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Exhibit (8)(a)
CUSTODIAL SERVICES AGREEMENT
AGREEMENT dated as of March 1, 1995, between NATIONAL CITY
BANK, a national banking association having an office at 0000 Xxxx 000xx Xxxxxx,
Xxxxxxxxx, Xxxx 00000 (the "Bank"), and THE SESSIONS GROUP, a business trust
organized under the laws of the State of Ohio, having an office at 0000 Xxxx
Xxxxxx-Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000 (the "Trust").
WITNESSETH:
THAT WHEREAS, the Trust represents that it is authorized to
open and maintain a custody account (the "Custody Account") with the Bank to
hold certain property ("Property") including but not limited to stocks, bonds,
or other securities ("Securities"), funds and similar other investment property
owned or held by the Trust for its Riverside "Family" of funds as listed on
Exhibit A, and for such other portfolio series of the Trust as the parties
hereto subsequently shall agree to in writing (which agreement may be reflected
by executing an amended Exhibit A) and is authorized to enter into this
agreement.
NOW, THEREFORE, in consideration of the premises and of the
agreements hereinafter set forth, the parties hereby agree as follows:
1. APPOINTMENT AND ACCEPTANCE
The Trust hereby appoints the Bank as custodian of the
Property, and the Bank agrees to act as such upon the terms and conditions
hereinafter provided.
2. DELIVERY; SAFEKEEPING
The Trust has heretofore delivered or will deliver Property to
the Bank, and will deliver or cause to be delivered to the Bank Property
hereafter acquired which Property the Bank agrees to keep safely as custodian
for the Trust. The Bank shall not surrender possession of Property except upon
properly authorized instructions of the Trust.
3. IDENTIFICATION AND SEGREGATION OF ASSETS
With respect to Property in the Custody Account:
(a) The Bank will segregate and identify on its books as
belonging to the Trust all Property held by the Bank or by any other entity
authorized to hold Property in accordance with Section 6 or 7 hereof.
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(b) The Bank shall supply to the Trust from time to time as
mutually agreed upon a written statement with respect to all of the Property in
the Custody Account. In the event that the Trust does not inform the Bank in
writing of any exceptions or objections within a reasonable time after receipt
of such statement, the Trust shall be deemed to have approved such statement.
4. STANDARD OF CARE
The Bank assumes full responsibility to exercise the same
standard of care that it exercises over its own assets in the safekeeping,
handling, servicing and disposition of the Property, in accordance with this
Agreement. The Bank will exercise the due care expected of a professional
custodian for hire with respect to the property in its possession or control and
shall assume the burden of proving that it exercised such care in the event of
any loss of such Property.
The Bank is not under any duty to supervise the investments of
the Trust, or to advise or make any recommendation to the Trust with respect to
the purchase or sale of any of the Securities or the investment of any funds.
5. PERFORMANCE BY THE BANK
(a) Receipt, Delivery and Disposal of Securities. The Bank
shall, or shall instruct any other entity authorized to hold Property in
accordance with Section 6 or 7 hereof to, receive or deliver Securities and
credit or debit the Trust's account, in accordance with properly authorized
instructions from the Trust. The Bank or such entity shall also receive in
custody all stock dividends, rights and similar securities issued in connection
with Securities held hereunder, shall surrender for payment, in a timely manner,
all items maturing or called for redemption and shall take such other action as
the Trust may direct in properly authorized instructions.
(b) Trade Execution. The Trust may from time to time place
orders with the Bank to buy or sell Securities. The Bank or any entity
authorized to hold Property in accordance with Section 7 hereof may refer each
such order to any broker or sub-agent of its choice, including an affiliate of
the Bank, unless otherwise specified, and shall have no liability or
responsibility whatsoever for any error, neglect or default of any such broker
or sub-agent or for mutilations, interruptions, omissions, errors or delays
occurring in the mails, or on the part of any telegraph, cable or wireless
company, or any employee of such company, or by reason of any cause beyond its
control. In placing such orders, the Trust may from time to time place special
orders with the Bank which will, as agent, undertake the purchase or sale of the
Securities as set out above; provided that if the order is for the purchase or
sale of obligations of the United States Government or its agencies, or
municipal bonds, the Bank may act as principal. The Trust hereby agrees, with
respect to all purchases, that good funds for settlement will be on deposit by
settlement date. Further, the Trust agrees to provide specific instructions
regarding the deposit or delivery of all such Securities to the Custody Account.
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(c) Registration. Securities held hereunder may be registered
in the name of the Bank, any entity authorized to hold property in accordance
with Section 6 or 7 hereof, or a nominee of the Bank or any such authorized
entity, and the Trust shall be informed upon request of all such registrations.
The Securities in registered form will be transferred upon request of the Trust
into such names or registrations as it may specify in properly authorized
instructions.
