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Exhibit (8)
CUSTODIAN, FUND ACCOUNTING AND RECORDKEEPING AGREEMENT
BY AND BETWEEN
THE RIVERFRONT FUNDS
AND
THE PROVIDENT BANK
This Custodian, Fund Accounting and Recordkeeping Agreement is entered
into as of , 1997, by and between The Riverfront Funds, an Ohio
business trust (the "Fund"), having its principal place of business at 0000
Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000, and The Provident Bank, an Ohio banking
corporation ("Provident"), having its principal place of business at Xxx Xxxx
Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000.
WITNESSETH:
WHEREAS, the Fund is authorized to issue shares in separate series,
with each such series representing interests in a separate portfolio of
securities and other assets;
WHEREAS, the Fund offers from time to time shares in one or more
series, and desires to retain Provident to provide the services described herein
to those series, as are now or hereafter may be identified in Schedule A hereto,
as may be amended from time to time and made subject to this Agreement in
accordance with paragraph 13. Each such series is herein referred to singly as a
"Portfolio" and collectively, as the "Portfolios"; and
NOW THEREFORE, in consideration of the mutual agreements herein
contained, the Fund and Provident agree as follows:
1. The Fund appoints Provident as the Custodian of the assets of the
Portfolios, subject to the provisions hereof. Provident hereby accepts such
appointment as Custodian. As such Custodian, Provident shall retain all
securities, commodities, cash and other assets now owned or hereafter acquired
by each Portfolio, and the Portfolio shall deliver and pay or cause to be
delivered and paid to Provident, as Custodian, all securities, cash and other
assets now owned or hereafter acquired by the Portfolio during the period of
this Agreement.
2. All securities delivered to Provident (other than in bearer form)
shall be properly endorsed and in proper form for transfer into or in the name
of the appropriate Portfolio, or a nominee of Provident for the exclusive use of
the Portfolio or of such other nominee as may be mutually agreed upon by
Provident and the Fund.
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3. The Fund shall deliver to Provident certified or authenticated
copies of its Declaration of Trust and By-Laws, all amendments thereto, a
certified copy of the resolution of the Fund's Board of Trustees appointing
Provident to act in the capacities covered by this Agreement and authorizing the
signing of this Agreement and copies of such resolutions of its Board of
Trustees, contracts and other documents as may be reasonably required by
Provident in the performance of its duties hereunder.
4. As Custodian, Provident shall promptly:
A. SAFEKEEPING. Keep safely in a separate account the
securities and other assets of each Portfolio of the Fund, including,
without limitation, all securities in bearer form, other than
securities which are maintained pursuant to paragraph 4B in a
Securities System (as defined in paragraph 4B) and, on behalf of the
Portfolio, receive delivery of certificates, including without
limitation all securities in bearer form, for safekeeping and keep such
certificates physically segregated at all times from those of any other
person. Provident shall maintain records of all receipts, deliveries
and locations of such securities, together with a current inventory
thereof, and shall conduct periodic physical inspections of
certificates representing bonds and other securities held by it under
this Agreement at least annually in such manner as Provident shall
determine from time to time to be advisable in order to verify the
accuracy of such inventory. Provident shall provide the Fund with
copies of any reports of its internal count or other verification of
the securities of the Portfolio held in its custody, including reports
on its own system of internal accounting control. In addition, if and
when independent certified public accountants retained by Provident
shall count or otherwise verify the securities of the Portfolio held in
Provident's custody, Provident shall provide the Fund with a copy of
the report of such accountants. With respect to securities held by any
agent or Subcustodian appointed pursuant to paragraph 7C hereof,
Provident may rely upon certificates from such agent or Subcustodian as
to the holdings of such agent or Subcustodian, it being understood that
such reliance in no way releases Provident of its responsibilities or
liabilities under this Agreement. Provident shall promptly report to
the Fund the results of such inspections, indicating any shortages or
discrepancies uncovered thereby, and take appropriate action to remedy
any such shortages or discrepancies.
B. DEPOSIT OF PORTFOLIO ASSETS IN SECURITIES SYSTEMS.
Notwithstanding any other provision of this Agreement,
Provident may deposit and/or maintain securities owned by each
Portfolio in Depository Trust Company, a clearing agency
registered with the Securities and Exchange Commission (the
"Commission") under Section 17A of the Securities Exchange Act
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of 1934 (the "Exchange Act"), which acts as a securities depository, in
any other clearing agency registered under Section 17A of the Exchange
Act and which has been authorized by the Fund's Board of Trustees, in
the book-entry system authorized by the U.S. Department of the Treasury
and certain federal agencies or in any other book-entry system which
the Commission has authorized for use by investment companies as a
securities depository by order or interpretive of no-action letter and
which has been authorized by the Fund's Board of Trustees,
collectively referred to herein as "Securities System(s)," in
accordance with applicable Federal Reserve Board and Commission rules
and regulations, if any, and subject to the following provisions:
1) Provident may keep securities of a Portfolio in a
Securities System provided that such securities are deposited in an
account ("Account") of Provident in the Securities System which shall
not include any assets of Provident other than assets held as a
fiduciary, custodian or otherwise for customers;
2) The records of Provident with respect to securities of
the Portfolios which are maintained in a Securities System
shall identify by book-entry those securities belonging to
such Portfolio;
3) Provident shall pay for securities purchased for the
account of each Portfolio upon (i) receipt of advice from the
Securities System that such securities have been transferred to the
account, and (ii) the making of an entry on the records of Provident to
reflect such payment and transfer for the account of the Portfolio.
