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EXHIBIT (8)(a)
U.S. INVESTMENT COMPANY
CUSTODIAL SERVICES AGREEMENT
CUSTODIAL SERVICES AGREEMENT dated as of April 1, 1995 among CITIBANK,
N.A., a national banking association having an office at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 and acting through such office in New York (the "Bank"),
CITICORP, a corporation organized under the laws of the State of Delaware,
having an office at Citicorp Center, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 and Conestoga Family of Funds, a Trust organized under the laws of the
state of Massachusetts having an office at 0000 Xxxx Xxxxxx-Xxxxxxxxx Xxxx,
Xxxxxxxx, Xxxx 00000 (the "Fund").
WITNESSETH:
THAT WHEREAS, the Fund represents that it is a management investment
company registered under the Investment Company Act of 1940, as amended (the
"Investment Company Act");
WHEREAS, the Fund further represents that it is duly organized and in
good standing under the laws of its state of organization and the consummation
of transactions contemplated hereby or directed by it hereunder will not
violate any applicable laws, regulations or orders;
WHEREAS, the Fund represents that it is authorized to (a) open and
maintain one or more custody accounts (the "Custody Account") with the Bank to
hold certain property ("Property"), including but not limited to stocks, bonds
or other securities ("Securities"), cash and other property owned or held by
the Fund, (b) to enter into this Agreement and (c) direct all actions and
transactions contemplated hereunder; and
WHEREAS, on June 12, 1992, the Securities and Exchange Commission
issued an order (the "Exemptive Order") which, among other things, exempts
certain indirect subsidiaries of Citicorp (the "Exempt Subsidiaries") from the
shareholders' equity requirements of Rule 17f-5 promulgated under the
Investment Company Act;
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 Fund hereby appoints the Bank as custodian of the Property and as
its agent hereunder, and the Bank agrees to act as such upon the terms and
conditions hereinafter provided.
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2. DELIVERY; SAFEKEEPING
The Fund has heretofore delivered, and will deliver or cause to be
delivered, Property to the Bank, which Property the Bank agrees to keep safely
as custodian for the Fund. The Bank shall not surrender possession of Property
except upon properly authorized Instructions (as hereinafter defined) of the
Fund or as may be required by due process of applicable law.
3. IDENTIFICATION AND SEGREGATION OF ASSETS
With respect to Property in the Custody Account:
(A) Except as otherwise provided in this Agreement, the Bank will
separately identify on its books as belonging to the relevant portfolio of the
Fund and, to the extent practicable, segregate all Property held pursuant to
this Agreement by the Bank or any other entity authorized to hold Property in
accordance with Section 6 or 7 hereof
(B) The Bank shall supply to the Fund 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 Fund does not inform the Bank in
writing of any exceptions or objections within thirty (30) days after receipt
of such statement, the Fund shall be deemed to have approved such statement.
4. STANDARD OF CARE
(A) The Bank shall exercise the due care expected of a
professional custodian for hire with respect to the safekeeping, handling,
servicing and disposition of 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.
(B) The Bank shall be responsible for the acts or omissions of any
Exempt Subsidiary acting as a foreign subcustodian pursuant to the Exemptive
Order or any subsequent exemptive order issued by the Securities and Exchange
Commission to the same extent as if the act or omission of such Exempt
Subsidiary were that of the Bank.
(C) Except as otherwise provided above, the Bank shall use
reasonable care in selecting, and shall be responsible only for the proper
selection of, any foreign subcustodian or foreign depository.
(D) The Bank's delegation of duties to an Exempt Subsidiary shall
not relieve the Bank of any responsibility to the Fund for any loss due to such
delegation, except such losses or damages which may result from (i) political
risk, including, but not
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limited to losses resulting from exchange control restrictions, confiscation,
expropriation, nationalization, insurrection, civil strife or armed hostilities
and (ii) other risk of loss for which neither the Bank nor any foreign
subcustodian would be liable under Rule 17f-5 promulgated under the Investment
Company Act.
