Exhibit (h)(25)
Sub-Transfer Agency Agreement
Dated February 1, 2001
between
First Union National Bank
And
One Group Mutual Funds
148
SERVICES AGREEMENT
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This Services Agreement is made and entered into as of February 1, 2001, by
and between First Union National Bank, a national banking association chartered
by The Office of the Comptroller of the Currency under the laws of the United
States ("First Union"), and One Group Mutual Funds, a Massachusetts business
trust (the "Alliance Partner").
WHEREAS, the Alliance Partner is an investment company registered under the
Investment Company Act of 1940, as amended (the " 1940 Act") comprised of
certain series listed on Schedule A (the "Funds").
WHEREAS, First Union acts as trustee or custodian to certain employee
benefit plans (the "Plans") and provides certain administrative and
recordkeeping services to the Plans and their participants; and
WHEREAS, First Union, and the Alliance Partner desire to facilitate the
purchase and redemption of shares (the "Shares") of the Funds on behalf of the
Plans and their participants ("Plan Participants") through one or more accounts
("Accounts") subject to the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the premises and mutual agreements
contained herein, the parties hereto agree as follows:
1. Performance of Services. First Union shall perform, or arrange for the
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performance of, any one or more of the following services (collectively,
"Administrative Services"):
(a) establish and maintain omnibus accounts with the Funds. Each Fund
shall recognize all Plans as a single shareholder and will not maintain separate
Accounts for the Plans or the Plan Participants;
(b) aggregate orders given by Plan sponsors or their authorized
representatives, or Plan Participants for the purchase of Shares, submit such
orders to Alliance Partner and promptly deliver payment and appropriate
documentation to Alliance Partner. The record holder for Shares so ordered shall
be First Union National Bank. Shares so held are referred to as "Plan Shares;"
(c) aggregate exchange and redemption orders given by Plan Participants
and Plan sponsors, submit such exchange and redemption orders to Alliance
Partner and receive the proceeds of redemptions for allocation to the Plan
Participant's sub-accounts;
(d) receive in the aggregate and allocate to the Plan sub-accounts
dividends and distributions with respect to Plan Shares;
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(e) provide record-keeping services relating to the foregoing purchase and
redemption transactions; and
(f) provide such information and services relating to the foregoing as
Alliance Partner reasonably requests, to the extent First Union is permitted by
applicable law to provide such information or service.
2. Orders and Settlement. (a) Alliance Partner hereby appoints First Union as
its agent for the sole and limited purpose of accepting purchase, exchange and
redemption orders for Shares purchased, exchanged or redeemed by the Plans
("Orders"). First Union hereby accepts its appointment on the terms and
conditions set forth herein. Notwithstanding anything in this Agreement to the
contrary, First Union shall not be acting as agent for Alliance Partner in any
manner whatsoever, except in accepting such Orders.
(b) First Union, as agent of Alliance Partner, shall be permitted to
accept from the Plans, orders for the purchase, exchange or redemption of Shares
of the Funds on each business day that the New York Stock Exchange is open for
business and a Fund's net asset value is determined ("Business Day"). First
Union shall not be required to accept Orders on any Business Day on which it is
not open for business. If Orders are accepted by First Union prior to the latest
time at which a Fund's net asset value is calculated as specified in such Fund's
prospectus ("Close of Trading") on a Business Day, they shall be treated as
having been received by Alliance Partner on such Business Day. If such Orders
are received after Close of Trading on a Business Day, they shall not be treated
as having been accepted by First Union or Alliance Partner on such Business Day.
(c) Instructions from First Union or its designee for the purchase,
exchange or redemption of Shares of the Funds pursuant to Orders shall be
processed and transmitted by electronic data transmission to Alliance Partner or
its designee. If such means of transmittal become unavailable, then Orders may
be processed and transmitted by telephone, fax, or any other mutually acceptable
means. First Union or its designee shall only transmit instructions which are
pursuant to Orders authorized by the Plans. Such instructions shall specify: (i)
either the number of Shares or the dollar amount of any such purchase, exchange
or redemption; (ii) the applicable Fund(s); and (iii) the Business Day on which
the Order was accepted by First Union.
