INVESTMENT ADVISORY AGREEMENT
NATIONS FUNDS TRUST
THIS AGREEMENT is made as of March 30, 2000, by and between NATIONS
FUNDS TRUST, a Delaware business trust (the "Trust"), and BANC OF AMERICA
ADVISORS, INC., a North Carolina corporation (the "Adviser"), on behalf of those
series of the Trust now or hereafter identified on Schedule I (each, a "Fund"
and collectively, the "Funds").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "Commission") as an open-end management investment company under
the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Adviser is registered with the Commission as an investment
adviser under the Investment Advisers Act of 1940, as amended (the "Advisers
Act");
WHEREAS, the Trust desires that the Adviser manage the investment
operations of the Funds and the Adviser desires to manage said operations; and
WHEREAS, the Board of Trustees of the Trust (the "Board"), including a
majority of the Trustees who are not "interested persons" (as defined herein) of
any party to this Agreement, have approved this arrangement;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment of Adviser.
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The Trust hereby appoints the Adviser and the Adviser hereby agrees to manage
the investment operations of each Fund subject to the terms of this Agreement
and subject to the supervision of the Board. The Trust and the Adviser
contemplate that certain duties of the Adviser under this Agreement may be
delegated to one or more investment sub-adviser(s) (the "Sub-Adviser(s)")
pursuant to separate investment sub-advisory agreement(s) (the "Sub-Advisory
Agreement(s)"). The Adviser may, in its discretion, provide services under this
Agreement through its own employees or through one or more affiliated companies
that are qualified to act as investment advisers under applicable law and are
under common control of Bank of America Corporation.
2. Services of Adviser.
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The Adviser shall perform, or arrange for the performance of, the management
services necessary for the investment operations of each Fund, including but not
limited to:
(a) Managing the investment and reinvestment of all
assets, now or hereafter acquired by each Fund,
including determining what securities and other
investments are to be purchased or sold for each Fund
and executing transactions accordingly;
(b) Transmitting trades to each Fund's custodian for
settlement in accordance with each Fund's procedures
and as may be directed by the Trust;
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(c) Assisting in the preparation of all shareholder
communications, including shareholder reports, and
participating in shareholder relations;
(d) Making recommendations as to the manner in which
voting rights, rights to consent to Fund action and
any other rights pertaining to each Fund's portfolio
securities shall be exercised;
(e) Making recommendations to the Board with respect to
Fund investment policies and procedures, and carrying
out such investment policies and procedures as are
adopted by the Board;
(f) Supplying reports, evaluations, analyses, statistical
data and information to the Board or to the Funds'
officers and other service providers as the Board may
reasonably request from time to time or as may be
necessary or appropriate for the operation of the
Trust as an open-end investment company or as
necessary to comply with Section 3(a) of this
Agreement;
(g) Maintaining all required books and records with
respect to the investment decisions and securities
transactions for each Fund;
(h) Furnishing any and all other services, subject to
review by the Board, that the Adviser from time to
time determines to be necessary or useful to perform
its obligations under this Agreement or as the Board
may reasonably request from time to time.
3. Responsibilities of Adviser.
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In carrying out its obligations under this Agreement, the Adviser agrees that it
will:
(a) Comply with all applicable law, including but not
limited to the 1940 Act and the Advisers Act, the
rules and regulations of the Commission thereunder,
and the conditions of any order affecting the Trust or
a Fund issued thereunder;
(b) Use the same skill and care in providing such services
as it uses in providing services to other fiduciary
accounts for which it has investment responsibilities;
(c) Not make loans to any person for the purpose of
purchasing or carrying Fund shares;
(d) Place, or arrange for the placement of, all orders
pursuant to its investment determinations for the
Funds either directly with the issuer or with any
broker or dealer (including any affiliated broker or
dealer). In executing portfolio transactions and
selecting brokers or dealers, the Adviser will use its
best efforts to seek on behalf of each Fund the best
overall terms available. In assessing the best overall
terms available for any transaction, the Adviser shall
consider all factors that it deems relevant, including
the
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breadth of the market in the security, the price of
the security, the financial condition and execution
capability of the broker or dealer, and the
reasonableness of the commission, if any, both for the
specific transaction and on a continuing basis. In
evaluating the best overall terms available, and in
selecting the broker or dealer to execute a particular
transaction, the Adviser may also consider whether
such broker or dealer furnishes research and other
information or services to the Adviser;
(e) Adhere to the investment objective, strategies and
policies and procedures of the Trust adopted on behalf
of each Fund; and
(f) Maintain a policy and practice of conducting its
investment advisory services hereunder independently
of the commercial banking operations of its
affiliates. In making investment recommendations for a
Fund, the Adviser's investment advisory personnel will
not inquire or take into consideration whether the
issuers (or related supporting institutions) of
securities proposed for purchase or sale for the
Fund's account are customers of the commercial
departments of its affiliates. In dealing with
commercial customers, such commercial departments will
not inquire or take into consideration whether
securities of those customers are held by the Fund.
