Exhibit (h)(26)
Sub-Transfer Agency Agreement
Dated January 31, 2001
Between
Matrix Settlement & Clearance Services, LLC,
Banc One Investment Advisors Corporation
And
One Group Mutual Funds
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SUB-ADMINISTRATION SERVICING AGREEMENT
This Sub Administration Servicing Agreement (the "Agreement") is made as of
January 31, 2001, by One Group Mutual Funds ("Company")Banc One Investment
Advisors Corporation ("Banc One" )both having an address at ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ and Matrix Settlement & Clearance Services,
LLC, a New York limited liability company , having an address at ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Service Provider") (collectively, the
"Parties").
WHEREAS, the Company is an open-end investment company comprised of the 56
series (each a "Fund") listed in Schedule A annexed hereto;
WHEREAS, Banc One serves solely as the investment advisor to the Funds;
WHEREAS, Banc One's commitment under the Agreement only relates to paying
that portion of the Fee, as defined below, which exceeds the equivalent of
$18.00 per Account, as defined below;
WHEREAS, the Service Provider, directly or through its affiliate or
designee (collectively, the "Service Provider") provides administrative support
services (the "Services"), that may include, but are not limited to, some or all
of the Services contained in Schedule B annexed hereto for certain qualified and
non-qualified plans (the "Plans");
WHEREAS, the Parties wish to facilitate the purchase and redemption of
shares of the Funds (the "Shares"), through and in accordance with the Rules &
Procedures Manual of the National Securities Clearing Corporation, as amended
from time to time, (the "Rules of the NSCC") on behalf of the Plans and the
Participants through one or more accounts (as determined by the Service
Provider) in the Funds (individually an "Account" and collectively the
"Accounts") and the rendering of the Services, subject to the terms and
conditions of this Agreement; and
WHEREAS, Company desires to engage Service Provider to provide the
Services, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements hereinafter set
forth, and for other good and valuable consideration, the receipt and adequacy
of which is hereby acknowledged, the Parties, intending to be legally bound,
agree as follows:
AGREEMENT
1. Incorporation of the Rules of the NSCC. The Rules & Procedures Manual
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of the NSCC, including the rules and procedures applicable to the utilization of
the Defined Contribution Clearing and Settlement System, as amended from time to
time (the "Procedures), are hereby made a part of this Agreement as if fully set
forth herein and shall be a part of each trade cleared by Service Provider on
behalf of or at the request of the Company.
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Notwithstanding the contrary provisions of Sections 4 and 5 hereof, the
Procedures applicable to the transmission of information and instructions, and
the settlement of transactions, shall be followed in all instances. Sections 4
and 5 shall apply as the operational procedures for this Agreement only in the
event that the NSCC is unavailable for whatever reason.
2. Term. The term of this Agreement shall commence on the date hereof and
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shall continue until the earliest to occur of the following (the "Termination
Date"):
(A) This Agreement is terminated by mutual written consent of the
parties hereto. Consent shall not be unreasonably withheld by
either Party hereto;
(B) This Agreement is terminated by written notice from Service
Provider to the Company, provided that Service Provider shall
only be able to terminate this Agreement under this Section 1(B)
following the occurrence of a material breach by the Company of
any of its representations, warranties, covenants or agreements
hereunder;
(C) This Agreement is terminated by written notice from the Company
to Service Provider, provided that the Company shall only be able
to terminate this Agreement under this Section 1(C) following the
occurrence of a material breach by Service Provider of any of its
representations, warranties, covenants or agreements hereunder;
or
(D) The first anniversary of the date of this Agreement; provided
that, this Agreement shall be automatically renewed for
successive one (1) year terms unless (i) either party not less
than 30 days prior to the expiration date of the initial term or
any renewal term notifies the other party in writing that the
Agreement will not be renewed or (ii) the Agreement is otherwise
terminated pursuant to (A) (B) or (C) above.
The termination of this Agreement shall not relieve either Party
of any obligation hereunder that accrued prior to such termination.
3. Services Provided by the Service Provider. The Service Provider
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shall provide the Services for the plan participants (the "Participants") having
an interest in Shares of the Funds purchased by the Plans for which the Service
Provider provides the Services. The Accounts will be held of record by the Plan
or the Service Provider or its designee; separate accounts for Participants will
not be maintained by the Company, the Funds or their agents. Company hereby
appoints Service Provider as its agent for the sole and limited purpose of
accepting purchase, exchange or redemption orders for Shares purchased,
exchanged or redeemed by the Plans ("Orders"). Service Provider hereby accepts
its appointment on the terms and conditions set forth herein.
