CUSTODY AGREEMENT
THIS AGREEMENT is made as of the 14th day of February, 2000 by and
between The Bank of New York, a New York corporation authorized to do a banking
business ("Custodian"), and Nations Funds Trust, a Delaware business trust (the
"Trust").
W I T N E S S E T H
WHEREAS, the Trust is a registered open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Trust desires to retain Custodian to serve as
custodian for the Trust, 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 Trust and Custodian hereby agree as follows:
1. Appointment.
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The Trust 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 Trust may from time to time issue separate series or classes, and
classify and reclassify shares of any such series or class. The Trust 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 Trust 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.
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The Trust has furnished Custodian with copies properly certified or
authenticated of each of the following:
(a) votes of the Trust's Board of Trustees authorizing the
appointment of Custodian as custodian of portfolio securities,
cash and other property of the Trust, respectively, and approving
and consenting to this Agreement;
(b) schedules identifying and containing the signatures of all of the
Trust'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 Trust;
(c) the Trust's current registration statement on Form N-1A (the
"Registration Statement") under the Securities Act of 1933, as
amended (the "1933 Act"), and under the 1940 Act (File Nos.
333-89661 and 811-09645), as filed with the Securities and
Exchange Commission (the "SEC"), relating
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to the Funds' shares of beneficial interest, without par value
(the "Shares");
(d) the current prospectus(es) and statement(s) of additional
information of each of the Funds, including all amendments and
supplements thereto (collectively the "Prospectuses"); and
(e) a copy of the opinion of counsel for the Trust, filed with the
SEC as part of the Trust's current Registration Statement.
The Trust 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.
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(a) "Authorized Person". As used in this Agreement, the term
"Authorized Person" means any of the Trust's officers, and any other person,
whether or not any such person is an officer or employee of the Trust, duly
authorized by the Board of Trustees of the Trust to give Oral and Written
Instructions to Custodian on behalf of the Trust and listed on a schedule
provided to Custodian pursuant to Section 2 of this Agreement. Authorized
Persons duly authorized by the Board of Trustees of the Trust 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.
(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.
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(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
Trust 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 Trust which
the Trust may from time to time deliver to Custodian, as applicable, or which
Custodian may from time to time hold for the Trust;
(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 Trust.
(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 vote of
the Trust's Board of Trustees 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.
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The Trust 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 Trust, 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 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 Trust, pursuant to Paragraphs 7, 27, or 28(g) hereof or shall be
properly endorsed and in form for transfer satisfactory to Custodian.
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5. Voting and Other Rights.
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With respect to all securities, however registered, it is understood
that the voting and other rights and powers shall be exercised by the Trust.
Custodian's only duty with respect to such rights shall be to mail to the Trust
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 Trust understands that in order for Custodian to act,
Custodian must receive the Trust'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 Trust). 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 Trust any annual, quarterly or
special reports issued by companies whose securities are held by Custodian
hereunder.
6. Receipt and Disbursement of Money.
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(a) Custodian shall open and maintain a custody account for each Fund
of the Trust, 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; (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.
7. Receipt of Securities.
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(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 vote authorizing the specific
transaction by the Trust's Board of Trustees, and subject to Paragraph 25
hereof, Custodian shall have no power or authority to
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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 Trustee, officer, employee or agent of
the Trust 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 Trust to any such
sub-custody arrangement. Custodian will provide the Trust 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 Trust 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 Trust 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 Trust stating that any such instruments or certificates are
available. The Trust 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 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 Trust'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
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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.
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The Trust shall deliver to Custodian a certified vote of the Board of
Trustees of the Trust 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
Trust's duly authorized employees or agents and the Trust'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 Trust
will be furnished with all information in respect of the services rendered to it
as it may require.
(c) Custodian will provide the Trust 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 report by
Custodian. Custodian will also provide the Trust with such reports on its own
system of internal control as the Trust may reasonably request from time to
time.
9. Instructions Consistent With the Charter, Etc.
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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 Declaration of Trust or any vote of the Trust's Board of
Trustees, 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 Trust 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
Trust agrees that the fact that such confirming Written Instructions are
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not received by Custodian shall in no way affect the validity of any of the
transactions authorized by the Trust 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.
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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 Trust of such receipt and shall
credit such income, as collected, to such Fund of the Trust. From time to time,
Custodian may elect, but shall not be so obligated, to credit the account with
interest, dividends or principal payments on the payable or contractual
settlement date, in anticipation of receiving same from a payor, central
depository, Securities Depository, broker or other agent employed by the Trust
or Custodian. Any such crediting and posting shall be at the Trust'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 Trust 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 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 Trust
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,
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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 Appendix A hereto, which Appendix may
be amended to add other publications at any time by Custodian without prior
notice to or consent from the Trust and which may be amended to delete a
publication with the prior notice and consent from the Trust;
(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 Trust or the investment adviser to the Trust
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 Trust'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.
(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
Trust 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.
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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:
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(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;
(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.
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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 Trust with the procedures required by a securities or option exchange, (ii)
for the purpose of compliance by the Funds and the Trust with the 1940 Act and
Release No. 10666 or any subsequent release or releases of the SEC relating to
the maintenance
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of segregated accounts by registered investment companies, and (iii) for other
proper corporate purposes.
13. Dividends and Distributions.
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(a) The Trust shall furnish Custodian with appropriate evidence of
action by the Trust's Board of Trustees 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 Trust's
Board of Trustees and payable to interestholders 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 Trust, and the Trust's
administrator or transfer agent, Custodian shall pay to the Fund's transfer
agent, as agent for the interestholders, an amount equal to the amount indicated
in said Officer's Certificate as payable by the Fund to such interestholders for
distribution in cash by the transfer agent to such interestholders.
