Exhibit 99.D3
SUB-ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made as of this 21st day of May, 1999, by and between
NATIONSBANC ADVISORS, INC., a North Carolina corporation (the "Adviser"),
CHICAGO EQUITY PARTNERS CORPORATION, a Delaware corporation (the "Sub-Adviser"),
and NATIONS MASTER INVESTMENT TRUST, a Delaware business trust (the "Trust"), on
behalf of those portfolios of the Trust now or hereafter identified on Schedule
I hereto (each a "Master Portfolio" and collectively, the "Master Portfolios").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission ("Commission") under the Investment Company Act of 1940, as amended
("1940 Act") as an open-end, management investment company;
WHEREAS, the Adviser is registered with the Commission under the
Investment Advisers Act of 1940, as amended (the "Advisers Act") and engages in
the business of acting as an investment adviser;
WHEREAS, the Sub-Adviser is also registered with the Commission under
the Advisers Act as an investment adviser and engages in the business of acting
as an investment adviser;
WHEREAS, the Adviser and the Trust have entered into an Investment
Advisory Agreement (the "Investment Advisory Agreement"), pursuant to which the
Adviser acts as investment adviser with respect to the Master Portfolios; and
WHEREAS, pursuant to such Investment Advisory Agreement, the Adviser,
with the approval of the Trust, wishes to retain the Sub-Adviser for purposes of
rendering advisory services to the Adviser and the Trust in connection with the
Master Portfolios upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and other good and valuable consideration, the receipt of which is
hereby acknowledged, it is agreed between the parties hereto as follows:
1. APPOINTMENT OF SUB-ADVISER. The Adviser hereby appoints the
Sub-Adviser to act as investment sub-adviser or co-investment sub-adviser with
respect to the Master Portfolios, under the supervision of the Adviser and
subject to the policies and control of the Trust's Board of Trustees, and the
Sub-Adviser hereby accepts such appointment, all subject to the terms and
conditions contained herein.
2. SERVICES OF SUB-ADVISER. Subject to the oversight and supervision of
the Adviser and the Trust's Board of Trustees, the Sub-Adviser will provide a
continuous investment program for the Master Portfolios, including investment
research and management with respect to all equity securities and investments.
Pursuant to the foregoing, the Sub-Adviser will
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determine from time to time what securities and other investments will be
purchased, retained or sold by the Master Portfolios. The Sub-Adviser will
provide the services rendered by it under this Agreement in accordance with the
investment criteria and policies established from time to time for the Master
Portfolios by the Adviser, the Master Portfolios' investment objectives,
strategies and restrictions as stated in the Master Portfolios' Prospectuses and
Statement of Additional Information, the operating policies and procedures of
the Master Portfolios, and resolutions of the Trust's Board of Trustees.
The Sub-Adviser further agrees that it will:
(a) Provide information to the Master Portfolios'
accountant for the purpose of updating the Master
Portfolios' cash availability throughout the day as
required;
(b) Maintain historical tax lots for each portfolio
security held by the Master Portfolios;
(c) Transmit trades to the Trust's custodian for proper
settlement in accordance with the Trust's procedures
and as may be directed by the Trust or the Adviser;
(d) Maintain all books and records with respect to the
Master Portfolios that are required to be maintained
under Rule 31a-l(f) under the 1940 Act;
(e) Supply the Adviser, the Trust and the Trust's Board
of Trustees with reports, statistical data and
economic information as requested; and
(f) Prepare a quarterly broker security transaction
summary and, if requested in advance, monthly
security transaction listing for the Master
Portfolios.
3. CONTROL BY BOARD OF TRUSTEES. As is the case with respect to the
Adviser under the Investment Advisory Agreement, any investment activities
undertaken by the Sub-Adviser pursuant to this Agreement, as well as any other
activities undertaken by the Sub-Adviser with respect to the Trust, shall at all
times be subject to any directives of the Board of Trustees of the Trust.
4. OTHER COVENANTS. In carrying out its obligations under this
Agreement, the Sub-Adviser agrees that it:
(a) will comply with all applicable Rules and Regulations
of the Commission and will in addition conduct its
activities under this Agreement in accordance with
other applicable law, including but not limited to
the 1940 Act and the Advisers Act;
(b) will use the same skill and care in providing such
services as it uses in providing services to
fiduciary accounts for which it has investment
responsibilities;
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(c) will not make loans to any person to purchase or
carry Master Portfolio shares;
(d) will place orders pursuant to its investment
determinations for the Master Portfolios either
directly with the issuer or with any broker or
dealer. Subject to the other provisions of this
paragraph, in executing portfolio transactions and
selecting brokers or dealers, the Sub-Adviser will
use its best efforts to seek on behalf of each Master
Portfolio the best overall terms available. In
assessing the best overall terms available for any
transaction, the Sub-Adviser shall consider all
factors that it deems relevant, including the breadth
of the market in the security, the price of the
security, the financial condition and execution
capability of the broker or dealer, and the
reasonableness of the commission, if any, both for
the specific transaction and on a continuing basis.
