Exhibit (e)(15)
Mutual Fund Sales and Service Agreement dated as of June 21, 2002 between
Eastern Michigan Bank, One Group Dealer Services, Inc. and One Group
Administrative Services, Inc.
ONE GROUP DEALER SERVICES, INC.
MUTUAL FUND SALES AND SERVICE AGREEMENT
This Agreement is entered into among the financial institution executing this
Agreement ("Financial Institution"), One Group Dealer Services, Inc. ("OGDS")
and One Group Administrative Services, Inc. ("OGA"), with respect to those
series of One Group Mutual Funds ("One Group") listed in Exhibit A hereto (each
series referred to individually as a "Fund" and collectively as the "Funds") for
whose shares of beneficial interest ("Shares") OGDS serves as Distributor and
for whom OGDS provides or coordinates shareholder services.
A. Financial Institution.
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1. Status of Financial Institution.
(a) Financial Institution represents and warrants to OGDS:
(i) That it is a "bank," as that term is defined in Section
3(a)(6) of the Exchange Act, that engages in activities
described in Section 3(a)(4) of the Exchange Act and that,
during the term of this Agreement, it will abide by the
rules and regulations of those state and federal authorities
with appropriate jurisdiction over the Financial
Institution, especially those regulations dealing with the
activities of the Institution as described under this
Agreement. Financial Institution agrees to notify OGDS
immediately of any action by or communication from state or
federal banking authorities, state securities authorities,
the SEC, or any other party which may affect its status as a
bank or which may otherwise affect in any material way its
ability to act in accordance with the terms of this
Agreement. Any action or decision of any of the foregoing
regulatory authorities or any court of appropriate
jurisdiction which affects Financial Institution's ability
to act in accordance with the terms of this agreement,
including the loss of its exemption from registration as a
broker or dealer, will terminate this Agreement effective
upon OGDS' written notice of termination to Financial
Institution; and
(b) That Financial Institution is registered with the appropriate
securities authorities in all states, territories and jurisdictions in
which its activities make such registration necessary.
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2. Financial Institution Acts as Agent for its Customers.
The parties agree that in each transaction in the Shares of any Fund and
with regard to any services rendered pursuant to this Agreement:
(a) Financial Institution is acting as agent for the customer;
(b) The customer is for all purposes the customer of Financial Institution
(c) Each transaction is initiated solely upon the order of the customer;
(d) As between Financial Institution and its customer, the customer will
have full beneficial ownership of all Shares of the Funds;
(e) Each transaction shall be for the account of the customer and not for
Financial Institution's account; and
(f) Each transaction shall be without recourse to Financial Institution
provided that Financial Institution acts in accordance with the terms
of this Agreement.
Financial Institution will offer and sell the Shares of the Funds only in
accordance with the terms and conditions of the applicable current
Prospectus and Statement of Additional Information ("SAI") and will make no
representations not included in said Prospectus or SAI or in any authorized
supplemental material supplied by OGDS. Financial Institution shall not
have any authority in any transaction to act as agent for OGDS or One
Group.
B. Sales of Fund Shares.
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1. Execution of Orders for Purchase and Redemption of Shares.
(a) All orders for the purchase of any Shares shall be executed at the
then-current net asset value per share and all orders for the
redemption of any Shares shall be executed at the net asset value per
share, in each case as described in the applicable Fund prospectus.
OGDS and One Group reserve the right to reject any purchase request in
their sole discretion.
The procedures relating to all orders will be subject to the terms of
the prospectus of each Fund and OGDS' written instructions to
Financial Institution from time to time. Specifically,
(i) orders to purchase and redeem shares received by Financial
Institution prior to the close of trading on the New York Stock
Exchange (generally, 4:00 p.m., Eastern Time ("ET")) ("Market
Close") on any day that a Fund is open for business ("Day 1")
will be electronically transmitted to One Group by 8:00 a.m., ET
on the next day that the Fund is open for business ("Day 2")
(such orders are referred to as "Day 1 Trades"); and
(ii) orders to purchase and redeem shares received by Financial
Institution after the Market Close on Day 1, but prior to the
Market Close on Day 2 ("Day 2 Trades") will be electronically
transmitted to One Group on the second day that a Fund is open
for business following Day 1.
