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Exhibit (e)(14)
Services Agreement
dated December 28, 1999
between
Fidelity Brokerage Services, Inc., National Financial Services Corporation,
One Group Mutual Funds, and
The One Group Services Company
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SERVICES AGREEMENT
This Agreement is made as of the 28th day of December, 1999 between: (1) the
Fidelity Brokerage Services, Inc. ("FBSI") and National Financial Services
Corporation ("NFSC") (together "Fidelity"), and (2) One Group Mutual Funds (the
"Trust") and the One Group Services Company.
RECITALS
A. The Trust is either (i) an open-end investment company with one or more
series or classes of shares (each such series or class of shares a "Fund"), (ii)
an investment adviser to or administrator for the Funds, (iii) the principal
underwriter or distributor for the Funds, or (iv) the transfer agent for the
Funds.
B. The Trust wishes to have Fidelity provide to The Trust or on its behalf
certain administrative services with respect to beneficial owners of shares
("Shareholder(s)") of such Funds which Fidelity makes available to Shareholders
through securities brokerage accounts carried by NFSC on behalf of FBSI.
C. Fidelity agrees to provide such services on the terms and conditions set
forth herein.
AGREEMENT
THEREFORE, in consideration of the mutual promises set forth herein, the parties
agree as follows:
1. Shareholder Services
A. SHAREHOLDER ACCOUNT SET-UP AND MAINTENANCE - Fidelity shall maintain
and provide to FBS1 adequate facilities and procedures to: (1 ) establish and
maintain Fund investments on behalf of Shareholders within a consolidated
brokerage account(s) on the Fidelity transaction processing and recordkeeping
system, and (2) access Shareholders' current Fund information including, but not
limited to, share balances, dividend information and transaction history.
B. SHAREHOLDER ASSISTANCE - Fidelity shall make available to FBSI any
information maintained by Fidelity as may be necessary for correspondents to
support and resolve Shareholder servicing inquiries. Fidelity personnel will
assist FBSI in the investigation of Shareholder inquiries when necessary. FBSI
will support Shareholder service inquiries from Shareholders who maintain
brokerage accounts with FBSI.
C. TRANSACTION PROCESSING AND SETTLEMENT - The Fidelity transaction
processing system shall enable Shareholders to purchase, redeem and exchange
shares of Funds available through Fidelity. NFSC shall facilitate settlement
with each Fund of Shareholder transactions in such Fund insofar as such
transactions are transmitted to NFSC by FBS1 on behalf of Shareholders.
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The Trust agrees that it shall either: (1) make arrangements for all
transactions processed pursuant to this Agreement to be processed through the
National Securities Clearing Corporation Fund/SERV system, or (2) obtain proper
authority for NFSC to transmit to the Fund or its Agent daily manual trades
until 5:00 p.m. Eastern Time, or such other times as set forth on Exhibit B,
which trades shall remain eligible for that day's public offering price provided
Fidelity received the order by the close of trading that day.
D. SHAREHOLDER ACCOUNT STATEMENT PREPARATION AND DISTRIBUTION - With
respect to each Shareholder holding Fund investments through Fidelity, Fidelity
shall deliver or cause to be delivered to such Shareholder monthly statements
when there has been activity in such Shareholder's brokerage account during such
month, or quarterly statements during periods when there has been no monthly
account activity. Statements will include transaction detail for the statement
period for each Fund in which shares were purchased, redeemed or exchanged, and
a summary of the number of Fund shares owned and share value thereof as of the
statement date to the extent such value is provided by the Fund.
E. CONFIRMATION PREPARATION AND DISTRIBUTION - Fidelity shall generate a
written confirmation for each purchase, redemption and exchange transaction
affecting each Shareholder's Fund investments held through Fidelity to the
extent such confirmation is required, and such confirmation shall be distributed
to Shareholders through or on behalf of FBSI.
F. PAYMENT OF FUND DISTRIBUTIONS - NFSC shall distribute to Shareholders all
dividend, capital gain or other payments authorized by the Fund and distributed
to and received by NFSC, and such distributions shall be credited to
Shareholders in accordance with the instructions provided by each Shareholder,
including but not limited to dividend reinvestment into the Fund, or cash
payments of distributions.
G. PROSPECTUS FULFILLMENT - Subsequent to any Shareholder's acquisition
of shares of a Fund by purchase or exchange, Fidelity shall provide to such
Shareholder a confirming prospectus for such Fund to the extent such prospectus
is required with respect to such acquisition and is provided by the Fund to
Fidelity or its designee.
