SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
[X] Filed by the registrant
[ ] Filed by a party other than the registrant
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
- ------------------------------------------------------------------------------
Nations Government Income Term Trust 2003, Inc.
- ------------------------------------------------------------------------------
Payment of filing fee (Check the appropriate box):
[X] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies.
- -----------------------------------------------------------------------------
(2) Aggregate number of securities to which transactions applies:
- ------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11:
- ------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- ------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
<PAGE>
- ------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- ------------------------------------------------------------------------------
(3) Filing party:
- ------------------------------------------------------------------------------
(4) Date filed:
- ------------------------------------------------------------------------------
<PAGE>
NATIONS GOVERNMENT INCOME TERM TRUST 2003, INC.
----------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
SEPTEMBER 25, 1998
----------------------------------------------
TO THE STOCKHOLDERS OF
NATIONS GOVERNMENT INCOME TERM TRUST 2003, INC.:
Notice is hereby given that the Annual Meeting (the "Annual Meeting") of
Stockholders of Nations Government Income Term Trust 2003, Inc. (the "Company")
will be held on Friday, September 25, 1998 at 10:00 a.m. (Eastern time), at One
NationsBank Plaza, 33rd Floor, Charlotte, North Carolina 28255, for the
following purposes:
(1) To elect one Director to serve a three-year term of office;
(2) To ratify the selection of PricewaterhouseCoopers LLP as independent
public accountants of the Company for the fiscal year ending June 30, 1999; and
(3) To transact such other business as may properly come before the Annual
Meeting, or any adjournment(s) thereof, including any adjournment(s) necessary
to obtain requisite quorums and/or approvals.
The Board of Directors of the Company has fixed the close of business on
August 14, 1998 as the record date for the determination of Stockholders
entitled to receive notice of and to vote at such Annual Meeting or any
adjournment(s) thereof. The enclosed Proxy Statement contains further
information regarding the meeting and the proposals to be considered. The
enclosed Proxy Card is intended to permit you to vote even if you do not attend
the meeting in person.
YOUR PROXY IS VERY IMPORTANT TO US. WHETHER OR NOT YOU PLAN TO ATTEND THE
MEETING IN PERSON, PLEASE MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD
TODAY IN THE ENCLOSED POSTAGE-PAID ENVELOPE. Signed but unmarked Proxy Cards
will be counted in determining whether a quorum is present and will be voted in
favor of the proposals.
By Order of the Board of Directors.
/s/ Robert B. Carroll
-----------------------------------
ROBERT B. CARROLL
SECRETARY
August 21, 1998
<PAGE>
-------------------------------------------------------
-------------------------------------------------
YOUR VOTE IS VERY IMPORTANT TO US REGARDLESS
OF THE NUMBER OF SHARES THAT YOU OWN.
PLEASE MARK, SIGN, DATE AND RETURN YOUR
PROXY CARD IMMEDIATELY.
-------------------------------------------------
-------------------------------------------------------
SHARES OF THE COMPANY ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF, OR ISSUED,
ENDORSED OR GUARANTEED BY NATIONSBANK, N.A. ("NATIONSBANK") OR ANY OF ITS
AFFILIATES. SUCH SHARES ARE NOT INSURED BY THE U.S. GOVERNMENT, THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENT AGENCY. AN INVESTMENT IN THE COMPANY INVOLVES CERTAIN RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL.
NATIONSBANK AFFILIATES PROVIDE INVESTMENT ADVISORY, ADMINISTRATIVE AND
CERTAIN OTHER SERVICES TO THE COMPANY, FOR WHICH THEY ARE COMPENSATED.
<PAGE>
NATIONS GOVERNMENT INCOME TERM TRUST 2003, INC.