(b) Custodian may enter into separate custodial agreements with various
futures commission merchants ("FCMs") that the Trust uses (each a "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 a "FCM Account") subject to the disposition by the
FCM involved in such contracts in accordance with the customer contract between
the FCM and the Trust ("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
Trust which state that: (i) an FCM Contract has been entered into; (ii) the
Trust is in compliance with all the rules and regulations of the CFTC; and (iii)
the FCM Agreement is acceptable to the Trust. Transfers of initial margin shall
be made into a 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 a 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.
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Promptly after each purchase of securities by the Trust on behalf of
any Fund, the Trust 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 Trust pay out
of the monies held for the account of the Trust 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, the Trust 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
10
total amount payable to the Trust 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 Trust 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 Trust which are
in the possession of Custodian shall be the property of the Trust. Such books
and records shall be prepared and maintained as required by the 1940 Act and
other applicable securities laws, rules and regulations. The SEC, the Trust, or
the Trust'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 Trust, copies of any such books and records shall be
provided by Custodian to the Trust or the Trust's authorized representative, and
the Trust shall reimburse Custodian reasonable expenses for providing such
copies. Upon reasonable request of the Trust, Custodian shall provide in hard
copy, tape or on micro-film, or such other medium as agreed to among the Trust
and Custodian, and any books and records maintained by Custodian.
17. Reports.
------------
(a) Custodian shall furnish the Trust the following reports:
(i) such periodic and special reports as the Trust 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 Trust 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 Trust and Custodian.
(b) Subject to Paragraphs 5 and 27(g) hereof, Custodian shall transmit
promptly to the Trust 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
11
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 Trust'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 Trust, its prior, present or
potential interestholders, 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
Trust 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 Trust.
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 Custodian, it may request, and shall receive, from the
Trust 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 Trust'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
12
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 Trust 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 Trust and Custodian as set forth in
Schedule III.
24. Indemnification.
-------------------
The Trust 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 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 Trust is for
any other reason indebted to Custodian, including any indebtedness to The Bank
of New York under the Trust'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 Trust 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 Trust 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
13
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
Trust 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 Trust 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 Trust 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 Trust 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 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 Trust against delivery
of a stated amount of collateral. The Trust shall promptly deliver to Custodian
Written Instructions 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
Trust 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 Trust 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 Trust 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,
14
express or implied, including, but not limited to, any implied warranties of
merchantability or fitness for a particular purpose. The Trust and the Custodian
shall use commercially reasonable efforts to develop other mechanisms (i) to
enable the Trust 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
Trust and the Funds to utilize the Software. With respect to any such
Software, Custodian grants to the Trust 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 Trust 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 Trust be obligated to
use the Software to transmit Instructions to Custodian.
(b) The Trust 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 Trust to utilize the Software,
Custodian shall, at its own expense, provide and maintain such equipment.
(c) The Trust acknowledges that the Software, all databases made
available to the Trust by utilizing the Software (other than databases 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 Trust shall keep the Information
confidential by using the same care and discretion that the Trust 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 Trust shall return to Custodian all copies of the Information
which are in its possession or under its control or which the Trust distributed
to third parties.
(d) Custodian reserves the right to modify the Software from time to
time upon reasonable prior notice and the Trust 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 Trust agrees not to modify or attempt to modify the
Software without Custodian's prior written consent. The Trust acknowledges that
any modifications to the Software, whether by the Trust 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 Trust
involves an automatic systems acknowledgment to the Trust 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
Trust, Custodian shall not be deemed to have received any such Instructions, and
(ii) if an acknowledgment is actually received by the Trust, 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,
15
however, that the Trust shall promptly review all acknowledgments actually
received and notify the Custodian in the event of any apparent discrepancy.
(f) (i) The Trust agrees that where it delivers to Custodian
Instructions hereunder using the Software, it shall be the Trust's sole
responsibility to ensure that only persons duly authorized by the Trust and the
correct number of such persons transmit such Instructions to Custodian and the
Trust 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. (ii) The Trust 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 Trust. (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 Trust 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 Trust whenever Custodian
learns or reasonably should have learned, of any errors, omissions or
interruption in, or delay or unavailability of, the Trust's ability to send
Instructions using the Software provided by Custodian.
26B. FX Transactions.
---------------------
(a) Whenever a Fund shall enter into a FX Transaction, the Fund shall
promptly deliver to Custodian a Certificate or Oral Instructions specifying with
respect to such FX Transaction: (i) the Series to which such FX Transaction is
specifically allocated; (ii) the type and amount of Currency to be purchased by
the Fund; (iii) the type and amount of Currency to be sold by the Fund; (iv) the
date on which the Currency to be purchased is to be delivered; (v) the date on
which the Currency to be sold is to be delivered; and (vi) 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.
16
(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
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
Trust's Board of Trustees ("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 Trust 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 Trust herewith and will not be amended in a way that
materially or adversely affects the Trust without the Trust's prior written
consent.
17
(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 Trust, it shall be entitled to be subrogated to any claims by
the Trust 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
Trust or any Fund if and to the extent that the Trust or such Fund has been made
whole by Custodian for any such loss, damage, cost, expense, liability or claim.
(d) Upon request of the Trust, Custodian will, consistent with the
terms of the applicable Foreign Sub-Custodian Agreement, use reasonable efforts
to arrange for the independent accountants of the Trust 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 Trust.
(e) Custodian will supply to the Trust 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 advises 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 Trust or any Fund it will promptly notify the Trust 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 Trust all notices, reports
or other written information received pertaining to the Funds' 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 Trust or
any Fund and delivery of securities maintained for the account of the Trust 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 Trust'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.
