Exhibit (h)(15)
Services Agreement dates as of April 1, 2002 between One Group Mutual Funds, One
Group Dealer Services, Inc., Bank One Trust Company, X.X. Xxxxxxx Investment
Services Company and Xxxxxxx Distributors, Inc.
SERVICES AGREEMENT
THIS AGREEMENT, made and entered into as of this 1/st/ day of April, 2002,
is by and between One Group Mutual Funds ("Fund"), One Group Dealer Services,
Inc. ("Principal Underwriter"), Bank One Trust Company, N.A. ("Bank One"),
Xxxxxxx Investment Services Company ("SISC"), and Xxxxxxx Distributors, Inc.
("SDI").
WHEREAS, the Fund is an investment company registered under the Investment
Company Act of 1940, as amended (the "1940 Act"); the Principal Underwriter is
the agent of the Fund for the distribution of shares of the Fund; and Bank One
is a national bank providing education and enrollment services in connection
with retirement plans;
WHEREAS, SISC, a registered transfer agent, provides various administrative
services, including recordkeeping, reporting and processing services to
retirement plans covered by the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"); and SDI, a registered broker-dealer, distributes shares of
investment companies to Plans;
WHEREAS, it is contemplated that the appropriate fiduciary of a Plan (e.g.,
the trustee, a committee or other "named fiduciary") ("Plan Fiduciary") will
either direct the investment of Plan assets in the Fund, or offer participants
of the Plan ("Participants") the opportunity to select the Fund as an investment
for their individual accounts, and the Plan Fiduciary has designated SISC as its
agent for purposes of transmitting orders for purchases and requests for
redemptions to the Fund on behalf of the Plan;
WHEREAS, the Fund, Bank One, the Principal Underwriter, SDI, and SISC
desire to facilitate the investment by Plans in shares of the Fund, the
provision of services for the benefit of Plans and Participants related to
accounts in the Fund, including processing of Plan orders for
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purchases and redemptions of Fund shares; and the dissemination of information
regarding the Fund to Plans and Participants; and
WHEREAS, the Fund desires that SISC provide certain administrative services
(as described herein at ARTICLES 1, 2 and 3) on its behalf with respect to
Plans, and SISC is willing to perform such services;
NOW, THEREFORE, the parties agree as follows:
ARTICLE 1. Appointment of SISC as Agent. The Fund hereby appoints SISC as its
agent for the limited purpose of receiving orders for purchases and requests for
redemptions for Fund shares from Plans, and receipt thereof by SISC shall
constitute receipt by the Fund. The Fund further appoints SISC as a co-transfer
agent, responsible for transferring record ownership in connection with Plans'
orders for purchases and requests for redemptions of Fund shares. SISC accepts
this appointment subject to the terms and conditions herein.
ARTICLE 2. Transactions in Fund Shares.
Section 2.1 The Fund or its designee shall make Fund shares available for
purchase by Plans, at a public offering price determined in a manner described
in the applicable prospectus, which shall be the net asset value as determined
by the prospectus.
Section 2.2 Processing of Orders. (a) SISC shall, as agent for the Fund,
receive for acceptance from Plans orders for purchases and requests for
redemptions, and stamp each order with the date and time received. SISC shall
determine each Plan's daily orders to correspond with instructions received from
Plan Fiduciaries or Participants.
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(b) Orders for purchases and requests for redemptions received in good
form by SISC prior to the determination of net asset value by the Fund ("Time of
Pricing") on each day that the New York Stock Exchange is open ("Business Day")
shall be priced at the net asset value effective on that day. Orders received
after the Time of Pricing shall be priced at the net asset value effective on
the next Business Day. A Plan's order for purchase shall not be deemed received
"in good form" by SISC until the Master Custodian (described in Section 2.3) has
received from the Plan funds necessary to settle the order, and SISC has
received purchase instructions in good order that balance to the order received.
(c) The Fund or its designee shall provide to SISC closing net asset
value, dividend and capital gain information determined at the close of trading
on each Business Day no later than 6 p.m. Central Time.