(d) Instructions for the purchase, exchange or redemption of Shares of the
Funds pursuant to Orders shall be properly communicated to and received by
Alliance Partner by 9:00 a.m. Eastern Time of the Business Day next following
the Business Day on which the Order was accepted by First Union. Such
instructions shall be effected at the public offering price of the Shares of the
respective Fund (giving effect to any applicable load waiver or reduction in
offering price as described in the prospectus of the Fund) calculated as of the
Close of Trading on the Business Day on which the Order was accepted by First
Union. If such instructions for the purchase, exchange or redemption of Shares
of the Funds are received by Alliance Partner after 9:00 a.m. Eastern Time of
the Business Day next following the Business Day on which the Order was accepted
by First Union, First Union shall be responsible for any claim, demand, loss,
expense or cause of action suffered by Alliance Partner or the Funds, or
affiliates of either, as a
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result of such delay.
(e) The Funds shall not impose a minimum account balance or minimum order
requirement, or if the Funds require such minimums, they will be waived under
this Agreement.
(f) Settlement for purchases and redemptions shall be conducted in
accordance with the terms of Schedule B.
3. Pricing Information. Alliance Partner or its designee will furnish First
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Union on each Business Day with: (i) net asset value information calculated as
of the Close of Trading or as of such earlier times at which the Fund's net
asset value is calculated as specified in such Fund's prospectus, (ii) dividend
and capital gains information as such becomes available, and (iii) in the case
of income Funds, the daily accrual for interest rate factor. Alliance Partner or
its designee will make a best faith effort to provide such information by 6:30
p.m. Eastern Time on the same Business Day, however, in no event will such
information be provided later than 7:00 p.m. Eastern Time on the same Business
Day.
4. Account Information. (a) Alliance Partner or its agent will provide or make
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available to First Union (i) daily confirmations of Account activity on the
Business Day following the Business Day on which an Order is accepted by First
Union, (ii) if requested by First Union, monthly statements detailing activity
in each account within five (5) Business Days after the end of each month, and
(iii) such other reports as reasonably requested by First Union.
(b) First Union shall be permitted to use, discuss with, and provide to
Plans and Plan Participants information, including Fund return information,
which is publicly and/or widely available, including but not limited to,
information from Morningstar and Lipper.
5. Reports and Proxies. Alliance Partner will provide First Union, without
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expense, with the number of prospectuses, proxy statements and periodic
shareholder reports and such other information with respect to the Funds as
First Union may reasonably request. Alliance Partner will notify First Union
regarding planned shareholder meetings and proxy votes, a soon as practicable,
but in no event less than 10 business days before the record date, in order to
provide First Union adequate time to obtain necessary voting directions from the
Plans.
6. Fund Expenses. First Union shall bear none of the expenses for the cost of
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registration of the Shares, preparation of the Funds' prospectuses, proxy
materials and reports, and preparation of other related statements and notices
required by law. No party shall charge any other party a fee for wiring funds or
for execution of purchases and sales under this Agreement. The Funds will not
impose transaction fees and will not impose sales load charges for purchases or
redemptions, or if there are such charges, they will be waived for any
shareholder under this Agreement.
7. Fees. In consideration of the administrative savings resulting from such an
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arrangement and the other provisions of this Agreement, Alliance Partner agrees
to pay First Union the fees described in the attached Schedule A
("Administrative Fees"). The parties agree that the
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Administrative Fees are for the Administrative Services only and do not
constitute payment in any manner for investment advisory or distribution
services. Alliance Partner or its designee will calculate the Administrative
Fees based on the actual daily balance of Accounts maintained in each Fund and
make payment to First Union within ten (10) days after each month-end for the
preceding month. Alliance Partner or its designee will send First Union a fee
summary each month. Such summary will be accompanied by statements showing the
calculation of the Administrative Fees.
8. Representations of First Union. First Union represents and warrants that
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the following are true and shall remain true through the term of this Agreement:
(a) First Union is a national banking association chartered by The Office
of the Comptroller of the Currency under the laws of the United States.
(b) First Union is authorized to enter into and perform this Agreement.
(c) To the best of its knowledge, it is in material conformity with all
applicable federal and state laws and related regulations.
9. Representations of the Alliance Partner. The Alliance Partner represents
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and warrants that the following are true and shall remain true through the term
of this Agreement:
(a) The Alliance Partner is a business trust duly organized and existing
in good standing under the laws of the state where it is organized.
(b) The Alliance Partner is authorized to enter into and perform this
Agreement on behalf of the Funds, and the performance of its obligations
hereunder does not and will not violate or conflict with any governing documents
or agreements with respect to the Funds.