4. Confidentiality of Information.
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Each party agrees that it will treat confidentially all information provided by
the other party regarding such other party's business and operations, including
without limitation the investment activities or holdings of a Fund. All
confidential information provided by a party hereto shall not be disclosed to
any unaffiliated third party without the prior consent of the providing party.
The foregoing shall not apply to any information that is public when provided or
thereafter becomes public or which is required to be disclosed by any regulatory
authority in the lawful and appropriate exercise of its jurisdiction over a
party, by any auditor of the parties hereto, by judicial or administrative
process or otherwise by applicable law or regulation.
5. Delegation of Duties.
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Subject to the approval of the Board and, if required, the shareholders of the
Funds, the Adviser may delegate to one or more Sub-Adviser(s) any or all of its
duties hereunder, provided that the Adviser shall continue to supervise and
monitor the performance of the duties delegated to the Sub-Adviser(s) and any
such delegation shall not relieve the Adviser of its duties and obligations
under this Agreement. The Adviser shall be solely responsible for compensating
the Sub-Adviser(s) for performing any of the duties delegated to them. The
Adviser may request that the Trust pay directly to the Sub-Adviser(s) the
portion of the Adviser's compensation that the Adviser is obligated to pay to
the Sub-Adviser(s). If the Trust agrees to such request, it will pay such
portion to the Sub-Adviser(s) on behalf of the Adviser, thereby reducing the
compensation paid to the Adviser by the amount paid directly to the
Sub-Adviser(s). However, such an arrangement will not relieve the Adviser of its
responsibility for compensating the Sub-Adviser(s). In the event that any
Sub-Adviser appointed hereunder is terminated, the Adviser may provide
investment advisory services pursuant to this Agreement through its own
employees or through one or more affiliated companies that are
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qualified to act as investment advisers under applicable law and are under
common control of Bank of America Corporation or through other Sub-Adviser(s) as
approved by the Trust in accordance with applicable law.
6. Services Not Exclusive.
----------------------
The services furnished by the Adviser hereunder are deemed not to be exclusive,
and the Adviser shall be free to furnish similar services to others so long as
its provision of services under this Agreement is not impaired thereby. To the
extent that the purchase or sale of securities or other investments of the same
issuer may be deemed by the Adviser to be suitable for two or more accounts
managed by the Adviser, the available securities or investments may be allocated
in a manner believed by the Adviser to be equitable to each account. It is
recognized that in some cases this procedure may adversely affect the price paid
or received by a Fund or the size of the position obtainable for or disposed of
by a Fund. Nothing in this Agreement shall limit or restrict the right of any of
the Adviser's partners, officers or employees to engage in any other business or
to devote his or her time and attention in part to the management or other
aspects of any business, whether of a similar or dissimilar nature, nor limit or
restrict the Adviser's right to engage in any other business or to render
services of any kind to any other corporation, firm, individual or association.
7. Delivery of Documents.
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The Trust has furnished the Adviser with copies, properly certified or
authenticated, of each of the following:
(a) the Trust's Certificate of Trust, as filed with the
Secretary of State of Delaware, and Declaration of
Trust (such Declaration of Trust, as presently in
effect and as from time to time amended, is herein
called the "Declaration of Trust");
(b) the most recent prospectus(es) and statement(s) of
additional information relating to each Fund (such
prospectus(es) together with the related statement(s)
of additional information, as presently in effect and
all amendments and supplements thereto, are herein
called the "Prospectus"); and
(c) any and all applicable policies and procedures
approved by the Board.
