INVESTMENT SUB-ADVISORY AGREEMENT
NATIONS FUNDS TRUST
THIS AGREEMENT is made as of January 1, 2003, by and between BANC OF
AMERICA CAPITAL MANAGEMENT, LLC, a North Carolina limited liability company (the
"Adviser"), XXXXXXX INVESTMENT PARTNERS, LLC, a Delaware limited liability
company (the "Sub-Adviser"), and NATIONS FUNDS TRUST, a Delaware statutory trust
(the "Trust"), on behalf of those series of the Trust now or hereafter
identified on Schedule I (each a "Fund" and collectively, the "Funds").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "Commission") as an open-end management investment company under
the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Adviser is registered with the Commission as an investment
adviser under the Investment Advisers Act of 1940, as amended (the "Advisers
Act");
WHEREAS, the Sub-Adviser is also registered with the Commission as an
investment adviser under the Advisers Act;
WHEREAS, the Adviser and the Trust have entered into an investment
advisory agreement (the "Investment Advisory Agreement"), pursuant to which the
Adviser manages the investment operations of each Fund and may delegate certain
duties of the Adviser to one or more investment sub-adviser(s); and
WHEREAS, the Adviser, with the approval of the Board of Trustees of the
Trust (the "Board"), including a majority of the Trustees who are not
"interested persons" (defined herein) of any party to this Agreement, desires to
delegate to the Sub-Adviser the duty to manage the portfolio investments of the
Funds;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT OF SUB-ADVISER. The Adviser hereby appoints the
Sub-Adviser and the Sub-Adviser hereby agrees to manage the portfolio
investments of each Fund subject to the terms of this Agreement and subject to
the supervision of the Adviser and the Board.
2. SERVICES OF SUB-ADVISER. The Sub-Adviser shall perform all
services necessary for the management of the portfolio investments of each Fund,
including but not limited to:
(a) Managing, in its discretion, the investment and reinvestment of all
assets, now or hereafter acquired by each Fund, including determining
what securities and other investments are to be purchased or sold for
each Fund and executing transactions accordingly;
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(b) Transmitting trades to each Fund's custodian for settlement in
accordance with each Fund's procedures and as may be directed by the
Trust;
(c) Assisting in the preparation of all shareholder communications,
including shareholder reports, and participating in shareholder
relations;
(d) Making determinations as to the manner in which voting rights
and/or any other rights pertaining to each Fund's securities holdings
shall be exercised; provided, however, that any such determinations
shall be subject to any policies, procedures or directives approved by
the Board and provided to the Sub-Adviser;
(e) Attending and participating in discussions and meetings with the
Adviser with respect to Fund investment policies and procedures, and
carrying out such investment policies and procedures as are approved by
the Board or by the Adviser under authority delegated by the Board to
the Adviser and provided to the Sub-Adviser;
(f) Supplying reports, evaluations, analyses, statistical data and
information to the Adviser, the Board or to the Funds' officers and
other service providers as the Adviser or the Board may reasonably
request from time to time or as may be necessary or appropriate for the
operation of the Trust as an open-end investment company or as
necessary to comply with Section 3(a) of this Agreement;
(g) Maintaining all required books and records with respect to the
investment decisions and securities transactions for each Fund;
(h) Furnishing any and all other services, subject to review by the
Board, that the Adviser from time to time determines to be necessary or
useful to perform its obligations under the Investment Advisory
Agreement or as the Board may reasonably request from time to time.