(c) The Shares shall be registered under the Securities Act of 1933, as
amended (the 1933 Act"), and shall be duly authorized for issuance and sold in
compliance with the 1933 Act and all other applicable federal and state
securities laws.
(d) The Funds are registered under the 0000 Xxx.
(e) The investment adviser of the Funds is an adviser registered under the
Investment Advisers Act of 1940, as amended.
(f) To the best of its knowledge, it is in material conformity with all
applicable federal and state laws and related regulations.
10. Indemnification. Each of the parties hereto agrees to indemnify and hold
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harmless (the "Indemnitor") the other, including their respective affiliates,
and each of their directors, trustees, officers, and employees (the
"Indemnitees"), against any losses, claims, damages, liabilities or expenses to
which the Indemnitees may become subject insofar as such losses, claims,
damages, liabilities or expenses (or actions in respect thereof) directly arise
out of or are directly based
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upon any breach by the Indemnitor of any material provision of this Agreement or
of a representation, warranty, or covenant in this Agreement, provided that such
breach resulted from a negligent act or omission to act, bad faith, willful
misfeasance or reckless disregard by the Indemnitor. The Indemnitor will
reimburse the Indemnitees for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim or
action. This indemnity agreement will be in addition to any other remedies which
the Indemnitees may otherwise have and shall survive the termination of this
Agreement. Where the Indemnitee receives notice of a claim for which the
Indemnitor may be required to indemnify the Indemnitee, the Indemnitee shall
promptly give notice thereof to the Indemnitor; provided, however, that the
obligation shall not be reduced on account of the failure or delay of the
Indemnitee to give such notice. The terms of this section shall survive
termination of this Agreement.
11. Relationship of Parties. Except as expressly provided herein, nothing
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contained in this Agreement shall be deemed or construed to constitute or create
a partnership, association, or joint venture or agency relationship among First
Union, and the Alliance Partner or the Funds.
12. Confidentiality. First Union and Alliance Partner agree that all non-public
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records, information, and data relating to the business of the other (including
customer names and information) that are exchanged or negotiated pursuant to
this Agreement or in carrying out this Agreement shall remain confidential, and
shall not be voluntarily disclosed by either 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 an court, governmental agency or
regulatory body.
13. Nonexclusivity. Nothing in this Agreement shall be construed or is intended
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to prohibit Alliance Partner or the Funds from establishing a retirement plan
administration or record keeping program or from entering into similar
arrangements with other administrative or record keeping service providers.
Nothing in this Agreement shall be construed or is intended to prohibit First
Union from entering into similar arrangements with any other person or entity
regarding other mutual funds or any other type of investment.
14. Termination. Either party may terminate this Agreement by providing sixty
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(60) days written notice to the other party. Notwithstanding the foregoing,
either party may terminate this Agreement at any time by giving thirty (30) days
written notice to the other party in the event of a material breach of this
Agreement by the other party that is not cured during such thirty (30) day
period.
15. Governing Law. This Agreement shall be governed by and construed in
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accordance with the internal laws of the State of North Carolina applicable to
agreements fully executed and to be performed therein.
16. Assignment. This Agreement shall not be assigned by a party hereto, without
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the prior written consent of the other parties hereto. If a party assigns this
Agreement to an affiliate, the party assigning the Agreement shall notify the
other parties within 30 days. This Agreement
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shall inure to the benefit of and be binding upon the parties and their
permitted successors and assigns.
17. Controlling Agreement. The terms of this Services Agreement shall supercede
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and take precedence over any other agreements between the parties to the
Services Agreement to the extent that such other agreement(s) conflict(s) with
the terms of the Services Agreement with respect to assets invested by Plans
through First Union.
18. Time of the Essence. All times specified in this Agreement for the
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performance of the obligations of the parties shall be deemed to be of the
essence. The acceptance of a late performance, with or without objection or
reservation, shall not waive the right of any party to claim damages or avail
itself of any other remedy for such breach, nor constitute a waiver of this
requirement of timely performance of any obligation under this Agreement.
19. Written Notice. Except as otherwise provided herein, any notice required or
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permitted to be given hereunder shall be given in writing and shall be addressed
and delivered to the parties at the address set forth below, or such other
address as may be designated by either party by notice pursuant to the terms
hereof. Any such notice will be deemed given on the next Business Day if sent by
a nationally recognized overnight courier service that provides evidence of
receipt or the same Business Day if sent by 3:00 p.m. (receiving party's time)
by facsimile transmission and confirmed by a telephone call, otherwise, the next
Business Day.
