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Exhibit (h)(36)
Sub-Transfer Agency Agreement
dated March 30, 2000
between
National Deferred Compensation, Inc. and One Group Mutual Funds.
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SUB TRANSFER AGENCY AGREEMENT
AGREEMENT made as of March 30, 2000 by and between National Compensation,
Inc. ("Recordkeeper") and One Group Mutual Funds (the "Trust").
WHEREAS, the Trust desires to enter into a Sub Transfer Agency Agreement
pursuant to which the Trust will retain the Recordkeeping to perform certain
Recordkeeping and accounting services and functions with respect to transactions
in Trust shares ("Shares") made by or on behalf of participants in certain
defined contribution employee benefit or retirement plans, and with respect to
holdings of Shares maintained by or on behalf of such participants, when with
respect to the Trust such plans maintain with the Trust's transfer agent
("Transfer Agent") a single master shareholder account; and
NOW, THEREFORE, in consideration of the following premises and mutual
covenants, the parties agree as follows:
1. SERVICES PROVIDED BY THE RECORDKEEPER
When and to the extent requested by the Trust, the Recordkeeper agrees to
perform recordkeeping and account services and functions with respect to
transactions in Shares made by or on behalf of participants in the Plan
("Participants"), and with respect to holding of Shares maintained by or on
behalf of participants, when with respect to the Trust the Plan maintains with
the Transfer Agent plan level shareholder accounts. To the extent requested, the
Recordkeeper will provide the following services:
A. Maintain separate records for each Participant reflecting Shares
purchased, redeemed and exchanged on behalf of such Participant and
outstanding balances of Shares owned by or for the benefit of such
Participant.
B. Prepare and transmit to Plan and/or its Participants periodic account
statements indicating the number of shares of the Trust owned by or for the
benefit of Participants and purchases, redemptions and exchanges made on
behalf of Participants.
C. With respect to the Plan, aggregate all purchase, redemption and
exchange orders made by or on behalf of the Plan's Participants and
transmit instructions based on such aggregate orders ("Instructions") to
the Transfer Agent for acceptance.
D. Provide to the Trust, the Transfer Agent and/or other parties
designated by them such other information relating to transactions in and
holdings of Shares by or on behalf of Participants as is reasonably
requested.
E. As agreed upon with the Trust, deliver or arrange for the delivery of
appropriate documentation in connection with orders.
2. APPOINTMENT AS AGENT FOR LIMITED PURPOSE
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The Recordkeeper shall be deemed the agent of the Trust for the sole and
limited purpose of receiving purchase redemption and exchange orders from
Participants and transmitting corresponding instructions to the Transfer Agent.
Except as provided specifically herein, neither the Trust nor any person to
which the Trust may delegate any of its duties hereunder shall be or hold itself
out as an agent of the Transfer Agent or the Trust.
3. REPRESENTATIONS OF RECORDKEEPER
The Recordkeeper agrees, represents and warrants that:
A. It will forward Instructions within such time periods and to such
parties as are specified by the Trust, the Transfer Agent, the Trust's
prospectuses and applicable law and regulation.
B. If and to the extent required under applicable federal and state
securities laws and regulations, it is duly registered pursuant to such
laws and regulations, it is not a "fiduciary" of any Plan as such term
defined in Section 3(21) of the Employment Retirement Income Security Act
of 1974, as amended ("ERISA"), and Section 4975 the Internal Revenue Code
of 1986, amended (the ""ode"): and the receipt of any fees by it from the
Trust, and the corresponding reduction of fees payable to the Recordkeeper
by the Plan (or by the P1an sponsor, according to Recordkeeper's agreement
with the Plan) will not constitute a "prohibited transaction" for purposes
of Title I of ERISA and Section 4975 of the Code.
C. At all times during the term of this contract, the Recordkeeper will
maintain errors and omissions coverage in an amount not less than
$1,000,000 per occurrence, and in the aggregate. A certificate of insurance
evidencing such coverage will be provided by the Recordkeeper One Group
Mutual Funds as soon as is practicable after commencement of this
Agreement.