(E) In the event the Fund enters into triparty repurchase
agreements pursuant to which collateral therefor is to be held by a custodian
other than the Bank and the Fund instructs the Bank to deliver Property to such
custodian, the Bank shall be under no duty to determine whether such custodian
satisfies the requirements of Section 17(f) of the Investment Company Act or
the Rules promulgated thereunder. Citibank shall have no further duties or
obligations under this Agreement with respect to such Property.
(F) The Bank is not under any duty to supervise the investments of
the Fund, or to advise or make any recommendation to the Fund with respect to
the purchase or sale of any of the Securities or the investment of any cash.
The Fund shall have the sole and exclusive responsibility for investment of
Property held hereunder.
5. PERFORMANCE BY THE BANK
(A) General. The Bank's performance of its duties hereunder and
the day-to-day operations of the Custody Account shall be in accordance with
written service standards furnished to the Fund by the Bank from time to time.
(B) 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 Fund's account, in accordance with properly authorized Instructions
from the Fund. 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 Fund
may direct in properly authorized Instructions.
(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 Fund shall be informed upon request of all such registrations.
Securities in registered form will be transferred upon request of the Fund into
such names or registrations as it may specify in properly authorized
Instructions.
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(D) Cash Accounts.
(i) 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 (x) held in a cash account in accordance
with properly authorized Instructions received by the Bank or such entity, or
(y) if specified in the Fund's Instructions, converted to or from U.S. dollars
and remitted to the Fund. The Fund shall bear any foreign exchange risk in
connection with any such conversion. In effecting any currency conversions
hereunder, the Bank or such entity may use any methods or agencies as it may
see fit including the Bank's or such entity's facilities at customary rates.
(ii) The Fund agrees, with respect to all payments for
purchases of Securities to be deposited in the Custody Account, that funds for
settlement will be on deposit by the settlement date at the location of
settlement, in good available funds and in the currency of settlement. The
Fund acknowledges that nothing in this Agreement shall obligate the Bank to
extend credit, grant financial accommodation or otherwise advance moneys to the
Fund for the purpose of making any payments for purchases or part thereof or
otherwise carrying out any Instructions.
(iii) The Fund authorizes the Bank from time to time to
cause the branch of the Bank located in London, England ("Citibank London") to
establish a multicurrency cash account reflecting cash received by any Eligible
Foreign Custodian on the Fund's behalf. Citibank London will maintain such
cash account in accordance with the requirements of Section 7 hereof applicable
to an entity authorized to hold Property hereunder.
(E) Reports.
(i) If the Bank has in place a system for providing
telecommunication access or other means of electronic access by customers to
the Bank's reporting system for Property in the Custody Account, then, at the
Fund's election, the Bank shall provide the Fund with such instructions and
passwords as may be necessary in order for the Fund to have such electronic
access through the Fund's terminal device. Such electronic access shall be
restricted to information relating to the Custody Account. If electronic
access to such reporting system is requested by the Fund, the Fund agrees to
assume full responsibility for the consequences of such 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,
reasonable counsel fees, and other expenses of every nature suffered or
incurred by the Bank by reason of or in
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connection with such use by the Fund 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, in the event the Fund elects to have
electronic access, the Bank shall provide the Fund on each business day a
report of the preceding business day's transactions relating to the Custody
Account and of the closing or net balances of each business day. If the Fund
does not choose to have electronic access, the Bank shall provide the Fund with
such reports of transactions in the Custody Account by such means as may be
mutually agreed upon.
(ii) The Bank agrees to use reasonable efforts to furnish
the Fund with such information regarding Property held hereunder as the Fund
may reasonably request in connection with its complying with requests of any
regulatory authorities having jurisdiction over the Fund.
(iii) 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 records
of such entity relating to the Property in the Custody Account as may be
required by the Fund or its agents in connection with an internal examination
by the Fund of its own affairs. Upon a reasonable request from the Fund, the
Bank shall use its best efforts to cash to the Fund reports (or portions
thereof) of the external auditors of each such entity relating directly to such
entity's system of internal accounting controls applicable to its duties under
its agreement with the Bank.