Provident shall transfer securities sold for the account of each
Portfolio upon (i) receipt of advice from the Securities System that
payment for such securities has been transferred to the account, and
(ii) the making of an entry on the records of Provident to reflect such
transfer and payment for the account of that Portfolio. Copies of all
advices from the Securities System of transfers of securities for the
account of each Portfolio shall identify the Portfolio, be maintained
for such Portfolio by Provident and be provided to the Fund at its
request. Provident shall furnish the Fund confirmation of each transfer
to or from the account of the Portfolios in the form of a written
advice or notice and shall furnish to the Fund copies of daily
transaction sheets reflecting each day's transactions in the Securities
System for the account of the Portfolios on the next business day;
4) Provident shall promptly provide the Fund with any report
obtained by Provident on the Securities System's accounting system,
internal accounting control and procedures for safeguarding securities
deposited in the Securities
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System. Provident shall promptly provide the Fund any report on
Provident's accounting system, internal accounting control and
procedures for safeguarding securities deposited with Provident which
is reasonably requested by the Fund;
5) Anything to the contrary in this Agreement notwithstanding,
Provident shall be liable to the Fund for any claim, loss, liability,
damage or expense to the Fund or its Portfolios, including attorneys'
fees, resulting from use of a Securities System by reason of any
negligence, misfeasance or misconduct of Provident, its agents or any
of its or their employees or from failure of Provident or any such
agent to enforce effectively such rights as it may have against a
Securities System. At the election of the Fund, it shall be entitled to
be subrogated to the rights of Provident or its agents with respect to
any claim against the Securities System or any other person which
Provident or its agents may have as a consequence of any such claim,
loss, liability, damage or expense if and to the extent that the Fund
has not been made whole for any such loss or damage.
C. PROVIDENT'S RECORDS. The records of Provident (and its
agents and Subcustodians) with respect to its services for the Fund
shall at all reasonable times and upon reasonable notice (unless
otherwise required by law) during the regular business hours of
Provident (or its agents or Subcustodians) be open for inspection by
duly authorized officers, employees or agents of the Fund and
employees and agents of the Commission.
D. DELIVERY OF SECURITIES. Release and deliver securities
owned by a Portfolio held by Provident or in a Securities System
account of Provident only upon receipt of proper instructions (as
defined in paragraph 6A hereof; hereafter "Proper Instructions"), which
may be continuing instructions when deemed appropriate by the parties,
and only in the cases specified in paragraphs 4E, 4F, 4G, 4H, 4I, 4J,
4K, 4L, 4M and 4N hereof.
E. REGISTERED NAME, NOMINEE. Register securities of each
Portfolio held by Provident in the name of the Portfolio, of a nominee
of Provident for the exclusive use of such Portfolio, or of such other
nominee as may be mutually agreed upon, or of any mutually acceptable
nominee of any agent or Subcustodian appointed pursuant to paragraph
7C hereof.
F. PURCHASES. Upon receipt of Proper Instructions, and
insofar as cash is available for the purpose, pay for and receive all
securities purchased for the account of a Portfolio, payment being
made only upon receipt of the securities by Provident (or any bank,
banking firm, responsible commercial agent or trust company doing
business
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in the United States and appointed pursuant to paragraph 7C hereof as
Provident's agent or Subcustodian for this purpose) registered as
provided in paragraph 4E heretofore in form for transfer satisfactory
to Provident, or, in the case of repurchase agreements entered into
between a Portfolio and a bank or a dealer, delivery of the securities
either in certificate form or through an entry crediting Provident's
account at the Federal Reserve Bank with such securities, or, upon
receipt by Provident of a facsimile copy of a letter of understanding
with respect to a time deposit account of a Portfolio signed by any
bank, whether domestic or foreign, and pursuant to Proper Instructions
from the Fund, for transfer to the time deposit account of the
Portfolio in such bank; such transfer may be effected prior to receipt
of a confirmation from a broker and/or the applicable bank. All
securities accepted by Provident shall be accompanied by payment of, or
a "due xxxx" for, any dividends, interest or other distributions of the
issuer due the purchaser. In any and every case of a purchase of
securities for the account of a Portfolio where payment is made by
Provident in advance of receipt of the securities purchased, Provident
shall be absolutely liable to the Fund and its Portfolios for such
securities to the same extent as if the securities had been received by
Provident, except that in the case of repurchase agreements entered
into by a Portfolio with a bank which is a member of the Federal
Reserve System, Provident may transfer funds to the account of such
bank prior to the receipt of written evidence that the securities
subject to such repurchase agreement have been transferred by
book-entry into a segregated nonproprietary account of Provident
maintained with the Federal Reserve Bank of Cincinnati, provided that
such securities have in fact been so transferred by book-entry;
provided, further, however, that Provident and the Fund agree to use
their best efforts to ensure receipt by Provident of copies of
documentation for each such transaction as promptly as possible.