18
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 Trust 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 Trust) 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 Trust at the
expense of the Trust, 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 Trust
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 Trust
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 Trust 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 Trust pursuant to this
Paragraph 28, the Trust 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 Trust
in writing of Custodian's intention to assume such defense; and (2) retains
legal counsel reasonably satisfactory to the Trust to conduct the defense of
such Action. If Custodian advises the Trust 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 Trust,
in addition to any other amounts for which Custodian may be liable pursuant to
this Paragraph 28. The other person will 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 Trust will have the right to employ
a separate counsel and to participate in
19
(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 Trust 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 Trust, or (c) the Trust
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 Trust 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 Trust without the consent of the
Trust, 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 Trust 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 Trust 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 Trust;
(iv) the legality of any borrowing by the Trust 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 Trust 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 Trust or any Fund that
the amount of such cash collateral held by Custodian for the Trust is sufficient
collateral for the Trust, but such duty or obligation shall be the sole
responsibility of the Trust. 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 Trust during the period of such
loan or at the termination of such loan, provided, however, that Custodian shall
promptly notify the Trust in the event that such dividends or interest are not
paid and received when due; or
20
(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 Trust is
entitled to receive, or to notify the Trust 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 Trust 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 Trust of an overdue amount on
securities held in a Securities Depository, Custodian shall make a claim against
a Securities Depository on behalf of the Trust, 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 Trust from a transfer agent of the
Trust nor to take any action to effect payment or distribution by the transfer
agent of the Trust of any amount paid by Custodian to the transfer agent of the
Trust 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.
(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 Funds, upon such terms and conditions as may be
approved in
21
an Officer's Certificate or contained in an agreement executed by Custodian and
the Trust 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 Trust and specifically
allocated to a Fund are such as properly may be held by the Trust 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 Trust incurred by Custodian in the performance of
its duties under this Agreement only against the money of the Fund or Funds of
the Trust 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 Trust. To the extent that Custodian is entitled to recover from the Trust
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 Trust that is/are identified by the
Trust in an Officer's Certificate, unless and until the Trust 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 Trust 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 Trust 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 Trust. The Trust agrees that Custodian
shall not incur any liability to the Trust 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
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.
22
(l) Custodian shall provide the Trust 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 Trust 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 Trust or a successor
custodian designated by the Trust all securities and moneys then owned by the
Trust 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 Trust 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, 00 Xxxxxxxxxx Xxxxxx,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Ajosa; (b) if to the
Trust, at the address of the Trust's Secretary, 000 Xxxxxx Xxxxxx, Xxxxxx Xxxx,
Xxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxx, Xx., 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.
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.
23
33. Miscellaneous.
-----------------
(a) The Trust agrees that Custodian may be a counterparty in any
purchase or sale of foreign currency by or for the Trust 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 Trust" and "Trustees of Nations Funds 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 which is hereby referred to and a copy of which is on file at the
principal office of the Trust. The obligations of "Nations Funds 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 (as defined in the Declaration of
Trust), and all persons dealing with any class of Shares of the Trust Property,
and all persons dealing with any class of Shares of the Trust must look solely
to the Trust Property belonging to such class for the enforcement of any claims
against the Trust.
35. Counterparts.
----------------
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
24
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.
NATIONS FUNDS TRUST
By: /s/ Xxxxx X. Xxxxx, Xx.
------------------------
Xxxxx X. Xxxxx, Xx.
Assistant Secretary
THE BANK OF NEW YORK
By: /s/ Xxxxxxx X. Grunston
-------------------------
Xxxxxxx X. Grunston
Vice President
25
SCHEDULE I
The Custody Agreement between Nations Funds Trust and Sub-Custodian
applies to the following Funds of the Trust:
Nations High Yield Bond Fund
Nations Kansas Municipal Income Fund
Nations MidCap Index Fund
Nations Xxxxxxx 21st Century Fund
Nations Xxxxxxx International Opportunities Fund
Nations Financial Services Fund
Nations Classic Value Fund
Nations Global Value Fund
Approved: December 9, 1999
Last Amended: April 9, 2001
IN WITNESS WHEREOF, the parties hereto have caused this amended
Schedule I to be executed by their officers designated below as of the 9th day
of April, 2001.
THE BANK OF NEW YORK
By: /s/ Xxxxxx X. XxXxxx
----------------------------
Vice President
NATIONS FUNDS TRUST
on behalf of the Funds
By: /s/ Xxxxxxx X. Xxxxx, Xx.
--------------------------
Xxxxxxx X. Xxxxx, Xx.
Secretary
26
SCHEDULE II
PUBLICATIONS
I, Xxx Xxxxxx, a Vice President with THE BANK OF NEW YORK do hereby designate
the following publications:
The Bond Buyer
Depository Trust Company Services
Financial Daily Card Service
XX Xxxxxx Municipal Bond Service
London Financial Times
New York Times
Standard & Poor's Called Bond Record
Wall Street Journal
27
SCHEDULE III
Domestic Custodian Fee Schedule
For
Nations Funds Trust
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-xxxx 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.
28
Domestic Custodian Fee Schedule
For
Nations Funds Trust
Money Market Funds
Out-of-Pocket Expenses
----------------------
None.
Billing Cycle
-------------
The above fees are billed monthly.
Nations Funds Trust The Bank of New York
------------------- --------------------
Approved by: /s/ Xxxxxxx X. Xxxxx, Xx. Approved by: /s/ Xxxxxxx X. Grunston
------------------------- -----------------------
Title: Secretary and Treasurer Title: Vice President
----------------------- --------------------
Date: 2/14/00 Date: 2/14/00
----------------------- --------------------
29
Domestic Custodian Fee Schedule
For
Nations Funds Trust
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-xxxx 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.
30
Domestic Custodian Fee Schedule
For
Nations Funds Trust
Non-Money Market Funds
Out-of-Pocket Expenses
----------------------
None.