(d) Cash Accounts. All cash received or held by the Bank or by
any entity authorized to hold Property in accordance with Section 7 hereof as
interest, dividends, proceeds from transfer, and other payments for or with
respect to the Securities shall be (i) held in a cash account in accordance with
properly authorized instructions received by the Bank, or (ii) converted and
remitted to the Trust at the Trust's risk. In effecting any currency conversions
hereunder the Bank or such entity may use such methods or agencies as it may see
fit including the Bank's facilities at customary rates.
(e) Reports, Records, Affidavits and Access. If the Bank has
in place a system for providing telecommunication access or other means of
direct access by customers to the Bank's reporting system for Property in the
Custody Account, then, at the Trust's election, the Bank shall provide the Trust
with such instructions and passwords as may be necessary in order for the Trust
to have such direct access through the Trust's terminal device. Such direct
access shall be restricted to information relating to the Custody Account. Where
direct access to such reporting system is requested by the Trust, the Trust
agrees to assume full responsibility for the consequences of the use, including
any misuse or unauthorized use of the terminal device, instructions or passwords
referred to above and agrees to defend and indemnify the Bank and hold the Bank
harmless from and against any and all liabilities, losses, damages, costs,
counsel fees and other expenses of every nature suffered or incurred by the Bank
by reason of or in connection with such use by the Trust or others of such
terminal device, unless such liabilities, losses, damages, costs, counsel fees
and other expenses can be shown to be the result of negligent or wrongful acts
of the Bank, the Bank's employees or the Bank's agents. Further, where the trust
elects to have direct access, the Bank shall provide the Trust on each business
day a report of the preceding business day's transactions relating to such
accounts and of the closing or net balances of each business day. If the Trust
should not choose to have direct access, the Bank shall provide the Trust with
such reports of transactions in the Custody Account by such means as may be
mutually agreed upon.
During the Bank's regular banking hours and upon receipt of
reasonable notice from the Trust, any officer or employee of the Trust, any
independent accountant(s) selected by the Trust and any person designated by any
regulatory authority having jurisdiction over the Trust shall be entitled to
examine on the Bank's premises, Property held by the Bank on its premises and
the Bank's records regarding Property held hereunder deposited with entities
authorized to hold Property in accordance with Section 6 or 7 hereof, but only
upon the Trust's furnishing the Bank with properly authorized instructions to
that effect, provided, such examination shall be consistent with the Bank's
obligations of confidentiality to other parties. The Bank's costs and expenses
in facilitating such examinations, including but not limited to the cost to the
Bank of
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providing personnel in connection with examinations shall be borne by the
persons or agencies making such examinations, provided that such costs and
expenses shall not be deemed to include the Bank's costs in providing to the
Trust (i) the "single audit report" of the independent certified public
accountants engaged by the Bank and (ii) such reports and documents as the
Agreement contemplates that the Bank shall furnish routinely to the Trust.
The Bank shall also, subject to restrictions under applicable
law, seek to obtain from any entity with which the Bank maintains the physical
possession of any of the Property in the Custody Account such records of such
entity relating to the Custody Account as may be required by the Trust or its
agents in connection with an internal examination by the Trust of its own
affairs. Upon a reasonable request from the Trust, the Bank shall use its best
efforts to furnish to the Trust such reports (or portions thereof) of the
external auditors of each such entity as related directly to such entity's
system of internal accounting controls applicable to its duties under its
agreement with the Bank.
The Bank shall supply to the Trust from time to time, written
operational procedures which shall govern the day to day operations of the
account. Such operating procedures are hereby incorporated herein by reference.
(f) Voting and Other Action. The Bank will transmit to the
Trust upon receipt, and will instruct any entities authorized to hold Property
in accordance with Section 6 or 7 hereof to transmit to the Trust upon receipt,
all financial reports, stockholder communications, notices, proxies and proxy
soliciting materials received from issuers of the Securities, and all
information relating to exchange or tender offers received from offerors with
respect to the Securities. Proxies will be executed by the registered holder if
the registered holder is other than the Trust, but the manner in which the
Securities are to be voted will not be indicated. Specific instructions
regarding proxies will be provided when necessary. Neither the Bank nor any such
entity agrees to vote any of the Securities or authorize the voting of any
Securities or give any consent or take any other action with respect thereto,
except as otherwise provided herein.
In the event of tender offers, the Trust shall mail
instructions to the Bank as to the action to be taken with respect thereto or
telephone such instructions to its National City Bank account administrator at
the Bank, designating such instruction as being related to a tender offer. The
Trust shall deliver to the Bank, by 5:00 p.m., Cleveland time on the following
calendar day, written confirmation, including telefax, provided such telefax is
on the letterhead of the Trust and signed by an authorized person, of telephonic
instructions. The Trust agrees to hold the Bank harmless from any adverse
consequences of the Trust's use of any other method of transmitting instructions
relating to a tender offer.