(F) Access. During the Bank's regular banking hours and upon
receipt of reasonable notice from the Fund, any officer or employee of the
Fund, any independent accountant(s) selected by the Fund and any person
designated by any regulatory authority having jurisdiction over the Fund 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 Fund's furnishing the Bank with properly authorized
Instructions to that effect, provided, that 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 shall be borne
by the Fund, provided that such costs and expenses shall not be deemed to
include the Bank's costs in providing to the Fund: (i) the "single audit
report" of the independent certified public accountants engaged by the Bank and
(ii) such reports and documents as this Agreement contemplates that the Bank
shall furnish routinely to the Fund.
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(G) Voting and other Action.
(i) The Bank will transmit to the Fund upon receipt, and
will instruct any entities authorized to hold Property in accordance with
Section 6 or 7 hereof to transmit to the Fund 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 offers with respect to the
Securities. Such proxies will be executed by the registered holder if other
than the Fund, but the manner in which Securities are to be voted will not be
indicated. Neither the Bank nor any other entity holding Property hereunder
shall 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.
(ii) In the event of tender offers, the Fund will hand
deliver or telecopy Instructions to the Bank as to the action to be taken with
respect thereto, designating such Instructions as being related to a tender
offer. The Fund shall hold the Bank harmless from any adverse consequences of
the Fund's use of any other method of transmitting Instructions relating to a
tender offer.
(iii) The Fund agrees that if it gives an Instruction for
the performance of an act on the last permissible date of a period established
by a tender offer or on the last permissible date for the performance of such
act, the Fund shall hold the Bank harmless from any adverse consequences in
connection with acting upon or failing to act upon such Instructions.
(iv) The Bank is authorized to accept and open on the
Fund's behalf all mail or communications relating to the Property received by
the Bank or directed in its care.
6. AUTHORIZED USE OF U.S. DEPOSITORIES
The Fund authorizes the Bank, for any Securities held hereunder, to
use the services of any United States securities depository permitted to
perform such services for registered investment companies and their custodians
under Rule 17f-4 promulgated under the Investment Company Act, including but
not limited to, The Depository Trust Company, the Federal Reserve Book Entry
System and Participants Trust Company ("U.S. Depositories"). The Bank will
deposit Securities held hereunder with a U.S. Depository only in an account
which holds assets of customers of the Bank.
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7. USE OF FOREIGN CUSTODIANS
(A) Authorization.
(i) The Bank may cause Securities which are foreign
securities within the meaning of Rule 17f-5(c)(1) promulgated under the
Investment Company Act ("Foreign Securities") and amounts of cash and cash
equivalents reasonably required to effect the Fund's Foreign Securities
transactions ("Cash") in the Custody Account to be held in such country or
other jurisdiction as the Fund shall direct in properly authorized
Instructions.
(ii) Subject to prior approval by the Fund, the Bank may
hold such Foreign Securities and Cash in subcustody accounts, which shall be
deemed part of the Custody Account and which have been established by the Bank
with (x) branches of "Qualified U.S. Banks", as defined in Rule 17f-5(c)(3)
promulgated under the Investment Company Act ("Branches"), or (y) foreign
custodians which satisfy the provisions of Rule 17f-5(c)(2)(i) or (ii)
promulgated under the Investment Company Act, or Exempt Subsidiaries or other
foreign custodians which are exempt from such provisions under the Exemptive
Order or any other order or release issued by the Securities and Exchange
Commission (such Branches, foreign custodians and Exempt Subsidiaries,
collectively, the "Eligible Foreign Custodians"). The Fund shall deliver to
the Bank a certified copy of the resolution approving both the use of each
Eligible Foreign Custodian with which the Foreign Securities and Cash of the
Fund will be kept and, with respect to Eligible Foreign Custodians other than
Branches, the Bank's contract with such Eligible Foreign Custodian.
(iii) Subject to prior approval by the Fund, the Bank or an
Eligible Foreign Custodian is authorized to hold Foreign Securities of the Fund
in an account with any foreign securities depository or foreign clearing agency
which in the Bank's judgment satisfies the provisions of Rule 17f-5(c)(iii) or
(iv) promulgated under the Investment Company Act, or which is exempt from such
provisions under an order, no-action letter or release issued by the Securities
and Exchange Commission ("Eligible Foreign Securities Depository"). The Fund
shall deliver to the Bank a certified copy of the resolution approving the use
of each Eligible Foreign Securities Depository with which Foreign Securities of
the Fund will be deposited.