Billing Cycle
-------------
The above fees are billed monthly.
Nations Funds Trust The Bank of New York
------------------- --------------------
Approved by: /s/ Xxxxxxx X. Xxxxx, Xx. Approved by: /s/ Xxxxxxx X. Grunston
------------------------- -----------------------
Title: Secretary and Treasurer Title: Vice President
--------------------------- --------------------
Date: 2/14/00 Date: 2/14/00
--------------------------- --------------------
31
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.
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.
32
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.
General Servicing
-----------------
Prompt notification of corporate actions.
Corporate literature directly forwarded upon receipt.
33
Proxies for securities held in our nominee are executed and forwarded
to the Fund for voting.
Payment of your authorized corporate expenses.
34
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS FINANCIAL SERVICES FUND
------------------------------------------------------ ------------------------ ------------------------
Argentina 18.00 70
------------------------------------------------------ ------------------------ ------------------------
Australia 4.00 50
------------------------------------------------------ ------------------------ ------------------------
Austria 5.00 50
------------------------------------------------------ ------------------------ ------------------------
Bahrain 60.00 175
------------------------------------------------------ ------------------------ ------------------------
Bangladesh 45.00 175
------------------------------------------------------ ------------------------ ------------------------
Belgium (reg. bds) 2.00 10
------------------------------------------------------ ------------------------ ------------------------
Belgium (equities and Cpn bds) 4.00 10
------------------------------------------------------ ------------------------ ------------------------
Bermuda 30.00 90
------------------------------------------------------ ------------------------ ------------------------
Bolivia 50.00 95
------------------------------------------------------ ------------------------ ------------------------
Botswana 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Brazil 25.00 25
------------------------------------------------------ ------------------------ ------------------------
Bulgaria 50.00 100
------------------------------------------------------ ------------------------ ------------------------
Canada 2.00 15
------------------------------------------------------ ------------------------ ------------------------
Chile 25.00 70
------------------------------------------------------ ------------------------ ------------------------
China 20.50 60
------------------------------------------------------ ------------------------ ------------------------
Colombia 50.00 135
------------------------------------------------------ ------------------------ ------------------------
Costa Rica 15.00 60
------------------------------------------------------ ------------------------ ------------------------
Croatia 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Cyprus 15.00 45
------------------------------------------------------ ------------------------ ------------------------
Czech Republic 23.00 60
------------------------------------------------------ ------------------------ ------------------------
Denmark 3.00 50
------------------------------------------------------ ------------------------ ------------------------
EASDAQ 7.00 55
------------------------------------------------------ ------------------------ ------------------------
Ecuador 55.00 100
------------------------------------------------------ ------------------------ ------------------------
Egypt 45.00 120
------------------------------------------------------ ------------------------ ------------------------
Estonia 7.00 20
------------------------------------------------------ ------------------------ ------------------------
Euro CD's 3.00 30
------------------------------------------------------ ------------------------ ------------------------
Euromarket 2.00 15
------------------------------------------------------ ------------------------ ------------------------
Finland 5.00 50
------------------------------------------------------ ------------------------ ------------------------
France 4.00 50
------------------------------------------------------ ------------------------ ------------------------
Germany 2.00 50
------------------------------------------------------ ------------------------ ------------------------
Ghana 35.00 70
------------------------------------------------------ ------------------------ ------------------------
Greece 30.00 145
------------------------------------------------------ ------------------------ ------------------------
Hong Kong 5.00 75
------------------------------------------------------ ------------------------ ------------------------
Hungary 50.00 175
------------------------------------------------------ ------------------------ ------------------------
Iceland 60.00 175
------------------------------------------------------ ------------------------ ------------------------
India 50.00 175
------------------------------------------------------ ------------------------ ------------------------
Indonesia 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Ireland 3.50 45
------------------------------------------------------ ------------------------ ------------------------
Israel 35.00 55
------------------------------------------------------ ------------------------ ------------------------
Italy 4.00 50
------------------------------------------------------ ------------------------ ------------------------
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS FINANCIAL SERVICES FUND
------------------------------------------------------ ------------------------ ------------------------
Ivory Coast 40.00 155
------------------------------------------------------ ------------------------ ------------------------
Jamaica 35.00 50
------------------------------------------------------ ------------------------ ------------------------
Japan (bonds) 3.00 10
------------------------------------------------------ ------------------------ ------------------------
Japan (equities) 3.00 10
------------------------------------------------------ ------------------------ ------------------------
Jordan 45.00 140
------------------------------------------------------ ------------------------ ------------------------
Kazakhstan (T Bills) 35.00 140
------------------------------------------------------ ------------------------ ------------------------
Kazakhstan (Equities) 55.00 130
------------------------------------------------------ ------------------------ ------------------------
Kenya 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Latvia (equities/bonds) 30.00 75
------------------------------------------------------ ------------------------ ------------------------
Latvia Gov't Bonds 15.00 75
------------------------------------------------------ ------------------------ ------------------------
Lebanon 25.00 90
------------------------------------------------------ ------------------------ ------------------------
Lithuania 20.00 50
------------------------------------------------------ ------------------------ ------------------------
Luxembourg 5.00 50
------------------------------------------------------ ------------------------ ------------------------
Malaysia 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Malta 18.00 50
------------------------------------------------------ ------------------------ ------------------------
Mauritius** 60.00 175
------------------------------------------------------ ------------------------ ------------------------
Mexico 10.00 25
------------------------------------------------------ ------------------------ ------------------------
Morocco 35.00 110
------------------------------------------------------ ------------------------ ------------------------
Namibia 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Netherlands 5.00 35
------------------------------------------------------ ------------------------ ------------------------
New Zealand 3.50 65
------------------------------------------------------ ------------------------ ------------------------
Nigeria 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Norway 3.00 80
------------------------------------------------------ ------------------------ ------------------------
