Exhibit 99.D1
INVESTMENT ADVISORY AGREEMENT
NATIONS MASTER INVESTMENT TRUST
THIS AGREEMENT is made as of this 21st day of May, 1999, by and between
NATIONS MASTER INVESTMENT TRUST, a Delaware business trust (the "Trust"), and
NATIONSBANC ADVISORS, INC., a North Carolina corporation (the "Adviser"), on
behalf of those portfolios of the Trust now or hereafter identified on Schedule
I hereto (each a "Master Portfolio" and collectively, the "Master Portfolios").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (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 under the
Investment Advisers Act of 1940, as amended (the "Advisers Act") as an
investment adviser;
WHEREAS, the Trust and the Adviser desire to enter into an agreement to
provide for investment advisory services to the Trust upon the terms and
conditions hereinafter set forth; and
WHEREAS, the Trust and the Adviser contemplate that certain duties of the
Adviser under this Agreement will be delegated to one or more investment
sub-adviser(s) (the "Sub-Adviser(s)") pursuant to separate sub-advisory
agreement(s) (the "Sub-Advisory Agreement(s)");
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
it is agreed between the parties hereto as follows:
1. APPOINTMENT. The Trust hereby appoints the Adviser to act as investment
adviser to each Master Portfolio for the period and on the terms set forth in
this Agreement. The Adviser accepts such appointment and agrees to furnish the
services herein set forth for the compensation herein provided. In the event
that the Trust establishes one or more portfolios other than the Master
Portfolios with respect to which it desires to retain the Adviser to act as
investment adviser hereunder, it shall notify the Adviser in writing. If the
Adviser is willing to render such services under this Agreement it shall notify
the Trust in writing whereupon such portfolio shall become a Master Portfolio
hereunder and shall be subject to the provisions of this Agreement except to the
extent that said provisions (including those relating to the compensation
payable by the Master Portfolio to the Adviser) are modified with respect to
such Master Portfolio in writing by the Trust and the Adviser at the time.
2. DELEGATION OF RESPONSIBILITIES. Subject to the approval of the Trust's
Board of Trustees and, if required, the interestholders of the Master
Portfolios, the Adviser may, pursuant to the Sub-Advisory Agreement(s), delegate
to the Sub-Adviser(s) those of its duties hereunder identified in the
Sub-Advisory Agreement(s), provided that the Adviser shall continue to supervise
and monitor the performance of the duties delegated to the Sub-Adviser(s) and
any such delegation shall not relieve the Adviser of its duties and obligations
under this Agreement.
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The Adviser shall be solely responsible for compensating the Sub-Adviser(s) for
services rendered under the Sub-Advisory Agreement(s).
3. DELIVERY OF DOCUMENTS. The Trust has furnished the Adviser with copies,
properly certified or authenticated, of each of the following:
(a) the Trust's Certificate of Trust, as filed with the Secretary
of State of Delaware on January 14, 1999, and Declaration of Trust and all
amendments thereto (such Declaration of Trust, as presently in effect and as it
shall from time to time be amended, is herein called the "Declaration of
Trust");
(b) the Trust's By-Laws and amendments thereto (such By-Laws, as
presently in effect and as it shall from time to time be amended, is herein
called the "By-Laws");
(c) votes of the Trust's Board of Trustees authorizing the
appointment of the Adviser and approving this Agreement;
(d) the Trust's Registration Statement, as amended, on Form N-1A
under the 1940 Act (File No. 811-09347); and
(e) the most recent prospectus of the Trust relating to each
Master Portfolio (such prospectus together with the related statement of
additional information, as presently in effect and all amendments and
supplements thereto, are herein called the "Prospectus").
The Trust will furnish the Adviser from time to time with copies of all
amendments of or supplements to the foregoing, if any.
4. MANAGEMENT. Subject to the supervision of the Trust's Board of
Trustees, the Adviser will provide a continuous investment program for each
Master Portfolio, including investment research and management with respect to
all securities, investments, cash and cash equivalents in each Master Portfolio.
The Adviser will determine from time to time what securities and other
investments will be purchased, retained or sold by the Master Portfolios and
will place the daily orders for the purchase or sale of securities. The Adviser
will provide the services rendered by it under this Agreement in accordance with
each Master Portfolio's investment objective, policies and restrictions as
stated in the Prospectus and votes of the Trust's Board of Trustees. The Adviser
further agrees that it will:
(a) update each Master Portfolio's cash availability throughout
the day as required;
(b) maintain historical tax lots for each portfolio security held
by each Master Portfolio;
(c) transmit trades to the Trust's custodian for proper
settlement;
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(d) maintain all books and records with respect to each Master
Portfolio's securities and transactions;
(e) supply the Trust and its Board of Trustees with reports and
statistical data as requested; and
(f) prepare a quarterly broker security transaction summary and
monthly security transaction listing for each Master Portfolio.