The Trust acknowledges and agrees that Fidelity is not responsible for (i) the
compliance of any prospectus or supplement thereto, annual report, proxy
statement or item of advertising or marketing material of or relating to any
Fund, with any applicable laws, rules or regulations, (J) the registration or
qualification of any shares of any Fund under any federal or applicable state
laws or (iii) the compliance by any Fund or the Trust or any "affiliated person"
(as that term is defined in the rules under the Investment Company Act of 1940,
as amended), with any applicable federal or state law, rule, or regulation or
the rules and regulations of any self-regulatory organization with jurisdiction
over such Fund, The Trust or affiliated person.
Fidelity will not make any offer or sale of Fund shares (a) in any state or
jurisdiction in which such shares are not qualified for sale or exempt from the
requirements of the relevant securities laws at any time after it has been
provided with written notice from the Trust that such Fund is not so qualified
or exempt in such state or jurisdiction, (b) in any state or jurisdiction in
which it is not properly licensed or authorized to make offers or sales, or (c)
at any time after it has been
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provided with written notice from the Trust that such Fund is not then currently
offering shares to the public.
H. ACCOUNT LEVEL TAX REPORTING - NFSC shall provide to Shareholders through
FBSI such reports and information as may be required by the then-prevailing laws
and regulations under the Internal Revenue Code for non-retirement accounts and
qualified and non-qualified retirement plan accounts.
II. REPRESENTATIONS AND WARRANTIES
A. The Trust and The One Group Services Company each represents and warrants
that:
(1) it has the requisite authority to enter into this agreement on its own
behalf and on behalf of the Fund(s), and
(2) that the payment to NFSC of any fees pursuant hereto:
(a) has been duly authorized by the Fund(s), the Board of Trustees of
the Fund(s), or any other persons to the extent such
authorization is required to properly make such payment;
(b) is properly disclosed in the relevant Fund prospectus to the
extent such disclosure may be required, and
(c) is in material conformity with all federal, state and industry
laws or regulations to which the Fund or its agents are subject.
B. FBSI and NFSC each represent and warrant that:
(1) it is a corporation duly organized under the laws of the Commonwealth
of Massachusetts and is duly registered and/or qualified as a
broker/dealer with the SEC, NASD and in every state or territory of
the United States of America (including the District of Columbia)
where such registration or qualification is required and has the
requisite authority to enter into this Agreement and to carry out the
services contemplated herein;
(2) the execution and delivery of this Agreement and the performance of
the services contemplated herein have been duly authorized by all
necessary corporate action in its part, and this Agreement constitutes
the valid and binding obligations of FBSI and NFSC; and
(3) it is in material conformity with all federal, state and industry laws
or regulations to which it is subject.
C. Each party hereto represents and warrants that it shall provide to the
others such
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information or documentation necessary for such party to fulfill its
obligations hereunder, such other information or documentation as any party
may reasonably request, and that it shall comply with such operating
policies and procedures as the parties may adopt from time to time.
III. FEES
A. Start Up Fee
The Trust or the One Group Services Company shall pay to NFSC a one-time start
up fee ("Start Up Fee") for Fidelity's initial set up and preparation to support
a new group or family of Funds. The amount of the Start Up Fee is set forth on
Exhibit A and shall be due and payable to NFSC the earlier of 30 days from the
execution of this Agreement or the availability of any such Fund to Fidelity
customers. The identity and description of each Fund which is subject to this
Agreement shall be set forth on Exhibit B, as amended from time to time.
B. CUSIP Fee
The Trust or the One Group Services Company shall pay to NFSC a fee ("CUSIP
Fee") to add any Fund to Fidelity's computer system in order to make such Fund
available to Fidelity's customers. The amount of the CUSIP Fee is set forth on
Exhibit A, and shall be due and payable to NFSC upon the earlier of the addition
of the Fund to Exhibit B, or the availability of such Fund to Fidelity's
customers.
C. Asset Based Fee
For the services provided by Fidelity hereunder, the Trust or the One Group
Services Company shall pay to NFSC a fee with respect to each Fund, which fee
shall be based upon a percentage per annum of the average daily value of the
aggregate number of shares of the Fund held by NFSC for the accounts of
customers of FBSI. Such fee shall be calculated and paid in accordance with
Exhibit A hereto.