Oman 60.00 175
------------------------------------------------------ ------------------------ ------------------------
Pakistan 40.00 150
------------------------------------------------------ ------------------------ ------------------------
Panama 65.00 85
------------------------------------------------------ ------------------------ ------------------------
Peru 45.00 120
------------------------------------------------------ ------------------------ ------------------------
Philippines 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Poland 35.00 125
------------------------------------------------------ ------------------------ ------------------------
Portugal 5.00 80
------------------------------------------------------ ------------------------ ------------------------
Romania 35.00 100
------------------------------------------------------ ------------------------ ------------------------
Russia Equities 45.00 175
------------------------------------------------------ ------------------------ ------------------------
Russia (Min. Fin Bonds) 10.00 100
------------------------------------------------------ ------------------------ ------------------------
Singapore 5.00 80
------------------------------------------------------ ------------------------ ------------------------
Slovak Republic 35.00 150
------------------------------------------------------ ------------------------ ------------------------
Slovenia 25.00 110
------------------------------------------------------ ------------------------ ------------------------
South Africa 1.50 35
------------------------------------------------------ ------------------------ ------------------------
South Korea 12.00 25
------------------------------------------------------ ------------------------ ------------------------
Spain 5.00 50
------------------------------------------------------ ------------------------ ------------------------
Sri Lanka 20.00 70
------------------------------------------------------ ------------------------ ------------------------
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS FINANCIAL SERVICES FUND
------------------------------------------------------ ------------------------ ------------------------
Swaziland 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Sweden 3.00 50
------------------------------------------------------ ------------------------ ------------------------
Switzerland 3.00 50
------------------------------------------------------ ------------------------ ------------------------
Taiwan 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Thailand 5.00 45
------------------------------------------------------ ------------------------ ------------------------
Trinidad & Tobago 40.00 75
------------------------------------------------------ ------------------------ ------------------------
Tunisia 40.00 45
------------------------------------------------------ ------------------------ ------------------------
Turkey 12.00 75
------------------------------------------------------ ------------------------ ------------------------
Ukraine 30.00 45
------------------------------------------------------ ------------------------ ------------------------
United Kingdom 0.75 25
------------------------------------------------------ ------------------------ ------------------------
United Kingdom (gilts) 3.50 50
------------------------------------------------------ ------------------------ ------------------------
United States See below 7
------------------------------------------------------ ------------------------ ------------------------
Uruguay 50.00 65
------------------------------------------------------ ------------------------ ------------------------
Venezuela 25.00 80
------------------------------------------------------ ------------------------ ------------------------
Zambia 35.00 70
------------------------------------------------------ ------------------------ ------------------------
Zimbabwe 35.00 65
------------------------------------------------------ ------------------------ ------------------------
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 one basis point on the excess.
*Fee expressed in basis points per annum is calculated based upon month end
market value.
** Not yet 17f-5 qualified.
Third Party Foreign Exchange Settlements
----------------------------------------
$10 per transaction/money movement
Minimum charges imposed by Agent Banks/Local Administrators
-----------------------------------------------------------
Brazil - 15 basis points for annual administrative charges
Chile - USD $17,500 - $20,000 per annum minimum administration charge
Colombia - USD $600 per month minimum administration charge
Ecuador - USD $800 monthly minimum per relationship
Egypt - USD $400 monthly minimum per relationship
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS FINANCIAL SERVICES FUND
Additional Charges
------------------
Charges incurred by The Bank of New York for local taxes, stamp duties or other
local duties and assessments stock exchange fees, postage and insurance for
shipping, extraordinary telecommunication fees or other unusual expenses which
are unique to a country in which our clients is investing will be in addition to
the stated fees.
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS XXXXXXX TECHNOLOGY FUND
------------------------------------------------------ ------------------------ ------------------------
Argentina 18.00 70
------------------------------------------------------ ------------------------ ------------------------
Australia 4.00 50
------------------------------------------------------ ------------------------ ------------------------
Austria 5.00 50
------------------------------------------------------ ------------------------ ------------------------
Bahrain 60.00 175
------------------------------------------------------ ------------------------ ------------------------
Bangladesh 45.00 175
------------------------------------------------------ ------------------------ ------------------------
Belgium (reg. bds) 2.00 10
------------------------------------------------------ ------------------------ ------------------------
Belgium (equities and Cpn bds) 4.00 10
------------------------------------------------------ ------------------------ ------------------------
Bermuda 30.00 90
------------------------------------------------------ ------------------------ ------------------------
Bolivia 50.00 95
------------------------------------------------------ ------------------------ ------------------------
Botswana 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Brazil 25.00 25
------------------------------------------------------ ------------------------ ------------------------
Bulgaria 50.00 100
------------------------------------------------------ ------------------------ ------------------------
Canada 2.00 15
------------------------------------------------------ ------------------------ ------------------------
Chile 25.00 70
------------------------------------------------------ ------------------------ ------------------------
China 20.50 60
------------------------------------------------------ ------------------------ ------------------------
Colombia 50.00 135
------------------------------------------------------ ------------------------ ------------------------
Costa Rica 15.00 60
------------------------------------------------------ ------------------------ ------------------------
Croatia 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Cyprus 15.00 45
------------------------------------------------------ ------------------------ ------------------------
Czech Republic 23.00 60
------------------------------------------------------ ------------------------ ------------------------
Denmark 3.00 50
------------------------------------------------------ ------------------------ ------------------------
EASDAQ 7.00 55
------------------------------------------------------ ------------------------ ------------------------
Ecuador 55.00 100
------------------------------------------------------ ------------------------ ------------------------
Egypt 45.00 120
------------------------------------------------------ ------------------------ ------------------------
Estonia 7.00 20
------------------------------------------------------ ------------------------ ------------------------
Euro CD's 3.00 30
------------------------------------------------------ ------------------------ ------------------------
Euromarket 2.00 15