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Notwithstanding anything in this Agreement to the contrary, Service Provider
shall not be acting as agent for Company in any manner whatsoever, except in
accepting such Orders.
4. Information Provided by the Company. (a) The Company agrees to provide
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the Service Provider on each business day that the New York Stock Exchange
("NYSE") is open for business (the "Business Day") with (i) net asset value
information as determined at or about the close of trading (currently 4:00 P.M.
Eastern Time ("ET") on the NYSE or at such other time at which the Fund's net
asset value is calculated as specified in each Fund's current prospectus (the
"Close of Trading"); (ii) dividend and capital gains distribution information as
it becomes available; (iii) in the case of income Funds, the daily accrual for
interest rate factor (mil rate); and (iv) any other information that the Service
Provider needs to perform the Services listed in Schedule B. The Company will
provide net asset value information, and income accrual, dividend payment and
capital gains information to the Service Provider by 7:00 P.M. ET on each
Business Day.
(b) The Company will provide the Service Provider (i) a confirmation with
respect to each instruction as defined below, under Section 5 herein no later
than the start of trading on the NYSE on the Business Day following the date on
which the instruction is deemed to be received by the Company; (ii) share
positions for each Fund on each Business Day; (iii) quarterly statements
detailing activity in each Account within fifteen Business Days after the end of
each quarter; and (iv) such other reports as may be reasonably requested by the
Service Provider.
5. Instructions and Settlement. (a) Instructions to purchase and redeem
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Shares by the Plan shall be effected as provided in this Section 5. The Service
Provider shall transmit to the Company instructions to purchase or redeem Shares
of the Funds for Accounts that have been or will be opened with the Funds for
the Plans (the "Instructions").
(b) The Service Provider will facilitate the clearing for the purchase and
redemption of trades of various mutual fund shares (the "Trades") in accordance
with the Rules of the NSCC. Purchases and redemptions for the Plans shall be
made at the net asset value determined as of the Close of Trading on the
Business Day that an Instruction to purchase or redeem shares is received by the
Service Provider, provided that (i) Service Provider receives Instructions from
Participants or Plan Representatives prior to the Close of Trading on that
Business Day; and (ii) the Company receives the Instructions from the Service
Provider by 6:00 A.M. ET on the next following Business Day. Instructions
received by the Service Provider from Participants or Plan Representatives after
the Close of Trading on any given Business Day shall be treated as if received
on the next following Business Day. The Service Provider has in place and at all
times during the term of this Agreement will maintain, internal controls
reasonably designed to prevent Participant and Plan orders received after the
Close of Trading on a Business Day from being aggregated with orders properly
received before that time.
(c) Payment for net purchases of Shares attributable to all Instructions
executed for the Accounts on a given Business Day will be wired by the Service
Provider no later than 3:00 P.M. ET on the next Business Day to a custodial
account designated by the Company. The Company agrees that payment for
redemptions of Shares attributable to all Instructions executed for the
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Accounts on a given Business Day will be wired by the Company on the next
Business Day no later than 3:00 P.M. ET to an account designed by the Service
Provider.
6. Compensation to Service Provider. The Company will pay a fee as listed
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in Schedule C to the Service Provider in consideration for the services provided
pursuant to this Agreement.
7. Representations, Warranties and Covenants.
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(A) Each of the Parties represents and warrants to the other as
follows:
(1) Such Party is an entity duly organized, validly existing and
in good standing under the laws of its jurisdiction of
organization and is duly qualified to transact business in
each other jurisdiction where it is required to be so
qualified;
(2) This Agreement, and the other agreements and instruments
entered into by such Party in connection with this Agreement
(the "Transaction Documents"), have been duly authorized and
executed by such Party, and represent the legal, valid and
binding obligations of such Party, enforceable against such
party in accordance with their respective terms;
(3) The execution, delivery and performance by such Party of the
Transaction Documents does not violate, conflict with or
constitute a breach of any provision of any Federal, state
or local law applicable to such Party, the organizational
documents of such Party or any material agreement, contract,
consent decree, order or other instrument to which such
Party is a Party or by which such Party is bound;
(4) Other than a consent previously obtained, no consent or
other action of any third party is necessary for such Party
to execute, deliver or perform the Transaction Documents;
(5) The Parties are not affiliated with each other in any way.