One NationsBank Plaza
Charlotte, North Carolina 28255
(800) 321-7854
------------------------------------------------
PROXY STATEMENT
Annual Meeting of Stockholders
September 25, 1998
------------------------------------------
This Proxy Statement is being furnished to holders of common stock
("Stockholders") of the Nations Government Income Term Trust 2003, Inc. (the
"Company") in connection with the solicitation by the Board of Directors of the
Company of proxies to be used at the Annual Meeting of Stockholders (the "Annual
Meeting") of the Company to be held on September 25, 1998 at 10:00 a.m. (Eastern
time) at One NationsBank Plaza, 33rd Floor, Charlotte, North Carolina 28255, and
at any adjournment(s) thereof. Your proxy is being solicited for the purposes
set forth in the accompanying Notice of Annual Meeting.
The Board of Directors has fixed August 14, 1998 (the "Record Date") as the
date for the determination of Stockholders entitled to receive notice of and to
vote at such Annual Meeting, and, accordingly, only Stockholders of record at
the close of business on the Record Date will be entitled to notice of and to
vote at such Annual Meeting. As of the Record Date, there were 15,149,678
outstanding shares of common stock of the Company. This Proxy Statement is first
being mailed to Stockholders on or about August 21, 1998.
THE COMPANY WILL FURNISH, WITHOUT CHARGE, COPIES OF ITS MOST RECENT ANNUAL
AND SEMI-ANNUAL REPORTS TO ANY STOCKHOLDER UPON WRITTEN OR ORAL REQUEST MADE TO
THE ADDRESS OR TOLL-FREE TELEPHONE NUMBER ABOVE.
PROPOSAL 1: ELECTION OF DIRECTOR
William H. Grigg, a Director, (the "Nominee") has been nominated for
election as a Director of the Company with a term to expire in 2001. Voting for
the Nominee is not cumulative. If elected, the Nominee will serve as Director
until his successor shall be elected and shall qualify. The Nominee is currently
a member of the Board of Directors and has consented to his nomination and to
serve if elected. The other members of the Board of Directors are A. Max Walker,
whose term will expire in 2000, and Thomas F. Keller, whose term will expire in
1999. Although the Board of Directors expects that the Nominee will be available
for election, in the event a vacancy in the slate of nominees is occasioned by
death or other unexpected occurrence, it is intended that shares represented by
proxies in the accompanying form will be voted for the election of a substitute
nominee selected by the persons named in the proxy. The Nominee will be elected
by a majority of the votes cast.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE TO ELECT THE NOMINEE.
<PAGE>
THE BOARD OF DIRECTORS
Information regarding the Nominee and each other member of the Board of
Directors is as follows:
WILLIAM H. GRIGG, age 65, Chairman Emeritus, Duke Power Co., Charlotte,
North Carolina, a public utility, since July 1997. Mr. Grigg was Chairman and
Chief Executive Officer of Duke Power Co. from April 1994 to July 1997; Vice
Chairman of Duke Power Co. from November 1991 to April 1994, and Executive Vice
President -- Customer Group of Duke Power Co. from 1988 to November 1991. He
has been a Director of the Company since July 1993. Mr. Grigg is also a
Director of The Shaw Group, Inc., Coltec Industries, Nations Balanced Target
Maturity Fund, Inc., Nations Government Income Term Trust 2004, Inc. Hatteras
Income Securities, Inc., Nations Fund, Inc., Nations Fund Portfolios, Inc., and
Nations LifeGoal Funds, Inc. Mr. Grigg is also a Trustee of Nations
Institutional Reserves, Nations Fund Trust and Nations Annuity Trust.
A. MAX WALKER, age 76, independent Financial Consultant since May 1987.
From April 1982 through May 1987, Mr. Walker was Vice President of Merrill
Lynch, Pierce, Fenner & Smith, Inc. He has been a Director of the Company since
the Company was organized in July 1993. Mr. Walker serves as a Director of
Cerulean Companies, Inc. Mr. Walker is Chairman of the Board of the Company,
Nations Balanced Target Maturity Fund, Inc., Hatteras Income Securities, Inc.,
Nations Government Income Term Trust 2004, Inc., Nations Institutional Reserves,
Nations Fund Trust, Nations Fund, Inc., Nations Fund Portfolios, Inc., Nations
Annuity Trust and Nations LifeGoal Funds, Inc.