3. RESPONSIBILITIES OF SUB-ADVISER. In carrying out its obligations under this
Agreement, the Sub-Adviser agrees that it will:
(a) Comply with all applicable law, including but not limited to the
1940 Act and the Advisers Act, the rules and regulations of the
Commission thereunder, and the conditions of any order affecting the
Trust or a Fund issued thereunder;
(b) Use the same skill and care in providing such services as it uses
in providing services to other fiduciary accounts for which it has
investment responsibilities;
(c) Place, or arrange for the placement of, all orders pursuant to its
investment determinations for the Funds either directly with the issuer
or with any broker or dealer (including any broker or dealer affiliated
with the Trust, the Adviser or any of their affiliates; with listings
of such affiliated brokers and dealers to be provided to the
Sub-Adviser by the Adviser on an annual basis, and more frequently as
changes occur). In executing portfolio transactions and selecting
brokers or dealers, the Sub-Adviser will use its best efforts to seek
on behalf of each Fund the best overall terms available. In
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assessing the best overall terms available for any transaction, the
Sub-Adviser shall consider all factors that it deems relevant,
including the breadth of the market in the security, the price of the
security, the financial condition and execution capability of the
broker or dealer, and the reasonableness of the commission, if any,
both for the specific transaction and on a continuing basis. In
evaluating the best overall terms available, and in selecting the
broker or dealer to execute a particular transaction, the Sub-Adviser
may also consider whether such broker or dealer furnishes research and
other information or services to the Sub-Adviser; and
(d) Adhere to the investment objective, strategies and policies and
procedures of the Trust adopted on behalf of each Fund including, but
not limited to, those stated in each of their prospectuses and
statements of additional information.
4. CONFIDENTIALITY OF INFORMATION. Each party agrees that it will treat
confidentially all information provided by another party regarding such other
party's business and operations which is not generally known by third parties
nor otherwise generally disclosed publicly by such other party, including
without limitation the investment activities or holdings of a Fund, except as is
otherwise mutually agreed upon by the parties. Each party agrees that it will
not unreasonably withhold its agreement to disclosure of investment activities
or holdings. All confidential information provided by a party hereto shall not
be disclosed to any unaffiliated third party without the prior consent of the
providing party. The foregoing shall not apply to any information that is public
when provided or thereafter becomes public through disclosure by the party about
whom the information relates or becomes public without any wrongful act of the
party providing such information or which is required to be disclosed by any
regulatory authority in the lawful and appropriate exercise of its jurisdiction
over a party, by any auditor of the parties hereto, by judicial or
administrative process or by applicable law or regulation.
5. SERVICES NOT EXCLUSIVE. The services furnished by the Sub-Adviser hereunder
are deemed not to be exclusive, and the Sub-Adviser shall be free to furnish
similar services to others so long as its provision of services under this
Agreement is not impaired thereby. To the extent that the purchase or sale of
securities or other investments of the same issuer may be deemed by the
Sub-Adviser to be suitable for two or more accounts managed by the Sub-Adviser,
the available securities or investments may be allocated in a manner believed by
the Sub-Adviser to be equitable to each account. It is recognized that in some
cases this procedure may adversely affect the price paid or received by a Fund
or the size of the position obtainable for or disposed of by a Fund.
6. DELIVERY OF DOCUMENTS. The Trust will provide the Sub-Adviser with copies,
properly certified or authenticated, of each of the following:
(a) the Trust's Certificate of Trust, as filed with the Secretary of
State of Delaware, and Declaration of Trust (such Declaration of Trust,
as presently in effect and as from time to time amended, is herein
called the "Declaration of Trust");
(b) the Trust's Bylaws, if any;
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(c) the most recent prospectus(es) and statement(s) of additional
information relating to each Fund (such prospectus(es) together with
the related statement(s) of additional information, as presently in
effect and all amendments and supplements thereto, are herein called
the "Prospectus"); and
(d) any and all applicable policies and procedures approved by the
Board.
The Trust will promptly furnish the Sub-Adviser with copies of any and
all amendments of or additions or supplements to the foregoing.
7. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3 under
the 1940 Act, the Sub-Adviser hereby agrees that all records that it
maintains for each Fund under this Agreement are the property of the Trust
and further agrees to surrender promptly to the Trust or the Adviser any of
such records upon request. The Sub-Adviser further agrees to preserve for
the periods prescribed by Rule 31a-2 under the 1940 Act the records required
to be maintained by it under this Agreement.
8. EXPENSES OF THE FUNDS. Except to the extent expressly assumed by the
Sub-Adviser and except to any extent required by law to be paid or
reimbursed by the Sub-Adviser, the Sub-Adviser shall have no duty to pay any
ordinary operating expenses incurred in the organization and operation of
the Funds. Ordinary operating expenses include, but are not limited to,
brokerage commissions and other transaction charges, taxes, legal, auditing,
printing, or governmental fees, other Fund service providers' fees and
expenses, expenses relating to the issue, sale (including any sales loads),
redemption and repurchase of shares, expenses of registering and qualifying
shares for sale, expenses relating to Board and shareholder meetings, and
the cost of preparing and distributing reports and notices to shareholders.