(iv) Any Foreign Securities or Cash held by an Eligible
Foreign Custodian or an Eligible Foreign Securities Depository, shall be
subject to applicable laws, regulations, decrees, orders, government acts,
restrictions, customs, procedures, and market practices (the "Laws") (i) to
which such Eligible Foreign Custodian or Eligible Foreign Securities Depository
is subject, (ii) as exist in the country in which such Foreign Securities and
Cash is held, and (iii) of the country of the currency in which
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the Property is denominated. In the event that the Laws to which an Eligible
Foreign Custodian or Eligible Foreign Securities Depository is subject change
in a way that would prevent or limit the performance of duties and obligations
by the Eligible Foreign Custodian or Foreign Securities Depository, such duties
and obligations shall be superseded and neither the Bank nor its parent, nor
any other of its branches, subsidiaries or affiliates shall be liable therefor
or for any damages in any way resulting from such prevented or limited
performance. The Fund acknowledges that, as is normally the case with respect
to the deposits outside the United States, deposits with Citibank London, and
any other entity authorized to hold property pursuant to this Agreement, are
not insured by the Federal Deposit Insurance Corporation..
(B) Provision of information Regarding Foreign Custodians and
Securities Depositories.
(i) The Bank shall use its best efforts to provide the
Fund with the Following:
(a) As to each country in which Property is
held, information concerning whether, and to what extent, applicable foreign
law would restrict the access afforded the Fund's independent public
accountants to books and records kept by a foreign custodian or foreign
securities depository used in that country,
(b) As to each country in which Property is held,
information concerning whether, and to what extent, applicable foreign law
would restrict the Fund's ability to recover its assets in the event of the
bankruptcy of a foreign custodian or foreign securities depository used in that
country;
(c) As to each country in which Property is held,
information concerning whether, and to what extent, applicable foreign law
would restrict the Fund's ability to recover assets that are lost while under
the control of a foreign custodian or foreign securities depository used in
that country;
(d) As to each country in which Property is held,
information concerning whether under applicable foreign currency exchange
regulations the Fund's cash and cash equivalents held in that country are
readily convertible to U.S. dollars;
(e) Information relating to whether each foreign
custodian or foreign securities depository used would provide a level of
safeguards for maintaining the Fund's Securities not materially different from
that provided by the Bank in maintaining the Securities in the United States;
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(f) Information concerning whether each foreign
custodian or foreign securities depository used has offices in the United
States in order to facilitate the assertion of jurisdiction over and
enforcement of judgments against such custodian or depository; and
(g) As to each foreign securities depository
used, information concerning the number of participants in, and operating
history of, such depository.
(ii) During the term of this Agreement, the Bank shall use
its best efforts to provide the Fund with prompt notice of any material changes
in the facts or circumstances upon which any of the foregoing information or
statements were based.
(iii) Notwithstanding any of the foregoing provisions of
this subsection (b) of this Section 7, the Bank's undertaking to provide the
Fund with the information referred to in this subsection (b) of this Section 7
shall neither increase the Bank's duty of care nor reduce the Fund's
responsibility to determine for itself the prudence of entrusting its assets to
any particular foreign custodian or foreign securities depository.
(C) Segregation and Identification of Assets. The Bank will
deposit Property of the Fund with an Eligible Foreign Custodian only in an
account which holds exclusively assets of customers of the Bank. In the event
that an Eligible Foreign Custodian is authorized to hold any of the Foreign
Securities placed in its care in an Eligible Foreign Securities Depository
pursuant to the provisions of subsection (A) of this Section 7, the Bank will
direct such Eligible Foreign Custodian to identify such Foreign Securities on
its books as being held for the account of the Bank as custodian for its
customers.