THOMAS F. KELLER, age 66, R.J. Reynolds Industries Professor of Business
Administration and Former Dean of Fuqua School of Business, Duke University,
Durham, North Carolina, since 1974. He has been a Director of the Company since
July 1993. Mr. Keller is also a Director of LADD Furniture, Inc., Wendy's
International, Inc., American Business Products, Inc., Dimon, Inc. and Biogen,
Inc. Mr. Keller is a Trustee of The Mentor Funds, Mentor Institutional Trust
and Cash Resource Trust. Mr. Keller is also a Director of Nations Balanced
Target Maturity Fund, Inc., Nations Government Income Term Trust 2004, Inc.
Hatteras Income Securities, Inc., Nations Fund, Inc., Nations Fund Portfolios,
Inc., and Nations LifeGoal Funds, Inc. Mr. Keller is also a Trustee of Nations
Institutional Reserves, Nations Fund Trust and Nations Annuity Trust.
None of the Directors, including the Nominee, owns, either directly or
indirectly, shares of capital stock of the Company. None of the Directors is a
"interested person" (as defined in the Investment Company Act of 1940, as
amended (the "1940 Act")) of the Company, NationsBanc Advisors, Inc. ("NBAI"),
the Company's investment adviser and administrator or TradeStreet Investment
Associates, Inc. ("TradeStreet"), the Company's investment sub-adviser. No
Director has been, during the past five years, an officer, employee, director,
general partner or shareholder, of NBAI or TradeStreet, or owned any securities
or had any other material direct or indirect interest in NBAI or any of its
affiliates. None of the Directors has had, since the beginning of the current
fiscal year, a material direct or indirect interest in any material transactions
or proposed material transactions to which NBAI or TradeStreet or any affiliate
thereof was or is to be a party, other than a transaction involving an
investment company in the Company's "Fund Complex", as that term is defined in
Item 22 of Schedule 14A under the Securities Exchange Act of 1934, as amended
(the "1934 Act"). No Director is a party adverse, or has a material interest
adverse, to the Company or any affiliates thereof in connection with any
material pending legal proceedings. Since the beginning of the current fiscal
year, none of the Directors has engaged in any transactions to which the Company
was a party or been indebted to the Company. Some of the Directors and their
affiliates have been customers of NationsBank, N.A. ("NationsBank"), the parent
company of NBAI. All extensions of
2
<PAGE>
credit to the Directors, if any, have been made in the ordinary course of
business on substantially the same terms, including interest rates and
collateral, as those prevailing in comparable transactions with others, and did
not involve more than the normal risk of collectability or present other
unfavorable features. Based solely on its review of copies of Forms 3 and 4 and
amendments thereto and Forms 5 received by it, or written representations from
certain reporting persons that no such Forms were required from such persons,
the Company believes that, during the fiscal year ended June 30, 1998, it
complied with all filing requirements applicable to its officers, directors and,
if any, greater than ten percent beneficial owners.
COMMITTEES OF DIRECTORS
The Board of Directors meets regularly once each quarter at an in-person
meeting and may have special meetings. The Board held four regular meetings
during the fiscal year ended June 30, 1998. In addition, the Board has an Audit
Committee and Nominating Committee. Both Committees are composed of all three
incumbent members of the Board of Directors. Mr. Keller is Chairman of the Audit
Committee. The function of the Audit Committee is to (i) nominate the
independent public accountants to be engaged by the Company, subject to the
approval of the Board of Directors and ratification by the Stockholders, and
(ii) review with the independent public accountants the proposed scope of the
annual audit, the results of their examination, the financial statements and
their opinion thereon. The Audit Committee met twice during the fiscal year
ended June 30, 1998. The function of the Nominating Committee is to review
information assembled for the purpose of selecting candidates for nomination to
membership on the Board and to recommend nominees for election as directors. The
Nominating Committee will consider nominees recommended by Stockholders, in
writing, that are submitted by the Secretary of the Company. William H. Grigg is
Chairman of the Nominating Committee. The Nominating Committee did not hold a
meeting during the fiscal year ended June 30, 1998. The Board has no standing
compensation committee or committee performing a similar function. During the
previous fiscal year ended June 30, 1998, each director attended at least 75% of
the regular meetings of the Board and, as appropriate, meetings of the
committees of the Board.