4 RECORDS AND REPORTING
The Recordkeeper will maintain and preserve all records as required by law
in connection with its provision of services under this Agreement. Upon the
reasonable request of the Funds or the Transfer Agent, the Recordkeeper will
provide copies of. historical records relating to transactions involving the
Trust and Participants; written communications regarding the Trust to or from
participants; and other materials relating to the provision of services by the
Recordkeeper under this Agreement. The Recordkeeper will comply with any
reasonable request for such information and documents made by the Trust, or its
board of Trustees or any governmental body or self-regulatory organization. The
Recordkeeper agrees that, with respect to the Plans regarding which it is
providing services under this Agreement, the Recordkeeper will permit the Trust,
the Transfer Agent, or their representatives to have; reasonable access to it
personnel and records in order to facilitate the monitoring of the quality of
the services provided by the Recordkeeper. Notwithstanding anything herein to
the contrary, the Recordkeeper shall
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not be required to provide the names and addresses of Participants to the
Transfer Agent or the Trust, unless applicable law or regulation otherwise
requires.
5. ABILITY TO PROVIDE SERVICES
The Recordkeeper agrees to notify the Trust promptly if for any reason it is
unable to perform its obligations under this Agreement.
6. COMPENSATION
A In consideration of performance of the services by the Recordkeeper
hereunder, the Trust will compensate the Recordkeeper as provided in
Exhibit F as to which the Trust and the Recordkeeper agree from
time-to-time in writing.
B. The Recordkeeper will permit the Trust and their representatives
(including counsel and independent accounts) with reasonable access to its
records to enable the Trust to verify that the Recordkeeper's charges
hereunder comply with the provisions of this Agreement. Such access shall
include, but not be limited to, up to four on-site inspections of the
Recordkeeper's records each calendar year.
7. INDEMNIFICATION
The Recordkeeper shall indemnify and hold harmless the Trust from and
against any and all losses and liabilities that it may incur, including without
limitation reasonable attorneys' fees, expenses and costs arising out of or
related to the performance or non-performance of the Recordkeeper of its
responsibilities under this Agreement, excluding, however, any such claims,
suits, loss, damage or costs caused by, contributed to or arising from any
non-compliance by the Trust with its obligations under this Agreement, as to
which the Trust as pertinent, shall indemnify, hold harmless and defend the
Recordkeeper on the same basis as set forth above.
8 TERMINATION
This Agreement may be terminated at any time by either parry hereto upon
ninety (90) days written notice to the other. The provisions of paragraphs
4 and 7 shall continue in full force and effect after termination of this
Agreement.
9. LIMITATION OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS
It is expressly agreed that the obligations of the Trust hereunder shall
not be binding upon any of the Trustees, shareholders, nominees, officers,
agents or employees of the Trust personally, but shall bind only the trust
property of the Trust. The execution and delivery of this Agreement has been
authorized by the Trustees, and this Agreement has been signed and delivered by
an authorized officer of the Trust, acting as such, and neither such
authorization by the Trustees nor such execution and delivery by such officer
shall be deemed to have been made by any of them individually or to impose any
liability on any of them personally, but shall bind
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only the trust property of the Trust as provided in the Trust's Agreement and
Declaration of Trust.
10. MISCELLANEOUS
This Agreement represents the entire Agreement between the parties with
regard to the matters described herein and may not be modified or amended except
by written instrument executed by all parties. This Agreement may not be
assigned by either party hereto without the prior written consent of the other
parties. This Agreement is made and shall be construed under the laws of the
State of Ohio. This Agreement supersedes all previous agreements and
understandings between the parties with respect to its subject matter. If any
provision of the Agreement shall be held or made invalid by a statute, rule,
regulation, decision of a tribunal or otherwise, the remainder of the Agreement
shall not be affected thereby.
IN WITNESS HEREOF, the parties hereto have executed and delivered this Agreement
as of the date first above written.