(iii) If the Financial Institution cannot electronically transmit Day
1 Trades by 8:00 a.m. on Day 2, Financial Institution will
transmit such orders by facsimile prior to the beginning of
trading on the New York Stock Exchange (generally 9:30 a.m ET)
("Market Open") on Day 2.
(b) Day 1 Trades will be effected at the NAV calculated as of the Market
Close on Day 1and Day 2 Trades will be effected at the NAV calculated
as of the Market Close on Day 2. One Group agrees that, consistent
with
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the foregoing, Day 1 Trades will have been received by One Group prior
to the Market Close on Day 1 for all purposes, including, without
limitation, effecting distributions.
(c) Payments for Shares shall be made as specified in the applicable Fund
prospectus, (i.e., by wire directly to State Street Bank and Trust
Company, One Group's transfer agent). If payment for any purchase
order is not received in accordance with the terms of the applicable
Fund prospectus, OGDS reserves the right, without notice, to cancel
the sale and to hold Financial Institution responsible for any loss
sustained as a result thereof, including loss of profit.
C. Miscellaneous.
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1. Delivery of Prospectuses and Reports to Customers.
Financial Institution will deliver or cause to be delivered to each
customer, at or prior to the time of the initial purchase of Shares, a copy
of the current prospectus of the Fund and, upon request by a customer or
shareholder, a copy of the Fund's current Statement of Additional
Information. Financial Institution agrees to deliver to Shareholder, upon
the request of OGDS, copies of amended prospectuses and to deliver or cause
to be delivered to shareholders proxy solicitation materials and copies of
the Funds' annual and semi-annual reports. Financial Institution shall not
make any representations concerning any Shares other than those contained
in the prospectus or Statement of Additional Information of a Fund or in
any promotional materials or sales literature furnished to Financial
Institution by OGDS or One Group.
2. Blue Sky.
(a) Shares of the Funds have been qualified for sale under, or are exempt
from the requirements of the respective securities laws of the states
and jurisdictions listed on Exhibit A. OGDS will promptly notify
Financial Institution in the event shares of the Funds cease to be
qualified for sale under, or cease to qualify for an exemption from
the requirements of the respective securities laws of the states and
jurisdictions listed on Exhibit A to this Agreement.
(b) Financial Institution agrees and certifies that:
(i) It is licensed to offer and sell securities of open-end
investment companies in all jurisdictions in which it plans to
offer and sell such securities, or it is exempt from licensing
requirements;
(ii) It will comply with all applicable state and federal laws and
the rules and regulations of authorized regulatory agencies; and
(iii) It will not sell or offer for sale Shares of the Funds in any
state or jurisdiction where the Shares have not been qualified
for sale.
3. Indemnification.
(a) Financial Institution shall indemnify and hold harmless OGDS, OGA,
each Fund, the transfer agent of the Funds, and their respective
subsidiaries, affiliates, officers, directors, agents and employees
from all direct or indirect liabilities, losses or costs (including
attorneys fees) arising from, related to or otherwise connected with:
(i) any material breach by Financial Institution of any
representations, covenants or warranties of this Agreement;
(ii) any actions or omissions of OGDS, OGA, any Fund, the transfer
agent of the Funds, and their subsidiaries, affiliates, officers,
directors, agents and employees in reliance upon any oral,
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written or computer or electronically transmitted instructions,
documents or materials believed to be genuine and to have been
given by or on behalf of Financial Institution; or
(iii) any willful misconduct or negligence (as measured by industry
standards) of Financial Institution, its agents and employees,
in the performance of, or failure to perform, its obligations
under this Agreement, or any reckless disregard of its
obligations under this Agreement.
(b) OGDS shall indemnify and hold harmless Financial Institution and its
subsidiaries, affiliates, officers, directors, agents and employees
from and against any and all direct or indirect liabilities, losses or
costs (including attorneys fees) arising from, related to or otherwise
connected with:
(i) any breach by OGDS of any representations, covenants or
warranties of this Agreement or any provision of this Agreement;
(ii) any alleged untrue statement of a material fact contained in any
Fund's Registration Statement or Prospectus, or as a result of
or based upon any alleged omission to state a material fact
required to be stated therein or necessary to make the
statements contained therein not misleading; and
(iii) any willful misconduct or negligence (as measured by industry
standards) of OGDS, its agents and employees, in the performance
of, or failure to perform, its obligations under this Agreement,
or any reckless disregard of its obligations under this
Agreement
(c) OGA shall indemnify and hold harmless Financial Institution and its
subsidiaries, affiliates, officers, directors, agents and employees
from and against any and all direct or indirect liabilities, losses or
costs (including attorneys fees) arising from, related to or otherwise
connected with any breach by OGA of any provision of this Agreement.