3
<PAGE>
EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES
The Executive Officers and Significant Employees of the Company and their
principal occupations for at least the last five years and their other
affiliations are set forth below.
<TABLE>
<S> <C>
ROBERT H. GORDON, President, the Company and Nations Balanced Target Maturity
President Fund, Inc., Nations Government Income Term Trust 2004, Inc. and
Hatteras Income Securities, Inc. since March 1998. President and
Director, NationsBanc Advisors, Inc. since February 1998; Senior
Vice President, NationsBanc Advisors, Inc. 1995-February 1998;
Senior Vice President, NationsBank, N.A. since 1993.
EDWARD D. BEDARD, Chief Financial Officer, the Company and Nations Balanced Target
Chief Financial Maturity Fund, Inc., Nations Government Income Term Trust 2004,
Officer and Inc. and Hatteras Income Securities, Inc. since 1997; Senior Vice
Treasurer President, Chief Operating Officer and Director, NationsBanc Advisors, Inc.
since 1996; Corporate Vice President, New York Life Insurance 1992-1996;
Treasurer, Seligman Family of Funds January 1992-June 1992; Senior Manager,
Price Waterhouse 1991-1992.
ROBERT B. CARROLL, Secretary, the Company and Nations Balanced Target Maturity Fund,
Secretary Inc., Nations Government Income Term Trust 2004, Inc. and
Hatteras Income Securities, Inc. since February 1997; Assistant
General Counsel, NationsBank Corporation since 1996; Vice
President, SEI Corporation, 1992-1996; Senior Special Counsel,
Securities and Exchange Commission, Division of Investment
Management 1992-1994.
JOHN S. SWAIM, Senior Product Manager, TradeStreet Investment Associates, Inc.
Vice President and since 1995; Vice President, NationsBank, N.A. 1986-1995; Vice
Portfolio Manager President and Portfolio Manager, Nations Government Income Term
Trust 2003, Inc., and Nations Government Income Term Trust 2004,
Inc.
ANDREW PETRUSKI, Assistant Treasurer, the Company and Nations Balanced Target
Assistant Treasurer Maturity Fund, Inc., Nations Government Income Term Trust 2004,
Inc. and Hatteras Income Securities, Inc. since 1998; Vice President,
NationsBanc Advisors, Inc. since 1998; Assistant Treasurer, Lexington
Management Company, 1994-1996; Senior Accountant, New York
Life Insurance 1991-1994.
</TABLE>
4
<PAGE>
COMPENSATION OF MANAGEMENT
The following table shows compensation paid by the Company and the Fund
Complex to the Directors of the Company for the fiscal year ended June 30, 1998.
Officers of the Company are employed by the Company's investment adviser and
receive no compensation or reimbursements from the Company.
COMPENSATION TABLE
<TABLE>
<CAPTION>
NAME OF PERSON, AGGREGATE COMPENSATION TOTAL COMPENSATION FROM COMPANY
POSITION FROM COMPANY(1) AND FUND COMPLEX PAID TO DIRECTORS(2)
- --------------------- ------------------------ --------------------------------------
<S> <C> <C>
William H. Grigg $3,000 $ 111,702.70(3)
Director
Thomas F. Keller $3,000 $ 104,875.05(4)
Director
A. Max Walker $3,000 $ 93,625.00
Chairman
</TABLE>
- ----------
(1) The Company pays the Chairman of the Board and each Director $1,000 per
year, plus $500 for each meeting attended in person, and reimburses each for
travel and other out-of-pocket disbursements incurred in connection with
attending meetings.
