77E Legal Proceedings

NATIONS FUNDS TRUST AND NATIONS MASTER INVESTMENT TRUST

On February 9, 2005, BACAP and BACAP Distributors entered into an Assurance of
Discontinuance with the New York Attorney General (the "NYAG Settlement") and
consented to the entry of a cease-and-desist order by the U.S. Securities and
Exchange Commission (the "SEC") (the "SEC Order"). A copy of the NYAG Settlement
is available as part of the Bank of America Corporation Form 8-K filing on
February 10, 2005 and a copy of the SEC Order is available on the SEC's website.

Under the terms of the SEC Order, BACAP and its affiliate, Banc of America
Securities, LLC ("BAS") have agreed, among other things, (1) to pay $250 million
in disgorgement and $125 million in civil money penalties; (2) to cease and
desist from violations of the antifraud provisions and certain other provisions
of the federal securities laws; (3) to undertake various remedial measures to
ensure compliance with the federal securities laws related to certain mutual
fund trading practices; and (4) to retain an independent consultant to review
their applicable supervisory, compliance, control and other policies and
procedures. The NYAG Settlement also requires, among other things, BACAP along
with Columbia Management Advisors, Inc. and Columbia Funds Distributors, Inc.--
the investment advisor to and distributor of the Columbia Funds, respectively,
-- to reduce Columbia Funds, Nations Funds and other mutual funds management
fees collectively by $32 million per year for five years, for a projected total
of $160 million in management fee reductions. BACAP and BACAP Distributors are
currently in the process of implementing the various terms of the NYAG
Settlement and SEC Order.

Pursuant to the procedures set forth in the SEC Order, $375 million will be
distributed in accordance with a distribution plan to be developed by the
independent distribution consultant. The distribution plan must be based on a
methodology developed in consultation with the BACAP, BACAP Distributors and the
independent trustees of the Nations Funds and not unacceptable to the staff of
the SEC. Although the distribution plan has not yet been formulated, it is
anticipated that a significant portion of the settlement fund will be paid to
shareholders or mutual funds of other mutual fund complexes that may have been
harmed by the trading of the third parties referenced in the Settlements through
systems provided by BAS. At this time, the distribution plan is still under
development. As such, any gain to the Nations Funds or their shareholders cannot
currently be determined. More specific information on the distribution plan will
be communicated on a later date.

As a result of these matters or any adverse publicity or other developments
resulting from them, including lawsuits brought by shareholders of the affected
Nations Funds, there may be increased redemptions or reduced sales of fund
shares, which could increase transaction costs or operating expenses, or have
other adverse consequences for the Nations Funds.

Civil Litigation
In connection with the events that resulted in the NYAG Settlement and SEC
Order, various parties filed suits against Bank of America Corporation and
certain of its affiliates, including BACAP and BACAP Distributors (collectively
"BAC"), Nations Funds Trust and its Board of Trustees. On February 20, 2004, the
Judicial Panel on Multidistrict Litigation transferred these cases and cases
against several other mutual fund companies based on similar allegations to the
United States District Court in Maryland for consolidated or coordinated
pretrial proceedings (the "MDL"). Subsequently, additional related cases were
transferred to the MDL. On September 29, 2004, the plaintiffs in the MDL filed
amended and consolidated complaints. One of these amended complaints is a
putative class action that includes claims under the federal securities laws and
state common law, and that names Nations Funds Trust, the Trustees, BAC and
others as defendants. Another of the amended complaints is a derivative action
purportedly on behalf of Nations Funds Trust against BAC and others that asserts
claims under the federal securities laws and state common law. The MDL is
ongoing. Accordingly, an estimate of the financial impact of this litigation on
any Fund, if any, cannot currently be made.

Separately, a putative class action (Reinke v. Bank of America N.A., et al.) was
filed against Nations Funds Trust and others on December 16, 2004 in the United
States District Court for the Eastern District of Missouri relating to the
conversion of common trust funds and the investment of assets held in fiduciary
accounts in the Funds. Nations Funds Trust has filed a motion to dismiss that is
pending, and no discovery has been taken. At the present time, an estimate of
the financial impact of this litigation on any Fund, if any, cannot currently be
made.