(d) On each Business Day, SISC shall transfer record ownership of the
Fund's shares in accordance with the orders for purchases and requests for
redemptions received from Plans prior to the Time of Pricing on that Business
Day (T). SISC shall transfer record ownership of the Fund's shares in accordance
with orders for purchases and requests for redemptions received from Plans after
the Time of Pricing on the next Business Day.
(e) SISC shall use its best efforts to notify the Fund or its designee of
(1) the total number of Fund shares purchased by Plans and, (2) the total number
of shares redeemed by Plans (without identifying transactions on a Plan-by-Plan
basis) on each Business Day (T) no later than 8 a.m. Central Time on the next
Business Day (T+1), or such other specified time mutually acceptable to the
parties ("Time of Transmission").
(f) The Fund or its designee shall confirm the net number of Fund shares
purchased or redeemed by Plans on the prior Business Day (T) no later than 2
p.m. Central Time
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on the next Business Day (T+1), or such other time as mutually agreed by the
parties. SISC shall promptly review confirmation information and coordinate with
the Fund or its designee to resolve any discrepancies. SISC shall be responsible
for providing confirmations of transactions to Plans and to Participants, as
required under applicable laws.
Section 2.3 Settlement. (a) Generally, a master custodial account will be
maintained on behalf of Plans by Investors Fiduciary Trust Company ("Master
Custodian") under the terms of a certain Master Custodial Agreement between the
Plan Fiduciaries and the Master Custodian. Plan Fiduciaries will appoint SISC to
act as their agent to transmit instructions to the Master Custodian regarding
the receipt and transfer of Plan assets in connection with the investment of
Plan assets, including investment in the Fund.
(b) Settlement of Purchases. Acting as agent for Plan Fiduciaries,
SISC shall instruct the Master Custodian to wire the full purchase price for
Fund shares purchased by Plans to the appropriate custodial account for the Fund
(the "Fund Custodial Account") no later than 11 a.m. Central Time on the next
Business Day after the order is accepted by SISC (T+1), or such other specified
time mutually acceptable to the parties.
(c) Settlement of Redemptions. Full payment for total redemptions
by Plans on each Business Day shall be wired by the Fund to the Master Custodial
Account no later than 11 a.m. Central Time on the next Business Day after the
order is accepted (T+1), or such other specified time mutually acceptable to the
parties.
Section 2.4 Dividends. All dividends declared or distributions made by the
Fund shall be reinvested in shares of the Fund on behalf of Plans entitled to
the dividend or distribution. Upon declaration of any dividend or other
distribution with respect to Fund shares, the Fund or its designee shall provide
SISC information setting forth the date of declaration of the dividend or
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distribution, the exdividend date, the date of payment thereof, the record date
on which Plans entitled to payment will be determined, and the amount payable
per share to the Plans on that date.
ARTICLE 3. Administrative Services. SISC shall provide the following
administrative and recordkeeping services to the Fund.
Section 3.1 Plan Accounting. SISC shall maintain an individual
securityholder account for each Plan on behalf of the Fund or its designee. SISC
shall promptly post to each Plan's securityholder account credits and debits
containing the minimum and appropriate certificate detail representing all Fund
shares purchased or redeemed by Plans, and shall dispatch (by electronic means,
or as otherwise mutually agreed) to the Fund or its designee a record of all
debits and credits for every security purchased or redeemed by each Plan within
two Business Days after the day of the purchase or redemption transaction, or by
such time as may be otherwise required under Section 17 of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and the regulations
thereunder. SISC shall provide periodic account statements to each Plan that
reflect the Plan's interest in the Fund.
Section 3.2 Participant Accounting. In accordance with directions by Plan
Fiduciaries, SISC shall maintain individual accounts for Participants, including
a record of the number of shares of the Fund allocated to each Participant's
individual account. If requested by the Plan Fiduciary, SISC shall provide
periodic account statements for each Participant that reflect Participants'
interests in the Fund.