G. EXCHANGES. Upon receipt of Proper Instructions,
exchange securities, interim receipts or temporary securities held by
it or by any agent or Subcustodian appointed by it pursuant to
paragraph 7C hereof for the account of each Portfolio, for other
securities alone or for other securities and cash, and expend cash
insofar as cash is available in connection with any merger,
consolidation, reorganization, recapitalization, split-up of shares,
changes of par value, conversion or in connection with the exercise of
warrants, subscription or purchase rights, or otherwise, and deliver
securities to the designated depository or other receiving agent or
Subcustodian in response to tender offers or similar offers to
purchase received in writing; provided that in any such case the
securities and/or cash to be received as a result of any such
exchange, expenditure or delivery are to be
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delivered to Provident (or its agents or Subcustodians). Provident
shall give notice as provided under paragraph 15 hereof to the Fund in
connection with any transaction specified in this paragraph and at the
same time shall specify to the Fund whether such notice relates to
securities held by an agent or Subcustodian appointed pursuant to
paragraph 7C hereof, so that the Fund may issue to Provident Proper
Instructions for Provident to act thereon prior to any expiration date
(which shall be presumed to be two business days prior to such date
unless Provident has previously advised the Fund of a different
period). The Fund shall give to Provident full details of the time and
method of submitting securities in response to any tender or similar
offer, exercising any subscription or purchase right or making any
exchange pursuant to this paragraph. When such securities are in the
possession of an agent or Subcustodian appointed by Provident pursuant
to paragraph 7C hereof, the Proper Instructions referred to in the
preceding sentence must be received by Provident in timely enough
fashion (which shall be presumed to be three business days unless
Provident has advised the Fund in writing of a different period) for
Provident to notify the agent or Subcustodian in sufficient time to
permit such agent to act prior to any expiration date.
H. SALES. Upon receipt of Proper Instructions and upon receipt
of full payment therefor, release and deliver securities which have
been sold for the account of a Portfolio. At the time of delivery all
such payments are to be made in cash, by a certified check upon or a
treasurer's or cashier's check of a bank, by effective bank wire
transfer through the Federal Reserve Wire System or, if appropriate,
outside of the Federal Reserve Wire System and subsequent credit to
such Portfolio's custodian account, or, in case of delivery through a
stock clearing company, by book-entry credit by the stock clearing
company in accordance with the then current "street" custom.
I. PURCHASES BY ISSUER. Upon receipt of Proper Instructions,
release and deliver securities owned by a Portfolio to the issuer
thereof or its agent when such securities are called, redeemed, retired
or otherwise become payable; provided that in any such case, the cash
or other consideration is to be delivered to Provident.
J. CHANGES OF NAME AND DENOMINATION. Upon receipt of Proper
Instructions, release and deliver securities owned by a Portfolio to
the issuer thereof or its agent for transfer into the name of the
Portfolio or of a nominee of Provident or of the Portfolio for the
exclusive use of the Portfolio or for exchange for a different number
of bonds, certificates or other evidence representing the same
aggregate face amount or number of units bearing the same interest
rate, maturity date
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and call provisions if any; provided that in any such case, the new
securities are to be delivered to Provident.
K. STREET DELIVERY. In connection with delivery in New York
City and upon receipt of Proper Instructions, which in the case of
registered securities may be standing instructions, release securities
owned by a Portfolio upon receipt of a written receipt for such
securities to the broker selling the same for examination in accordance
with the existing "street delivery" custom. In such case, Provident
shall have no responsibility or liability for any loss arising from the
delivery of such securities prior to receiving payment for such
securities, except as may arise from Provident's own negligence or
willful misconduct. In every instance, either payment in full for such
securities shall be made or such securities shall be returned to
Provident that same day. In the event existing "street delivery" custom
is modified, Provident shall obtain authorization from the Board of
Trustees of the Fund prior to any use of such modified "street
delivery" custom.
L. RELEASE OF SECURITIES FOR USE AS COLLATERAL. Upon receipt
of Proper Instructions and subject to the Declaration of Trust and
By-Laws of the Fund, release securities belonging to the Portfolio to
any bank or trust company for the purpose of pledge, mortgage or
hypothecation to secure any loan incurred by a Portfolio; provided,
however, that securities shall be released only upon payment to
Provident of the monies borrowed, except that in cases where
additional collateral is required to secure a borrowing already made,
subject to proper prior authorization from the Fund, further
securities may be released for that purpose. Upon receipt of Proper
Instructions, Provident shall pay such loan upon redelivery to it of
the securities pledged or hypothecated therefor and upon
surrender of the note or notes evidencing the loan.
M. COMPLIANCE WITH APPLICABLE RULES AND REGULATIONS OF THE
OPTIONS CLEARING CORPORATION AND NATIONAL SECURITIES OR COMMODITIES
EXCHANGES OR COMMISSIONS. Upon receipt of Proper Instructions, deliver
securities of a Portfolio in accordance with the provisions of any
agreement among the Fund, Provident and a broker-dealer registered
under the Exchange Act and a member of the National Association of
Securities Dealers, Inc. ("NASD") relating to compliance with the rules
of The Options Clearing Corporation and of any registered national
securities exchange, or of any similar organization or organizations,
regarding escrow or other arrangements in connection with transactions
by a Portfolio; or, upon receipt of Proper Instructions, Provident
shall deliver securities in accordance with the provisions of any
agreement among the Fund, Provident and a Futures Commission Merchant
registered under the Commodity Exchange Act relating to compliance with
the rules
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of the Commodity Futures Trading Commission and/or any contract market,
or any similar organization or organizations, regarding account
deposits in connection with transactions by a Portfolio.
N. RELEASE OR DELIVERY OF SECURITIES FOR OTHER PURPOSES. Upon
receipt of Proper Instructions, release or deliver any securities held
by it for the account of a Portfolio for any other purpose (in addition
to those specified in paragraphs 4D, 4E, 4F, 4G, 4H, 4I, 4J, 4K, 4L and
4M hereof) which the Fund declares is a proper corporate purpose
pursuant to Proper Instructions.
