursuant to a
Distribution Plan adopted under Rule 12b-1, the Investor B
Shares of each Money Market Fund may pay distribution fees
of up to 0.10% of the average daily net assets of such
shares.
4. Maximum Shareholder Servicing Fees: Pursuant to a
Shareholder Servicing Plan, the Investor B Shares of each
Money Market Fund may pay shareholder servicing fees of up
to 0.25% of the average daily net assets of such shares.
5. Conversion Features: Investor B Shares of a Fund shall have
such conversion features, if any, as are determined by or
ratified by the Board of Directors of the Company and
described in the then-current prospectus for such shares of
such Fund.
6. Exchange Privileges:
(a) Investor B Shares of a Money Market Fund may be
exchanged for Investor B Shares of any other
Money Market Fund.
(b) From time to time, the Board of Directors of the
Company may modify, or ratify modifications to,
the exchange privileges of Investor B Shares of a
Fund without amending this Plan, provided that
such exchange privileges, as modified, are
described in the then-current prospectus for such
shares of such Fund.
7. Other Shareholder Services: The Company offers
check-writing services, a Systematic Investment Plan and an
Automatic Withdrawal Plan to holders of Investor B Shares
of the Money Market Funds.
F. Investor B Shares -- Non-Money Market Funds Only.
1. Maximum Initial Sales Load: None
7
<PAGE>
2. Contingent Deferred Sales Charge (as a percentage of the
lower of the original purchase price or redemption
proceeds): 5.00% if redeemed within one year of purchase,
declining to 1.00% in the sixth year after purchase and
eliminated thereafter.
3. Maximum Rule 12b-1 Distribution Fees: Pursuant to a
Distribution Plan adopted under Rule 12b-1, the Investor B
Shares of each Non-Money Market Fund may pay distribution
fees of up to 0.75% of the average daily net assets of such
shares.
4. Maximum Shareholder Servicing Fees: Pursuant to a
Shareholder Servicing Plan, the Investor B Shares of each
Non-Money Market Fund may pay shareholder servicing fees of
up to 0.25% of the average daily net assets of such shares.
5. Conversion Features: Investor B Shares of a Fund shall have
such conversion features, if any, as are determined by or
ratified by the Board of Directors of the Company and
described in the then-current prospectus for such shares of
such Fund.
6. Exchange Privileges:
(a) Investor B Shares of a Non-Money Market Fund may
be exchanged for Investor B Shares of any other
Nations Fund, except Money Market Funds.
(b) Investor B Shares of a Non-Money Market Fund may
be exchanged for Investor B Shares of any Nations
Reserves Money Market Fund.
(c) From time to time, the Board of Directors of the
Company may modify, or ratify modifications to,
the exchange privileges of Investor B Shares of a
Fund without amending this Plan, provided that
such exchange privileges, as modified, are
described in the then-current prospectus for such
shares of such Fund.
7. Other Shareholder Services: The Company offers a Systematic
Investment Plan, an Automatic Withdrawal Plan and an
Automatic Exchange Feature to holders of Investor B Shares
of the Non-Money Market Funds.
G. Investor C Shares -- Money Market Funds Only.
1. Maximum Initial Sales Load: None
2. Contingent Deferred Sales Charge: None
3. Maximum Rule 12b-1 Distribution Fees: None
4. Maximum Shareholder Servicing Fees: Pursuant to a
Shareholder Servicing Plan, the Investor C Shares of each
Money Market Fund may pay shareholder servicing fees of up
to 0.25% of the average daily net assets of such shares.
8
<PAGE>
5. Conversion Features: Investor C Shares of a Fund shall have
such conversion features, if any, as are determined by or
ratified by the Board of Directors of the Company and
described in the then-current prospectus for such shares of
such Fund.
6. Exchange Privileges:
(a) Investor C Shares of a Money Market Fund may be
exchanged for Investor B Shares of any other
Nations Fund, except Nations Funds Money Market
Funds.
(b) Investor C Shares of a Money Market Fund acquired
in exchange for Investor B Shares of another
Nations Fund Non-Money Market Fund may be
re-exchanged for Investor B Shares of any Nations
Reserves Money Market Fund.
(c) From time to time, the Board of Directors of the
Company may modify, or ratify modifications to,
the exchange privileges of Investor C Shares of a
Fund without amending this Plan, provided that
such exchange privileges, as modified, are
described in the then-current prospectus for such
shares of such Fund.
7. Other Shareholder Services: The Company offers a Systematic
Investment Plan and an Automatic Withdrawal Plan to holders
of Investor C Shares of the Money Market Funds.
H. Investor C Shares -- Non- Money Market Funds Only.
1. Maximum Initial Sales Load: None
2. Contingent Deferred Sales Charge (as a percentage of the
lower of the original purchase price or redemption
proceeds): 1.00% if redeemed within one year of purchase
and eliminated thereafter.
3. Maximum Rule 12b-1 Distribution Fees: Pursuant to a
Distribution Plan adopted under Rule 12b-1, Investor C
Shares of the Non-Money Market Funds may pay distribution
fees of up to 0.75% of the average daily net assets of such
shares.