THE ONE GROUP
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Title: Vice President
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National Deferred Compensation Services
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: V.P. Finance & Treasurer
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EXHIBIT A
FUND/SERV PROCESSING PROCEDURES
AND
MANUAL PROCESSING PROCEDURES
The purchase, redemption and settlement of Shares of a Fund will normally follow
the Fund/SERV-Defined Contribution Clearance and Settlement Service ( DCCS )
Processing Procedures below and the rules and procedures of the SCC Division of
the National Securities Clearing Corporation ( NSCC ) shall govern the purchase,
redemption and settlement of Shares of the Funds through NSCC by the Dealer. In
the event of equipment failure or technical malfunctions or the parties'
inability to otherwise perform transactions pursuant to the FUND/SERV Processing
Procedures, or the parties' mutual consent to use manual processing, the Manual
Processing Procedures below will apply.
It is understood and agreed that, in the context of Section 22 of the 1940 Act
and the rules and public interpretations thereunder by the staff of the
Securities and Exchange Commission ("SEC Staff"), receipt by the Dealer of any
Instructions from the Client-shareholder prior to the Close of Trade on any
Business Day shall be deemed to be receipt by the Funds of such Instructions
solely for pricing purposes and ' shall cause purchases and sales to be deemed
to occur at the Share Price for such Business Day, except as provided in 4(c) of
the Manual Processing Procedures. Each Instruction shall be deemed to be
accompanied by a representation by the Dealer that it has received proper
authorization from each Client-shareholder whose purchase, redemption, account
transfer or exchange transaction is effected as a result of such Instruction.
FUND/SERV-DCCS PROCESSING PROCEDURES
1. On each business day that the New York Stock Exchange (the "Exchange") is
open for business on which the Funds determine their net asset values
("Business Day"), the One Group or its designee ('the One Group") shall
accept, and effect changes in its records upon receipt of purchase,
redemption, exchanges, account transfers and registration instructions from
the Dealer electronically through Fund/SERV ("Instructions") without
supporting documentation from the Client-shareholder. On each Business Day,
the One Group or its designee shall accept for processing any Instructions
from the Dealer and shall process such Instructions in a timely manner.
2. One Group or its designee shall perform any and all duties, functions,
procedures and responsibilities assigned to it under this Agreement and as
otherwise established by the NSCC. One Group or its designee shall conduct
each of the foregoing activities in a competent manner and in compliance
with (a) all applicable laws, rules and regulations, including NSCC
Fund/SERV-DCCS rules and procedures relating to Fund/SERV; (b) the
then-current Prospectus of a Fund; and (c) any provision relating to
Fund/SERV in any other agreement of the One Group or its designee that
would affect its duties and obligations pursuant to this Agreement.
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3. Confirmed trades and any other information provided by the One Group or its
designee to the Dealer through Fund/SERV and pursuant to this Agreement
shall be accurate, complete, and in the format prescribed by the NSCC.
4. Trade, registration, and broker/dealer information provided by the Dealer
to the One Group or its designee through Fund/SERV and pursuant to this
Agreement shall be accurate, complete and, in the format prescribed by the
NSCC. All Instructions by the Dealer regarding each Fund./SERV Account
shall be true and correct and will have been duly authorized by the
registered holder.
5. For each Fund/SERV transaction, including transactions establishing a
Client-shareholder account with the One Group or its designee, the Dealer
shall provide the Funds and the One Group or its designee with all
information necessary or appropriate to establish and maintain each
Fund/SERV transaction (and any subsequent changes to such information),
which the Dealer hereby certifies is and shall remain true and correct. The
Dealer shall maintain documents required by the Funds to effect Fund/SERV
transactions. The Dealer certifies that all Instructions delivered to One
Group or its designee on any Business Day shall have been received by the
Dealer from the Client- shareholder by the close of trading (generally 4:00
p.m. Eastern Time ("ET")) on the Exchange (the "Close of Trading") on such
Business Day and that any Instructions received by it after the Close of
Trading on any given Business Day will be transmitted to Distributor on the
next Business Day.