(d) The agreement of the parties in this Section 3 to indemnify each other
is conditioned upon the party entitled to indemnification (Indemnified
Party) giving notice to the party required to provide indemnification
(Indemnifying Party) promptly after the summons or other first legal
process for any claim as to which indemnity may be sought is served on
the Indemnified Party. Such notice will be given by a means of prompt
delivery that provides confirmation of receipt to the address provided
below in Section 8. The Indemnified Party shall permit the
Indemnifying Party to assume the defense of any such claim or any
litigation resulting from it, provided that counsel for the
Indemnifying Party who shall conduct the defense of such claim or
litigation shall be approved by the Indemnified Party (which approval
shall not unreasonably be withheld), and that the Indemnified Party
may participate in such defense at its expense. If the Indemnifying
party does not elect to assume the defense, the Indemnifying Party
will reimburse the Indemnified Party for the reasonable fees and
expenses of any counsel retained by it. The failure of the Indemnified
Party to give notice as provided in this Sub-section (d) shall not
relieve the Indemnifying Party from any liability other than its
indemnity obligation under this Section. No Indemnifying Party, in the
defense of any such claim or litigation, shall, without the written
consent of the Indemnified Party, consent to entry of any judgment or
enter into any settlement that does not include as an unconditional
term the giving by the claimant or plaintiff to the Indemnified Party
of a release from all liability in respect to such claim or
litigation.
(e) The provisions of this Section 3 shall survive the termination of this
Agreement.
4. Customer Names Proprietary to Financial institution.
(a) All information, including "nonpublic personal information" as that
term in defined in Regulation S-P, relating to Financial Institution's
customers are and shall remain Financial Institution's sole property
and shall not be disclosed to or used by OGDS, OGA, or their
affiliates for any purpose except the performance of their respective
duties and responsibilities under this Agreement and except for
servicing and
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informational mailings relating to the Funds or as permitted by Rule
15 of Regulation S-P. Notwithstanding the foregoing, this Section 5
shall not prohibit OGDS, OGA, or any of their affiliates from
utilizing the names of Financial Institution's customers for any
purpose if the names are obtained in any manner other than from
Financial Institution pursuant to this Agreement.
(b) If applicable, Financial Institution will deliver One Group's privacy
policy as required by Regulation S-P.
(c) Neither party shall use the name of the other party in any manner
without the other party's written consent, except as required by any
applicable federal or state law, rule or regulation, and except
pursuant to any mutually agreed upon promotional programs.
(d) The provisions of this Section 5 shall survive the termination of this
Agreement.
5. Security Against Unauthorized Use of Funds' Recordkeeping Systems.
Financial Institution agrees to proved such security as is necessary to
prevent any unauthorized use of the Funds' recordkeeping system, accessed
via (a) xxx.xxxxxxxx.xxx or any other URL maintained by One Group, (b) a
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networking/data access arrangement or (c) computer hardware or software
provided to Financial Institution by OGDS or OGA.
6. Solicitation of Proxies.
Financial Institution agrees not to solicit or cause to be solicited
directly, or indirectly, at any time in the future, any proxies from the
shareholders of any or all of the Funds in opposition to proxies solicited
by management of the Fund or Funds, unless a court of competent
jurisdiction shall have determined that the conduct of a majority of the
Board of Directors or Trustees of the Fund or Funds constitutes willful
misfeasance, bad faith, gross negligence or reckless disregard of their
duties. This Section 7 will survive the termination of this Agreement.
7. Certification of Customers' Taxpayer Identification Numbers.
Financial Institution agrees to obtain any taxpayer identification number
certification from its customers required under the Internal Revenue Code
of 1986, as amended, and any applicable Treasury regulations, and to
provide OGDS, or its designee with timely written notice of any failure to
obtain such taxpayer identification number certification in order to enable
the implementation of any required backup withholding.
8. Notices.
(a) Except as otherwise specifically provided in this Agreement, all
notices required or permitted to be given pursuant to this Agreement
shall be given in writing and delivered by:
(i) personal delivery;
(ii) postage prepaid, registered or certified United States first
class mail, return receipt requested;
(iii) overnight courier services; or
(iv) facsimile or similar electronic means of delivery (with a
confirming copy by mail as provided herein).
