Exhibit No. (h) (37)
Xxxx Xxxxx
& Company
California's First Discount Broker. Since 1973
SERVICE AGREEMENT
NOFEE NETWORK MUTUAL FUND SERVICE
Firstar Funds, Inc. ("Funds"), Firstar Investment Research & Management Company,
LLC ("FIRMCO") and Xxxx Xxxxx & Company hereby agree as follows:
1.
Funds of certain services described herein as part of its NoFee Network (No
Transaction Fee) Service. In consideration of such services, FIRMCO agrees
to pay Xxxx Xxxxx & Company a service fee as set forth herein. Xxxx Xxxxx &
Company agrees to waive its usual transaction fees, subject to exceptions in
paragraph 5 herein, for transactions of shares of the mutual funds related to
this Agreement.
2. SERVICES. Xxxx Xxxxx & Company agrees to perform or arrange for the
performance of the following Services and such other services as FIRMCO or Funds
may reasonably request.
Process all purchase, redemption and exchange orders by customers;
transmit or arrange for the transmission to each Fund purchase or
redemption orders reflecting purchase, redemption and exchange orders
Xxxx Xxxxx
& Company
received by it with respect to subaccounts. Xxxx Xxxxx & Company may
process orders directly, or through a clearing agent, or through
NSCC's FundServ facility, or through other agencies or systems
accepted by Funds.
Record Maintenance
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Xxxx Xxxxx & Company shall:
Fund in an account with Xxxx Xxxxx & Company, which records shall
include: number of shares; date and price of purchases and redemptions
(including dividend reinvestments) and dates and amounts of dividends
paid for at least the current year to date; name and address of such
customers; records of distributions and dividend payments; any
transfers of shares; and overall control records.
Local (000) 000-0000 Toll Free 0-000-000-0000
Xx Xxxxx Xxxxxxx Xxxxxxxx, Xxxxx 000 9191 Towne Center Drive,
Xxxx Xxxxx
& Company
Shareholder Communications
Mail Fund prospectuses and statements of additional information
("SAIs") upon customer request and, as applicable, upon confirmation
of customer purchases to the extent required by law and mail any
supplements to prospectuses and SAIs.
Produce and mail to customer's confirmation statements reflecting
purchases and redemptions of shares of each Fund in a customer's
account.
Produce and mail statements to customers on a monthly basis (or, as to
accounts in which there has been no activity in a particular month, no
less frequently than quarterly) showing, among other things, the
number of shares of each Fund owned by such customers and the net
asset values of such shares as of a recent date.
Respond to customer inquiries regarding, among other things, share
prices, account balances, dividend amounts and dividend payment dates.
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Xxxx Xxxxx & Company will arrange for the preparation of and filing
with the appropriate governmental agencies such information returns
and reports as are required to be so filed for reporting (i) dividends
and other distributions made, (ii) amounts withheld on dividends and
other distributions and payments under applicable federal and state
Xxxx Xxxxx
& Company
laws, rules and regulations, and (iii) gross proceeds of sales
transactions as required.
Xxxx Xxxxx & Company will withhold on dividends and distributions as
may be required by state or federal authorities from time to time.
Xxxx Xxxxx & Company represents and warrants that it has and will continue
at all times to have the necessary facilities, equipment and personnel to
perform the services hereunder in a businesslike and competent manner and its
system complies with all applicable laws, rules and regulations related to the
services to be provided under this Agreement, including the maintenance and
preservation of all records and registrations required by any applicable laws,
rules and regulations.
Xxxx Xxxxx & Company will make adequate disclosure to its customers to
ensure that the customers of Xxxx Xxxxx & Company are aware that they are
transacting business with Xxxx Xxxxx & Company and not FIRMCO or Funds. Xxxx
Xxxxx & Company shall maintain all historical shareholder records, consistent
with requirements of all applicable laws, rules and regulations.
Xxxx Xxxxx & Company shall not make any statement or representation
concerning a Fund that is not contained in the Fund's registration statement,
annual report or proxy statement or any advertising or promotional material
generated by or on behalf of any Fund.
Xxxx Xxxxx & Company 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 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
Xxxx Xxxxx
& Company
time after it has been provided with written notice that such Fund is not then
currently offering shares to the public.
3. ROLE OF PARTIES. The parties acknowledge and agree that the Services under
this Agreement are shareholder services only and are not the services of an
underwriter or a principal underwriter within the meaning of the Securities Act
of 1933, as amended, or the Investment Company Act of 1940, as amended. This
Agreement does not constitute Xxxx Xxxxx & Company as an agent of Funds for
purposes of selling shares of any Fund to any dealer or to the public. To the
extent Xxxx Xxxxx & Company is involved in the purchase of shares of any Fund by
customers, such involvement in these purchases will be as agent of such
customers only.
4. FEES. For performance of Services, Xxxx Xxxxx & Company shall receive a Fee
(the "Fee") which will be calculated and paid as provided in the Agreement.