MANUAL PROCESSING PROCEDURES
1. On each Business Day, the Dealer may receive Instructions from the
Client-shareholder for the purchase or redemption of shares of the Funds
based solely upon receipt of such Instructions prior to the Close of
Trading on that Business Day. Instructions in good order received by the
Dealer prior to the close of trading on any given Business Day (generally,
4:00 p.m. ET (the "Trade Date") and transmitted to the Distributor by no
later than 9:00 a.m. ET the Business Day following the Trade Date ("Trade
Date plus One" or "TD+I"), will be executed at the NAV (%%Share Price") of
each applicable Fund, determined as of the Close of Trading on the Trade
Date.
2. By no later than 6:00 p.m. ET on each Trade Date ("Price Communication
Time"), the One Group or its designee will use its best efforts to
communicate to the Dealer via electronic transmission acceptable to both
parties, the Share Price of each applicable Fund, as well as dividend and
capital gain information and, in the case of funds that credit a daily
dividend, the daily accrual for interest rate factor (mil rate), determined
at the Close of Trading on that Trade Date.
3. As noted in Paragraph 1 above, by 9:00 a.m. ET on TD+1 ("Instruction Cutoff
Time") and after the Dealer has processed all approved transactions, the
Dealer will transmit to the One Group or its designee via facsimile,
telefax. or electronic transmission or system to-system, or by a method
acceptable to the Dealer and the One Group or its designee, a
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report (the "Instruction Report") detailing the Instructions that were
received by the Dealer prior to the Funds, daily determination of Share
Price for each Fund (i.e., the Close of Trading) on Trade Date.
(a) It is understood by the parties that all Instructions from the
Client-shareholder shall be received and processed by the Dealer in
accordance with its standard transaction processing procedures. The
Dealer or its designees shall maintain records sufficient to identify
the date and time of receipt of all Client-shareholder transactions
involving the Funds and shall make or cause to be made such records
available upon reasonable request for examination by the Funds or its
designated representative or, at the request of the Funds, by
appropriate governmental authorities. Under no circumstances shall the
Dealer change, alter or modify any Instructions received by it is good
order.
(b) Following the completion of the transmission of any Instructions by
the Dealer to the One Group or its designee by the Instruction Cutoff
Time, the Dealer will verify that the Instruction was received by the
Distributor and trades are pending by utilizing a remote terminal or
such other method acceptable to the One Group or its designee.
(c) In the event that an Instruction transmitted by the Dealer on any
Business Day is not received by the One Group or its designee by the
Instruction Cutoff Time, due to mechanical difficulties or for any
other reason beyond the Dealer's reasonable control, such Instruction
shall nonetheless be treated by the One group or its designee as if it
had been received by the Instruction Cutoff Time, provided that the
Dealer retransmits such Instruction by facsimile transmission to the
One Group or its designee and such Instruction is received by the One
Group or its designee financial control representative no later than
9:00 a.m. ET on TD+l. In addition, the Dealer will place a phone call
to a financial control representative of the One Group or its designee
prior to 9:00 a.m. ET on TD+1 to advise the One Group or its designee
that a facsimile transmission concerning the Instruction is being
sent.
(d) With respect to all Instructions, the One Group or its designee
financial control representative will manually adjust a Fund I s
records for the Trade Date to reflect any Instructions sent by the
Dealer.
(e) By no later than 4:00 p.m. on TD+1, and based on the information
transmitted to the One Group or its designee pursuant to Paragraph
3(c) above, the Dealer will use its best efforts to verify that all
Instructions provided to the One Group or its designee on TD+I were
accurately received and that the trades for each Account were
accurately completed and the Dealer will use its best efforts to
notify One Group or its designee of any discrepancies.
4. As set forth below, upon the timely receipt from the Dealer of the
Instructions, the Fund will execute the purchase or redemption transactions
(as the case may be) at the Share Price for each Fund computed as of the
Close of Trading on the Trade Date.