Section 3.3 Plan Fiduciary and Participant Inquiries. SISC shall
investigate and respond to inquiries from Plan Fiduciaries and Participants,
including responding to Participant inquiries
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regarding their individual accounts or regarding the Fund. If authorized by the
Plan Fiduciaries, SISC (acting together with SDI) shall make available to Plan
Fiduciaries and Participants an "800" number service through which live
operators will provide information about the Fund, answer Participant inquiries
about their investment in the Fund, and receive Participant investment
instructions. The Fund or its designee shall provide SISC a telephone number and
the name of an employee ("Point of Contact") for answering questions or
inquiries that SISC may have about the Fund and for forwarding Participant
questions and inquiries that SISC is unable to answer. At the request of SISC,
the Fund or its designee shall provide SISC training to enable SISC to respond
to and answer Participant questions and inquiries.
Section 3.4 Communications. SISC shall distribute prospectuses to Plans
and Participants already invested in the Fund upon Participant request, or as
otherwise directed by Plan Fiduciaries. SISC shall notify the Fund or its
designee of the number of prospectuses required, and the Fund or its designee
shall, at their expense, provide SISC with a sufficient quantity of Fund
prospectuses. SISC also may periodically distribute current Fund Sheets
(described in Section 5.2 below) to Plans and Participants already invested in
the Fund. SISC shall pay the cost of distributing these materials to Plan
Fiduciaries and Participants.
Section 3.5 Proxy Materials. The Fund or its designee is responsible for
making proxy solicitations to Plans. SISC agrees, however, that it will prepare
adequate computer tapes compatible with the Fund's or its designee's computer
equipment and software so that the Fund or its designee may make proper proxy
solicitations of Plans. The Fund or its designee shall provide SISC fifteen (15)
Business Days' prior written notice of the date that the Fund or its designee
requires the computer tapes. SISC shall have no responsibility with respect to
unexecuted proxies.
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Section 3.6 Blue Sky Reports. If, in the reasonable judgment of the Fund
or its designee, blue sky information is required by applicable state securities
laws or the interpretation thereof by applicable regulatory authorities, SISC
shall periodically prepare a report to the Fund or its designee, in accordance
with a system approved by the Fund or its designee, showing by state all sales
and redemptions of Fund shares by Plans.
Section 3.7 Records.
(a) Generally, SISC shall maintain and preserve all records
required by law to be maintained and preserved in connection with providing the
above described administrative services. To the extent required by Section 31 of
the 1940 Act, and regulations thereunder, all such records are the property of
the Fund, and shall be preserved, or surrendered promptly to the Fund or its
agents on request. In addition, SISC agrees that with respect any of its records
that are required to be maintained in connection with its provision of services
under this Agreement under Section 17 of the 1934 Act, and regulations
thereunder, (a) such records are subject at any time, or from time to time, to
reasonable periodic, special, or other examinations by representatives of the
Securities and Exchange Commission (the "Commission") and any other regulatory
agency having authority with respect to the Fund or its designee; and (b) SISC
will furnish to the Commission (and any other appropriate regulatory agency)
upon demand, complete, correct and current hard copies of any and all such
records.
Section 3.8 Termination of Services With Respect to a Plan. SISC shall
notify the Fund if it terminates its agreement for providing administrative
services to a Plan. In that event, SISC shall deliver to the Fund or its
designee all securityholder records that the Fund is required to maintain under
Section 17 of the 1934 Act and Section 31 of the 1940 Act, and applicable
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regulations, and the Fund or its designee shall thereafter be responsible for
preserving, maintaining and posting such records on behalf of the Fund.
ARTICLE 4. Fee for Administrative Services. In consideration of the
services provided under this Agreement, SISC shall receive an administrative fee
equal to 35 basis points per annum of the daily net asset value of assets
invested by Plans in the Fund, computed monthly and paid quarterly in arrears.
The Fund shall pay up to $18.00 per account and Bank One shall pay the balance.
ARTICLE 5. Dissemination of Information to Prospective Plan Investors.