The Trust will promptly furnish the Adviser with copies of any and all
amendments of or additions or supplements to the foregoing.
8. Books and Records.
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In compliance with the requirements of Rule 31a-3 under the 1940 Act, the
Adviser hereby agrees that all records that it maintains for each Fund under
this Agreement are the property of the Trust and further agrees to surrender
promptly to the Trust any of such records upon request. The Adviser further
agrees to preserve for the periods prescribed by Rule 31a-2 under the 1940 Act
the records required to be maintained by Rule 31a-1 under the 1940 Act.
9. Expenses of the Funds.
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Except to the extent expressly assumed by the Adviser and except to any extent
required by law to be paid or reimbursed by the Adviser, the Adviser
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shall have no duty to pay any ordinary operating expenses incurred in the
organization and operation of the Funds. Ordinary operating expenses include,
but are not limited to, brokerage commissions and other transaction charges,
taxes, legal, auditing, printing, or governmental fees, other service providers'
fees and expenses, expenses of issue, sale, redemption and repurchase of shares,
expenses of registering and qualifying shares for sale, expenses relating to
Board and shareholder meetings, the cost of preparing and distributing reports
and notices to shareholders and interest payments and other fees or charges
associated with any credit facilities established by or on behalf of the Funds.
10. Compensation.
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Except as otherwise provided herein, for the services provided to each Fund and
the expenses assumed pursuant to this Agreement, the Trust will pay the Adviser
and the Adviser will accept as full compensation therefor a fee determined in
accordance with Schedule I attached hereto; provided, however, that the
compensation paid to the Adviser shall be reduced by any amount paid by the
Trust directly to the Sub-Advisor(s) pursuant to Section 5 of this Agreement. In
addition, BAAI or its affiliated persons may receive compensation or
reimbursement of recordkeeping, bookkeeping, accounting, administrative and
transactional fees or charges incurred in connection with any credit facilities
established by or on behalf of the Funds. The fees or charges attributable to
each Fund shall be a separate charge to such Fund and shall be the several (and
not joint or joint and several) obligation of each such Fund. The Trust and the
Adviser may, from time to time, agree to reduce, limit or waive the amounts
payable hereunder with respect to one or more Funds for such period or periods
they deem advisable.
11. Liability of Adviser.
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The Adviser shall not be liable for any error of judgment or mistake of law or
for any loss suffered by the Trust in connection with the performance of its
duties under this Agreement, except a loss resulting from a breach of fiduciary
duty with respect to the receipt of compensation for services, or a loss
resulting from willful misfeasance, bad faith or negligence on the part of the
Adviser or any of its officers, directors, employees or agents, in the
performance of their duties under this Agreement, or from reckless disregard by
it of obligations and duties under this Agreement.
12. Term and Approval.
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This Agreement will become effective as of the date set forth herein above, and
shall continue in effect until the second anniversary of its effective date.
This Agreement will become effective with respect to each additional Fund as of
the date set forth on Schedule I when each such Fund is added thereto. The
Agreement shall continue in effect for a Fund after the second anniversary of
the effective date for successive annual periods ending on each anniversary of
such date, provided that the continuation of the Agreement is specifically
approved for the Fund at least annually:
(a)(i) by the Board 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 0000 Xxx); and
(b) by the affirmative vote of a majority of the Trustees
of the Trust who are not parties to this Agreement or
"interested persons" (as defined in the 0000 Xxx) of a
party to this Agreement (other than as Trustees of the
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Trust), by votes cast in person at a meeting
specifically called for such purpose.
13. Termination.
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This Agreement may be terminated without payment of any penalty at any time by:
(a) the Trust with respect to a Fund, by vote of the Board
or by vote of a majority of a Fund's outstanding
voting securities, upon sixty (60) days' written
notice to the Adviser; or
(b) the Adviser with respect to a Fund, upon sixty (60)
days' written notice to the Trust.