In evaluating the best overall terms available, and
in selecting the broker/dealer to execute a
particular transaction, the Sub-Adviser may also
consider any brokerage and research services (as
those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934, as amended) provided
to the Master Portfolio and/or other accounts over
which the Sub-Adviser or an affiliate of the
Sub-Adviser exercises investment discretion. The
Sub-Adviser is authorized, subject to prior approval
of the Trust's Board of Trustees, to pay to a broker
or dealer who provides such brokerage and research
services a commission for executing a portfolio
transaction for any Master Portfolio which is in
excess of the amount of commission another broker or
dealer would have charged for effecting that
transaction if, but only if, the Sub-Adviser
determines in good faith that such commission was
reasonable in relation to the value of the brokerage
and research services provided by such broker or
dealer -- viewed in terms of that particular
transaction or in terms of the overall
responsibilities of the Sub-Adviser to its clients,
including the particular Master Portfolio and to the
Trust. In addition, the Sub-Adviser is authorized to
take into account the sale of shares of the Trust in
allocating purchase and sale orders for portfolio
securities to brokers or dealers (including brokers
and dealers that are affiliated with the Sub-Adviser
or the Trust's principal underwriter), provided that
the Sub-Adviser believes that the quality of the
transaction and the commission are comparable to what
they would be with other qualified firms. In no
instance, however, will portfolio securities be
purchased from or sold to the Adviser, Sub-Adviser or
the Trust's principal underwriter for the Master
Portfolios or an affiliated person of either acting
as principal or broker, except as permitted by the
Commission or applicable law;
(e) will adhere to the policies and procedures of the
Trust adopted on behalf of the Master Portfolios;
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(f) will maintain a policy and practice of conducting its
investment advisory services hereunder independently
of the commercial banking operations of its
affiliates. In making investment recommendations for
a Master Portfolio, its investment advisory personnel
will not inquire or take into consideration whether
the issuer (or related supporting institution) of
securities proposed for purchase or sale for the
Master Portfolio's account are customers of the
commercial departments of its affiliates;
(g) will use reasonable efforts to perform its duties and
obligations under this Agreement without: (a) any
failure of its computer systems, or those used by it
in the performance of its duties hereunder, properly
to record, store, process, calculate or present
calendar dates falling on and after, and time spans
including, September 9, 1999, January 1, 2000 or
February 29, 2000 (the "Subject Dates") as a result
of the occurrence, or use of data containing, any
such Subject Dates; (b) any failure of its computer
systems, or those used by it in the performance of
its duties hereunder, to calculate any information
dependent on or relating to dates on or after the
Subject Dates; or (c) any loss of functionality or
performance with respect to the maintenance of
records or processing of data containing dates
falling on or after the Subject Dates ((a), (b), and
(c) above shall be referred to as "Y2K Failures").
Notwithstanding the above, the Sub-Adviser shall not
be liable for any Y2K Failures caused by Y2K Failures
in a third party system with which the Sub-Adviser
interfaces or from which the Sub-Adviser receives
data in connection with the performance of its duties
hereunder; and
(h) will treat confidentially and as proprietary
information of the Trust all records and other
information relative to the Trust and prior, present
or potential interestholders, and will not use such
records and information for any purpose other than
performance of its responsibilities and duties
hereunder (except after prior notification to and
approval in writing by the Trust, which approval
shall not be unreasonably withheld and may not be
withheld and will be deemed granted where the
Sub-Adviser may be exposed to civil or criminal
contempt proceedings for failure to comply, when
requested to divulge such information by duly
constituted authorities, or when so requested by the
Trust).
5. SERVICES NOT EXCLUSIVE. The services furnished by the Sub-Adviser
hereunder are deemed not to be exclusive, and the Sub-Adviser shall be free to
furnish similar services to others so long as its services under this Agreement
are not impaired thereby. To the extent that the purchase or sale of securities
or other investments of the same issuer may be deemed by the Sub-Adviser to be
suitable for two more accounts managed by the Sub-Adviser, the available
securities or investments may be allocated in a manner believed by the
Sub-Adviser to be equitable to each account. It is recognized that in some cases
this procedure may adversely affect the price paid or received by a Master
Portfolio or the size of the position obtainable for or disposed of by a Master
Portfolio.