4. Maximum Shareholder Servicing Fees: Pursuant to a
Shareholder Servicing Plan, the Investor C Shares of each
Money Market Fund may pay shareholder servicing fees of up
to 0.25% of the average daily net assets of such shares.
5. Conversion Features: Investor C Shares of a Fund shall have
such conversion features, if any, as are determined by or
ratified by the Board of Directors of the Company and
described in the then-current prospectus for such shares of
such Fund.
9
<PAGE>
6. Exchange Privileges:
(a) Investor C Shares of a Non-Money Market Fund may
be exchanged for Investor C Shares of any other
Nations Fund, except Money Market Funds.
(b) Investor C Shares of a Non-Money Market Fund may
be exchanged for Investor C Shares of any Nations
Reserves Money Market Fund.
(c) Investor C Shares of a Non-Money Market Fund that
were originally obtained in an exchange of
Investor A Shares of a Managed Index Fund for
Investor C Shares of a Non-Money Market Fund may
be exchanged for Investor A Shares of any Index
Fund.
(d) From time to time, the Board of Directors of the
Company may modify, or ratify modifications to,
the exchange privileges of Investor C Shares of a
Fund without amending this Plan, provided that
such exchange privileges, as modified, are
described in the then-current prospectus for such
shares of such Fund.
7. Other Shareholder Services. The Company offers a Systematic
Investment Plan, an Automatic Withdrawal Plan and an
Automatic Exchange Feature to holders of Investor C Shares
of the Non-Money Market Funds.
I. Daily Shares -- Money Market Funds Only.
1. Maximum Initial Sales Load: None
2. Contingent Deferred Sales Charge: None
3. Maximum Rule 12b-1 Distribution Fees: Pursuant to a
Distribution Plan adopted under Rule 12b-1, Daily Shares of
each Money Market Fund may pay distribution fees of up to
0.45% of the average daily net assets of such shares.
4. Maximum Shareholder Servicing Fees: Pursuant to a
Shareholder Servicing Plan, the Daily Shares of each Money
Market Fund may pay shareholder servicing fees of up to
0.25% of the average daily net assets of such shares.
5. Conversion Features: Daily Shares of a Fund shall have such
conversion features, if any, as are determined by or
ratified by the Board of Directors of the Company and
described in the then-current prospectus for such shares of
such Fund.
6. Exchange Privileges:
10
<PAGE>
(a) Daily Shares of a Money Market Fund may be
exchanged for Daily Shares of any other Nations
Funds Money Market Fund or Investor C Shares of
any Nations Funds Non-Money Market Fund.
(b) Daily Shares of a Money Market Fund that were
originally obtained in an exchange of Investor C
Shares of a Nations Fund, except a Money Market
Fund, which were re-exchanged for Investor C
Shares of any Nations Fund, except a Money Market
Fund, can be exchanged for Investor C Shares of
any Nations Reserves Money Market Fund.
(c) From time to time, the Board of Directors of the
Company may modify, or ratify modifications to,
the exchange privileges of Daily Shares of a Fund
without amending this Plan, provided that such
exchange privileges, as modified, are described
in the then-current prospectus for such shares of
such Fund.
7. Other Shareholder Services: The Company offers a Systematic
Investment Plan, an Automatic Withdrawal Plan and an
Automatic Exchange Feature to holders of Daily Shares of
the Money Market Funds.
J. Marsico Shares -- Nations Prime Fund Only.
1. Maximum Initial Sales Load: None
2. Contingent Deferred Sales Charge: None
3. Maximum Rule 12b-1 Distribution Fees: None
4. Maximum Shareholder Servicing Fees: Pursuant to a
Shareholder Servicing Plan, Marsico Shares of Nations Prime
Fund may pay shareholder servicing fees of up to 0.25% of
the average daily net assets of such shares.
5. Conversion Features: Marsico Shares of Nations Prime Fund
shall have such conversion features, if any, as are
determined by or ratified by the Board of Directors of the
Company and described in the then-current prospectus for
such shares of the Fund.
6. Exchange Privileges:
(a) Marsico Shares of Nations Prime Fund may be
exchanged for shares of Marsico Funds.
(b) From time to time, the Board of Directors of the
Company may modify, or ratify modifications to,
the exchange privileges of Marsico Shares of
Nations Prime Fund without amending this Plan,
provided that such exchange privileges, as
modified, are described in the then-current
prospectus for such shares of such Fund.
11
<PAGE>
7. Other Shareholder Services: The Company offers an Automatic
Investment Plan, a Systematic Withdrawal Plan and an
Automatic Exchange Feature to holders of Marsico Shares of
the Fund.
IV. Board Review.
The Board of Directors of the Company shall review this Plan as
frequently as it deems necessary. Prior to any material amendment(s) to this
Plan, the Company's Board of Directors, including a majority of the Directors
that are not interested persons of the Company, shall find that the Plan, as
proposed to be amended (including any proposed amendments to the method of
allocating class and/or fund expenses), is in the best interests of each class
of shares of the Fund individually and the Fund as a whole. In considering
whether to approve any proposed amendment(s) to the Plan, the Directors of the
Company shall request and evaluate such information as they consider reasonably
necessary to evaluate the proposed amendment(s) to the Plan.