To: First Union National Bank
If via U.S. Mail:
First Union National Bank
Benefit Services Group - Risk Management
0000 Xxxx X.X. Xxxxxx Xxxxxxxxx, 0X0
Xxxxxxxxx, XX 00000-0000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attention: Risk Management - Xxxxx Xxxxxxxx
If via any other means:
First Union National Bank
Benefit Services Group - Risk Management
0000 Xxxx X.X. Xxxxxx Xxxxxxxxx, 0X0
Xxxxxxxxx, XX 00000
Attention: Risk Management -Xxxxx Xxxxxxxx, NC-1176
With a copy to:
First Union National Bank
Xxxx X.X. Xxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000-0000
Attention: Mutual Funds, NC-I 151
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To: One Group Mutual Funds
0000 Xxxxxxx Xxxxxxx
X.X. Xxx 000000
Xxxxxxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxx, V.P. & Treasurer
20. Severability. If any provision of this Agreement is held invalid or
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unenforceable for any reason, such provision shall be fully severable, and this
Agreement shall be enforced and construed as if such provision had never
comprised a part of this Agreement. To the extent required, any provision of
this Agreement may be modified by a court of competent jurisdiction to preserve
its validity.
21. Counterparts. This Agreement may be executed in two or more counterparts,
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each of which shall be deemed an original, but all of which together shall
constitute one and the same Agreement.
22. Headings. The headings used herein are for convenience only and shall not
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be used in construing or interpreting the provisions of this Agreement.
IN WITNESS THEREOF, the undersigned has executed this Agreement by their duly
authorized officers.
FIRST UNION NATIONAL BANK One Group Mutual Funds
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxx X. Xxxxxxxx Name: Xxxxxx X. Xxxxx
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Title: V.P. Title: V.P. & Treasurer
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SCHEDULE A
Funds Covered by the Agreement Class of Shares Annual Fee
One Group Bond Fund I 15 Basis Points*
One Group Equity Index Fund I 15 Basis Points*
* This fee shall be limited to $18 per social security number per Fund per year.
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SCHEDULE B
SETTLEMENT PROVISIONS
1. Settlement (NSCC). If both First Union and Alliance Partner are members of
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the National Securities Clearing Corporation (the "NSCC"), and have
executed the NSCC Trust Networking Agreement and Trust Fund/SERV Agreement
and related Addendums (the "NSCC Agreements"), settlement of purchases and
redemptions will be processed pursuant to the NSCC Agreements .
2. Settlement (non-NSCC). If either First Union or Alliance Partner is not a
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member of the NSCC and/or has not executed the NSCC Agreements, then
settlement of the purchases and redemptions will be processed pursuant to
the following:
(a) For purchases, First Union shall make payment to Alliance Partner
in federal funds no later than the close of the Fedwire system on
the Business Day following the day on which purchase instructions
are treated as having been received by Alliance Partner pursuant
to the Services Agreement. Payment shall be made by wire transfer
to an account designated in writing by Alliance Partner or its
designee. If the payment is not received by Alliance Partner by
such time, Alliance Partner or any of its affiliates shall have
the right, without notice, to cancel the sale, or, at Alliance
Partner's option, to sell the Shares ordered back to the issuing
Fund, and Alliance Partner may hold First Union responsible for
any claim, demand, loss, expense or cause of action suffered by
Alliance Partner or the Funds, or affiliates of either, as a
result of First Union's failure to make such payment. Without
limiting the foregoing, in the event Alliance Partner, in its
sole discretion, accepts any wire payment received after such
time, Alliance Partner shall be entitled to compensation from
First Union for the amount of reasonable interest plus associated
bank penalties.
(b) For redemptions, Alliance Partner shall make payment in federal
funds no later than the close of the Fedwire system on the
Business Day following the day on which redemption instructions
are treated as having been received by Alliance Partner pursuant
to the Services Agreement, subject to the right of a Fund to
delay payment for redemptions in accordance with the terms of its
current prospectus. Payment shall be made by wire transfer to an
account designated in writing by First Union or its designee. If
the payment is not received in good order by such time, First
Union shall notify Alliance Partner. If it is determined that
Alliance Partner was negligent in initiating the payment causing
the delay or non-receipt of any such payment, then Alliance
Partner will compensate First Union for the amount of reasonable
interest plus associated bank penalties.
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