The Trust agrees that if it gives an instruction for the
performance of an act on the last permissible date of a period established by
the tender offer or for the performance of such act or that if it fails to
provide next day written confirmation of an oral instruction, the Trust shall
hold the Bank harmless from any adverse consequences of failing to follow said
instructions.
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The Bank is authorized to accept and open in the Trust's
behalf all mail or communications received by it or directed in its care.
6. AUTHORIZED USE OF U.S. DEPOSITORIES
The Trust authorizes the Bank, for any Securities held
hereunder, to use the services of any United States central securities
depository it deems appropriate, including, but not limited to, the Depository
Trust Company and the Federal Reserve Book Entry System.
7. AUTHORIZED USE OF FOREIGN CUSTODIANS
(a) Authorization. The Bank may cause Securities which are
issued by foreign governments or foreign companies of which principal trading
market is located outside the United States ("Foreign Securities") and other
Property in the Custody Account to be held in such country or other jurisdiction
as the Trust shall direct in properly authorized instructions. In carrying out
its duties with respect to Foreign Securities, the Bank may use the services of
(i) a Global Custodian, or (ii) foreign banks or trust companies ("Foreign
Custodians"), and foreign securities depositories or clearing agencies ("Foreign
Securities Depositories") as the Bank deems prudent and appropriate.
(b) Segregation and Identification of Assets. The Bank will
deposit Property of the Trust with a Foreign Custodian or Foreign Securities
Depository only in an account which holds exclusively the assets of the Bank as
custodian for its customers. In the event that the Bank authorizes a Foreign
Custodian to hold any of the Foreign Securities placed in its care in a Foreign
Securities Depository, the Bank will direct such Foreign Custodian to identify
on its books such Foreign Securities as being held for the account of the Bank
as custodian for its customers.
(c) Instructions to Foreign Custodians and Foreign Securities
Depositories. Any Property in the Custody Account deposited by the Bank with a
Foreign Custodian or Foreign Securities Depository will be subject only to the
instructions of the Bank or its agents; and any Foreign Securities held in a
Foreign Securities Depository for the account of a Foreign Custodian will be
subject only to the instructions of such Foreign Custodian as custodian for the
Bank.
8. AUTHORIZATIONS
The Bank is authorized to rely and act upon written, signed
instructions of those persons as are named in a list provided to the Bank from
time to time and certified by the Trust's Secretary or Assistant Secretary. Such
list shall separately designate those persons who may authorize the withdrawal
of the Securities free of payment. The Trust will provide the Bank with
authenticated specimen signatures of the persons so authorized.
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The Bank is further authorized to rely upon any instructions
received by any other means and identified as having been given or authorized by
any person named to the Bank as authorized to give written instructions,
regardless of whether such instructions shall in fact have been authorized or
given by any of such persons, provided that the Bank and the Trust shall have
agreed upon the means of transmission and the method of identification for such
instructions. Instructions received by any other means shall include verbal
instructions, provided that any verbal instruction shall be promptly confirmed
in writing. In the event verbal instructions are not subsequently confirmed in
writing, as provided above, the Trust agrees to hold the Bank harmless and
without liability for any claims or losses in connection with such verbal
instructions. Notwithstanding the above, instructions for the withdrawal of
securities "free of payment" shall be sent to the Bank in writing, manually
signed by any two such authorized persons.
The Trust may appoint one or more investment managers
("Investment Managers") with respect to the Custody Account. The Bank is
authorized to act upon instructions received from any Investment Manager to the
same extent that the Bank would act upon the instructions of persons named in
the above mentioned certificate or separate list, provided that the Bank has
received copies of the instruments appointing the Investment Manager and written
confirmation from the Investment Manager evidencing his acceptance of such
appointment.
If the Trust should choose to have telecommunication or other
means of direct access to the Bank's reporting system for Property in the
Custody Account, pursuant to paragraph (e) of Section 5, the Bank is also
authorized to rely and act upon any instructions received by it through a
terminal device, provided that such instructions are accompanied by code words
which the Bank has furnished to the Trust, or its delegated personnel by any
method mutually agreed to by the Bank and the Trust, and which the Bank shall
not have then been notified by the Trust or any such delegate to cease to
recognize regardless whether such instructions shall in fact have been given or
authorized by the Trust or any such person. The Trust's delegates shall be named
by a certificate provided to the Bank from time to time by the Trust's Secretary
or an Assistant Secretary.