(b) Unless otherwise notified in writing, all notices to OGDS or OGA shall
be given or sent to OGDS or OGA at their offices located at 0000
Xxxxxxx Xxxxxxx, Xxxxxxxx, Xxxx, 00000-0000, Attn: President, and all
notices to Financial Institution shall be given or sent to it at its
address shown below.
9. Records.
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Financial Institution will maintain all records required to be kept by
state and federal law relating to transactions in Shares and, upon request
by One Group, will promptly make such records available to One Group.
10. Termination and Amendment.
(a) This Agreement shall become effective in this form as of the date
executed by OGDS or as of the first date thereafter upon which
Financial Institution executes any transaction, performs any service,
or receives any payment pursuant hereto. This Agreement supersedes any
prior sales, distribution, shareholder service, or administrative
service agreements between the parties.
(b) This Agreement, including Exhibit A hereto, may be amended by OGDS
from time to time by the following procedure. OGDS will mail a copy of
the amendment to Financial Institution's address, as shown below. If
Financial Institution does not object to the amendment within thirty
(30) days after its receipt, the amendment will become part of the
Agreement. Financial Institution's objection must be in writing and be
received by OGDS within such thirty days.
(c) Notwithstanding the foregoing, this Agreement may be terminated as
follows:
(i) At any time, without the payment of any penalty, by the vote of
a majority of the Independent Trustees or by a vote of a
majority of the outstanding voting securities of the Fund as
defined in the Investment Company Act of 1940 on not more than
sixty (60) days' written notice to the parties to this
Agreement;
(ii) automatically in the event of the Agreement's assignment as
defined in the Investment Company Act of 1940, upon the
termination of the "Distribution Agreement" between One Group
and OGDS, upon termination of the "Management and Administration
Agreement" between One Group and OGA, or upon the termination of
the applicable Distribution and Shareholder Services Plan(s);
and
(iii) by any party to this Agreement without cause by giving the other
party at least sixty (60) days' written notice of its intention
to terminate.
(d) The termination of this Agreement with respect to any one Fund will
not cause the Agreement's termination with respect to any other Fund.
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12. Anti-Money Laundering Procedures.
(a) Financial Institution will comply with all applicable laws and
regulations aimed at preventing, detecting, and reporting money
laundering and suspicious transactions and will take all necessary and
appropriate steps, consistent with applicable regulations and
generally accepted industry practices, to (i) obtain, verify, and
retain information with regard to investor identification and source
of investor funds, and (ii) to maintain records of all investor
transactions. Financial Institutionr will (but only to the extent
consistent with applicable law) take all steps necessary and
appropriate to provide One Group and/or ODGS with any requested
information about investors and accounts in the event that One Group
and/or ODGS shall request such information due to an inquiry or
investigation by any law enforcement, regulatory, or administrative
authority.
(b) Financial Institution will, to the extent permitted by applicable law
and regulations, notify One Group and/or OGDS of any concerns that
Financial Institution may have in connection with any investor in the
context of relevant anti-money laundering legislation/regulations.
13. Governing Law.
This Agreement shall be construed in accordance with the laws of the State
of Delaware.
ONE GROUP DEALER SERVICES, INC.
0000 Xxxxxxx Xxxxxxx
Xxxxxxxx, Xxxx 00000-0000
By: /s/ Xxxx X. Xxxxxx
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Name: Xxxx X. Xxxxxx
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Title: President
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Date: 6/21/02
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ONE GROUP ADMINISTRATIVE SERVICES, INC.
0000 Xxxxxxx Xxxxxxx
Xxxxxxxx, Xxxx 00000-0000
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
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Title: COO
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Date: 6/21/02
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Eastern Michigan Bank One
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Financial Institution Name
(Please Print or Type)
Address 00 X. Xxxxxx Xxx
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City: Croswell State MI Zip Code 48422
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By: /s/ Xxxxxxxx Xxxxxxx
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Xxxxxxxx Xxxxxxx
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Authorized Signature
E.V.P.
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Title
Xxxxxxxx Xxxxxxx
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Print Name or Type Name
5-2202
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Dated
Mutual Funds Sales and Service Agreement.(e)(15)doc
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