D. Maintenance Fee
The Trust or the One Group Services Company shall pay to NFSC an annual
maintenance fee ("Maintenance Fee") with respect to certain Funds as set forth
on Exhibit A.
In the event the parties agree to material changes to the scope of services
provided hereunder, the parties agree to negotiate in good faith as to the
appropriate amendment to the fees due NFSC.
IV. Indemnification
A. The Trust and the One Group Services Company shall indemnify and hold
harmless Fidelity and each officer, employee and agent of Fidelity from and
against any and all claims, demands, actions, losses, damages, liabilities, or
costs, charges, counsel fees, and expenses of any nature ("Losses") arising out
of (i) any inaccuracy or omission in any prospectus or
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supplement thereto, registration statement, annual report or proxy statement, of
any Fund or the Trust or any advertising or promotional material generated by
any Fund or the Trust, 00 any breach by the Trust or the One Group Services
Company of any representation, warranty, covenant, or agreement contained in
this Agreement and (iii) any action taken or omitted to be taken by Fidelity
pursuant to this Agreement, except to the extent such Losses result from
Fidelity's breach of this Agreement, willful misconduct, or gross negligence.
B. Fidelity shall indemnify and hold harmless Fund/Agent and each director,
officer, employee and agent of Fund/Agent from and against any and all claims,
demands, actions, losses, damages, liabilities, or costs, charges, counsel fees,
and expens6s of any nature ("Losses") arising out of (i) Fidelity's
dissemination of information regarding Fund/Agent or any Fund that contains any
inaccuracy or omission unless such information was provided or approved by
Fund/Agent or any Fund, 00 any breach by Fidelity of any representation,
warranty, covenant, or agreement contained in this Agreement and (iii ) any
Losses resulting from Fidelity's willful misconduct or negligence.
V. CONFIDENTIALITY
Each party acknowledges and understands that any and all technical, trade
secret, or business information, including, without limitation, financial
information, business or marketing strategies or plans, product development or
customer information, which is disclosed to the other or is otherwise obtained
by the other, its affiliates, agent or representatives during the term of this
Agreement (the "Proprietary Information") is confidential and proprietary,
constitutes trade secrets of the owner, and is of great value and importance to
the success of the owner's business. Each party agrees to use its best efforts
(the same being not less than that employed to protect his own proprietary
information) to safeguard the Proprietary Information and to prevent the
unauthorized, negligent or inadvertent use or disclosure thereof. Neither party
shall, without the prior written approval of any officer of the other, directly
or indirectly, disclose the Proprietary Information to any person or business
entity except for a limited number of employees, attorneys, accountants and
other advisors of the other on a need-to-know basis or as may be required by law
or regulation. Each party shall promptly notify the other in writing of any
unauthorized, negligent or inadvertent use or disclosure of Proprietary
Information. Each party shall be liable under this Agreement to the other for
any use or disclosure in violation of this Agreement by its employees,
attorneys, accountants, or other advisors or agents. This Section V shall
continue in full force and effect notwithstanding the termination of this
Agreement.
VI. DURATION AND TERMINATION OF AGREEMENT
With respect to any Fund, this Agreement shall become effective upon the date
such Fund is identified on Exhibit B, and this Agreement is approved by the Fund
or its Board of Trustees if such approval is required, and shall continue in
force for one year, and shall thereafter continue automatically for successive
annual periods unless earlier terminated and subject to any periodic approval
required by the Fund or its Board of Trustees. This Agreement is terminable as
to any Fund by any party upon 90 days written notice thereof to the other
parties or upon default hereof provided that such default shall not terminate
this Agreement to the extent the defaulting party
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has been notified of such default by the non-defaulting party and the defaulting
party cures such default within 10 business days of notice of such default.
After the date of termination as to any Fund, no fee will be due with respect to
any shares of such Fund that are first placed or purchased in FBSI customer
accounts after the date of such termination. However, notwithstanding any such
termination, The Trust and the One Group Services Company will remain obligated
to pay NFSC the fee as to each share of such Fund that was considered in the
calculation of the fee as of the date of such termination, for so long as such
share is held in the FBSI account. This Agreement, or any provision hereof,
shall survive termination to the extent necessary for each party to perform its
obligations with respect to shares for which a fee continues to be due
subsequent to such termination.