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6. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Adviser hereby agrees that all records which it
maintains for each Master Portfolio are the property of the Trust and further
agrees to surrender promptly to the Adviser or the Trust any of such records
upon request. The Sub-Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
7. EXPENSES. During the term of this Agreement, the Sub-Adviser will
pay all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments
(including brokerage commissions and other transaction charges, if any)
purchased or sold for the Master Portfolios.
8. COMPENSATION. For the services provided to each Master Portfolio and
the expenses assumed pursuant to this Agreement, the Adviser will pay the
Sub-Adviser and the Sub-Adviser will accept as full compensation therefor a fee
for that Master Portfolio determined in accordance with Schedule I attached
hereto. The Adviser and the Sub-Adviser may, from time to time, agree to reduce,
limit or waive the amounts payable hereunder with respect to one or more Master
Portfolios for such period or periods they deem advisable. It is understood that
the Adviser shall be responsible for the Sub-Adviser's fee for its services
hereunder, and the Sub-Adviser agrees that it shall have no claim against the
Trust or the Master Portfolio with respect to compensation under this Agreement.
9. LIABILITY OF SUB-ADVISER. The Sub-Adviser shall not be liable for
any error of judgment or mistake of law or for any loss suffered by the Adviser
or the Company in connection with the performance of this Agreement, except a
loss resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or negligence on the part of the Sub-Adviser in the performance of its
duties or from reckless disregard by it of its obligations and duties under this
Agreement.
10. DURATION AND TERMINATION. This Agreement shall become effective
when approved, and shall continue in effect until the second anniversary of its
effective date. Thereafter, if not terminated, this Agreement shall continue in
effect for successive annual periods ending on January 1, provided that the
continuation of the Agreement is specifically approved at least annually:
(a)(i) by the Trust's Board of Trustees or (ii) by the vote
of "a majority of the outstanding voting securities"
of the Master Portfolio (as defined in Section
2(a)(42) of the 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 Trust), by votes cast in person at a meeting
specifically called for such purpose.
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Notwithstanding the foregoing, this Agreement may be terminated as to any Master
Portfolio at any time, without the payment of any penalty, by the Trust (by vote
of the Trust's Board of Trustees or by vote of a majority of the outstanding
voting securities of the particular Master Portfolio), or by the Sub-Adviser or
Adviser on sixty (60) days' written notice to the other parties to this
Agreement. The notice provided for herein may be waived by the party entitled to
receipt thereof. This Agreement will immediately terminate in the event of its
assignment. As used in this Agreement, the terms "majority of the outstanding
voting securities," "interested persons" and "assignment" shall have the same
meanings as such terms have in the 1940 Act.
11. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No amendment of this Agreement affecting a
Master Portfolio shall be effective until approved by vote of a majority of the
outstanding voting securities of such Master Portfolio. However, this shall not
prevent the Sub-Adviser from reducing, limiting or waiving its fee.
12. RELEASE. The names "Nations Master Investment Trust" and "Trustees
of Nations Master Investment Trust" refer respectively to the Trust created and
the Trustees, as trustees but not individually or personally, acting from time
to time under a Declaration of Trust dated as of January 14, 1999, which is
hereby referred to and a copy of which is on file at the principal office of the
Trust. The obligations of "Nations Master Investment Trust" entered into in the
name or on behalf thereof by any of the Trustees, representatives or agents are
made not individually, but in such capacities, and are not binding upon any of
the Trustees, interestholders, or representatives of the Trust personally, but
bind only the Trust property, and all persons dealing with any class of shares
of the Trust must look solely to the property belonging to such class for the
enforcement of any claims against the Trust.
13. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and shall be
governed by Delaware law.
14. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ A. Xxx Xxxxxx
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A. Xxx Xxxxxx
President and Chairman of
the Board of Trustees
NATIONSBANC ADVISORS, INC.
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
President
CHICAGO EQUITY PARTNERS
CORPORATION
By: /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
President
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SCHEDULE I
The Adviser shall pay the Sub-Adviser, as full compensation for services
provided and expenses assumed hereunder, a sub-advisory fee for each Master
Portfolio, computed daily and payable monthly at the annual rates listed below
as a percentage of the average daily net assets of the Master Portfolio:
Master Portfolio Rate of Compensation
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Nations Blue Chip Master Portfolio 0.25%
Approved: December 2, 1998
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