0. PROXIES, NOTICES, ETC. Promptly forward upon receipt to the
Fund all forms of proxies and all notices of meetings and any other
notices or announcements affecting or relating to the securities,
including, without limitation, notices relating to class action claims
and bankruptcy claims, and upon receipt of Proper Instructions execute
and deliver or cause its nominee to execute and deliver such proxies or
other authorizations as may be required. Provident, its nominee or its
agents or Subcustodian shall not vote any of the securities or execute
any proxy to vote thereon or give any consent or take any other action
with respect thereto (except as otherwise herein provided) unless
ordered to do so by Proper Instructions. Provident shall require its
agents and Subcustodians appointed pursuant to paragraph 7C hereof to
forward any such announcements and notices to Provident upon receipt.
P. SEGREGATED ACCOUNT. Upon receipt of Proper Instructions,
establish and maintain a segregated account or accounts for and on
behalf of each Portfolio, into which account or accounts may be
transferred cash and/or securities, including securities maintained in
an account by Provident pursuant to paragraph 4B hereof, (i) in
accordance with the provisions of any agreement among the Fund,
Provident and a broker-dealer registered under the Exchange Act and a
member of the NASD (or any futures commission merchant registered
under the Commodity Exchange Act), relating to compliance with the
rules of The Options Clearing Corporation and of any registered
national securities exchange (or the Commodity Futures Trading
Commission or any registered contract market), or of any similar
organization or organizations, regarding escrow or other arrangements
in connection with transactions by a Portfolio, (ii) for purposes of
segregating cash or government securities in connection with options
purchased, sold or written by a Portfolio or commodity futures
contracts or options thereon purchased or sold by such Portfolio,
(iii) for the purposes of compliance by the Fund with the procedures
required by Investment Company Act Release No. 10666, or any
subsequent release or releases of the Commission relating to
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the maintenance of segregated accounts by registered investment
companies and (iv), for other proper corporate purposes, but only, in
the case of clause (iv) , upon receipt of, in addition to Proper
Instructions, a certified copy of a resolution of the Board of Trustees
signed by an officer of the Fund and certified by the Secretary or an
Assistant Secretary, setting forth the purpose or purposes of such
segregated account and declaring such purposes to be proper corporate
purposes.
Q. MISCELLANEOUS. In general, attend to all nondiscretionary
details in connection with the sale, exchange, substitution, purchase,
transfer or other dealing with such securities or property of each
Portfolio, except as otherwise directed by the Fund pursuant to Proper
Instructions. Provident shall render to the Fund daily a report of all
monies received or paid on behalf of the Portfolio, an itemized
statement of the securities and cash for which it is accountable to the
Fund under this Agreement and an itemized statement of security
transactions which settled the day before and shall render to the Fund
weekly an itemized statement of security transactions which failed to
settle as scheduled. At the end of each week Provident shall provide a
list of all security transactions that remain unsettled at such time.
5. Additionally, as Custodian, Provident shall promptly:
A. BANK ACCOUNT. Retain safely all cash of each Portfolio,
other than cash maintained by a Portfolio in a bank account established
and used in accordance with Rule 17f-3 under the 1940 Act, in the
banking department of Provident in a separate account or accounts in
the name of such Portfolio, subject only to draft or order by Provident
acting pursuant to the terms of this Agreement. If and when authorized
by Proper Instructions in accordance with a vote of the Board of
Trustees of the Fund, Provident may open and maintain an additional
account or accounts in such other bank or trust companies as may be
designated by such instructions, such account or accounts, however, to
be solely in the name of Provident in its capacity as Custodian and
subject only to its draft or order in accordance with the terms of this
Agreement. Provident shall furnish the Fund, not later than thirty (30)
calendar days after the last business day of each month, a statement
reflecting the current status of its internal reconciliation of the
closing balance as of that day in all accounts described in this
paragraph to the balance shown on the daily cash report for that day
rendered to the Fund.
B. COLLECTIONS. Unless otherwise instructed by receipt of
Proper Instructions, collect, receive and deposit in the bank
account or accounts maintained pursuant to paragraph 5A
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hereof all income and other payments with respect to the securities
held hereunder, execute ownership and other certificates and affidavits
for all federal and state tax purposes in connection with the
collection of bond and note coupons, do all other things necessary or
proper in connection with the collection of such income, and without
waiving the generality of the foregoing:
1) present for payment on the date of payment all coupons
and other income items requiring presentation;
2) present for payment all securities which may mature or
be called, redeemed, retired or otherwise become payable on
the date such securities become payable;
3) endorse and deposit for collection, in the name of the
Portfolio, checks, drafts or other negotiable instruments on
the same day as received.
In any case in which Provident does not receive any such due and unpaid
income within a reasonable time after it has made proper demands for the same
(which shall be presumed to consist of at least three demand letters and at
least one telephonic demand), it shall so notify the Fund in writing, including
copies of all demand letters, any written responses thereto, and memoranda of
all oral responses thereto and to telephonic demands, and await Proper
Instructions; Provident shall not be obliged to take legal action for collection
unless and until reasonably indemnified to its satisfaction for the reasonable
costs of such legal action for collection. It shall also notify the Fund as soon
as reasonably practicable whenever income due on securities is not collected in
due course.
C. SALE OF SHARES OF THE PORTFOLIO OF THE FUND. Make
such arrangements with the Transfer Agent of the Fund as will
enable Provident to make certain it receives the cash
consideration due each Portfolio for shares of beneficial
interest without par value ("shares"), of such Portfolio as
may be issued or sold from time to time by the Fund, all in
accordance with the Fund's Declaration of Trust and By-Laws,
as amended.