Neither will represent or imply in any way that either Party
has any relationship with the other Party except as
described in this Agreement. Neither Party will use the
other's name in advertising or marketing material, or
otherwise, without the other's prior written consent, except
that each party may use the name of the other as may be
necessary in their respective regulatory filings; and
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(6) At all times, the Parties shall comply, and the Service
Provider shall use reasonable efforts to cause its
affiliates or designees to comply, with all federal and
state laws and regulations, including, but not limited to,
the Investment Company Act of 1940 (the "1940 Act"), the
Securities Act of 1933 (the "1933 Act"), the Securities and
Exchange Act of 1934 (the "1934 Act") and the Employee
Retirement Income Security Act (all as amended).
(B) The Company represents, warrants, and covenants that:
(1) The Company is an investment company registered under
the 1940 Act and Shares sold by the Funds are, and will be,
registered under the 1933 Act;
(2) Except as indicated on Schedule A, Shares of the
Company and Funds are properly registered with the U.S.
Securities and Exchange Commission and all regulatory
requirements necessary to permit Shares to be sold in
accordance with the terms of this Agreement have been
satisfied for all fifty states and the District of Columbia.
The Company will notify the Service Provider immediately if
there is any change in the registration or qualification for
sale of any Shares;
(3) Instructions may be placed on each and every Business
Day, without regard to the market value of the transaction;
and
(4) The Service Provider is not responsible for any
information contained in any prospectus, registration
statement, annual report, proxy statement, or item of
advertising, marketing material or any other document
prepared by the Company or its affiliate that relates to any
Fund.
(C) Service Provider represents, warrants and covenants that:
(1) To the extent Service Provider is subject to the
provisions of the Financial Modernization Act of 1999 and
other laws governing, among other things, the conduct of
activities by federally chartered and supervised banks and
other affiliated banking organizations, Service Provider
will perform only those activities consistent with its
statutory and regulatory obligations and will act solely as
agent for, upon the order of, and for the account of,
Administrators;
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(2) To the extent Service Provider engages one or more third
parties (including any of its affiliates or designees) to act as
subcontractor(s) or agent(s) ("Subcontractor") to perform the
Services required by this Agreement, Service Provider represents
it has determined that each such Subcontractor is capable of
performing the Services, and that Service Provider will take such
measures as may be necessary to ensure that such Subcontractors
perform the Services in accordance with the terms of this
Agreement and applicable law. All references to Service Provider
in this Agreement shall also cover Subcontractors to the extent
that Services are provided by Subcontractors; and
(3) For all purposes of this Agreement, Service Provider is an
independent contractor, and has no authority to act as limited
agent for any of the Funds in any matter or in any respect except
that if Service Provider transmits purchase and sale instructions
to any of the Funds or their agent after the close of the New
York Stock Exchange, then Service Provider will be considered
such Fund's agent for purposes of Rule 22c-l under the 1940 Act.
8. Indemnification. Service Provider does hereby agree to indemnify,
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defend and hold harmless the Company, and its affiliates, officers, directors,
representatives and employees (collectively, the "Company Parties") from and
against any claims, liabilities, costs, attorneys' fees and legal costs,
expenses, indirect or direct losses, damages and penalties (collectively,
"Costs"), incurred by any such Company Party from or relating to (A) any
material breach by Service Provider of any representation, warranty, agreement
or other obligation contained in this Agreement; (B) such Company Party's
investigation, preparation or defense of any of the foregoing; (C) such Company
Party acting in accordance with any Instructions given by or on behalf of the
Service Provider and/or Plan; (D) any error or omission by the Service Provider
in an Instruction that results in costs.
The Company does hereby agree to indemnify, defend and hold harmless the
Service Provider its affiliates, officers, directors, representatives, and
employees (collectively, the "Service Provider Parties") from and against any
claims, liabilities, costs, attorneys' fees and legal costs, expenses, indirect
or direct losses, damages and penalties (collectively, "Costs") incurred by any
such Service Provider Party arising from or relating to (A) any breach by the
Company of any representation, warranty, agreement or other obligation contained
in this Agreement; (B) such Service Provider acting in accordance with any
Instructions given by or on behalf of the Company for the Funds ; (C) any error
or omission by the Company in an Instruction that results in costs; (D) any
untrue statement or alleged untrue statement of material fact contained in the
Company registration statement, prospectus of the Funds, any sales literature of
the Funds or any other document prepared by the Company Parties or the omission
or alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; and (E) such Service
Provider's Party's investigation, preparation or defense of any of the
foregoing.
