SERVICES AGREEMENT
AGREEMENT made this 14th day of May 2007, between Fifth Third Asset
Management, Inc. ("FTAM"), an Ohio corporation having its principal place of
business at 00 Xxxxxxxx Xxxxxx Xxxxx, Xxxxxxxxxx, Xxxx 00000, and Fifth Third
Funds, a Massachusetts business trust having its principal place of business in
Cincinnati, Ohio (the "Trust").
WHEREAS, the Trust is an open-end management investment company as that
term is defined in the Investment Company Act of 1940 and is registered as such
with the Securities and Exchange Commission (the "Commission"); and
WHEREAS, the Trust desires to retain FTAM to perform certain services
for the Trust and each investment portfolio of the Trust, as now in existence or
as hereafter may be established from time to time (individually referred to
herein as the "Fund" and collectively as the "Funds");
WHEREAS, FTAM is willing to perform such services on the terms and
conditions set forth in this Agreement; and
NOW, THEREFORE, in consideration of the covenants hereinafter
contained, the Trust and FTAM hereby agree as follows:
1. Services
FTAM shall perform the following services for the Trust: assist with
the monitoring of market timing activities, assist with product development
activities related to transfer agency services, assist with merger/acquisition
activities related to transfer agency services and assist with due diligence
activities related to transfer agency services. FTAM also agrees to perform such
special services incidental to the performance of the services enumerated herein
as agreed to by the parties from time to time.
FTAM may, without prior notice to the Trust, appoint other parties
qualified to perform the services set forth under this Agreement (a
"Sub-Services Agent") to carry out some or all of its responsibilities under
this Agreement; provided, however, that the Sub-Services Agent shall be the
agent of FTAM and not the agent of the Trust, and that FTAM shall be fully
responsible for the acts of such Sub-Services Agent and shall not be relieved of
any of its responsibilities hereunder by the appointment of such Sub-Services
Agent.
2. Fees
The Trust shall pay FTAM for the services to be provided by FTAM under
this Agreement an annual fee of $370,000.
3. Reimbursement of Expenses
In addition to paying FTAM the fees set forth in Section 2, the Trust
agrees to reimburse FTAM for FTAM's reasonable out-of-pocket expenses, including
hardware, software, and licensing expenses related to the monitoring of market
timing activities.
4. Effective Date
This Agreement shall become effective as of the date first written
above (the "Effective Date").
5. Term
This Agreement shall continue in effect until December 31, 2008 (the
"Initial Term"), unless terminated by FTAM upon the provision of thirty (30)
days advance written notice. Thereafter, unless otherwise terminated as provided
herein, this Agreement shall be renewed automatically for successive one year
periods ("Rollover Periods"). This Agreement may be terminated only (i) by
provision of a notice of nonrenewal in the manner set forth below, (ii) by
mutual agreement of the parties, (iii) for "cause," as defined below, upon the
provision of thirty (30) days advance written notice by the party alleging
cause, (iv) by FTAM upon the provision of sixty (60) days advance written
notice. Written notice of nonrenewal must be provided at least sixty (60) days
prior to the end of the Initial Term or any Rollover Period, as the case may be.
For purposes of this Agreement, "cause" shall mean (a) a material
breach of this Agreement that has not been remedied for thirty (30) days
following written notice of such breach from the non-breaching party; (b) a
final, unappealable judicial, regulatory or administrative ruling or order in
which the party to be terminated has been found guilty of criminal or unethical
behavior in the conduct of its business; or (c) financial difficulties on the
part of the party to be terminated which are evidenced by the authorization or
commencement of, or involvement by way of pleading, answer, consent or
acquiescence in, a voluntary or involuntary case under Title 11 of the United
States Code, as from time to time is in effect, or any applicable law, other
than said Title 11, of any jurisdiction relating to the liquidation or
reorganization of debtors or to the modification or alteration of the rights of
creditors.