D. DIVIDENDS AND DISTRIBUTIONS. Upon receipt of Proper
Instructions, release or otherwise apply cash insofar as cash
is available for the purpose of the payment of dividends or
other distributions to shareholders of each Portfolio.
E. REDEMPTION OF SHARES OF THE PORTFOLIOS OF THE FUND.
From such funds as may be available for the purpose, but
subject to the limitation of the Fund's Declaration of Trust
and By-Laws, as amended, and applicable resolutions of the
Board of Trustees of the Fund pursuant thereto, make funds
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available for payment to shareholders who have delivered to the
Transfer Agent a request for redemption of their shares by the Fund
pursuant to such Declaration of Trust. In connection with the
redemption of shares of a Portfolio pursuant to the Fund's Declaration
of Trust and By-Laws, as amended, Provident is authorized and directed
upon receipt of Proper Instructions from the Transfer Agent for the
Fund to make funds available for transfer through the Federal Reserve
Wire System or by other bank wire to a commercial bank account
designated by the redeeming shareholder.
F. STOCK DIVIDENDS, RIGHTS, ETC. Receive and collect
all stock dividends, rights and other items of like nature;
and deal with the same pursuant to Proper Instructions
relative thereto.
G. DISBURSEMENTS. Upon receipt of Proper Instructions,
make or cause to be made, insofar as cash is available for the
purpose, disbursements for the payment on behalf of a
Portfolio of its expenses, including without limitation,
interest, taxes and fees or reimbursement to Provident or to
the Portfolio's investment adviser for its payment of any such
expenses.
H. OTHER PROPER CORPORATE PURPOSES. Upon receipt of
Proper Instructions, make or cause to be made, insofar as cash
is available for the purpose, disbursements for any other
purpose (in addition to the purposes specified in paragraphs
4F, 4G, 5D, 5E and 5G of this Agreement) which the Fund
declares is a proper corporate purpose.
I. RECORDS. Create, maintain and retain all records a)
relating to its activities and obligations under this Agreement in such
manner as shall meet the obligations of the Fund under the 1940 Act,
particularly Section 31 thereof and Rules 3la-1 and 3la-2 thereunder or
b) as reasonably requested from time to time by the Fund. All records
maintained by Provident in connection with the performance of its
duties under this Agreement shall remain the property of the Fund and
in the event of termination of this Agreement shall be delivered in
accordance with the terms of paragraph 10 below.
J. MISCELLANEOUS. Assist generally in the preparation
of routine reports to holders of shares of the Fund, to the
Commission, including form N-SAR, to state "Blue Sky"
authorities, to others in the auditing of accounts and in
other matters of like nature.
K. PORTFOLIO ACCOUNTING AND NET ASSET VALUE
COMPUTATION. Maintain the general ledger and all other books
of account of each Portfolio. In addition, upon receipt of
Proper Instructions, which may be deemed to be continuing
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instructions, Provident shall daily compute the net asset value of the
shares of each Portfolio and the total net asset value of each
Portfolio. Provident shall, in addition, perform such other services
incidental to its duties hereunder as may be reasonably requested from
time to time by the Fund.
6. Provident and the Fund further agree as follows:
A. PROPER INSTRUCTIONS. Provident shall be deemed to have
received Proper Instructions upon receipt of written instructions
signed by the Fund's Trustees or by one or more person or persons as
the Fund's Board of Trustees shall have from time to time authorized to
give the particular class of instructions for different purposes.
Different persons may be authorized to give instructions for different
purposes. A copy of a resolution or action of the Trustees certified by
the secretary or an assistant secretary of the Fund may be received and
accepted by Provident as conclusive evidence of the instruction of the
Fund's Board of Trustees and/or the authority of any person or persons
to act on behalf of the Fund and may be considered as in full force and
effect until receipt of written notice to the contrary. Such
instruction may be general or specific in terms. Oral instructions will
be considered Proper Instructions if Provident reasonably believes them
to have been given by a person authorized by the Board of Trustees to
give such oral instructions with respect to the class of instruction
involved. The Fund shall cause all oral instructions to be confirmed in
writing. Proper Instructions may include communications effected
directly between electro-mechanical or electronic devices provided that
the Fund and Provident are satisfied that such procedures afford
adequate safeguards for the assets of the Portfolios. Use by the Fund
of such communication systems shall constitute approval by the Fund of
the safeguards available therewith.
B. INVESTMENTS, LIMITATIONS. In performing its duties
generally, and more particularly in connection with the
purchase, sale and exchange of securities made by or for the
Portfolios, Provident may take cognizance of the provisions of
the Declaration of Trust of the Fund, as amended; provided,
however, that except as otherwise expressly provided herein,
Provident may assume unless and until notified in writing to
the contrary that instructions purporting to be Proper
Instructions received by it are not in conflict with or in any
way contrary to any provision of the Declaration of Trust of
the Fund, as amended, or resolutions or proceedings of the
Board of Trustees of the Fund.
7. Provident and the Fund further agree as follows:
A. INDEMNIFICATION. Provident, as Custodian, shall be
entitled to receive and act upon advice of counsel (who may be
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counsel for the Fund) and shall be without liability for any action
reasonably taken or thing reasonably done pursuant to such advice;
provided that such action is not in violation of applicable federal or
state laws or regulations or contrary to written instructions received
from the Fund, and shall be indemnified by the Fund and without
liability for any action taken or thing done by it in carrying out the
terms and provisions of this Agreement in good faith and without
negligence, misfeasance or misconduct. In order that the
indemnification provision contained in this paragraph shall apply,
however, if the Fund is asked to indemnify or save Provident harmless,
the Fund shall be fully and promptly advised of all pertinent facts
concerning the situation in question, and Provident shall use all
reasonable care to identify and notify the Fund fully and promptly
concerning any situation which presents or appears likely to present
the probability of such a claim for indemnification against the Fund.