(D) Instructions to Eligible Foreign Custodians; Instructions to
Eligible Foreign Securities Depositories. Any Property in the Custody Account
held by an Eligible Foreign Custodian will be subject only to the instructions
of the Bank or its agents; and any Foreign Securities held in an Eligible
Foreign Securities Depository for the account of an Eligible Foreign Custodian
will be subject only to the instructions of such Eligible Foreign Custodian, as
subcustodian for the Bank.
(E) Contracts between the Bank and Exempt Subsidiaries. The
Bank's contract with each Exempt Subsidiary provides:
(i) an acknowledgement by such Exempt Subsidiary that it
is acting as a foreign custodian for U.S. Investment Companies or their
custodians pursuant to the terms of the Exemptive Order; and
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(ii) that the Fund is entitled to enforce the terms of the
subcustodian agreement between the Bank and the Exempt Subsidiary and is
entitled to seek relief directly against the Exempt Subsidiary.
8. CITICORP GUARANTEE
Citicorp agrees that it shall be liable, in accordance with the terms
of a guarantee issued in compliance with the conditions of the Exemptive Order,
for losses incurred by the Fund resulting from bankruptcy or insolvency of
Exempt Subsidiaries operating pursuant to the terms of the Exemptive Order.
9. USE OF AGENTS
The Bank may, subject to applicable laws, rules and regulations,
appoint agents, whether in its own name or that of the Fund, to perform any of
the duties of the Bank hereunder, and the Bank may delegate to any such agent
so appointed any of its functions under this Agreement.
10. INSTRUCTIONS
(A) The Bank is authorized to rely and act upon instructions
("Instructions") in writing which are signed by persons ("Authorized Persons")
named in a list provided to the Bank from time to time, which list must be
certified by the Fund's Secretary or Assistant Secretary and include
authenticated specimen signatures of all Authorized Persons. Such list shall
separately designate those Authorized Persons who may authorize the withdrawal
of the Securities free of payment, those Authorized Persons who may authorize
the unconditional transfer of funds, and those Authorized Persons who may give
Instructions by electronic access.
(B) The Fund agrees that the Bank is authorized to rely and act
upon such Instructions in accordance with this Section 10 and the Funds
Transfer Procedures attached hereto and incorporated herein by reference
(including each Schedule A) to this Agreement and to debit or credit the
applicable account(s) of the Fund accordingly and that such Funds Transfer
Procedures and method(s) of transmission are commercially reasonable.
(C) The Bank shall be entitled to rely upon the continued
authority of any Authorized Person to give Instructions until the Bank receives
notice from the Fund to the contrary; and the Bank shall be entitled to rely
upon any Instructions it reasonably believes in good faith to have been given
by an Authorized Person.
(D) The Bank is further authorized to rely upon any Instructions
received by any other means and identified as having
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been given or authorized by any Authorized Person, regardless of whether such
Instructions shall in fact have been authorized or given by any of such
Authorized Persons, provided that the Bank and the Fund shall have agreed in
writing upon the means of transmission and the method of identification for
such Instructions. Instructions received by any other means shall include but
not be limited to oral Instructions only in connection with delivery against
payment or receipt against payment transactions and transfer from one account
with the Bank to another with the Bank and provided that such oral Instructions
are promptly confirmed in writing by the Fund. Notwithstanding the foregoing,
in the event any such oral Instructions are not subsequently confirmed in
writing, as provided above, the Fund agrees to hold the Bank harmless and
without liability for any claims or losses in connection with such oral
Instructions.
(E) The Fund agrees to be bound by any Instruction, whether or not
authorized, given to the Bank in its name and reasonably accepted by the Bank
in accordance with the provisions hereof (including but not limited to the
Funds Transfer Procedures and Schedule A thereto) and further agrees to
indemnify and hold the Bank harmless from and against any loss, liability,
claim or expense (including reasonable legal fees and expenses) associated with
the Bank's acting upon such Instructions as provided herein, except such as may
arise from the Bank's own negligence, bad faith or willful misconduct.
(F) The Fund 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 an Authorized
Person, provided that the Bank has received written evidence of the Investment
Manager's appointment and written confirmation from the Investment Manager
evidencing acceptance of such appointment. The Investment Manager shall
provide to the Bank from time to time a list of persons authorized to give
Instructions on behalf of the Investment Manager. The list must be certified
by the Investment Manager's Secretary or Assistant Secretary and include
authenticated specimen signatures of such persons.