6. Standard of Care; Uncontrollable Events; Limitation of Liability
FTAM shall use its best efforts to ensure the accuracy of all services
performed under this Agreement, but shall not be liable to the Trust for any
action taken or omitted by FTAM in the absence of bad faith, willful
misfeasance, negligence or reckless disregard by it of its obligations and
duties. The duties of FTAM shall be confined to those expressly set forth
herein, and no implied duties are assumed by or may be asserted against FTAM
hereunder.
Notwithstanding the foregoing or any other provision of this Agreement,
FTAM assumes no responsibility hereunder, and shall not be liable for, any
damage, loss of data, delay or any other loss whatsoever caused by events beyond
its reasonable control.
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Events beyond FTAM's reasonable control include, without limitation, force
majeure events. Force majeure events include natural disasters, actions or
decrees of governmental bodies, and communication lines failures that are not
the fault of either party. In the event of force majeure, computer or other
equipment failures or other events beyond its reasonable control, FTAM shall
follow applicable procedures in its disaster recovery and business continuity
plan and use all commercially reasonable efforts to minimize any service
interruption.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO EVENT
SHALL FTAM, ITS AFFILIATES OR ANY OF ITS OR THEIR DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS OR SUBCONTRACTORS BE LIABLE FOR EXEMPLARY, PUNITIVE, SPECIAL,
INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, OR LOST PROFITS, EACH OF WHICH IS
HEREBY EXCLUDED BY AGREEMENT OF THE PARTIES REGARDLESS OF WHETHER SUCH DAMAGES
WERE FORESEEABLE OR WHETHER EITHER PARTY OR ANY ENTITY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.
7. Indemnification
FTAM shall indemnify, defend, and hold the Trust harmless from and
against any and all claims, actions and suits and all losses, damages, costs,
charges, reasonable counsel fees and disbursements, payments, expenses and
liabilities (including reasonable investigation expenses) resulting directly and
proximately from FTAM's willful misfeasance, bad faith or negligence in the
performance of its duties or by reason of reckless disregard of its obligations
and duties hereunder.
The Trust shall indemnify, defend, and hold FTAM harmless from and
against any and all claims, actions and suits and all losses, damages, costs,
charges, reasonable counsel fees and disbursements, payments, expenses and
liabilities (including reasonable investigation expenses) resulting directly and
proximately from the Trust's willful misfeasance, bad faith or negligence in the
performance of its duties or by reason of reckless disregard of its obligations
and duties hereunder.
The indemnification rights hereunder shall include the right to
reasonable advances of defense expenses in the event of any pending or
threatened litigation with respect to which indemnification hereunder may
ultimately be merited. In order that the indemnification provisions contained
herein shall apply, however, it is understood that if in any case a party may be
asked to indemnify or hold the other party harmless, the indemnifying party
shall be fully and promptly advised of all pertinent facts concerning the
situation in question, and it is further understood that the indemnified party
will use all reasonable care to identify and notify the indemnifying party
promptly concerning any situation which presents or appears likely to present
the probability of such a claim for indemnification against the indemnifying
party, but failure to do so in good faith shall not affect the rights hereunder
except to the extent the indemnifying party is materially prejudiced thereby. As
to any matter eligible for indemnification, an indemnified party shall act
reasonably and in accordance with good faith business judgment and shall not
effect any settlement or confess judgment without the consent of the
indemnifying party, which consent shall not be withheld or delayed unreasonably.
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The indemnifying party shall be entitled to participate at its own
expense or, if it so elects, to assume the defense of any suit brought to
enforce any claims subject to this indemnity provision. If the indemnifying
party elects to assume the defense of any such claim, the defense shall be
conducted by counsel chosen by it and reasonably satisfactory to the indemnified
party, whose approval shall not be unreasonably withheld. In the event that the
indemnifying party elects to assume the defense of any suit and retain counsel,
the indemnified party shall bear the fees and expenses of any additional counsel
retained by it. If the indemnifying party does not elect to assume the defense
of suit, it will reimburse the indemnified party for the reasonable fees and
expenses of any counsel retained by the indemnified party. The indemnity and
defense provisions set forth herein shall indefinitely survive the termination
of this Agreement.
