EXHIBIT 99.(d)(i)(o)
SUPPLEMENTAL TERMS AND CONDITIONS TO
THE MANAGEMENT AGREEMENT BETWEEN
THE AMERICAN AADVANTAGE FUNDS
AND
AMR INVESTMENT SERVICES, INC.
The attached amended Schedule A is hereby incorporated into the Management
Agreement dated April 3, 1987, as supplemented on August 1, 1994, November 1,
1995, December 17, 1996, July 25, 1997, September 1, 1998, January 1, 1999, May
19, 2000, November 16, 2000, October 17, 2001, May 28, 2002 and May 13, 2003(the
"Agreement") between the American AAdvantage Funds and AMR Investment Services,
Inc. To the extent that there is any conflict between the terms of the Agreement
and these Supplemental Terms and Conditions ("Supplement"), this Supplement
shall govern.
Dated: February 9, 2004
American AAdvantage Funds
By: ______________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Vice President and Secretary
AMR Investment Services, Inc.
By: ______________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
President
AMENDED
SCHEDULE A
TO THE
MANAGEMENT AGREEMENT
BETWEEN
AMR INVESTMENT SERVICES, INC.
AND THE
AMERICAN AADVANTAGE FUNDS
I. BASE FEE
As compensation pursuant to section 6 of the Management Agreement between
AMR Investment Services, Inc. (the "Manager") and the American AAdvantage Funds
(the "AAdvantage Trust"), the AAdvantage Trust shall pay to the Manager a fee,
computed daily and paid monthly, at the following annual rates as percentages of
each Fund's average daily net assets:
(1) 0.10% of the net assets of the Balanced Fund, the Large Cap Value
Fund, the International Equity Fund, the Small Cap Value Fund, the S&P 500
Index Fund, the Large Cap Growth Fund, the Emerging Markets Fund, the
Small Cap Index Fund, the International Equity Index Fund, the Enhanced
Income Fund, the High Yield Bond Fund, the Treasury Inflation Protected
Securities Fund and the Mid-Cap Value Fund plus all fees payable by the
Manager with respect to such Funds pursuant to any Investment Advisory
Agreement entered into pursuant to Paragraph 2(d) of said Management
Agreement;
(2) 0.10% of the net assets of the Money Market Fund, the Municipal Money
Market Fund and the U.S. Government Money Market Fund; and
(3) 0.25% of the net assets of the Intermediate Bond Fund and the
Short-Term Bond Fund.
To the extent that a Fund invests all of its investable assets (i.e.,
securities and cash) in another registered investment company, however, the
AAdvantage Trust will not pay the Manager any fee pursuant to Section 6 of the
Agreement.
II. MANAGEMENT OF BALANCED FUND AND ENHANCED INCOME FUND
In addition to the fee set forth above, as compensation for directly
managing a portion of the assets of the Balanced Fund and the Enhanced Income
Fund, pursuant to section 6 of the Management Agreement between the Manager and
the AAdvantage Trust, the AAdvantage Trust shall pay to the Manager a fee
quarterly, on an annualized basis, of 0.15% of the average month-
end assets of the fixed income portion of the Balanced Fund and Enhanced Income
Fund directly managed by the Manager. The fee will be adjusted for any cash
flows of $10 million or greater into or out of the Manager's account for each
Fund on a particular day during a quarter.
To the extent that the Balanced Fund or Enhanced Income Fund invests all
of its investable assets (i.e., securities and cash) in another registered
investment company, however, the AAdvantage Trust will not pay the Manager any
fee pursuant to Section 6 of the Agreement for these Funds.
III. SECURITIES LENDING DUTIES AND FEES
A. Manager Duties
The Manager agrees to provide the following services in connection with
the investment of cash collateral received from the securities lending
activities of each Fund of the AAdvantage Trust: (a) assist the securities
lending agent (the "Agent") in determining which specific securities are
available for loan, (b) monitor the Agent to ensure that securities loans are
effected in accordance with its instructions and within the procedures adopted
by the Board of Trustees of the AAdvantage Trust, (c) prepare appropriate
periodic reports for, and seek appropriate approvals from, the Board of Trustees
of the AAdvantage Trust with respect to securities lending activities, (d)
respond to Agent inquiries concerning Agent's compliance with applicable
guidelines, and (e) perform such other duties as necessary.
B. Securities Lending Fees
As compensation for services provided by the Manager in connection with
securities lending activities of each Fund of the AAdvantage Trust, the lending
Fund shall pay to the Manager, with respect to cash collateral posted by
borrowers, a fee up to 25% of the net monthly interest income (the gross
interest income earned by the investment of cash collateral, less the amount
paid to borrowers as well as related expenses) from such activities and, with
respect to loan fees paid by borrowers when a borrower posts collateral other
than cash, a fee up to 25% of such loan fees.
To the extent that a Fund invests all of its investable assets (i.e.,
securities and cash) in another registered investment company, however, the
AAdvantage Trust will not pay the Manager any fee for services provided by the
Manager in connection with securities lending activities.
DATED: February 9, 2004