Fees are for shareholder servicing and other administrative services provided by
Xxxx Xxxxx & Company and do not constitute payment in any manner for investment
advisory, trustee, or custodial services.
Fund shares purchased through accounts held within Xxxx Xxxxx & Company; (ii)
additional Fund shares received through dividends reinvested in the same fund;
and (iii) Fund shares transferred into Xxxx Xxxxx & Company accounts from other
brokerage firms, the Fund, its transfer agent, or other service agents.
averaged through the exact number of days in the month to arrive at the average
daily net asset value of outstanding Fund shares held in Xxxx Xxxxx & Company's
accounts. Fees will be billed monthly in arrears at the annual rate of 0.25%
(25 basis points) of the market value of shares of each Fund held in Xxxx Xxxxx
& Company accounts.
Xxxx Xxxxx
& Company
hold fund positions directly with Funds or as correspondent broker through one
or more clearing broker/dealer relationships. Currently, Xxxxxxxxx, Xxxxxx &
Xxxxxxxx, Perishing Division, acts as Xxxx Xxxxx & Company's sole clearing
agent.
Xxxx Xxxxx
& Company
5. TRANSACTION FEES. Xxxx Xxxxx & Company maintains a policy that, in order for
customers to avoid transaction fees, customers shall adhere to a limitation on
short-term redemptions. The limitation currently states as follows:
purchased within 90 days (60 days for accounts controlled by financial
advisors) of the redemption trade date. A transaction fee or a Short
Term Redemption Fee will apply to short term redemptions.
If a customer makes 15 short-term redemptions in a calendar year, transaction
fees will apply on all of the customer's purchase, redemption and exchange
transactions for the remainder of the year. Xxxx Xxxxx & Company reserves the
right to modify at any time its policies and limitations regarding short-term
redemptions.
Xxxx Xxxxx & Company may from time to time enter into institutional
relationships which require ancillary brokerage or administrative services
related to processing fund transactions. Xxxx Xxxxx & Company may charge
nominal transaction fees to such institutional customers for its services.
Xxxx Xxxxx & Company agrees to inform customers of all transaction fees Xxxx
Xxxxx & Company may charge as well as the circumstances under which such fees
may be imposed.
6. REPRESENTATIONS. Xxxx Xxxxx & Company is registered as a broker-dealer under
the Securities Exchange Act of 1934 in all 50 states and in the District of
Columbia and is qualified to act as a broker-dealer in the states or other
jurisdictions where it transacts business, and is a member in good standing of
the National Association of Securities Dealers, Inc. ("NASD"), and has the
requisite authority to enter into this Agreement and to carry out all the
Xxxx Xxxxx
& Company
services. Xxxx Xxxxx & Company shall be, for purposes herein, deemed to be an
independent contractor, and is not an agent of and shall have no authority to
act for or represent FIRMCO, Funds, or the Funds' distributor(s).
Representatives of Xxxx Xxxxx & Company do not solicit orders to buy or sell
mutual fund shares. All orders entered by Xxxx Xxxxx & Company to buy or sell
mutual funds are unsolicited.
7. USE OF FIRMCO AND FUNDS NAME. Xxxx Xxxxx & Company acknowledges and agrees
that FIRMCO and Funds and/or its affiliates own all right, title and interest in
and to the name "Firstar Investment Research & Management Company, LLC" and
"Firstar Funds," respectively. Prior to its use of any advertising, sales
literature or other promotional materials that feature Funds, Xxxx Xxxxx &
Company shall give FIRMCO a reasonable opportunity to review and comment upon
such materials, and no such materials shall be used if FIRMCO objects. Subject
to the foregoing sentence, FIRMCO and Funds, respectively hereby authorize Xxxx
Xxxxx & Company to use the names and other identifying marks of FIRMCO or any
Fund in connection with the operation of Xxxx Xxxxx & Company's mutual fund
program. FIRMCO or Funds may withdraw this authorization as to any particular
use of any such name or identifying marks at any time
Xxxx Xxxxx
& Company
(i) upon FIRMCO's or Fund's reasonable determination that such use would have a
material adverse effect on the reputation or marketing efforts of FIRMCO or such
Fund or (ii) if no investment company, or series or class of shares of any
investment company advised by FIRMCO continues to be available through Xxxx
Xxxxx & Company's mutual fund program; provided, however, that Xxxx Xxxxx &
Company may, in its discretion, continue to use materials prepared or printed
prior to the withdrawal of such authorization.
FIRMCO and Funds understand that upon the addition of a Fund to the NoFee
Network, Xxxx Xxxxx & Company will update its listing of participating funds to
indicate their availability in the service. Such listings are sent to existing
and prospective customers. Participating funds may also be named on a
"messages" section of customer account statements. Fund participating in the
program will be highlighted in Xxxx Xxxxx & Company's regularly mutual fund
lists.