(G) If the Fund should choose to have telecommunication or other
means of electronic access to the Banks 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 Fund, or an Authorized Person, by any
method mutually agreed to in writing by the Bank and the Fund, provided that
the Bank has not been notified by the Fund, or any such Authorized Person to
cease to recognize such code words,
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regardless of whether such Instructions shall in fact have been given or
authorized by the Fund or any such Authorized Person.
11. THE FUND
(A) The Fund agrees that no printed material or other matter in
any language (including without limitation, prospectuses, statements of
additional information, notices to shareholders, annual reports and promotional
material) which mention the Bank's or Citicorp's name or the rights, powers or
duties of the custodian of the Fund shall be issued by the Fund or of Citicorp
or on the Fund's behalf unless the Bank shall first have given its specific
written consent thereto; provided, however, that no prior consent shall be
required if the only reference to the Bank's or Citicorp's name is in
identifying the Bank as the Fund's custodian.
(B) The Fund shall give prior notice to the Bank of any change in
its state of organization, mailing address, or sponsors, or any significant
change in management, investment objectives, fees or redemption rights.
(C) The Fund confirms that it is, and agrees that in the future it
will be, audited at least annually by an independent accounting firm and that
it mails, and in the future will mail an audited financial report of the Fund
to its shareholders at least annually.
12. FEES AND EXPENSES
Fees and expenses for the services rendered under this Agreement shall
be mutually agreed upon by the parties in writing. The Bank shall be entitled
to debit the Custody Account for such fees and expenses.
13. LIENS
The Bank shall have a lien on the Property in the Custody Account to
secure payment of fees and expenses for the services rendered under this
Agreement. If the Bank advances cash or securities to the Fund 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 arise 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
therefor and the Fund hereby grants a security interest therein to the Bank.
The Fund shall promptly reimburse the Bank for any such advance of cash or
securities or any such taxes, charges, expenses, assessments, claims or
liabilities upon request for payment, but should the Fund fail to so reimburse
the Bank, the
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Bank shall be entitled to dispose of such Property to the extent necessary to
obtain reimbursement. The Bank shall be entitled to debit any account of the
Fund with the Bank including, without limitation, the Custody Account, in
connection with any such advance and interest at the Bank's prime rate.
14. TAX STATUS
(A) The Fund's Tax Identification Numbers are as follows:
U.S. Treasury Securities Fund . . . . . . . . . . . . . . . . . . . . . . 00-0000000
Cash Management Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . 00-0000000
Tax-Free Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 00-0000000
Limited Maturity Fund . . . . . . . . . . . . . . . . . . . . . . . . . . 00-0000000
Income Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 00-0000000
Equity Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 00-0000000
Pennsylvania Tax-Free Bond Fund . . . . . . . . . . . . . . . . . . . . . 00-0000000
Special Equity Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . 00-0000000
(B) The Fund may be required from time to time to file such proof
of taxpayer status or residence, to execute such certificates and to make such
representations and warranties, or to provide any other information or
documents, as the Bank and/or a Eligible Foreign Custodian may deem necessary
or proper to fulfill the Banks and/or Eligible Foreign Custodian's obligations
under applicable law. The Fund shall provide the Bank and/or Eligible Foreign
Custodian, in a timely manner, with copies of originals if necessary and
appropriate, or any such proofs of residence, taxpayer status, beneficial
ownership and any other information or documents which the Bank and/or an
Eligible Foreign Custodian may reasonably request.
(C) If any tax or other governmental charge or assessment shall
become payable with respect to any payment due to the Fund ("Taxes"), such
Taxes shall be withheld from such payment in accordance with applicable law.