Adopted: April 3, 1995
Last Amended: August 19, 1999
12
POWER OF ATTORNEY
Edmund L. Benson, III, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Edmund L. Benson, III
-------------------------
Edmund L. Benson, III
<PAGE>
POWER OF ATTORNEY
James Ermer, whose signature appears below, does hereby constitute
and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M. Kurucza, Marco
E. Adelfio and Steven G. Cravath, each individually, his true and lawful
attorneys and agents, with power of substitution or resubstitution, to do any
and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ James Ermer
---------------
James Ermer
<PAGE>
POWER OF ATTORNEY
William H. Grigg, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ William H. Grigg
--------------------
William H. Grigg
<PAGE>
POWER OF ATTORNEY
Thomas F. Keller, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Thomas F. Keller
--------------------
Thomas F. Keller
<PAGE>
POWER OF ATTORNEY
Dr. Cornelius J. Pings, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., James E. Banks,
Jr., Robert M. Kurucza, Marco E. Adelfio and Steven G. Cravath, each
individually, his true and lawful attorneys and agents, with power of
substitution or resubstitution, to do any and all acts and things and to execute
any and all instruments which said attorneys and agents, each individually, may
deem necessary or advisable or which may be required to enable Nations Fund
Trust, Nations Fund, Inc., Nations Reserves, Nations LifeGoal Funds, Inc.,
Nations Annuity Trust, Nations Master Investment Trust and Nations Funds Trust
(each a Company and collectively the "Companies"), to comply with the Investment
Company Act of 1940, as amended, and the Securities and Exchange Act of 1933, as
amended (together the "Acts"), and any other applicable federal securities laws,
or rules, regulations or requirements of the Securities and Exchange Commission
in respect thereof, in connection with the filing and effectiveness of each
Company's Registration Statement on Form N-1A pursuant to the Acts, and any and
all amendments thereto, and to determine the states in which appropriate filings
should be made and to take any and all necessary and appropriate actions to make
any and all such filings, and any and all amendments thereto, including
specifically, but without limiting the generality of the foregoing, the power
and authority to sign in the name and on behalf of the undersigned as a
director/trustee of the Companies, such Registration Statement and filings, any
and all exemptive applications under the Acts, and any and all amendments and
any other instruments or documents related thereto, and the undersigned does
hereby ratify and confirm all that said attorneys and agents, individually or
collectively, shall do or cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Dr. Cornelius J. Pings
--------------------------
Dr. Cornelius J. Pings
<PAGE>
POWER OF ATTORNEY
A. Max Walker, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ A. Max Walker
-----------------
A. Max Walker
<PAGE>
POWER OF ATTORNEY
Charles B. Walker, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Charles B. Walker
---------------------
Charles B. Walker
<PAGE>
POWER OF ATTORNEY
Thomas S. Word, Jr., whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio, and Steven G. Cravath, each individually, his true
and lawful attorneys and agents, with power of substitution or resubstitution,
to do any and all acts and things and to execute any and all instruments which
said attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Thomas S. Word, Jr.
-----------------------
Thomas S. Word, Jr.
<PAGE>
POWER OF ATTORNEY
Carl E. Mundy, Jr., whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ Carl E. Mundy, Jr.
----------------------
Carl E. Mundy, Jr.
<PAGE>
POWER OF ATTORNEY
James B. Sommers, whose signature appears below, does hereby
constitute and appoint R. Gregory Feltus, Richard H. Blank, Jr., Robert M.
Kurucza, Marco E. Adelfio and Steven G. Cravath, each individually, his true and
lawful attorneys and agents, with power of substitution or resubstitution, to do
any and all acts and things and to execute any and all instruments which said
attorneys and agents, each individually, may deem necessary or advisable or
which may be required to enable Nations Fund Trust, Nations Fund, Inc., Nations
Reserves, Nations LifeGoal Funds, Inc., Nations Annuity Trust, Nations Master
Investment Trust and Nations Funds Trust (each a Company and collectively the
"Companies"), to comply with the Investment Company Act of 1940, as amended, and
the Securities and Exchange Act of 1933, as amended (together the "Acts"), and
any other applicable federal securities laws, or rules, regulations or
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing and effectiveness of each Company's Registration
Statement on Form N-1A pursuant to the Acts, and any and all amendments thereto,
and to determine the states in which appropriate filings should be made and to
take any and all necessary and appropriate actions to make any and all such
filings, and any and all amendments thereto, including specifically, but without
limiting the generality of the foregoing, the power and authority to sign in the
name and on behalf of the undersigned as a director/trustee of the Companies,
such Registration Statement and filings, any and all exemptive applications
under the Acts, and any and all amendments and any other instruments or
documents related thereto, and the undersigned does hereby ratify and confirm
all that said attorneys and agents, individually or collectively, shall do or
cause to be done by virtue hereof.
Dated: December 9, 1999
/s/ James B. Sommers
--------------------
James. B. Sommers