Section 5.1 Marketing Materials. SDI is authorized to develop and prepare
materials describing the Fund for use in providing information about the Fund to
Plans and Participants that may invest in Fund shares, including (but not
limited to) a "Fund Sheet," as described by Section 5.2. SDI shall pay the cost
of preparing and printing these materials. The Fund or its designee shall
provide NASD approved historical Fund information to SDI in an automated
electronic format agreed to by the parties to assist SDI in preparing the Fund
Sheet. SDI shall submit any such materials to the Principal Underwriter for
review and approval before use and the Principal Underwriter shall advise SDI in
writing of its approval or disapproval within fifteen (15) Business Days of
receiving any marketing materials.
Section 5.2 Fund Sheet. SDI may develop a standardized format for a "Fund
Sheet" that provides updated performance information about the Fund. SDI shall
submit the Fund Sheet format to the Principal Underwriter for review and
approval in accordance with Section 5.1. After receiving written approval of the
format, SDI may prepare, update and distribute the Fund Sheet
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without any requirement for subsequent written approval; provided that (a) each
version of the Fund Sheet is prepared or updated in accordance with the approved
format, and (b) SDI provides a copy of each version of the Fund Sheet to the
Principal Underwriter at least fifteen (15) days prior to first use.
Section 5.3 Absence of Representations with Respect to Fund Shares.
Neither SDI nor SISC is authorized to make any representations concerning shares
of the Fund except those contained in either (a) the current Fund prospectus,
(b) other printed information supplemental to the current Fund prospectus and
issued by either the Fund or Principal Underwriter, or (c) in materials prepared
by SDI and approved by the Principal Underwriter pursuant to Section 5.1.
Section 5.4 Use of Prospectus for Marketing Purposes. SDI shall notify the
Fund or its designee of the number of Fund prospectuses required for marketing
purposes, and the Fund or its designee will provide SDI with a sufficient
quantity at the Fund's own expense.
ARTICLE 6. Expenses. In addition to any costs or expenses specifically
assumed by SISC or SDI under this Agreement, SISC shall be responsible for costs
and expenses incident to its performance of its responsibilities under this
Agreement. The Fund, Bank One and Principal Underwriter shall assume and pay all
costs and expenses of their operations not specifically assumed by either SISC
or SDI under this Agreement.
ARTICLE 7. Representations and Warranties.
Section 7.1 Representations of SDI and SISC. SDI and SISC each represents
and warrants:
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(a) that it (1) is in material compliance with all applicable
federal, state and securities laws, (2) is duly licensed and authorized to
conduct business in every jurisdiction where such license or authorization is
required, and (3) has full authority to enter into this Agreement and carry out
its obligations pursuant to the terms of this Agreement;
(b) that it will promptly notify the Fund or the Principal
Underwriter in the event that it is for any reason unable to perform any of its
obligations under this Agreement;
(c) that it will comply with all federal and state statutes and
regulations applicable to its activities under this Agreement;
(d) for SISC only, that it is a transfer agent registered under
the 1934 Act and regulations thereunder; and
(e) for SDI only, that it is a broker-dealer registered under the
1934 Act and regulations thereunder, and the laws of all states and other
jurisdictions necessary for the sale of Fund shares under this Agreement.
Section 7.2 Representations of the Fund. The Fund, Bank One, and Principal
Underwriter each represents and warrants:
(a) that it (1) is in material compliance with all applicable
federal, state and securities laws, (2) is duly licensed and authorized to
conduct business in every jurisdiction where such license or authorization is
required, and (3) has full authority to enter into this Agreement and carry out
its obligations pursuant to the terms of this Agreement;
(b) that it shall promptly notify SDI and SISC in the event that
it is for any reason unable to perform any of its obligations under this
Agreement;
(c) that it shall comply with all federal and state statutes and
regulations applicable to its activities under this Agreement; and
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(d) that (1) the Fund is an investment company registered under
the 1940 Act, (2) a registration statement under the Securities Act of 1933 has
been filed and will be effective with respect to all shares of the Fund being
offered for sale, and (3) the Fund has registered and qualified its shares for
sale in accordance with the laws of each jurisdiction where it is required to do
so.