(2) The Fund Complex consists of nine registered investment companies, including
the Company.
(3) Includes $88,702.70 deferred compensation and interest earned.
(4) Includes $81,875.05 deferred compensation and interest earned.
RETIREMENT PLAN
Under the terms of the Nations Funds Retirement Plan for Eligible Directors
(the "Retirement Plan"), each Director may be entitled to certain benefits upon
retirement from the Board of Directors of one or more of the open-end investment
companies (the "Funds") in the Company's Fund Complex. Pursuant to the
Retirement Plan, the normal retirement date is the date on which an eligible
director has attained age 65 and has completed at least five years of continuous
service with one or more of the Funds. If a Director retires before reaching age
65, no benefits are payable. Each eligible director is entitled to receive an
annual benefit from the Funds equal to 5% of the aggregate directors' fees
payable by the Funds during the calendar year in which such director's
retirement occurs multiplied by the number of years of service (not in excess of
ten years of service) completed with respect to any of the Funds. Such benefit
is payable to each eligible director in quarterly installments for a period of
no more than five years. If an eligible director dies after attaining age 65,
such director's surviving spouse (if any) will be entitled to receive 50% of the
benefits that would have been paid (or would have continued to have been paid)
to the director if he had not died. The Retirement Plan is unfunded. The
benefits owed to each director are unsecured and subject to the general
creditors of the Funds. Each Director of the Company is a participant in the
Retirement Plan. Messrs. Grigg, Keller and Walker have 7, 6 and 12 years of
credited service, respectively, with the Funds.
5
<PAGE>
ESTIMATED ANNUAL RETIREMENT BENEFITS TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
----------------------
REMUNERATION 5 10
- -------------- --------- ----------
<S> <C> <C>
$ 25,000 $ 6,250 $12,500
50,000 12,500 25,000
75,000 18,750 37,500
100,000 25,000 50,000
</TABLE>
PROPOSAL 2: RATIFICATION OF SELECTION OF
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors, upon recommendation of its Audit Committee, has
selected PricewaterhouseCoopers LLP ("PricewaterhouseCoopers"), which has served
as independent public accountants of the Company since its organization, as
independent public accountants of the Company to examine the financial
statements of the Company for its fiscal year ending June 30, 1999, and to
report thereon to the Board and the Stockholders. If a majority of the shares of
the Company's capital stock represented at the meeting is voted against
ratification of the selection of PricewaterhouseCoopers, the selection of
auditors may be reconsidered by the Audit Committee and the Board of Directors.
To the best knowledge of management, the firm of PricewaterhouseCoopers has no
direct or material indirect financial interest in the Company.
PricewaterhouseCoopers acts as the independent public accountants for NBAI,
affiliates of NBAI, and the other investment companies in the Company's Fund
Complex. PricewaterhouseCoopers also acts as the independent public accountants
for NationsBank and NationsBank Corporation. If the Company receives, at least
five business days before the Annual Meeting, any written request from one or
more Stockholders to have representatives of PricewaterhouseCoopers present at
the Annual Meeting to respond to appropriate questions from Stockholders, the
Company will arrange to have such representatives present and provide them with
an opportunity to make a statement if they so desire.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE TO RATIFY THE
SELECTION OF PRICEWATERHOUSECOOPERS.
ADDITIONAL INFORMATION
PROCEDURAL MATTERS
Each Stockholder of the Company will be entitled to one non-cumulative vote
for each share and a fractional non-cumulative vote for each fractional share.
As of the Record Date, there were 15,149,678 outstanding shares of the Company.