Notwithstanding anything to the contrary contained in this Section VI, this
Agreement will terminate automatically with respect to The One Group Services
Company in the event that The One Group Services Company ceases to serve as
principal underwriter or distributor for the Funds pursuant to a termination of
its Distribution Agreement with the Fund; or, with respect to the Trust in the
event that the Funds' plan of distribution, adopted pursuant to Rule 1 2b-1
under the 1940 Act, or any other plan for the financing of shareholder servicing
activities (the "Plan") which finances such payment obligation is terminated for
whatever reason by the Funds' Board of Directors. In that connection the Trust's
and The One Group Services Company's payment obligations with respect to fees
will cease as of the effective date of (i) the termination of The one Group
Service Company's Distribution Agreement Fund or 00 the termination of the plan,
as the case may be. This paragraph does not relieve the Trust or The One Group
Services Company of the obligation for payment of past fees due under this
Agreement. In the event such payment obligation shall cease in accordance with
clause 0) above, Fidelity may seek to receive such payments from any successor
distributor that is appointed by the Funds. In the event such payment obligation
shall cease in accordance with clause 00 above, the Trust and Fidelity agree to
negotiate in good faith with respect to whether and to what extent the Trust
will continue to make such payments either from a related party's resources or
in reliance upon financing that is provided by a successor plan.
VII. MISCELLANEOUS
A. CUSTODY - The Trust acknowledges that Fund shares maintained by the Fund
for Shareholders hereunder are held in custody for the exclusive benefit of
customers of NFSC and shall be held free of any right, charge, security
interest, lien or claim against NFSC in favor of the Trust or its agents acting
on behalf of the Trust.
B. TRANSACTION CHARGES - During the term of this Agreement, FBSI shall not
assess against or collect from its brokerage customers any transaction fee upon
the purchase or redemption of any Fund's shares that are considered in
calculating the fee due pursuant to Section III hereof. The parties acknowledge
and agree that FBSI reserves the right to collect such transaction fees from
certain customers (including "Short-Term Traders," as FBSI may define that term)
for certain special trading services and from other customers upon such other
customers' redemption of certain shares.
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C. USE OF FIDELITY INVESTMENTS NAME - The Trust will not, nor will the
Trust cause or permit any Fund to, describe or refer to the name "Fidelity
Investments" or any derivation thereof, or to FMR Corp. or any affiliate
thereof, or to the services or relationship contemplated by this Agreement in
any advertisement or promotional materials or activities without the prior
written consent of an authorized officer of Fidelity.
D. NONEXCLUSIVITY - The Trust acknowledges that Fidelity may perform
services similar to those to be provided under this Agreement to other
investment companies, investment company sponsors, or service providers to
investment companies.
E. FORCE MAJEURE - No party shall be liable to any other party for any
damage, claim or other loss whatsoever caused by circumstances or events beyond
its reasonable control.
F. NOTICES - All notices and communications required or permitted by
this Agreement shall be in writing and delivered personally or sent by first
class mail unless otherwise agreed. All such notices and other communications
shall be made:
If to Fidelity, to:
Fidelity Investments
00 Xxxxxxxxxx Xxxxxx, X0X
Xxxxxx, XX 00000
Attn: Xxxxx Xxxxxxx
If to the Trust, to:
The One Group Services Company
0000 Xxxxxxx Xxxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxx Xxxxxx
G. This Agreement and any Exhibits hereto may be amended only upon the written
agreement of the parties.
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H. This Agreement may not be transferred or assigned by either the Trust, the
One Group Services Company or Fidelity, and shall be construed in accordance
with the laws of the Commonwealth of Massachusetts.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
One Group Mutual Funds Fidelity Brokerage Services, Inc.
By: /s/ Xxxxx X. Xxxxxxxxx By: /s/ Xxxxx Xxxxxxx
----------------------------- -------------------------------------
Name: Xxxxx X. Xxxxxxxxx Name: Xxxxx Xxxxxxx
--------------------------- -----------------------------------
Title: Vice President Title: Vice President
-------------------------- ----------------------------------
The One Group Services Company National Financial Services Corporation
By: /s/ Xxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxx
----------------------------- -------------------------------------
Name: Xxxx X. Xxxxxx Name: Xxxxxx X. Xxxxx
--------------------------- -----------------------------------
Title: President Title: Senior Vice President
-------------------------- ----------------------------------
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EXHIBIT A
FEE SCHEDULE
1 Start Up Fee = $ 10,000
2. CUSIP Fee = $ 1,000/cusip
3. Asset Based Fee
(a) For the services provided by Fidelity hereunder, the Trust or the One Group
Services Company shall pay to NFSC a fee with respect to each Fund, calculated
daily and paid monthly in arrears, equal to .35 percent per annum of the daily
market value of the total number of shares of such Fund held in accounts at NFSC
(determined by multiplying the number of such shares times the publicly-reported
net asset value of each share), excluding the value of (i) shares held in a
brokerage account prior to the effective date of the Agreement as to the Fund
issuing such shares ("Pre-Participating Assets"), and (ii) shares first placed
or purchased in a brokerage account after the termination of the Agreement as to
the Trust issuing such shares. The total number of shares of all Funds with
respect to which a fee will be due to Fidelity hereunder shall be referred to in
this Exhibit A as "Participating Assets".