------------------------------------------------------ ------------------------ ------------------------
Finland 5.00 50
------------------------------------------------------ ------------------------ ------------------------
France 4.00 50
------------------------------------------------------ ------------------------ ------------------------
Germany 2.00 50
------------------------------------------------------ ------------------------ ------------------------
Ghana 35.00 70
------------------------------------------------------ ------------------------ ------------------------
Greece 30.00 145
------------------------------------------------------ ------------------------ ------------------------
Hong Kong 5.00 75
------------------------------------------------------ ------------------------ ------------------------
Hungary 50.00 175
------------------------------------------------------ ------------------------ ------------------------
Iceland 60.00 175
------------------------------------------------------ ------------------------ ------------------------
India 50.00 175
------------------------------------------------------ ------------------------ ------------------------
Indonesia 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Ireland 3.50 45
------------------------------------------------------ ------------------------ ------------------------
Israel 35.00 55
------------------------------------------------------ ------------------------ ------------------------
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS XXXXXXX TECHNOLOGY FUND
------------------------------------------------------ ------------------------ ------------------------
Italy 4.00 50
------------------------------------------------------ ------------------------ ------------------------
Ivory Coast 40.00 155
------------------------------------------------------ ------------------------ ------------------------
Jamaica 35.00 50
------------------------------------------------------ ------------------------ ------------------------
Japan (bonds) 3.00 10
------------------------------------------------------ ------------------------ ------------------------
Japan (equities) 3.00 10
------------------------------------------------------ ------------------------ ------------------------
Jordan 45.00 140
------------------------------------------------------ ------------------------ ------------------------
Kazakhstan (T Bills) 35.00 140
------------------------------------------------------ ------------------------ ------------------------
Kazakhstan (Equities) 55.00 130
------------------------------------------------------ ------------------------ ------------------------
Kenya 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Latvia (equities/bonds) 30.00 75
------------------------------------------------------ ------------------------ ------------------------
Latvia Gov't Bonds 15.00 75
------------------------------------------------------ ------------------------ ------------------------
Lebanon 25.00 90
------------------------------------------------------ ------------------------ ------------------------
Lithuania 20.00 50
------------------------------------------------------ ------------------------ ------------------------
Luxembourg 5.00 50
------------------------------------------------------ ------------------------ ------------------------
Malaysia 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Malta 18.00 50
------------------------------------------------------ ------------------------ ------------------------
Mauritius** 60.00 175
------------------------------------------------------ ------------------------ ------------------------
Mexico 10.00 25
------------------------------------------------------ ------------------------ ------------------------
Morocco 35.00 110
------------------------------------------------------ ------------------------ ------------------------
Namibia 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Netherlands 5.00 35
------------------------------------------------------ ------------------------ ------------------------
New Zealand 3.50 65
------------------------------------------------------ ------------------------ ------------------------
Nigeria 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Norway 3.00 80
------------------------------------------------------ ------------------------ ------------------------
Oman 60.00 175
------------------------------------------------------ ------------------------ ------------------------
Pakistan 40.00 150
------------------------------------------------------ ------------------------ ------------------------
Panama 65.00 85
------------------------------------------------------ ------------------------ ------------------------
Peru 45.00 120
------------------------------------------------------ ------------------------ ------------------------
Philippines 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Poland 35.00 125
------------------------------------------------------ ------------------------ ------------------------
Portugal 5.00 80
------------------------------------------------------ ------------------------ ------------------------
Romania 35.00 100
------------------------------------------------------ ------------------------ ------------------------
Russia Equities 45.00 175
------------------------------------------------------ ------------------------ ------------------------
Russia (Min. Fin Bonds) 10.00 100
------------------------------------------------------ ------------------------ ------------------------
Singapore 5.00 80
------------------------------------------------------ ------------------------ ------------------------
Slovak Republic 35.00 150
------------------------------------------------------ ------------------------ ------------------------
Slovenia 25.00 110
------------------------------------------------------ ------------------------ ------------------------
South Africa 1.50 35
------------------------------------------------------ ------------------------ ------------------------
South Korea 12.00 25
------------------------------------------------------ ------------------------ ------------------------
Spain 5.00 50
------------------------------------------------------ ------------------------ ------------------------
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS XXXXXXX TECHNOLOGY FUND
------------------------------------------------------ ------------------------ ------------------------
Sri Lanka 20.00 70
------------------------------------------------------ ------------------------ ------------------------
Swaziland 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Sweden 3.00 50
------------------------------------------------------ ------------------------ ------------------------
Switzerland 3.00 50
------------------------------------------------------ ------------------------ ------------------------
Taiwan 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Thailand 5.00 45
------------------------------------------------------ ------------------------ ------------------------
Trinidad & Tobago 40.00 75
------------------------------------------------------ ------------------------ ------------------------
Tunisia 40.00 45
------------------------------------------------------ ------------------------ ------------------------
Turkey 12.00 75
------------------------------------------------------ ------------------------ ------------------------
Ukraine 30.00 45
------------------------------------------------------ ------------------------ ------------------------
United Kingdom 0.75 25
------------------------------------------------------ ------------------------ ------------------------
United Kingdom (gilts) 3.50 50
------------------------------------------------------ ------------------------ ------------------------
United States See below 7
------------------------------------------------------ ------------------------ ------------------------
Uruguay 50.00 65
------------------------------------------------------ ------------------------ ------------------------
Venezuela 25.00 80
------------------------------------------------------ ------------------------ ------------------------
Zambia 35.00 70
------------------------------------------------------ ------------------------ ------------------------
Zimbabwe 35.00 65
------------------------------------------------------ ------------------------ ------------------------
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 one basis point on the excess.