Shareholders holding a majority of the aggregate outstanding shares of the
Company at the close of business on the Record Date will constitute a quorum for
the approval of each of the proposals described in the accompanying Notice of
Annual Meeting and in this Proxy Statement. Each proposal must be approved by a
majority of the votes cast. Stockholders are not entitled to rights of appraisal
or similar rights of dissenters with respect to any matter to be acted upon at
the Annual Meeting.
Any proxy card which is properly executed and received in time to be voted
at the Annual Meeting will be counted in determining whether a quorum is present
and will be voted in accordance with the instructions marked thereon. In the
absence of instructions, any such proxy card will be voted in favor of (i)
electing as Director of
6
<PAGE>
the Company the Nominee named in the Proxy Statement for the term indicated, and
(ii) ratifying the selection of PricewaterhouseCoopers as independent public
accountants of the Company for the fiscal year ending June 30, 1999. Abstentions
and "broker non-votes" (I.E., proxies from brokers or nominees indicating that
such persons have not received instructions from the beneficial owners or other
persons entitled to vote shares as to a particular matter with respect to which
the brokers or nominees do not have discretionary power to vote) will not be
counted for or against any proxy to which they relate, but will be counted for
purposes of determining whether a quorum is present and will be counted as votes
present for purposes of determining a majority of the outstanding shares of the
Company present at the Annual Meeting. For this reason, abstentions and broker
non-votes will have the effect of a vote AGAINST the proposal.
If, by the time scheduled for the Annual Meeting, a quorum is not present,
or if a quorum is present but sufficient votes in favor of any of the proposals
are not received, the persons named as proxies may move for one or more
adjournments of the Annual Meeting to permit further solicitation of proxies
with respect to any of the proposals. Any such adjournment(s) will require the
affirmative vote of a majority of the shares present in person or by proxy at
the session of the Annual Meeting to be adjourned. The persons named as proxies
will vote in favor of such adjournment(s) those shares which they are entitled
to vote which have voted in favor of such proposals. They will vote against any
such adjournment(s) those proxies required to be voted against such proposals.
The duly appointed proxies may, in their discretion, vote upon such other
matters as may come before the Annual Meeting or any adjournment(s) thereof,
including any proposal to adjourn a meeting at which a quorum is present to
permit the continued solicitation of proxies in favor of the proposals. A
Stockholder of the Company may revoke his or her proxy at any time prior to its
exercise by delivering written notice of revocation or by executing and
delivering a later-dated proxy to the Secretary of the Company, at the address
set forth on the cover page of this Proxy Statement, or by attending the Annual
Meeting in person to vote the shares held by such Stockholder.
Signed but unmarked proxy cards will be counted in determining whether a
quorum is present and will be voted IN FAVOR of each of the proposals.
SOLICITATION OF PROXIES AND PAYMENT OF EXPENSES
The cost of soliciting proxies for the Annual Meeting, consisting
principally of expenses incurred in preparing, printing and mailing proxy
materials, together with the costs of any supplementary solicitation and proxy
soliciting services provided by third parties, will be borne by the Company. In
following up the original solicitation of the proxies by mail, the Company may
request brokers and others to send proxies and proxy materials to the beneficial
owners of the stock and may reimburse them for their reasonable expenses in so
doing. Proxies will be solicited in the initial, and any supplemental,
solicitation by mail and may be solicited in person, by telephone, telegraph,
telefacsimile, or other electronic means by officers of the Company, personnel
of NBAI or an agent of the Company. Compensation for such services will be paid
by the Company or NBAI, except that officers or employees of the Company will
not be compensated for performing such services.
SUBSTANTIAL SHAREHOLDERS
As of the close of business on the Record Date, there were no persons known
to the Company to be beneficial owners of 5% or more of the outstanding shares
of the Company.