Section 7.3 Y2k Compliance. Each party represents and warrants that the
software used in connection with this Agreement is year 2000 compliant.
ARTICLE 8. Term and Termination.
8.1 Term. This Agreement shall become effective on the date first set
forth above and shall continue in effect until terminated as set forth below.
The provisions of Sections 8.3, 9.1, 9.2 and Article 10 shall survive any
termination of this Agreement.
8.2 Termination. This Agreement may be terminated at the option of either
party upon at least sixty (60) days' written notice. In the event of
termination, SISC will cease to provide services to Plans or to the Fund with
respect to any new orders for additional shares of the Fund.
8.3 Continuation of Plan Services. No fee shall be due to SISC with
respect to any Fund shares purchased or held by Plans after the termination of
this Agreement. Notwithstanding any termination, to the extent Plans already are
invested in shares of the Fund, Plans shall be permitted to maintain such
investments, and SISC may continue to provide administrative and recordkeeping
services to Plans and Participants in connection with such investments. In this
regard, the Fund or its designee shall have a continuing obligation to cooperate
with SISC in its provision of services to Plans, including, but not limited to:
(a) accepting redemption requests and other information from SISC on behalf of
Plans; (b) forwarding redemption proceeds and other
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distributions to the Master Custodial Account or to such other account as
designated by SISC; (c) providing closing net asset value, dividend and capital
gain information as necessary to permit SISC's performance of recordkeeping
services for Plans, and (d) supplying to SISC prospectuses and other shareholder
communication materials necessary for SISC's performance of services for Plans.
SISC shall notify the Fund in the event that SISC no longer provides services to
a particular Plan.
ARTICLE 9. Indemnification.
Section 9.1 Indemnification of Fund, Bank One, and Principal Underwriter.
(a) SISC shall indemnify and hold harmless the Fund, Bank One, and Principal
Underwriter and their respective directors, officers, employees, and agents
against any claims or liabilities suffered to the extent arising from any act of
commission or omission by SISC relating to this Agreement or the services
rendered hereunder, including reasonable legal fees and other reasonable
out-of-pocket costs of defending against any claims or liability; provided,
however, that SISC shall not be responsible for any claims or liabilities that
arise from the negligence or willful misconduct of the Fund, Bank One, or
Principal Underwriter, or their respective directors, officers, employees and
agents.
(b) SDI shall indemnify and hold harmless the Fund, Bank One, and
Principal Underwriter and their respective directors, officers, employees, and
agents against any claims or liabilities suffered to the extent arising from any
act of commission or omission by SDI relating to this Agreement, including
reasonable legal fees and other reasonable out-of-pocket costs of defending
against any claims or liability; provided, however, that SDI shall not be
responsible for
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any claims or liabilities that arise from the negligence or willful misconduct
of the Fund, Bank One, or Principal Underwriter, or their respective directors,
officers, employees and agents.
Section 9.2 Indemnification of SDI and SISC. The Fund, Bank One and
Principal Underwriter shall each indemnify and hold harmless SDI and SISC and
their respective directors, officers, employees and agents against any claims or
liabilities suffered to the extent arising from any act of commission or
omission by the Fund, Bank One, or Principal Underwriter relating to this
Agreement or the services rendered hereunder, including reasonable legal fees
and other reasonable out-of-pocket costs, of defending against any claims or
liability; provided, however, that neither the Fund, Bank One, nor Principal
Underwriter shall be responsible for any claims or liabilities that arise from
the negligence or willful misconduct of SDI or SISC, or their respective
directors, officers, employees and agents.
ARTICLE 10. Confidentiality. All non-public books, records, information
and data pertaining to the business of another party that are exchanged or
received pursuant to the negotiation or the performance of this Agreement shall
remain confidential, and shall not be voluntarily disclosed by any party without
the prior written consent of the other party, except as may be required by law
or by such party to carry out this Agreement, or an order of any court,
governmental agency or regulatory body. Further, during the term of this
Agreement and for two years thereafter, the Fund, Bank One and Principal
Underwriter agree that they may not use the identity of Plans that have named
SISC as agent in connection with this Agreement, or any other information about
such Plans obtained in connection with this Agreement, except for purposes of
this Agreement; and that any information about Plans obtained in connection with
this Agreement may not be used to compete with the relationship of SISC or any
of its affiliates with the Plans.