The Sub-Adviser shall pay all other expenses incurred by it in connection
with its services under this Agreement.
9. COMPENSATION. Except as otherwise provided herein, for the services provided
to each Fund and the expenses assumed pursuant to this Agreement, the
Adviser will pay the Sub-Adviser and the Sub-Adviser will accept as full
compensation therefor a fee determined in accordance with Schedule I
attached hereto. It is understood that the Adviser shall be solely
responsible for compensating the Sub-Adviser for performing any of the
duties delegated to the Sub-Adviser and the Sub-Adviser agrees that it shall
have no claim against the Trust or any Fund with respect to compensation
under this Agreement.
10. LIABILITY OF SUB-ADVISER. The Sub-Adviser shall not be liable for any error
of judgment or mistake of law or for any loss suffered by the Adviser or the
Trust in connection with the performance of this Agreement, except that the
Sub-Adviser shall be liable to the Adviser or the Trust for any loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or any loss resulting from willful misfeasance,
bad faith or negligence on the part of the Sub-Adviser in the performance of
its duties or from reckless disregard by it of its obligations and duties
under this Agreement.
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11. TERM AND APPROVAL. This Agreement will become effective as of the date set
forth herein above, and shall continue in effect until the second
anniversary of its effective date. This Agreement will become effective with
respect to each additional Fund as of the date set forth on Schedule I when
each such Fund is added thereto. The Agreement shall continue in effect for
a Fund after the second anniversary of the effective date for successive
annual periods ending on each anniversary of such date, provided that the
continuation of the Agreement is specifically approved for the Fund at least
annually:
(a)(i) by the Board or (ii) by the vote of "a majority of
the outstanding voting securities" of the Fund (as
defined in Section 2(a)(42) of the 0000 Xxx); and
(b) by the affirmative vote of a majority of the Trustees
of the Trust who are not parties to this Agreement or
"interested persons" (as defined in the 0000 Xxx) of
a party to this Agreement (other than as Trustees of
the Trust), by votes cast in person at a meeting
specifically called for such purpose.
12. TERMINATION. This Agreement may be terminated without payment of any penalty
at any time by:
(a) the Trust with respect to a Fund, by vote of the Board or by vote
of a majority of a Fund's outstanding voting securities, upon sixty
(60) days' written notice to the other parties to this Agreement; or
(b) the Adviser or the Sub-Adviser with respect to a Fund, upon sixty
(60) days' written notice to the other parties to this Agreement.
Any party entitled to notice may waive the notice provided for herein.
This Agreement shall automatically terminate in the event of its assignment,
unless an order is issued by the Commission conditionally or unconditionally
exempting such assignment from the provisions of Section 15(a) of the 1940 Act,
in which event this Agreement shall remain in full force and effect subject to
the terms of such order. For the purposes of this paragraph, the definitions
contained in Section 2(a) of the 1940 Act and the applicable rules under the
1940 Act shall apply.
13. CODE OF ETHICS. The Sub-Adviser represents that it has adopted a written
code of ethics complying with the requirements of Rule 17j-1 under the 1940
Act and will provide the Adviser or the Trust with a copy of such code, any
amendments or supplements thereto and its policies and/or procedures
implemented to ensure compliance therewith.
14. INSURANCE. The Sub-Adviser shall maintain for the term of this Agreement and
provide evidence thereof to the Trust or the Adviser a blanket bond and
professional liability (error and omissions) insurance in an amount
reasonably acceptable to Adviser.
15. REPRESENTATIONS AND WARRANTIES. Each party to this Agreement represents and
warrants that the execution, delivery and performance of its obligations
under this Agreement are
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within its powers, have been duly authorized by all necessary actions and
that this Agreement constitutes a legal, valid and binding obligation
enforceable against it in accordance with its terms. The Sub-Adviser further
represents and warrants that it is duly registered as an investment adviser
under the Advisers Act.
16. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement may be changed,
waived, discharged or terminated orally, except by an instrument in writing
signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
17. NOTICES. Any notices under this Agreement shall be in writing, addressed and
delivered or mailed postage paid to such address as may be designated for
the receipt of such notice. Until further notice, it is agreed that the
address of the Trust shall be One Bank of America Plaza, 000 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: Secretary, that of the
Adviser shall be Xxx Xxxx xx Xxxxxxx Xxxxx, 00xx Xxxxx, 000 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: President, and that of
the Sub-Adviser shall be Xxxxxxx Investment Partners, LLC, 00000 Xx Xxxxxx
Xxxx, Xxx Xxxxx, Xxxxxxxxxx 00000, Attention: General Counsel. The
Sub-Adviser agrees to promptly notify the Adviser and the Trust, and the
Adviser and the Trust agree to notify the Sub-Adviser, in writing of the
occurrence of any event which could have a material impact on the
performance of another party's duties under this Agreement, including but
not limited to (i) the occurrence of any event which could disqualify the
Adviser or the Sub-Adviser from serving as an investment adviser pursuant to
Section 9 of the 1940 Act; (ii) any material change in the notifying party's
business activities; (iii) any event that would constitute a change in
control of the notifying party; (iv) any change in the portfolio manager or
portfolio management team of a Fund; (v) the existence of any pending or
threatened audit, investigation, examination, complaint or other inquiry
(other than routine audits or regulatory examinations or inspections)
relating to any Fund; and (vi) any material violation of the notifying
party's code of ethics.
18. RELEASE. The names "Nations Funds Trust" and "Trustees of Nations Funds
Trust" refer respectively to the Trust created by the Declaration of Trust
and the Trustees as Trustees but not individually or personally. All parties
hereto acknowledge and agree that any and all liabilities of the Trust
arising, directly or indirectly, under this Agreement will be satisfied
solely out of the assets of the Trust and that no Trustee, officer or
shareholder shall be personally liable for any such liabilities. All persons
dealing with any Fund of the Trust must look solely to the property
belonging to such Fund for the enforcement of any claims against the Trust.
Nothing in this Section 18 shall be deemed to limit the liabilities to which
a Trustee, officer or shareholder of the Trust may be subject under
applicable law arising from such person's own wrongful conduct.
19. MISCELLANEOUS. This Agreement contains the entire understanding of the
parties hereto. Each provision of this Agreement is intended to be
severable. If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
20. GOVERNING LAW. This Agreement shall be governed by, and construed in
accordance with, Delaware law and the federal securities laws, including the
1940 Act and the Advisers Act.
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21. COUNTERPARTS. This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original.
22. USE OF THE NAME "NATIONS FUNDS". The Sub-Adviser agrees that it will not use
the name "Nations Funds", any derivative thereof, or the name of the
Adviser, the Trust or any Fund except in accordance with such policies and
procedures as may be mutually agreed to in writing.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
NATIONS FUNDS TRUST
on behalf of the Funds
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Xxxxxx X. Xxxxxx
President
BANC OF AMERICA CAPITAL MANAGEMENT, LLC
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Xxxxxx X. Xxxxxx
Senior Vice President
XXXXXXX INVESTMENT PARTNERS, LLC
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Managing Partner
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SCHEDULE I
The Adviser shall pay the Sub-Adviser, as full compensation for
services provided and expenses assumed hereunder, a sub-advisory fee for each
Fund, computed daily and payable monthly at the annual rates listed below as a
percentage of the average daily net assets of the Fund:
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RATE OF
FUND COMPENSATION EFFECTIVE DATE
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Nations Global Value Fund 0.50% of the first 4/9/01
$1,000,000,000 in
assets; 0.45% of
assets in excess of
$1,000,000,000
--------------------------------------------------------------------------------
Approved: November 21, 2002
Last Amended: July 18, 2003
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IN WITNESS WHEREOF, the parties hereto have caused this amended
Schedule I to be executed by their officers designated below as of the 18th day
of July, 2003.
NATIONS FUNDS TRUST
on behalf of the Funds
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxx
Secretary
BANC OF AMERICA CAPITAL MANAGEMENT, LLC
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Xxxxxx X. Xxxxxx
Chief Administrative Officer,
Senior Vice President and Treasurer
XXXXXXX INVESTMENT PARTNERS, LLC
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Managing Partner