The Bank and/or a Eligible Foreign Custodian may withhold any interest, any
dividends or other distributions or securities receivable in respect of
Securities, proceeds from the sale or distribution of Securities ("Payments"),
or may sell for the account of the Fund any part thereof or all of the
Securities, and may apply such Payment in satisfaction of such Taxes, the Fund
remaining liable for any deficiency. If any Taxes shall become payable with
respect to any payment made to the Fund by the Bank or an Eligible Foreign
Custodian in a prior year, the Bank and the Eligible Foreign Custodian may
withhold Payments in satisfaction of such prior year's Taxes. The Fund shall
indemnify and hold harmless the Bank and the Eligible Foreign Custodian, its
officers, employees, agents and affiliated companies against any Taxes,
penalties, additions to tax, and interest, and costs and expenses related
thereto, arising out of claims against the Bank and/or the Eligible Foreign
Custodian by any governmental authority for
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failure to withhold Taxes or arising out of any reclaim or refund of taxes or
other tax benefit obtained by the Bank or the Eligible Foreign Custodian for
the Fund.
(D) This Section 14 shall survive the termination of this
Agreement and continue in force until the time for assessment of all Taxes
expires.
15. AMENDMENT
This Agreement may not be amended except by a written agreement among
the parties hereto.
16. TERMINATION
Either the Bank or the Fund may terminate this Agreement upon sixty
(60) days' written notice to the other parties.
17. CONFIDENTIALITY
Subject to the foregoing provisions of this Agreement and subject to
any applicable law, the Fund and the Bank shall each use best efforts to
maintain the confidentiality of matters concerning Property in the Custody
Account.
18. NOTICES
All notices and other communications hereunder, except for
Instructions and reports relating to the Property which are transmitted through
the Bank's electronic reporting system for Property in the Custody Account,
shall be in writing, telex or telecopy or, if oral, 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 Fund, marked "Attention President" and if to the Bank,
marked "Citibank as Custodian for the Conestoga Family of Funds", and if to
Citicorp, marked "Attention of Office of Corporate Finance, Xxxxxxx X. Xxxxx,
Vice President", or at such other address as either party may give notice of to
the other.
19. ASSIGNMENT
No party may assign, transfer or charge all or any of its rights and
benefits hereunder without the written consent of the other parties. Any
purported assignments made in contravention of this Section shall be null and
void and of no effect whatsoever.
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20. GOVERNING LAW
This Agreement shall be governed by and construed according to the
laws of the State of New York and the parties agree that the courts of the
State of New York shall have jurisdiction to hear and determine any suit,
action or proceeding and to settle any disputes which may arise out to or in
connection with this Agreement, and, for such purposes, each irrevocably
submits to the non-exclusive jurisdiction of such courts.
21. MISCELLANEOUS
(A) 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.
(B) This Agreement contains the entire agreement among the parties
relating to custody of Property and supersedes the Custodial Services
Agreement, dated November 24, 1989, by and between the Fund and the Bank, and
all other agreements on this subject made prior to the date hereof.
(C) 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.
(D) The names "Conestoga Family of Funds" and "Trustees of
Conestoga Family of Funds" refer respectively to the trust created and the
trustees, as trustees but not individually or personally, acting from time to
time under a Declaration of Trust dated August 1, 1989 which is hereby referred
to and a copy of which is on file at the office of the State Secretary of The
Commonwealth of Massachusetts and at the principal office of the Fund. The
obligations of "Conestoga Family of Funds" entered into in the name or on
behalf thereof by any of the trustees, representatives or agents are made not
individually, but in such capacities, and are not binding upon any of the
trustees, shareholders or representatives of the Fund personally, but bind only
the trust property. Notwithstanding any other provision of this Agreement, all
persons, including the parties hereto, dealing with any portfolio or class of
shares of the Fund must
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look solely to the property belonging to such portfolio or class for the
enforcement of any claims against the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized.
CITIBANK, N.A. CITICORP
BY:s/ Xxxx Xxxxxxxx BY:s/ Xxxxxxx X. Xxxxx
--------------------------- ---------------------------
NAME: Xxxx Xxxxxxxx NAME: Xxxxxxx X. Xxxxx
------------------------- -------------------------
TITLE: Vice President TITLE: Vice President
------------------------ ------------------------
CONESTOGA FAMILY OF FUNDS
BY:s/ Xxxx X. Xxxxxx
---------------------------
NAME: Xxxx X. Xxxxxx
-------------------------
TITLE: Vice President
------------------------
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