The Fund shall have the option to defend Provident against any claim
which may be the subject of this indemnification and in the event that
the Fund so elects it will so notify Provident, and thereupon the Fund
shall take over complete defense of the claim, and Provident shall
initiate no further legal or other expenses for which it shall seek
indemnification under this paragraph. Provident shall in no case
confess any claim or make any compromise in any case in which the Fund
will be asked to indemnify Provident except with the Fund's prior
written consent.
B. EXPENSES REIMBURSEMENT. Provident shall be entitled
to receive from each Portfolio on demand reimbursement for its
cash disbursements, expenses and charges, excluding salaries
and usual overhead expenses with respect to such Portfolio, as
set forth in Schedule A.
C. APPOINTMENT OF AGENTS AND SUBCUSTODIANS. Provident, as
Custodian, may appoint (and may remove), only in compliance with the
terms and conditions of the Fund's Declaration of Trust and ByLaws, as
amended, any other bank, trust company or responsible commercial agent
as its agent or Subcustodian to carry out such of the provisions of
this Agreement as Provident may from time to time direct; provided,
however, that the appointment of any such agent or Subcustodian shall
not relieve Provident of any of its responsibilities under this
Agreement.
D. RELIANCE ON DOCUMENTS. So long as and to the extent
that it is in good faith and in the exercise of reasonable
care, Provident, as Custodian, shall not be responsible for
the title, validity or genuineness of any property or evidence
of title thereto received by it or delivered by it pursuant to
this Agreement, shall be protected in acting upon any
instructions, notice, request, consent, certificate or other
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14
instrument or paper reasonably believed by it to be genuine and to
constitute Proper Instructions under this Agreement and shall, except
as otherwise specifically provided in this Agreement, be entitled to
receive as conclusive proof of any fact or matter required to be
ascertained by it hereunder a certificate signed by the Fund's
Trustees, the secretary or an assistant secretary of the Fund or any
other person expressly authorized by the Board of Trustees of the Fund.
E. ACCESS TO RECORDS. Subject to security requirements of
Provident applicable to its own employees having access to similar
records within Provident and such regulations as to the conduct of such
monitors as may be reasonably imposed by Provident after prior
consultation with an authorized officer of the Fund, books and records
of Provident pertaining to its actions under this Agreement shall be
open to inspection and audit at reasonable times by the Directors of,
attorneys for, auditors employed by the Fund or any other person as the
Fund's Board of Trustees shall direct.
F. RECORDKEEPING. Provident shall maintain such
records as shall enable the Fund to comply with the
requirements of all federal and state laws and regulations
applicable to the Fund and its Portfolios with respect to the
matters covered by this Agreement.
8. LIEN ON ASSETS. If a Portfolio requires Provident to advance cash
or securities for any purpose or in the event that Provident or its nominee
shall incur or be assessed any taxes, charges, expenses, assessments, claims or
liabilities in connection with the performance of this Agreement, except such as
may arise from its or its nominee's own negligent action, negligent failure to
act or willful misconduct, any property at any time held for the account of a
Portfolio shall be security therefor and should the Portfolio fail to repay
Provident promptly, Provident shall be entitled to utilize available cash and to
dispose of the Portfolio's assets to the extent necessary to obtain
reimbursement; provided, however, that the total value of any property of the
Portfolio which at any time is security for any payment by Provident hereunder
shall not exceed 15% of the Portfolio's total net asset value.
9. The Fund shall pay Provident for its services as
Custodian such compensation as shall be specified on the attached
Schedule A.
10. Provident and the Fund further agree as follows:
A. EFFECTIVE PERIOD, TERMINATION, AMENDMENT AND
INTERPRETIVE AND ADDITIONAL PROVISIONS. This Agreement shall
become effective as of the date of its execution, shall
continue in full force and effect until terminated as
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15
hereinafter provided, may be amended at any time by mutual agreement of
the parties hereto and may be terminated by either party by an
instrument in writing delivered or mailed, postage prepaid, to the
other party, such termination to take effect sixty (60) days after the
date of such delivery or mailing; and further provided, that the Fund
may by action of the Fund's Board of Trustees substitute another bank
or trust company for Provident by giving notice as provided above to
Provident, provided, however that Provident shall not act under
paragraph 4B hereof in the absence of receipt of an initial certificate
of the secretary or an assistant secretary that the Board of Trustees
of the Fund has approved the initial use of a particular Securities
System and the receipt of an annual certificate of the secretary or an
assistant secretary that the Board of Trustees has reviewed the use by
the Fund of such Securities System, as required in each case by Rule
17f-4 under the 1940 Act. The Fund or Provident shall not amend or
terminate this Agreement in contravention of any applicable federal or
state laws or regulations, or any provision of the Declaration of Trust
of the Fund, as amended; provided, however, that in the event of such
termination Provident shall remain as Custodian hereunder for a
reasonable period thereafter if the Fund after using its best efforts
is unable to find a Successor Custodian.