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(a) Except as otherwise provided herein, all purchase and redemption
transactions will settle on TD+I. Settlements will be through net
Federal Wire transfers to an account designated by a Fund. In the case
of Instructions which constitute a net purchase order, settlement
shall occur by the Dealer instructing the trustee or custodian for the
Plans to initiate a wire transfer by 1:00 p.m. ET on TD+1 to the
custodian for the Fund for receipt by the Funds' custodian by no later
than the Close of Business at the New York Federal Reserve Bank on
TD+1, causing the remittance of the requisite funds to the One Group
or its designee to cover such net purchase order. In the case of
Instructions which constitute a net redemption order, settlement shall
occur by the One Group or its designee causing the remittance of the
requisite funds to cover such net redemption order by Federal Funds
Wire by 1:00 p.m. ET on TD+1, provided that the Fund reserves the
right to (i) delay settlement of redemptions for up to seven (7)
Business Days after receiving a net redemption order in accordance
with Section 22 of the 1940 Act and Rule 22c1 thereunder, or (iii)
suspend redemptions pursuant to the 1940 Act or as otherwise required
by law. Settlements shall be in U.S. dollars and a Fund may pay
redemption proceeds in whole or in part by a distribution in-kind of
readily marketable securities that it holds in lieu of cash in
conformity with applicable law or regulations.
(b) The Dealer or such other party as may be designated, as record owner
of each account ("Record Owner") will be provided with all written
confirmations required under federal and state securities laws.
(c) On any Business Day when the Federal Reserve Wire Transfer System is
closed, all communication and processing rules will be suspended for
the settlement of Instructions. Instructions will be settled on the
next Business Day on which the Federal Reserve Wire Transfer System is
open. The original TD+1 Settlement Date will not apply. Rather, for
purposes of this Paragraph 4(c) only, the Settlement Date will be the
date on which the Instruction settles.
(d) The Dealer shall, upon receipt of any confirmation or statement
concerning the accounts, promptly verify by use of the terminal or by
such other method acceptable to the one Group or its designee and the
Dealer the accuracy of the information contained therein against the
information contained in the Dealer's internal recordkeeping system
and shall promptly, but in no event not more than seven days, advise
the One Group or its designee in writing of any discrepancies between
such information. The One Group or its designee and the Dealer shall
cooperate to resolve any such discrepancies as soon as reasonably
practicable.
INDEMNIFICATION
In the event of any error or delay with respect to both the Fund/SERV Processing
Procedures and the Manual Processing Procedures outlined in Exhibit C herein:
(i) which is caused by the Funds the One Group or its designee, the one Group or
its designee shall make any adjustments on the
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Funds' accounting system necessary to correct such error or delay and the
responsible party or parties shall reimburse the Client-shareholder and the
Dealer, as appropriate, for any losses or reasonable costs incurred directly as
a result of the error or delay but specifically excluding any and all
consequential punitive or other indirect damages or (ii) which is caused by the
Dealer or by any Client-shareholder or the One Group or its designee shall make
any adjustment on the Funds' accounting system necessary to correct such error
or delay and the affected party or parties shall be reimbursed by the Dealer for
any losses or reasonable costs incurred directly as a result of the error or
delay, but specifically excluding any and all consequential punitive or other
indirect damages. In the event of any such adjustments on the Funds' accounting
system, Dealer shall make the corresponding adjustments on its internal
record-keeping system. In the event that errors or delays with respect to the
Procedures are contributed to by more than one party hereto, each party shall be
responsible for that portion of the loss or reasonable cost which results from
its error or delay. All parties agree to provide the other parties prompt notice
of any errors or delays of the type referred to herein and to use reasonable
efforts to take such action as may be appropriate to avoid or mitigate any such
costs or losses.
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EXHIBIT B
PER PARTICIPANT SLIDING SCALE
AVERAGE ACCOUNT BALANCE PAYMENT PER ACCOUNT
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$0-$999 $4
$1,000 - $2,499 $6
$2,500 - $4,999 $8
$5,000 - $9,999 $10
$10,000 $12
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