*Fee expressed in basis points per annum is calculated based upon month end
market value.
** Not yet 17f-5 qualified.
Third Party Foreign Exchange Settlements
----------------------------------------
$10 per transaction/money movement
Minimum charges imposed by Agent Banks/Local Administrators
-----------------------------------------------------------
Brazil - 15 basis points for annual administrative charges
Chile - USD $17,500 - $20,000 per annum minimum administration charge
Colombia - USD $600 per month minimum administration charge
Ecuador - USD $800 monthly minimum per relationship
Egypt - USD $400 monthly minimum per relationship
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS XXXXXXX TECHNOLOGY FUND
Additional Charges
------------------
Charges incurred by The Bank of New York for local taxes, stamp duties or other
local duties and assessments stock exchange fees, postage and insurance for
shipping, extraordinary telecommunication fees or other unusual expenses which
are unique to a country in which our clients is investing will be in addition to
the stated fees.
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS GLOBAL VALUE FUND
------------------------------------------------------ ------------------------ ------------------------
Argentina 18.00 70
------------------------------------------------------ ------------------------ ------------------------
Australia 4.00 50
------------------------------------------------------ ------------------------ ------------------------
Austria 5.00 50
------------------------------------------------------ ------------------------ ------------------------
Bahrain 60.00 175
------------------------------------------------------ ------------------------ ------------------------
Bangladesh 45.00 175
------------------------------------------------------ ------------------------ ------------------------
Belgium (reg. bds) 2.00 10
------------------------------------------------------ ------------------------ ------------------------
Belgium (equities and Cpn bds) 4.00 10
------------------------------------------------------ ------------------------ ------------------------
Bermuda 30.00 90
------------------------------------------------------ ------------------------ ------------------------
Bolivia 50.00 95
------------------------------------------------------ ------------------------ ------------------------
Botswana 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Brazil 25.00 25
------------------------------------------------------ ------------------------ ------------------------
Bulgaria 50.00 100
------------------------------------------------------ ------------------------ ------------------------
Canada 2.00 15
------------------------------------------------------ ------------------------ ------------------------
Chile 25.00 70
------------------------------------------------------ ------------------------ ------------------------
China 20.50 60
------------------------------------------------------ ------------------------ ------------------------
Colombia 50.00 135
------------------------------------------------------ ------------------------ ------------------------
Costa Rica 15.00 60
------------------------------------------------------ ------------------------ ------------------------
Croatia 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Cyprus 15.00 45
------------------------------------------------------ ------------------------ ------------------------
Czech Republic 23.00 60
------------------------------------------------------ ------------------------ ------------------------
Denmark 3.00 50
------------------------------------------------------ ------------------------ ------------------------
EASDAQ 7.00 55
------------------------------------------------------ ------------------------ ------------------------
Ecuador 55.00 100
------------------------------------------------------ ------------------------ ------------------------
Egypt 45.00 120
------------------------------------------------------ ------------------------ ------------------------
Estonia 7.00 20
------------------------------------------------------ ------------------------ ------------------------
Euro CD's 3.00 30
------------------------------------------------------ ------------------------ ------------------------
Euromarket 2.00 15
------------------------------------------------------ ------------------------ ------------------------
Finland 5.00 50
------------------------------------------------------ ------------------------ ------------------------
France 4.00 50
------------------------------------------------------ ------------------------ ------------------------
Germany 2.00 50
------------------------------------------------------ ------------------------ ------------------------
Ghana 35.00 70
------------------------------------------------------ ------------------------ ------------------------
Greece 30.00 145
------------------------------------------------------ ------------------------ ------------------------
Hong Kong 5.00 75
------------------------------------------------------ ------------------------ ------------------------
Hungary 50.00 175
------------------------------------------------------ ------------------------ ------------------------
Iceland 60.00 175
------------------------------------------------------ ------------------------ ------------------------
India 50.00 175
------------------------------------------------------ ------------------------ ------------------------
Indonesia 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Ireland 3.50 45
------------------------------------------------------ ------------------------ ------------------------
Israel 35.00 55
------------------------------------------------------ ------------------------ ------------------------
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS GLOBAL VALUE FUND
------------------------------------------------------ ------------------------ ------------------------
Italy 4.00 50
------------------------------------------------------ ------------------------ ------------------------
Ivory Coast 40.00 155
------------------------------------------------------ ------------------------ ------------------------
Jamaica 35.00 50
------------------------------------------------------ ------------------------ ------------------------
Japan (bonds) 3.00 10
------------------------------------------------------ ------------------------ ------------------------
Japan (equities) 3.00 10
------------------------------------------------------ ------------------------ ------------------------
Jordan 45.00 140
------------------------------------------------------ ------------------------ ------------------------
Kazakhstan (T Bills) 35.00 140
------------------------------------------------------ ------------------------ ------------------------
Kazakhstan (Equities) 55.00 130
------------------------------------------------------ ------------------------ ------------------------
Kenya 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Latvia (equities/bonds) 30.00 75
------------------------------------------------------ ------------------------ ------------------------
Latvia Gov't Bonds 15.00 75
------------------------------------------------------ ------------------------ ------------------------
Lebanon 25.00 90
------------------------------------------------------ ------------------------ ------------------------
Lithuania 20.00 50
------------------------------------------------------ ------------------------ ------------------------
Luxembourg 5.00 50
------------------------------------------------------ ------------------------ ------------------------
Malaysia 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Malta 18.00 50