In connection with the operation of this Agreement, Provident and the
Fund may agree from time to time on such provisions interpretive of or in
addition to the provisions of this Agreement as may in their joint opinion be
consistent with the general tenor of this Agreement, any such interpretive or
additional provision to be signed by both parties and annexed hereto, provided
that no such interpretive or additional provisions shall contravene any
applicable federal or state laws or regulations, or any provision of the Fund's
Declaration of Trust and By-Laws, as amended. No interpretive provisions made as
provided in the preceding sentence shall be deemed to be an amendment of this
Agreement.
B. SUCCESSOR CUSTODIAN. Upon termination hereof or the
inability of Provident to continue to serve hereunder, the
Fund shall pay to Provident such compensation as may be due
for services through the date of such termination and shall
likewise reimburse Provident for its costs, expenses and
disbursements incurred prior to such termination in accordance
with paragraph 7B hereof and such reasonable costs, expenses
and disbursements as may be incurred by Provident in
connection with such termination.
If a Successor Custodian is appointed by the Board of Trustees of the
Fund in accordance with the Fund's Declaration of Trust, Provident shall, upon
termination, deliver to such Successor Custodian at the office of Provident,
properly endorsed and in proper form for transfer, all securities then held
hereunder, all
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16
cash and other assets of the Fund deposited with or held by it
hereunder.
If no such Successor Custodian is appointed, Provident shall, in like
manner at its office, upon receipt of a certified copy of a resolution of the
shareholders pursuant to the Fund's Declaration of Trust and By-Laws, as
amended, deliver such securities, cash and other properties in accordance with
such resolutions.
In the event that no written order designating a Successor Custodian or
certified copy of a resolution of the shareholders shall have been delivered to
Provident on or before the date when such termination shall become effective,
then Provident shall have the right to deliver to a bank or trust company doing
business in Cincinnati, Ohio of its own selection, having an aggregate capital,
surplus and undivided profits, as shown by its last published report, of not
less than $5,000,000, all securities, cash and other properties held by
Provident and all instruments held by it relative thereto and all other property
held by it under this Agreement. Thereafter, such bank or trust company shall be
the Successor of Provident under this Agreement and subject to the restrictions,
limitations and other requirements of the Fund's Declaration of Trust and
By-Laws.
In the event that securities, funds, and other properties remain in the
possession of Provident after the date of termination hereof owing to failure of
the Fund to procure the certified copy above referred to, or of the Fund's Board
of Trustees to appoint a successor Custodian, Provident shall be entitled to
fair compensation for its services during such period and the provisions of this
Agreement relating to the duties and obligations of Provident shall remain in
full force and effect.
C. DUPLICATE RECORDS AND BACKUP FACILITIES. Provident shall
not be liable for loss of data occurring by reason of circumstances
beyond its control, including, but not limited to, acts of civil or
military authority, national emergencies, fire, flood or catastrophe,
acts of God, insurrection, war, riots or failure of transportation,
communication or power supply. However, Provident shall keep in a
separate and safe place additional copies of all records required to be
maintained pursuant to this Agreement or additional tapes, disks or
other sources of information necessary to reproduce all such records.
Furthermore, at all times during this Agreement, Provident shall
maintain a contractual arrangement whereby Provident will have a
back-up computer facility available for its use in providing the
services required hereunder in the event circumstances beyond
Provident's control result in Provident not being able to process the
necessary work at its principal computer facility. Provident shall,
from time to time, upon request from the Fund provide written evidence
and details of its arrangement for obtaining
- 16 -
17
the use of such a back-up computer facility. Provident shall use its
best efforts to minimize the likelihood of all damage, loss of data,
delays and errors resulting from an uncontrollable event, and should
such damage, loss of data, delays or errors occur, Provident shall use
its best efforts to mitigate the effects of such occurrence.
Representatives of the Fund shall be entitled to inspect Provident's
premises and operating capabilities within reasonable business hours
upon reasonable notice to Provident, and, upon request of such
representative or representatives, Provident shall from time to time,
as appropriate, furnish to the Fund a letter setting forth the
insurance coverage thereon, any changes in such coverage which may
occur and any claim relating to the Fund which Provident may have made
under such insurance.
D. CONFIDENTIALITY. Provident agrees to treat all
records and other information relative to the Fund and the
Portfolio confidentially and Provident, on behalf of itself
and its officers, employees and agents, agrees to keep
confidential all such information, except after prior
notification to and approval by the Fund (which approval shall
not be unreasonably withheld and may not be withheld where
Provident may be exposed to civil or criminal contempt
proceedings), when requested to divulge such information by
duly constituted authorities or when so requested by a
properly authorized person.
Provident and the Fund agree that they, their officers, employees and
agents shall maintain all information disclosed to them by the other in
connection with this Agreement in confidence and will not disclose any such
information to any other person, nor use such information for their own benefit
or for the benefit of third parties without the consent in writing of the other;
provided, however, that each party shall have the right to use any such
information for its own necessary internal purposes while this Agreement is in
effect. The provisions of the paragraph shall not apply to information which (i)
is in or becomes part of the public domain, or (ii) is demonstrably known
previously to the party to whom it is disclosed, or (iii) is independently
developed outside this Agreement by the party to whom it is disclosed or (iv) is
rightfully obtained from third parties by the party to whom it is disclosed.
11. The Fund shall not circulate any printed matter which contains any
reference to Provident without the prior written approval of Provident,
excepting solely such printed matter as merely identifies Provident as
Custodian. The Fund will submit printed matter requiring approval to Provident
in draft form, allowing sufficient time for review by Provident and its counsel
prior to any deadline for printing.