5. OTHER COVENANTS. The Adviser agrees that it:
(a) will comply with all applicable Rules and Regulations of the
Commission and will in addition conduct its activities under this Agreement in
accordance with other applicable law, including but not limited to the 1940 Act
and the Advisers Act;
(b) will use the same skill and care in providing such services as
it uses in providing services to fiduciary accounts for which it has investment
responsibilities;
(c) will not make loans to any person to purchase or carry Master
Portfolio shares;
(d) will place orders pursuant to its investment determinations
for the Master Portfolios either directly with the issuer or with any broker or
dealer. Subject to the other provisions of this paragraph, in executing
portfolio transactions and selecting brokers or dealers, the Adviser will use
its best efforts to seek on behalf of each Master Portfolio the best overall
terms available. In assessing the best overall terms available for any
transaction, the Adviser shall consider all factors that it deems relevant,
including the breadth of the market in the security, the price of the security,
the financial condition and execution capability of the broker or dealer, and
the reasonableness of the commission, if any, both for the specific transaction
and on a continuing basis. In evaluating the best overall terms available, and
in selecting the broker/dealer to execute a particular transaction, the Adviser
may also consider the brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934, as amended)
provided to the Master Portfolio(s) and/or other accounts over which the Adviser
or an affiliate of the Adviser exercises investment discretion. The Adviser is
authorized, subject to the prior approval of the Trust's Board of Trustees, to
pay to a broker or dealer who provides such brokerage and research services a
commission for executing a portfolio transaction for any Master Portfolio which
is in excess of the amount of commission another broker or dealer would have
charged for effecting that transaction if, but only if, the Adviser determines
in good faith that such commission was reasonable in relation to the value of
the brokerage and research services provided by such broker or dealer, viewed in
terms of that particular transaction or in terms of the overall responsibilities
of the Adviser to the particular Master Portfolio and to the Trust. In addition,
the Adviser is authorized to take into account the sale of shares of the Trust
in allocating purchase and sale orders for portfolio securities to brokers or
dealers (including brokers and dealers that are affiliated with the Adviser or
the Trust's principal underwriter), provided that the Adviser believes that the
quality of the transaction and the commission are comparable to what they would
be with other qualified firms. In no instance, however, will
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portfolio securities be purchased from or sold to the Adviser or the Trust's
principal underwriter for the Master Portfolios or an affiliated person of
either acting as principal or broker, except as permitted by the Commission or
applicable law;
(e) will maintain a policy and practice of conducting its
investment advisory services hereunder independently of the commercial banking
operations of its affiliates. In making investment recommendations for a Master
Portfolio, its investment advisory personnel will not inquire or take into
consideration whether the issuer (or related supporting institution) of
securities proposed for purchase or sale for the Master Portfolio's account are
customers of the commercial departments of its affiliates. In dealing with
commercial customers, such commercial departments will not inquire or take into
consideration whether securities of those customers are held by the Master
Portfolio; and
(f) will treat confidentially, and as proprietary information of
the Trust, all records and other information relative to the Trust and prior,
present or potential interestholders, and will not use such records and
information for any purpose other than performance of its responsibilities and
duties hereunder (except after prior notification to and approval in writing by
the Trust, which approval shall not be unreasonably withheld and may not be
withheld and will be deemed granted where the Adviser may be exposed to civil or
criminal contempt proceedings for failure to comply, when requested to divulge
such information by duly constituted authorities, or when so requested by the
Trust).
6. SERVICES NOT EXCLUSIVE. The services furnished by the Adviser hereunder
are deemed not to be exclusive, and the Adviser shall be free to furnish similar
services to others so long as its services under this Agreement are not impaired
thereby. To the extent that the purchase or sale of securities or other
investments of the same issuer may be deemed by the Adviser to be suitable for
two or more accounts managed by the Adviser, the available securities or
investments may be allocated in a manner believed by the Adviser to be equitable
to each account. It is recognized that in some cases this procedure may
adversely affect the price paid or received by a Master Portfolio or the size of
the position obtainable for or disposed of by a Master Portfolio.
7. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Adviser hereby agrees that all records which it
maintains for each Master Portfolio are the property of the Trust and further
agrees to surrender promptly to the Trust any of such records upon the Trust's
request. The Adviser further agrees to preserve for the periods prescribed by
Rule 31a-2 under the 1940 Act the records required to be maintained by Rule
31a-1 under the 1940 Act.
8. EXPENSES. During the term of this Agreement, the Adviser will pay all
expenses incurred by it in connection with its activities under this Agreement
other than the cost of securities, commodities and other investments (including
brokerage commissions and other transaction charges, if any) purchased or sold
for the Master Portfolios. In addition, if the aggregate expenses borne by any
Master Portfolio in any fiscal year exceed the applicable expense limitations
imposed by the securities regulations of any state in which its shares are
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registered or qualified for sale to the public, the Adviser together with the
Master Portfolio's administrator(s) shall reimburse such Master Portfolio for
such excess in proportion to the fees otherwise payable to them for such year.