(b) Subsequent to each month-end, NFSC shall send to the One Group Services
Company a statement of the market value of shares of the Fund for which the fee
is calculated for the preceding month, together with a statement of the amount
of such fee. In the calculation of such fee, NFSC records shall govern unless
the Trust or the One Group Services Company can demonstrate that the number of
shares or Fund price(s) used in such calculation is inaccurate.
(c) The Trust or the One Group Services Company shall pay to NFSC such fee
within 30 days after their receipt of such statement. Such payment shall be by
wire transfer or other form acceptable to NFSC and shall be separate from
payments related to redemption proceeds and distributions.
4. Maintenance Fees
For each Fund which participates in the NSCC Fund/SERV networking level
3 system the Trust or the One Group Services Company shall pay to NFSC an annual
fee of $3.00 for each separate Fund position held in any Fidelity customer
account which fee shall be payable quarterly in arrears at a rate of $35 per
Fund position.
Upon written notice to the Trust or the One Group Services Company,
Fidelity may change, amend or waive any fee or the method of payment thereof
under this Agreement. Fidelity may issue to the Trust or the One Group Services
Company a new or replacement Agreement or Exhibit A. Such change, amendment or
waiver shall be effective on the date stated in such notice. The acceptance by
the Trust or the One Group Services Company of any order after the date stated
in such notice shall represent the Trust or the One Group Services Company's
agreement to pay such fees to Fidelity.
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EXHIBIT B
FUNDS PARTICIPATING IN SERVICES AGREEMENT
FUND NAME
One Group Balanced Class A
One Group Bond Class A
One Group Diversified Equity Class A
One Group Diversified Intl Class A
One Group Diversified Mid Cap Class A
One Group Equity Income Class A
One Group Equity Index Class A
One Group Government Bond Class A
One Group High Yield Bond Class A
One Group Income Bond Class A
One Group Intermediate Tax Free Bond Class A
One Group Intermediate Bond Class A
One Group Intl Equity Index Class A
One Group Investor Balanced Class A
One Group Investor Conserv Gro Class A
One Group Investor Growth & Income Class A
One Group Investor Growth Class A
One Group Large-Cap Growth Class A
One Group Large-Cap Value Class A
One Group Mid-Cap Growth Class A
One Group Mid-Cap Value Class A
One Group Municipal Bond Az Class A
One Group Municipal Bond Ky Class A
One Group Municipal Bond La Class A
One Group Municipal Bond Mi Class A
One Group Municipal Bond Oh Class A
One Group Municipal Bond WV Class A
One Group Municipal Income Class A
One Group Short-Term Bond Class A
One Group Small-Cap Growth Class A
One Group Small-Cap Value Class A
One Group Tax-Free Bond Class A
One Group Treasury & Agency Class A
One Group Ultra Short-Term Bond Class A
One Group Large Company Growth Class I
One Group Large Company Value Class I
Trading SYMBOL
OGASX PGBOX PAVGX PGIEX PECAX OIEIX
OGEAX OGGAX OHYAX ONIAX ONTAX OGBAX OEIAX OGIAX OICAX ONGIX
ONGAX OLGAX OLVAX OSGIX OGDIX OAMAX OKYAX PGILAX PEIAX
ONOHX OGWAX OTBAX OGLVX PGSGX PSOAX PMBAX OTABX ONUAX
SEEGX HLQVX
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CUSIP
000000000 00000X000 000000000 00000X000 00000X000 000000000 000000000
000000000 00000X000 000000000 000000000 000000000 000000000 000000000
000000000 000000000 000000000 000000000 000000000 000000000 000000000
000000000 000000000 000000000 00000X000 000000000 000000000 000000000
000000000 000000000 00000X000 00000X000 000000000 000000000
000000000 000000000
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