8. Record Retention
FTAM shall keep and maintain on behalf of the Trust all books and
records which the Trust or FTAM is, or may be, required to keep and maintain
pursuant to any applicable statutes, rules and regulations, including without
limitation Rules 31a-1 and 31a-2 under the Investment Company Act of 1940, as
amended (the "1940 Act"), relating to the maintenance of books and records in
connection with the services to be provided hereunder. FTAM further agrees that
all such books and records shall be the property of the Trust and to make such
books and records available for inspection by the Trust or by the Commission at
reasonable times.
9. Reports
FTAM shall furnish to the Trust such reports as agreed upon by the
parties.
10. Rights of Ownership
All computer programs and procedures employed or developed by or on
behalf of FTAM to perform services required to be provided by FTAM under this
Agreement are the property of FTAM. All computer programs and procedures
employed or developed by or on behalf of the Trust are the property of the
Trust.
11. Notices
Any notice provided hereunder shall be sufficiently given when sent by
registered or certified mail to the party required to be served with such notice
at the following address: if to FTAM, to it at 00 Xxxxxxxx Xxxxxx Xxxxx, XX
0000XX, Xxxxxxxxxx, Xxxx 00000 Attn: Xxxxxxx Xxxx; and if to the Trust, to it at
00 Xxxxxxxx Xxxxxx Xxxxx, XX 0000XX, Xxxxxxxxxx, Xxxx 00000; Attn: President, or
at such other address as such party may from time to time specify in writing to
the other party pursuant to this Section.
12. Assignment
This Agreement and the rights and duties hereunder shall not be
assignable by either of the parties hereto except by the specific written
consent of the other party.
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13. Governing Law and Matters Relating to the Trust as a Massachusetts
Business Trust.
This Agreement shall be governed by and provisions shall be construed
in accordance with the laws of the State of Ohio and the applicable provisions
of the 1940 Act. To the extent that the applicable laws of the State of Ohio, or
any of the provisions herein, conflict with the applicable provisions of the
1940 Act, the latter shall control. The names "Fifth Third Funds" and "Trustees
of the Fifth Third Funds" refer respectively to the Trust created and the
Trustees, as trustees but not individually or personally, acting from time to
time under the Declaration of Trust dated as of September 15, 1988, to which
reference is hereby made and a copy of which is on file at the office of the
Secretary of the State of the Commonwealth of Massachusetts and elsewhere as
required by law, and to any and all amendments thereto so filed or hereafter
filed. The obligations of "Fifth Third Funds" entered into in the name or on
behalf thereof by any of the Trustees, representatives or agents are made not
individually, but in such capacities and are not binding upon any of the
Trustees, shareholders or representatives of the Trust personally, but bind only
the assets of the Trust, and all persons dealing with any series of shares of
the Trust must look solely to the assets of the Trust belonging to such series
for the enforcement of any claims against the Trust.
14. Privacy
Nonpublic personal financial information relating to consumers or
customers of the Trust provided, collected or retained by FTAM in the course of
performing its duties under this Agreement, shall be considered confidential
information. FTAM shall not give, sell or in any way transfer such confidential
information to any person or entity, other than affiliates of FTAM except at the
direction of the Trust or as required or permitted by law (including Applicable
AML Laws).
15. Miscellaneous
(a) Paragraph headings in this Agreement are included for convenience
only and are not to be used to construe or interpret this Agreement.
(b) This Agreement constitutes the complete agreement of the parties
hereto as to the subject matter covered by this Agreement, and supercedes all
prior negotiations, understandings and agreements bearing upon the subject
matter covered herein.
(c) This Agreement may be executed in counterparts, each of which shall
be an original but all of which, taken together, shall constitute one and the
same agreement.
(d) No amendment to this Agreement shall be valid unless made in
writing and executed by both parties hereto.
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* * * * *
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
FIFTH THIRD ASSET MANAGEMENT, INC.
By: /s/ X. X. Xxxxx
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Name: X.X. Xxxxx
Title: President
FIFTH THIRD FUNDS
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxx
Title: Secretary
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