------------------------------------------------------ ------------------------ ------------------------
Mauritius** 60.00 175
------------------------------------------------------ ------------------------ ------------------------
Mexico 10.00 25
------------------------------------------------------ ------------------------ ------------------------
Morocco 35.00 110
------------------------------------------------------ ------------------------ ------------------------
Namibia 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Netherlands 5.00 35
------------------------------------------------------ ------------------------ ------------------------
New Zealand 3.50 65
------------------------------------------------------ ------------------------ ------------------------
Nigeria 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Norway 3.00 80
------------------------------------------------------ ------------------------ ------------------------
Oman 60.00 175
------------------------------------------------------ ------------------------ ------------------------
Pakistan 40.00 150
------------------------------------------------------ ------------------------ ------------------------
Panama 65.00 85
------------------------------------------------------ ------------------------ ------------------------
Peru 45.00 120
------------------------------------------------------ ------------------------ ------------------------
Philippines 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Poland 35.00 125
------------------------------------------------------ ------------------------ ------------------------
Portugal 5.00 80
------------------------------------------------------ ------------------------ ------------------------
Romania 35.00 100
------------------------------------------------------ ------------------------ ------------------------
Russia Equities 45.00 175
------------------------------------------------------ ------------------------ ------------------------
Russia (Min. Fin Bonds) 10.00 100
------------------------------------------------------ ------------------------ ------------------------
Singapore 5.00 80
------------------------------------------------------ ------------------------ ------------------------
Slovak Republic 35.00 150
------------------------------------------------------ ------------------------ ------------------------
Slovenia 25.00 110
------------------------------------------------------ ------------------------ ------------------------
South Africa 1.50 35
------------------------------------------------------ ------------------------ ------------------------
South Korea 12.00 25
------------------------------------------------------ ------------------------ ------------------------
Spain 5.00 50
------------------------------------------------------ ------------------------ ------------------------
THE BANK OF NEW YORK
BAAI GLOBAL FEE SCHEDULE
FOR
NATIONS GLOBAL VALUE FUND
------------------------------------------------------ ------------------------ ------------------------
Sri Lanka 20.00 70
------------------------------------------------------ ------------------------ ------------------------
Swaziland 35.00 65
------------------------------------------------------ ------------------------ ------------------------
Sweden 3.00 50
------------------------------------------------------ ------------------------ ------------------------
Switzerland 3.00 50
------------------------------------------------------ ------------------------ ------------------------
Taiwan 8.50 80
------------------------------------------------------ ------------------------ ------------------------
Thailand 5.00 45
------------------------------------------------------ ------------------------ ------------------------
Trinidad & Tobago 40.00 75
------------------------------------------------------ ------------------------ ------------------------
Tunisia 40.00 45
------------------------------------------------------ ------------------------ ------------------------
Turkey 12.00 75
------------------------------------------------------ ------------------------ ------------------------
Ukraine 30.00 45
------------------------------------------------------ ------------------------ ------------------------
United Kingdom 0.75 25
------------------------------------------------------ ------------------------ ------------------------
United Kingdom (gilts) 3.50 50
------------------------------------------------------ ------------------------ ------------------------
United States See below 7
------------------------------------------------------ ------------------------ ------------------------
Uruguay 50.00 65
------------------------------------------------------ ------------------------ ------------------------
Venezuela 25.00 80
------------------------------------------------------ ------------------------ ------------------------
Zambia 35.00 70
------------------------------------------------------ ------------------------ ------------------------
Zimbabwe 35.00 65
------------------------------------------------------ ------------------------ ------------------------
3/4ths of one basis point per annum on the aggregate net assets of all Nation
Non-Money Market Funds up to $10 billion.
1/2 of one basis point on the excess.
*Fee expressed in basis points per annum is calculated based upon month end
market value.
** Not yet 17f-5 qualified.
Third Party Foreign Exchange Settlements
----------------------------------------
$10 per transaction/money movement
Minimum charges imposed by Agent Banks/Local Administrators
-----------------------------------------------------------
Brazil - 15 basis points for annual administrative charges
Chile - USD $17,500 - $20,000 per annum minimum administration charge
Colombia - USD $600 per month minimum administration charge
Ecuador - USD $800 monthly minimum per relationship
Egypt - USD $400 monthly minimum per relationship
Domestic Custodian Fee Schedule
For
Nations Classic Value Fund
Safekeeping/Income Collection/Reporting/DTC-ID Affirmations
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 one basis point on the excess.
Security Transaction Charges/Paydowns
-------------------------------------
$5 Paydowns
$7 Domestic Book-Entry Settlements/DTC, FRB,
PTC
$15 Physicals, Options, and Futures
$40 Euro C/D's
Other Charges
-------------
$5 Bank official checks
$2 Money transfers in/our of the Fund's
custodian account not related to
securities transactions.
Domestic Custodian Fee Schedule
For
Nations Classic Value Fund
Safekeeping/Income Collection/Reporting/DTC-ID Affirmations
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 one basis point on the excess.
Security Transaction Charges/Paydowns
-------------------------------------
$5 Paydowns
$7 Domestic Book-Entry Settlements/DTC, FRB,
PTC
$15 Physicals, Options, and Futures
$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.
Earning Credits on Balances/Interest on Overdrafts
--------------------------------------------------
Earning credits are provided on each Fund on 80% of the daily balance in the
domestic custodian account computed at the 90-day T-xxxx rate on the day of the
balance.
Overdraft, excluding bank errors, will cause a reduction of earnings credits
daily, computed at 1% above the average Federal Funds rate on the overdraft.
Credits and debits will be accumulated daily and offset monthly against the
Bank's domestic custodian fee. 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.
Domestic Custodian Fee Schedule
For
Nations Classic Value Fund
Out-of-Pocket Expenses
----------------------
None.
Billing Cycle
-------------
The above fees are billed monthly.
SCHEDULE IV
-----------
OVERDRAFT RATE
35
