FORM OF ACCOUNTING SERVICES AGREEMENT
FORM OF
THIS
AGREEMENT is made and entered into this _____ day of February, 2009, by and
between the Conestoga Funds (the “Trust”), a Delaware business trust having its
principal place of business at 000 X. Xxxxxx-Xxxxxxx Xxxx, Xxxxxx Xxxxx, Xxxxx
000, Xxxxxx, XX 00000, and Mutual Shareholder Services, LLC, a Delaware Limited
Liability Company (“MSS”).
RECITALS:
A. The
Trust is an open-end management investment company registered with the United
States Securities and Exchange Commission under the Investment Company Act of
1940, as amended (the "1940 Act"); and
B. MSS
is a corporation experienced in providing accounting services to mutual funds
and possesses facilities sufficient to provide such services; and
C. The
Trust desires to avail itself of the experience, assistance and facilities of
MSS and to have MSS perform the Trust certain services appropriate to the
operations of the Trust, and MSS is willing to furnish such services in
accordance with the terms hereinafter set forth.
AGREEMENTS:
NOW,
THEREFORE, in consideration of the mutual covenants herein contained, the
parties hereby agree as follows:
1. DUTIES
OF MSS.
MSS will
provide the Trust with the necessary office space, communication facilities and
personnel to perform the following services for the Trust:
(a) Timely
calculate and transmit to NASDAQ the daily net asset value of each class of
shares of each portfolio of the Trust, and communicate such value to the Trust
and its transfer agent;
(b) Maintain
and keep current all books and records of the Trust as required by Rule 31a-1
under the 1940 Act, as such rule or any successor rule may be amended from time
to time ("Rule 31a-1"), that are applicable to the fulfillment of MSS's duties
hereunder, as well as any other documents necessary or advisable for compliance
with applicable regulations as may be mutually agreed to between the Trust and
MSS. Without limiting the generality of the foregoing, MSS will
prepare and maintain the following records upon receipt of information in proper
form from the Trust or its authorized agents:
· Cash
receipts journal
· Cash
disbursements journal
· Dividend
record
· Purchase
and sales - portfolio securities journals
· Subscription
and redemption journals
· Security
ledgers
· Broker
ledger
· General
ledger
· Daily
expense accruals
· Daily
income accruals
· Securities
and monies borrowed or loaned and collateral therefore
· Foreign
currency journals
· Trial
balances
(c) Provide
the Trust and its investment adviser with daily portfolio valuation, net asset
value calculation and other standard operational reports as requested from time
to time.
(d) Provide
all raw data available from its fund accounting system for the preparation by
the Trust or its investment advisor of the following
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1.
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Semi-annual
and annual financial statements;
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2.
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Semi-annual
forms N-SAR;
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3.
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Annual
tax returns;
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4.
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Financial
data necessary to update form N-1A;
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5.
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Annual
proxy statement.
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(e) Notwithstanding
paragragh 1 (d), prepare the following:
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1.
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Semi-annual
and annual financial statements;
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2.
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Semi-annual
forms N-SAR;
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(f) Edgarize
and file with the SEC the following:
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1.
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Semi-annual
and annual financial statements;
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2.
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Semi-annual
forms N-SAR;
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3.
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N-1A
and other necessary filings.
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(g) Provide
facilities to accommodate annual audit and any audits or examinations conducted
by the Securities and Exchange Commission or any other governmental or
quasi-governmental entities with jurisdiction.
MSS shall
for all purposes herein be deemed to be an independent contractor and shall,
unless otherwise expressly provided or authorized, have no authority to act for
or represent the Trust in any way or otherwise be deemed an agent of the
Trust.
2. FEES
AND EXPENSES.
(a) In
consideration of the services to be performed by MSS pursuant to this Agreement,
the Trust agrees to pay MSS the fees set forth in the fee schedule attached
hereto as Exhibit A.
(b) In
addition to the fees paid under paragraph (a) above, the Trust agrees to
reimburse MSS for out-of-pocket expenses or advances incurred by MSS in
connection with the performance of its obligations under this Agreement. In
addition, any other expenses incurred by MSS at the request or with the consent
of the Trust will be reimbursed by the Trust.
(c) The
Trust agrees to pay all fees and reimbursable expenses within five days
following the receipt of the respective billing notice.
3. LIMITATION
OF LIABILITY OF MSS.
(a) MSS
shall be held to the exercise of reasonable care in carrying out the provisions
of the Agreement, but shall not be liable to the Trust for any action taken or
omitted by it in good faith without negligence, bad faith, willful misconduct or
reckless disregard of its duties hereunder. It shall be entitled to
rely upon and may act upon the accounting records and reports generated by the
Trust, advice of the Trust, or of counsel for the Trust and upon statements of
the Trust's independent accountants, and shall not be liable for any action
reasonably taken or omitted pursuant to such records and reports or advice,
provided that such action is not, to the knowledge of MSS, in violation of
applicable federal or state laws or regulations, and provided further that such
action is taken without negligence, bad faith, willful misconduct or reckless
disregard of its duties.