Any party entitled to notice may waive the notice provided for herein.
This Agreement shall automatically terminate in the event of its assignment,
unless an order is issued by the Commission conditionally or unconditionally
exempting such assignment from the provisions of Section 15(a) of the 1940 Act,
in which event this Agreement shall remain in full force and effect subject to
the terms of such order. For the purposes of this paragraph, the definitions
contained in Section 2(a) of the 1940 Act and the applicable rules under the
1940 Act shall apply.
14. Amendment of this Agreement.
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No provision of this Agreement may be changed, waived, discharged or terminated
orally, except by an instrument in writing signed by the party against which
enforcement of the change, waiver, discharge or termination is sought.
15. Notices.
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Any notices under this Agreement shall be in writing, addressed and delivered or
mailed postage paid to such address as may be designated for the receipt of such
notice. Until further notice, it is agreed that the address of the Trust shall
be c/o Stephens Inc., 000 Xxxxxx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000, Attention:
Secretary, and that of the Adviser shall be Xxx Xxxx xx Xxxxxxx Xxxxx, 00xx
Xxxxx, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention:
President.
16. Release.
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The names "Nations Funds Trust" and "Trustees of Nations Funds Trust" refer
respectively to the Trust created by the Declaration of Trust and the Trustees
as Trustees but not individually or personally. All parties hereto acknowledge
and agree that any and all liabilities of the Trust arising, directly or
indirectly, under this Agreement will be satisfied solely out of the assets of
the Trust and that no Trustee, officer or shareholder shall be personally liable
for any such liabilities. All persons dealing with any Fund of the Trust must
look solely to the property belonging to such Fund for the enforcement of any
claims against the Trust.
17. Miscellaneous.
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This Agreement contains the entire understanding of the parties hereto. Each
provision of this Agreement is intended to be severable. If any provision of
this Agreement shall be held or made invalid by a court decision, statute, rule
or otherwise, the remainder of this Agreement shall not be affected thereby.
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18. Governing Law.
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This Agreement shall be governed by, and construed in accordance with, Delaware
law and the federal securities laws, including the 1940 Act and the Advisers
Act.
19. Counterparts.
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This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original.
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IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as of the day and
year first above written.
NATIONS FUNDS TRUST
on behalf of the Funds
By: /s/ A. Xxx Xxxxxx
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A. Xxx Xxxxxx
President and Chairman of the
Board of Trustees
BANC OF AMERICA ADVISORS, INC.
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
President
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SCHEDULE I
The Trust shall pay the Adviser, as full compensation for services
provided and expenses assumed hereunder, an advisory fee for each Fund, computed
daily and payable monthly at the annual rates listed below as a percentage of
the average daily net assets of the Fund:
Rate of
Fund Compensation Effective Date
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Nations MidCap Index Fund 0.40% 03/30/00
Nations Kansas Municipal Income Fund 0.50% 07/14/00
Nations Financial Services Fund 0.75% 03/29/01
Nations Classic Value Fund 0.65% 04/09/01
Nations Global Value Fund 0.90% 04/09/01
Nations Asset Allocation Fund 0.65% 06/08/01
Nations Government Securities Fund 0.50% up to $100 million 06/08/01
0.45% up to $250 million
0.40% in excess of $250 million
Nations LifeGoal Growth Portfolio 0.25% 06/08/01
Nations LifeGoal Balanced Growth Portfolio 0.25% 06/08/01
Nations LifeGoal Income and Growth Portfolio 0.25% 06/08/01
Nations MidCap Value Fund 0.75% 11/19/01
Nations LargeCap Value Fund 0.65% 11/19/01
Approved: December 9, 1999
Last Amended: November 19, 2001
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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 November, 2001.
BANC OF AMERICA ADVISORS,LLC
(formerly Banc of America Advisors, Inc.)
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
President
NATIONS FUNDS TRUST
on behalf of the Funds
By: /s/ Xxxxxxx X. Xxxxx, Xx.
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Xxxxxxx X. Xxxxx, Xx.
Secretary
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