7
<PAGE>
ADDITIONAL INFORMATION
The Company, with principal executive offices located at One NationsBank
Plaza, Charlotte, North Carolina 28255, is subject to the informational
requirements of the 1934 Act and the 1940 Act, and in accordance therewith files
reports, proxy material and other information with the Securities and Exchange
Commission (the "SEC"). Such reports, proxy materials and other information may
be inspected and copied at the public reference facilities of the SEC at 450
Fifth Street, N.W., Washington, D.C. 20549. Copies of such materials can be
obtained from the Public Reference Section of the SEC at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates.
NBAI, located at One NationsBank Plaza, Charlotte, North Carolina 28255, is
the investment adviser and administrator of the Company. TradeStreet, the
investment sub-adviser of the Company is also located at One NationsBank Plaza,
Charlotte, North Carolina 28255. First Data Investor Services Group, Inc., One
Exchange Place, Boston, Massachusetts 02109, serves as sub-administrator of the
Company.
FUTURE SHAREHOLDER PROPOSALS
In the event any Stockholder wishes to present a proposal to Stockholders
of the Company for inclusion in the Proxy Statement and form of proxy relating
to the 1999 Annual Meeting of Stockholders, such proposal must be received by
the Company on or before April 25, 1999.
OTHER MATTERS
The Board of Directors knows of no other business that will be presented
for consideration at the Annual Meeting. However, if other matters are properly
presented to the Annual Meeting, it is the intention of the proxy holders named
in the accompanying form of proxy to vote the proxies in accordance with their
best judgment.
8
<PAGE>
************************************************************************
APPENDIX
************************************************************************
NATIONS GOVERNMENT INCOME TERM TRUST 2003, INC.
ANNUAL MEETING OF STOCKHOLDERS
SEPTEMBER 25, 1998
The undersigned hereby appoints Robert B. Carroll (the "Proxy")
attorney and proxy of the undersigned, with power of substitution and
resubstitution, to attend, vote and act for the undersigned at the Annual
Meeting of Stockholders of the Nations Government Income Term Trust 2003, Inc.
(the "Company") to be held at One NationsBank Plaza, 33rd Floor, Charlotte,
North Carolina 28255, at 10:00 a.m. (Eastern time) on Friday, September 25,
1998, and at any adjournment(s) thereof. The Proxy shall cast votes according to
the number of shares of the Company which the undersigned may be entitled to
vote with respect to the proposals set forth on the reverse side of this proxy
card, in accordance with the specification indicated, if any, and shall have all
the powers which the undersigned would possess if personally present. The
undersigned hereby revokes any prior proxy to vote at such meeting, and hereby
ratifies and confirms all that said attorney and Proxy may lawfully do by virtue
hereof or thereof.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS ON BEHALF OF THE COMPANY.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY, IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
THE UNDERSIGNED HEREBY ACKNOWLEDGES RECEIPT OF THE NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS OF THE COMPANY AND THE PROXY STATEMENT, DATED AUGUST 21, 1998.
THIS PROXY WILL BE VOTED AS SPECIFIED HEREON WITH RESPECT TO THE ACTION TO
BE TAKEN ON THE FOLLOWING PROPOSALS. IN THE ABSENCE OF ANY SPECIFICATION, THIS
PROXY WILL BE VOTED IN FAVOR OF THE PROPOSALS.
(CONTINUED ON OTHER SIDE)
<PAGE>
(1) ELECTION OF DIRECTOR
FOR WITHHOLD AUTHORITY
Nominee
William H. Grigg [ ] [ ]
(2) Proposal to ratify the selection of PricewaterhouseCoopers LLP as the
independent public accountants of the Company.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
In their discretion, the named Proxy is authorized to vote upon any
other business that may properly come before the meeting, including matters
incident to the conduct of the meeting, or any adjournment(s) thereof, including
any adjournment(s) necessary to obtain requisite quorums and/or approvals.
Please sign below exactly as your name(s)
appear(s) hereon. Corporate proxies should
be signed in full corporate name by an
authorized officer. Each joint owner should
sign personally. Fiduciaries should give
full titles as such.
____________________________________, 1998
(Please Date)
------------------------------------
------------------------------------