(b) Nothing
herein contained shall be construed to protect MSS against any liability to the
Trust to which MSS shall otherwise be subject by reason of willful misfeasance,
bad faith, negligence in the performance of its duties to the Trust, reckless
disregard of its obligations and duties under this Agreement or the willful
violation of any applicable law.
(c) Except
as may otherwise be provided by applicable law, neither MSS nor its
stockholders, officers, directors, employees or agents shall be subject to, and
the Trust shall indemnify and hold such persons harmless from and against, any
liability for and any damages, expenses or losses incurred by reason of the
inaccuracy of information furnished to MSS by the Trust or its authorized
agents.
4. REPORTS.
(a) The
Trust shall provide to MSS on a quarterly basis a report of a duly authorized
officer of the Trust representing that all information furnished to MSS during
the preceding quarter was true, complete and correct in all material respects.
MSS shall not be responsible for the accuracy of any information furnished to it
by the Trust or its authorized agents, and the Trust shall hold MSS harmless in
regard to any liability incurred by reason of the inaccuracy of such
information.
(b) Whenever,
in the course of performing its duties under this Agreement, MSS determines, on
the basis of information supplied to MSS by the Trust or its authorized agents,
that a violation of applicable law has occurred or that, to its knowledge, a
possible violation of applicable law may have occurred or, with the passage of
time, would occur, MSS shall promptly notify the Trust and its counsel of such
violation.
5. ACTIVITIES
OF MSS.
The
services of MSS under this Agreement are not to be deemed exclusive, and MSS
shall be free to render similar services to others so long as its services
hereunder are not impaired thereby.
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6.
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ACCOUNTS
AND RECORDS.
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The
accounts and records maintained by MSS shall be the property of the Trust, and
shall be surrendered to the Trust promptly upon request by the Trust in the form
in which such accounts and records have been maintained or preserved. MSS agrees
to maintain a back-up set of accounts and records of the Trust (which back-up
set shall be updated on at least a weekly basis) at a location other than that
where the original accounts and records are stored. MSS shall assist the Trust's
independent auditors, or, upon approval of the Trust, any regulatory body, in
any requested review of the Trust's accounts and records. MSS shall preserve the
accounts and records as they are required to be maintained and preserved by Rule
31a-1.
7. CONFIDENTIALITY.
MSS
agrees that it will, on behalf of itself and its officers and employees, treat
all transactions contemplated by this Agreement, and all other information
germane thereto, as confidential and not to be disclosed to any person except as
may be authorized by the Trust.
8. TERM
OF AGREEMENT.
(a) This
Agreement shall become effective as of the date hereof and shall remain in force
for a period of three years. This Agreement will automatically renew
for successive annual terms unless one party provides written notice to the
other party 90 days prior to the annual renewal date that the agreement will not
be renewed. Each party to this Agreement has the option to terminate
this Agreement during the initial three year term and any renewal period,
without penalty, upon 90 days prior written notice.
(b) Should
the Trust exercise its right to terminate, all out-of-pocket expenses associated
with the movements of records and material will be paid by the
Trust. Additionally, MSS reserves the right to charge for any other
reasonable expenses associated with such termination.
9. MISCELLANEOUS.
(a) Neither
this Agreement nor any rights or obligations hereunder may be assigned by either
party without the written consent of the other party. This Agreement shall inure
to the benefit of and be binding upon the parties and their respective permitted
successors and assigns.
(b) The
provisions of this Agreement shall be construed and interpreted in accordance
with the laws of the State of Ohio as at the time in effect and the applicable
provisions of the 1940 Act. To the extent that the applicable law of the State
of Ohio, or any of the provisions herein, conflict with the applicable
provisions of the 1940 Act, the latter shall control.
(c) This
Agreement may be amended by the parties hereto only if such amendment is in
writing and signed by both parties.
(d) This
Agreement constitutes the entire agreement between the parties hereto and
supersedes any prior agreement with respect to the subject matter hereof whether
oral or written.
(e) All
notices and other communications hereunder shall be in writing, shall be deemed
to have been given when received or when sent by telex or facsimile, and shall
be given to the following addresses (or such other addresses as to which notice
is given):
To the
Trust: To
MSS:
000 X.
Xxxxxx-Xxxxxxx
Xxxx Mutual
Shareholder Services
Xxxxxx
Xxxxx, Xxxxx
000 0000
Xxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxx,
XX
00000 Xxxxxxxxx
Xxxxxxx, XX 00000
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year first above written.
Conestoga
Funds: Mutual
Shareholder Services, LLC:
By:
___________________________ By:
________________________________
Its:
___________________________ Its:
________________________________