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9. Non-Exclusivity. Both Parties may enter into other similar
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Servicing Agreements with any other person or persons without the other's
consent.
10. Set Off Rights. Service Provider shall have a contractual right
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to set off any money Service Provider owes to the Company against any obligation
of the Company to Service Provider, but any such set off shall not constitute an
accord and satisfaction unless agreed to in writing by the Parties.
11. Amendment and Waiver. Any of the terms of this Agreement may be
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waived, amended or modified in whole or in part only by a writing signed by the
Parties hereto. No failure of any Party to insist upon strict performance of
any provision of this Agreement shall constitute a waiver.
12. Entire Agreement. This Agreement, together with its accompanying
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schedule(s), constitutes the entire Agreement between the Parties with respect
to the subject matter herein and there are no agreements, representations or
warranties between the Parties other than those set forth or provided for
herein.
13. Choice of Law and Matters Relating to the Trust as a
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Massachusetts Business Trust. This Agreement shall be construed and the
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provisions hereof interpreted under and in accordance with the laws of the
Commonwealth of Massachusetts. The names "One Group(R) Mutual Funds" and
"Trustees of One Group Mutual Funds" refer respectively to the Trust created and
the Trustees, as trustees but not individually or personally, acting from time
to time under a Declaration of Trust dated May 23, 1985, as amended and restated
February 18, 1999, to which reference is hereby made and a copy of which is on
file at the office of the Secretary 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 `One Group Mutual 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. Liability; Acts Beyond Control. Company shall not be liable for
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undertaking any act on Instructions from the Service Provider or for failing to
act in the absence of such Instructions. Similarly, Service Provider shall not
be liable for undertaking any act on Instructions from the Company or for
failing to act in the absence of Instructions. Each of Company and Service
Provider shall be entitled to conclusively rely on the authenticity of any
notice or other communication received from the other so long as it reasonably
believes the notice or other communication to be genuine. Under no circumstances
shall Service Provider be liable to the Company for (A) any losses or unrealized
gains resulting from Instructions not authorized on a timely basis, or (B) any
indirect, incidental, special, consequential or punitive damages, including
without limitation any damages claimed as a result of lost profits.
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Neither Party shall be responsible for losses caused directly or
indirectly by conditions beyond its reasonable control, including but not
limited to war, natural disaster, government or NSCC restrictions or changes,
exchange, market or NSCC rulings, strikes, interruptions of communications or
data processing services, or disruptions in orderly trading on any exchange or
market. The Parties acknowledge that unforseen circumstances may temporarily
prohibit each from performing its respective obligations under the NSCC system.
15. Dispute Resolution and Arbitration. The Parties acknowledge that this
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Agreement evidences a transaction involving interstate commerce. The Parties
agree that any misunderstandings or disputes arising from this Agreement shall
be decided by binding arbitration which shall be conducted, upon request by
either party, in Boston, Massachusetts, before one (1) arbitrator designated by
the American Arbitration Association (the "AAA"), in accordance with the terms
of the Securities Arbitration Rules of the AAA, and, to the maximum extent
applicable, the United States Arbitration Act (Title 9 of the United States
Code). Notwithstanding anything herein to the contrary, either Party may
proceed to a court of competent jurisdiction to obtain equitable relief at any
time. An arbitrator shall have no authority to award punitive damages or other
damages not measured by the prevailing Party's actual damages. To the maximum
extent practicable, an arbitration proceeding under this Agreement shall be
concluded within 180 days of the filing of the dispute with the AAA. The
provisions of this arbitration clause shall survive any termination, amendment
or expiration of the Agreement and if any term, covenant, condition or provision
of this arbitration clause is found to be unlawful or invalid or unenforceable,
the remaining parts of the arbitration clause shall not be affected thereby and
shall remain fully enforceable.
16. Assignment by Service Provider. Either Party may without the consent
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of the other Party assign its rights and obligations under this Agreement to any
subsidiary, affiliate or successor by merger or consolidation upon written
notice to the other Party. Either Party may not otherwise assign its rights and
obligations under this Agreement without the written consent of the other Party.
Consent shall not be unreasonably withheld by either Party hereto.