- 17 -
18
12. In the event of a reorganization of the Portfolio through a merger,
consolidation, sale of assets or other reorganization, Provident, at the request
of the Fund, shall act as Custodian for shares of any investment company or
other company obtained in any such reorganization by the Portfolio for
distribution to those Portfolio shareholders whose shares are represented by
certificates. The Fund shall give notice to each such shareholder of his or her
right to exchange his or her Portfolio shares represented by certificates for
shares held by Provident upon surrender to Provident of his or her certificates
representing such Portfolio shares properly endorsed and in proper form for
transfer. Upon the surrender of such Portfolio certificates Provident will issue
a certificate or certificates to the surrendering shareholder for an approximate
number of shares held by Provident, unless such shareholder establishes an Open
Account Plan or other similar account at that time in which case such shares
will be credited to his or her account. Provident shall not be required to issue
certificates for any fractional shares held by it. Instead, fractional interests
in such shares shall be distributed to the shareholder in cash at their then
current market value or, if the fractional share represents an interest in an
investment company, it shall be redeemed by Provident at the then current
redemption price for such shares and the proceeds of such redemption shall be
distributed to such shareholder in cash.
13. In the event that the Fund establishes one or more series of shares
which it desires to have the Custodian render services as custodian under the
terms hereof or otherwise desires to have the Custodian render services as
custodian hereunder with respect to any other series, it shall so notify the
custodian in writing, and if the Custodian agrees in writing to provide such
services, such series of shares shall become a Portfolio hereunder.
14. This Agreement is executed and delivered in the State of Ohio and
shall be subject to and be construed in accordance with the laws of Ohio.
15. Notices and other writings delivered or mailed postage prepaid to
The Riverfront Funds, 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000, or to The
Provident Bank at Xxx Xxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000, or to such
other address as the Fund or Provident may hereafter specify, shall be deemed to
have been properly delivered or given hereunder to the respective address.
16. This Agreement shall be binding upon and shall inure to the benefit
of the Fund and its Portfolio and Provident and their respective successors or
assigns.
17. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original.
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19
18. The Fund is a business trust organized under the laws of the State
of Ohio and under a Declaration of Trust, to which reference is hereby made and
a copy of which is on file at the office of the Secretary of State of Ohio as
required by law, and to any and all amendments thereto so filed or hereafter
filed. The obligations of the Fund entered into in the name of the Fund or on
behalf thereof by any of the Trustees, officers, employees or agents are made
not individually, but in such capacities, and are not binding upon any of the
Trustees, officers, employees, agents or shareholders of the Fund or the
Portfolios personally, but bind only the assets of the Fund, and all persons
dealing with any of the Portfolios of the Fund must look solely to the assets of
the Fund belonging to such Portfolio for the enforcement of any claims against
the Fund.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed in its name and on its behalf by a duly authorized
officer as of the day and year first above written.
ATTEST: THE RIVERFRONT FUNDS
By
------------------------ ------------------------------
Name:
Title:
ATTEST: THE PROVIDENT BANK
By
------------------------ ------------------------------
Name:
Title:
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20
Schedule A
Dated: As of , 1997
-----------
THE PROVIDENT BANK
Custodian Fee Schedule
THE RIVERFRONT FUNDS
--------------------
I. ADMINISTRATION
--------------
CUSTODIAN, PORTFOLIO AND FUND ACCOUNTING SERVICE - Maintain custody of Portfolio
assets. Settle portfolio purchases and sales. Report buy and sell fails.
Determine and collect portfolio income. Make cash disbursements and report cash
transactions. Maintain investment ledgers, provide selected portfolio
transactions, position and income reports. Maintain general ledger and capital
stock accounts. Prepare daily trial balance. Calculate net asset value daily.
Provide from Fund approved pricing sources or vendors daily pricing for
Portfolio securities. Provide selected general ledger reports. Securities yield
or market value quotations for short term Portfolio securities will be provided
to Provident from a source designated by the Fund.
The administration fee shown below is an annual charge, billed and payable
monthly, based on average net assets and calculated in the same manner as the
Fund's management fee.
ANNUAL FEES PER PORTFOLIO
-------------------------
Portfolio Annual Fee
--------- ----------
The Riverfront U.S. Five one-hundredths of one
Government Securities percent (.05%) of such
Money Market Fund Portfolio's average net assets
The Riverfront Income Fifteen one-hundredths of one
Equity Fund percent (.15%) of such
Portfolio's average net assets
The Riverfront U.S. Ten one-hundredths of one
Government Income Fund percent (.10%) of such
Portfolio's average net assets
The Riverfront Ohio Tax- Fourteen one-hundredths of one
Free Bond Fund percent (.14%) of such
Portfolio's average net assets
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21
The Riverfront Balanced Fifteen one-hundredths of one
Fund percent (.15%) of such
Portfolio's average net assets
The Riverfront Small Fifteen one-hundredths of one
Company Select Fund percent (.15%) of such
Portfolio's average net assets
The Riverfront Large Fifteen one-hundredths of one
Company Select Fund percent (.15%) of such
Portfolio's average net assets
II. OUT OF POCKET EXPENSES
----------------------
A billing for the recovery of applicable out-of-pocket expenses as incurred by
the Portfolio will be made as of the end of each month.
The Riverfront Funds
By
--------------------------------
--------------------------------
(Name)
-------------------------------
(Title)
THE PROVIDENT BANK
By
--------------------------------
Xxxx X. Xxxxx
--------------------------------
(Name)
Senior Managing Director
--------------------------------
(title)
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