The obligation of the Adviser to reimburse the Trust hereunder is limited in any
fiscal year to the amount of its fee hereunder for such fiscal year, provided,
however, that notwithstanding the foregoing, the Adviser shall reimburse the
Trust for the full amount of its share of any such excess expenses regardless of
the fees paid to it during such fiscal year to the extent that the securities
regulations of any state having jurisdiction over the Trust so require. Such
expense reimbursement, if any, will be estimated, reconciled and paid on a
monthly basis.
9. COMPENSATION. For the services provided to each Master Portfolio and
the expenses assumed pursuant to this Agreement, the Trust will pay the Adviser
and the Adviser will accept as full compensation therefor a fee for that Master
Portfolio determined in accordance with Schedule I attached hereto. The fee
attributable to each Master Portfolio shall be a separate charge to such Master
Portfolio and shall be the several (and not joint or joint and several)
obligation of each such Master Portfolio. The Trust and the Adviser may, from
time to time, agree to reduce, limit or waive the amounts payable hereunder with
respect to one or more Master Portfolios for such period or periods they deem
advisable.
10. LIMITATION OF LIABILITY. The Adviser shall not be liable for any error
of judgment or mistake of law or for any loss suffered by the Trust in
connection with the performance of this Agreement, except a loss resulting from
a breach of fiduciary duty with respect to the receipt of compensation for
services or a loss resulting from willful misfeasance, bad faith or gross
negligence on the part of the Adviser or any of its officers, directors,
employees or agents, in the performance of its duties or from reckless disregard
by it of its obligations and duties under this Agreement.
11. TERM AND APPROVAL. This Agreement shall become effective when
approved, and shall continue in effect until the second anniversary of its
effective date. Thereafter, if not terminated, this Agreement shall continue in
effect for successive annual periods ending on January 1, provided that the
continuation of the Agreement is specifically approved at least annually:
(a)(i) by the Trust's Board of Trustees or (ii) by the vote
of "a majority of the outstanding voting securities" of the Master
Portfolio (as defined in Section 2(a)(42) of the ▇▇▇▇ ▇▇▇); 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 ▇▇▇▇ ▇▇▇) 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 at any time with respect
to:
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(a) a Master Portfolio, without the payment of any penalty,
by vote of the Trust's Board of Trustees or by vote of a majority
of a Master Portfolio's outstanding voting securities, or by the
Adviser, upon written notice to the other parties to this
Agreement; or
(b) by the Adviser on 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, the term "assignment" for purposes of this paragraph having the
meaning defined in Section 2(a)(4) of the 1940 Act.
13. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No amendment of this Agreement affecting a
Master Portfolio shall be effective until approved by vote of a majority of the
outstanding voting securities of such Master Portfolio. However, this shall not
prevent the Adviser from reducing, limiting or waiving its fee.
14. RELEASE. The names "Nations Master Investment Trust" and "Trustees of
Nations Master Investment Trust" refer respectively to the Trust created and the
Trustees, as trustees but not individually or personally, acting from time to
time under a Declaration of Trust and the Certificate of Trust dated January 14,
1999, which is hereby referred to and a copy of which is on file at the
principal office of the Trust. The obligations of "Nations Master Investment
Trust" entered into in the name or on behalf thereof by any of the Trustees,
representatives or agents are made not individually, but in such capacities, and
are not binding upon any of the Trustees, interestholders, or representatives of
the Trust personally, but bind only the Trust Property (as defined in the
Declaration of Trust) 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.
15. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and shall be
governed by Delaware law.
16. COUNTERPARTS. This Agreement may be executed in any manner of
counterparts, each of which shall be deemed an original.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ A. ▇▇▇ ▇▇▇▇▇▇
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A. ▇▇▇ ▇▇▇▇▇▇
President and Chairman of the
Board of Trustees
NATIONSBANC ADVISORS, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
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10
SCHEDULE I
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The Trust shall pay the Adviser as full compensation for services
provided and expenses assumed hereunder an advisory fee for each Master
Portfolio, computed daily and payable monthly at the annual rates listed below
as a percentage of the average daily net assets of the Master Portfolio:
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RATE OF
MASTER PORTFOLIO COMPENSATION
---------------- ------------
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Nations Blue Chip Master Portfolio 0.65%
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Nations Intermediate Bond Master Portfolio 0.40%
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Nations International Equity Master Portfolio 0.90%
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Nations ▇▇▇▇▇▇▇ Focused Equities Master Portfolio 0.85%
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Nations ▇▇▇▇▇▇▇ Growth & Income Master Portfolio 0.85%
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Nations International Value Master Portfolio 0.90%
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Approved: December 2, 1998
Last Amended: October 15, 1999
IN WITNESS WHEREOF, the parties hereto have caused this amended Schedule I
to be executed by their officers designated below as of the 15th day of October,
1999.
NATIONS MASTER INVESTMENT TRUST
on behalf of the Master Portfolios
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
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▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Assistant Secretary
NATIONSBANC ADVISORS, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
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