Each Fund acknowledges that Xxxx Xxxxx & Company intends to market its
NoFee Network to its current and prospective customers via direct mailing and
regular advertising in regional and national financial publications, trade
conferences, and other media and that Xxxx Xxxxx & Company may include reference
in such media to FUNDS participation in the NoFee Network.
Xxxx Xxxxx & Company will furnish Funds or its designees with such
information as it or they may reasonably request in connection with the
preparation of reports to Funds' Board of Directors concerning this Agreement,
Funds' annual audit, and any other reports or filings that may be required by
law.
Xxxx Xxxxx
& Company
8. TERMINATION. Participation in the NoFee Network may be terminated (i) upon
no less than 30 days' advance notification in writing either by FIRMCO, Funds or
by Xxxx Xxxxx & Company; or (ii) upon such shorter notice as is required by law,
order, or instruction from a court of competent jurisdiction, regulatory body,
or self-regulatory organization with jurisdiction over the terminating party.
Upon termination as to a Fund, FIRMCO will not be obligated to pay the
Fee with respect to any shares of the Fund that become part of a Xxxx Xxxxx &
Company customer account after the date of such termination. However,
notwithstanding any such termination, FIRMCO will remain obligated to pay Xxxx
Xxxxx & Company the Fee as to each share of such Fund that was considered when
calculating the fee as of the date of termination (a "Pre-Termination Share"),
for so long as such Pre-Termination Share is held in any Xxxx Xxxxx & Company
brokerage account and Xxxx Xxxxx & Company continues to perform the Services as
to such shares. For so long as Xxxx Xxxxx & Company continues to perform the
Services as to any Pre-Termination Shares pursuant to this section, the
provisions of this Agreement will remain in full force and effect as to such
Pre-Termination shares.
Xxxx Xxxxx
& Company
9. INDEMNIFICATION. Xxxx Xxxxx & Company shall indemnify FIRMCO, the Funds, and
their affiliates, directors, managers, employees, and shareholders for any loss
(including without limitation litigation costs and expenses and reasonable
attorney's and expert's fees) directly resulting from its negligent or willful
act, omission or error in the performance of its duties under this Agreement or
its breach of this Agreement. Such indemnification will survive the termination
of the Agreement.
FIRMCO shall indemnify Xxxx Xxxxx & Company and its affiliates, directors,
employees, and shareholders for any loss (including without limitation
litigation costs and expenses and reasonable attorney's and expert's fees)
directly resulting from its negligent or willful act, omission or error in the
performance of its duties under this Agreement or its breach of this Agreement.
Such indemnification will survive the termination of the Agreement.
10. 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, or product
development or customer information, including customer name and address, which
is disclosed to the others or is otherwise obtained by the others during the
term of the Agreement and which is identified in writing as proprietary
information by the disclosing party at the time of disclosure ("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 those employed to protect its own proprietary information) to safeguard the
other's Proprietary Information and to prevent the unauthorized, negligent or
inadvertent use or disclosure thereof. No party shall, without the prior
written approval of an authorized officer of the other, directly or indirectly,
disclose the Proprietary Information to any person or entity except for its
employees, attorneys, accountants, affiliates and other advisers on a need-to-
Xxxx Xxxxx
& Company
know basis or as may be required by law or regulation or demanded by any court
or administrative agency. Each party shall promptly notify the other in writing
of any unauthorized, negligent or inadvertent use or disclosure of the other's
Proprietary Information. This section shall continue in full force and effect
notwithstanding the termination of this Agreement.
11. NONEXCLUSIVITY. Each Party acknowledges that the other may enter into
Agreements, similar to this one, with other parties, for the performances of
services similar to those to be provided under this Agreement, unless otherwise
agreed to in writing by the parities.
12. ASSIGNABILITY. This Agreement may be assigned by any party with the other
parties' written consent.
13. ENTIRE AGREEMENT-AMENDMENT. This Agreement constitutes the entire Agreement
between the parties with regard to the subject matter herein. Additionally,
these materials supersede any and all Agreements, representations and warranties
made prior to the execution
Xxxx Xxxxx
& Company
of this Agreement. This Agreement may be amended only by a writing executed by
each party to be bound by the amendment.
14. GOVERNING LAW. This Agreement will be governed by, and interpreted under,
the laws of the State of California as applied to contracts entered into and to
be performed entirely within that State.
15. COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which will be deemed an original, but all of which together shall
constitute one instrument.
IN WITNESS WHEREOF the parties hereto have delivered and executed this
Agreement.
For Firstar Investment Research & Management Company, LLC:
By: /s/ J. Xxxxx Xxxxxxxx
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Title: Chairman
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Date: 5-12-98
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For Firstar Funds, Inc:
By: /s/ Xxxx Xxxxx Xxxxxx
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Title: Vice President
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Date: 5-17-98
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Xxxx Xxxxx
& Company
For Xxxx Xxxxx & Company:
By: /s/illegible
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Title: Executive Vice President
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Date: 5-14-98
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