17. Attorneys' Fees. In any arbitration, or other proceeding by which one
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Party either seeks to enforce its rights under this Agreement (whether in
contract, tort or both) or seeks a declaration of any rights under this
Agreement, the prevailing Party shall be awarded reasonable attorneys' fees,
together with any costs and expenses, to resolve the dispute and enforce the
final judgment.
18. Notice. Any notice, demand, consent, election, offer, approval,
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request or other communication (collectively, a "Notice") required or permitted
under this Agreement must be in writing and either delivered personally, by a
nationally recognized overnight courier, or sent by certified or registered
mail, postage prepaid, return receipt requested. A Notice must be addressed to
a Party as follows:
if to Service Provider, to
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Matrix Settlement & Clearance Services, L.L.C.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ Dash, General Counsel
if to Company, to
One Group Mutual Funds
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇, General Counsel
Banc One Investment Advisors Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇, General Counsel
A Notice delivered personally will be deemed given only when acknowledged
in writing by the party to whom it is delivered. A Notice delivered via a
nationally recognized overnight courier shall be deemed given as of the next
Business Day after it is sent. A Notice that is sent via mail will be deemed
given three (3) Business Days after it is mailed. The address specified by a
party above for notices to be sent may be changed by such party by written
notice to the other party.
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IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as of
the date first written above.
MATRIX SETTLEMENT & CLEARANCE SERVICES, L.L.C.
By: /s/ ▇▇▇▇. ▇. ▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
ONE GROUP MUTUAL FUNDS
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President and Treasurer
BANC ONE INVESTMENT ADVISORS CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Managing Director
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SCHEDULE A
THE FUNDS
A Shares of the following funds:
Large Cap Growth
Large Cap Value
Diversified Equity
Equity Income
Equity Index
Mid Cap Growth
Mid Cap Value
Diversified Mid Cap
Market Expansion Index
Small Cap Growth
Small Cap Value
Technology Fund
Diversified International
International Equity Index
Balanced
Investor Balanced
Investor Conservative Growth
Investor Growth
Investor Growth & Income
Bond
Intermediate Bond
Government Bond
Income
Treasury and Agency
Intermediate Tax Free Bond
Tax Free Bond
Municipal Income
Short Term Bond
Ultra Short Term Bond
Kentucky Muni
Louisiana Muni
Michigan Muni
Ohio Muni
West Virginia Muni
Arizona Muni
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SCHEDULE B
THE SERVICES
Services provided may include, but are not limited to, some or all of the
following:
(A) processing dividend and distribution payments from the Funds;
(B) providing periodic statements showing the Plans positions in the
Shares or share equivalents;
(C) arranging for bank wires;
(D) responding to routine inquiries from authorized representatives
of the Plans (the "Plan Representatives") or Participants
relating to services performed by Service Provider;
(E) providing sub-accounting with respect to the Shares or the
information necessary for sub-accounting;
(F) if required by law, forwarding shareholder communications from
the Funds (such as proxies, shareholder reports, annual and semi-
annual financial statements and dividend, distribution and tax
notices);
(G) forwarding proxy statements and proxies containing any proposals
regarding this Agreement or the Plan related hereto;
(H) aggregating and processing purchase, exchange and redemption
requests from and placing net purchase, exchange and redemption
orders;
(I) providing a service that invests the assets of their accounts in
the Shares pursuant to specific or pre-authorized instructions;
(J) establishing and maintaining accounts and records relating to
transactions in the Shares;
(K) assisting the Company and/or the Funds in changing dividend or
distribution options, account designations and addresses; and
(L) other similar services if requested by the Company.
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SCHEDULE C
COMPENSATION
Capitalized terms used in this Schedule have the meanings given them in the
Agreement to which this Schedule C is annexed.
Company shall pay to the Service Provider, for each Fund, a fee, computed daily
and paid quarterly in arrears, equal to the percentage specified below applied
to the average daily value of the total number of shares of such Fund held in
accounts at the Service Provider. Company shall pay the Service Provider such
fee within 30 days after the end of each quarter. For purposes of this
Schedule, the average daily value of the shares of each Fund will be based on
the net asset value reported by the Company to the Service Provider. For the
services discussed in the Agreement, the Service Provider shall receive a fee
equal to . .15% per annum applied to the average daily value of the Shares of
the Funds held in the Service Provider Plan accounts.
One Group Mutual Funds shall pay a portion of the fee equivalent to $18.00 per
account annually. Any portion of the fee in excess of the equivalent of this
amount shall be paid by Banc One Investment Advisors Corporation.
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