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ARTICLE 11. Relationship of Parties. Except to the extent of SISC's
appointment as agent under Article 1 of this Agreement; SISC shall act only as
agent for Plans or on its own behalf. It is understood the parties are
independent contractors and not partners, co-venturers, or employees of each
other.
ARTICLE 12. Non-Exclusivity. Nothing in this Agreement shall prohibit either
(a) SISC or any of its affiliates from entering agreements similar to this
Agreement with organizations other than the Fund, Bank One or Principal
Underwriter that also make available shares of mutual funds or other investment
options to Plans; or (b) the Fund, Bank One, or Principal Underwriter from
providing administrative or recordkeeping services to retirement plans, or from
soliciting any such plan (or its sponsor or fiduciary) to enter into an
arrangement with the Fund, Bank One, or Principal Underwriter, or any of their
affiliates for such services, or from otherwise providing any type of service or
product to any person, whether alone or in participation with others.
ARTICLE 13. Miscellaneous.
Section 13.1 Amendment and Waiver. Neither this Agreement nor any
provision hereof may be amended, waived, discharged or terminated except by an
instrument in writing signed by all parties hereto.
Section 13.2 Notices. All notices and other communications hereunder shall
be given or made in writing and shall be hand delivered or mailed by certified
mail, to the party or parties to
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whom they are directed at the following address, or at such other addresses as
may be designated by notice from such party to all other parties,
If to SDI or SISC:
000 Xxxxx Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
ATTN: Xxxxxxx X. Xxxxxxxxxxxx
Senior Vice President
If to the Fund, Bank One or Principal Underwriter:
One Group Mutual Funds
0000 Xxxxxxx Xxxxxxx
Xxxxxxxx, Xxxx 00000-0000
ATTN: Xxxx X. Xxxxxx
President
Any notice, demand or other communication given in a manner prescribed in this
Section 13.2 shall be deemed to have been delivered on receipt.
Section 13.3 Successors and Assigns. This Agreement shall not be assigned
by any party without the written consent of the other parties, except that a
party may assign this Agreement to an affiliate having the same ultimate
ownership as the assigning party without such consent, but such party shall not
be relieved of its responsibilities hereunder by reason of such assignment.
Section 13.4 Governing Law. This Agreement shall be governed by, and
construed and enforced in accordance with applicable federal law and the laws of
the State of Illinois.
Section 13.5 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which together shall
constitute one agreement.
Section 13.6 Severability. In case any one or more of the provisions
contained in this Agreement should be invalid, illegal or unenforceable in any
respect, the validity, legality and
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enforceability of the remaining provisions contained herein shall not in any way
be affected or impaired thereby.
Section 13.7 Captions. The paragraph headings contained herein are for
reference purposes only and shall not in any way affect the interpretation or
construction of this Agreement.
Section13.8 Entire Agreement. This Agreement constitutes the entire
agreement and understanding between the parties hereto and supersedes all prior
agreement and understandings relating to the subject matter hereof.
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IN WITNESS WHEREOF, the parties by their duly authorized officers, have
caused this Agreement to be executed as of the day and year above written.
XXXXXXX DISTRIBUTORS, INC. ONE GROUP MUTUAL FUNDS
By: /s/ Xxxxxx Xxxxx By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx Xxxxx Name: Xxxxxx X. Xxxxx
Title: President Title: X-X
XXXXXXX INVESTMENT SERVICES BANK ONE TRUST COMPANY, N. A.
COMPANY
By: /s/ Xxxx X. Gilegy By: /s/ Xxxx Xxx Xxxx
Name: Name: Xxxx Xxx Xxxx
Title: Vice President - Operations Title: Authorized Officer
ONE GROUP DEALER SERVICES, INC.
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: President & CEO
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