9. FEES AND EXPENSES
Fees and expenses for the services rendered under this
Agreement shall be as set forth in Exhibit B attached hereto, as such may be
amended from time to time. In addition, if the Bank advances cash or securities
to the Trust for any purpose or in the event that the Bank or its nominee shall
incur or be assessed any taxes, charges, expenses, assessments, claims or
liabilities in connection with the performance of its duties hereunder, except
such as may rise from its or its nominee's negligent action, negligent failure
to act, or willful misconduct, any Property at any time held for the Custody
Account shall be security thereof and should the Trust fail to reimburse the
Bank promptly after request for payment, the Bank shall be entitled to dispose
of such Property to the extent necessary to obtain reimbursement.
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10. TERMINATION
Either party may terminate this Agreement upon sixty (60) days
written notice to the other.
11. CONFIDENTIALITY
Subject to the foregoing provisions of this Agreement and
subject to any applicable law, the Trust and the Bank shall each use best
efforts to maintain the confidentiality of matters concerning Property in the
Custody Account.
12. LIMITATION OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS
The Sessions Group is a business trust organized under Chapter
1746, Ohio Revised Code 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 Sessions Group" entered into in the
name 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 Trust
personally, but bind only the assets of the Trust, as set forth in Section
1746.13(A), Ohio Revised Code, and all persons dealing with any of the Funds of
the Trust must look solely to the assets of the Trust belonging to such Fund for
the enforcement of any claims against the Trust.
13. NOTICES AND MISCELLANEOUS
All notices and other communications hereunder, except for
instructions and reports relating to the Property which are transmitted through
the Bank's reporting system for Property in the Custody Account, shall be in
writing, telex or telecopy or, if verbal, shall be promptly confirmed in
writing, and shall be hand-delivered, telexed, telecopied or mailed by prepaid
first class mail (except that notice of termination, if mailed, shall be by
prepaid registered or certified mail) to each party at its address set forth
above, if to the Trust, marked "Attention Riverside Funds", and if to the Bank,
marked "National City Bank as Custodian for The Sessions Group," or at such
other address as each party may give notice of to the other. This Agreement may
not be amended except by writing signed by the party against whom enforcement is
sought. This Agreement shall not be assignable by either party without the
written consent of the other. This Agreement may be executed in several
counterparts, each of which shall be an original, but all of which shall
constitute one and the same instrument. This Agreement contains the entire
agreement between the Trust and the Bank relating to custody of Property and
supersedes all prior agreements on this subject.
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The captions of the various sections and subsections of this
Agreement have been inserted only for the purposes of convenience and shall not
be deemed in any manner to modify, explain, enlarge or restrict any of the
provisions of this Agreement.
This Agreement shall be governed by and construed according to
the laws of the State of Ohio.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized.
NATIONAL CITY BANK THE SESSIONS GROUP
By /s/Xxxxxxx X. XxXxxxxx By /s/Xxx X. Xxxxxx
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Xxxxxxx X. XxXxxxxx Xxx X. Xxxxxx
Title Senior Vice President Title President
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EXHIBIT A
PORTFOLIOS
This EXHIBIT A, dated March 1, 1995, is that certain Exhibit A to a
Custodial Services Agreement dated as of March 1, 1995 between the undersigned
parties. This Exhibit A supersedes all previously dated Exhibits A.
Riverside Capital Value Equity Fund
Riverside Capital Equity & Municipal Income Fund
Riverside Capital Sunbelt Municipal Obligations Fund
Riverside Capital Low Duration Government Securities Fund
Riverside Capital Growth Fund
Riverside Capital Fixed Income Fund
Riverside Capital Tennessee Municipal Obligations Fund
Riverside Capital Money Market Fund
NATIONAL CITY BANK THE SESSIONS GROUP
By /s/Xxxxxxx X. XxXxxxxx By /s/Xxx X. Xxxxxx
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Xxxxxxx X. XxXxxxxx Xxx X. Xxxxxx
Title Senior Vice President Title President
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EXHIBIT B
The following fee schedule shall be billed at a rate of 1/12 per month at the
end of each month and shall be in effect for the period March 1, 1995 through
February 29, 1996. The fee schedule shall be evaluated by the parties to this
agreement at the end of that period to determine the appropriateness for the
proceeding twelve months. Adjustments shall be made if necessary and this
Exhibit B shall be updated to reflect those changes. Otherwise, this Exhibit B
will continue for Successive twelve month periods until an adjustment is agreed
upon by both parties.
ANNUAL FEE - $55,644.00
As an adjustment to the above fee, the Bank shall credit an amount equal to the
average positive monthly balance of all accounts less a 10% reserve factor times
the month-ending 91 day Treasury Xxxx rate divided by 12 or shall charge an
amount equal to the average overdraft balance times the national prime rate
found in The Wall Street Journal divided by 12.
NATIONAL CITY BANK THE SESSIONS GROUP
By /s/Xxxxxxx X. XxXxxxxx By /s/Xxx X. Xxxxxx
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Xxxxxxx X. XxXxxxxx Xxx X. Xxxxxx
Title Senior Vice President Title President
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