EXHIBIT 23(G)(XII) UNDER FORM N-1A
EXHIBIT 10(G) UNDER ITEM 601/REG. S-K
SUB-CUSTODY AGREEMENT
The Huntington National Bank (the "Custodian"), PFPC Trust Company (the "Sub-
Custodian") and The Huntington Funds (the "Fund") on behalf of its portfolios
which are covered by the Lending Agency Agreement (as defined below) (each such
portfolio, a "Portfolio") are entering into this Agreement as of February 1,
2006.
WHEREAS, the Custodian serves as custodian for the Portfolios pursuant to the
Custodian Contract between the Custodian and the Fund dated January 27, 1993 (as
amended or amended and restated from time to time) (the "Custodian Agreement");
and
WHEREAS, the Sub-Custodian serves as the securities lending agent for the
Portfolios pursuant to the Securities Lending Customer Agreement between the
Sub-Custodian and the Fund dated February 1, 2006 (as amended or amended and
restated from time to time) (the "Lending Agency Agreement"), and in that
capacity, among other things, maintains and carries out certain other activities
with respect to the assets which are received as collateral with respect to the
Portfolios' securities loans (such assets, including as the same may be invested
or reinvested, and all income or other distributions or proceeds received with
respect to such assets and with respect to any investments into which such
assets may be invested or reinvested, collectively the "Collateral");
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:
1. The Custodian and the Fund hereby appoint the Sub-Custodian as a sub-
custodian for the sole and limited purpose of providing custody for the
Collateral and for collateral relating to transactions regarding the
Collateral.
2. The Sub-Custodian will set up a separate account (each an "Account") on
its books and records with respect to each separate Portfolio, and will
reflect in the applicable Account the Collateral relating to the
applicable Portfolio.
3. The Sub-Custodian is authorized to take such actions relating to the
Collateral as are contemplated in (and in accordance with) the Lending
Agency Agreement or approved by the Fund. The Sub-Custodian shall comply
with the instructions of the Custodian with respect to the Collateral to
the extent such instructions are not inconsistent with the Lending Agency
Agreement. The Sub-Custodian will credit to the applicable Account any
income or other distributions or proceeds received by it with respect to
the Collateral in that Account.
4. The Sub-Custodian will provide to the Custodian such reports regarding the
Collateral as the Custodian may reasonably request, including without
limitation a monthly reconciliation report that will reconcile the
Collateral in an Account with the securities that are on loan with respect
to the Portfolio to which such Account relates.
5. The Sub-Custodian shall only utilize a sub-custodian that is itself
qualified under the Investment Company Act of 1940 to act as a custodian
and will inform the Custodian of such sub-custodian. To the extent that
an affiliate of the Sub-Custodian acts as a sub-custodian, the Sub-
Custodian agrees to be responsible for the activities of the affiliated
sub-custodian to the same extent it is responsible to the Fund for its own
activities hereunder. The Sub-Custodian's sole liability for the acts or
omissions of any other sub-custodian, however, shall be limited to
liability arising from the Sub-Custodian's failure to use reasonable care
in the selection of such non-affiliated sub-custodian. For the avoidance
of doubt, the Sub-Custodian acknowledges that its use of non-affiliated
sub-custodians shall be limited to tri-party repurchase agreement sub-
custodians unless otherwise authorized in writing by the Fund. The Sub-
Custodian may also utilize depositories and clearing agencies. Any assets
that the Sub-Custodian maintains pursuant to this Agreement at a
depository or clearing agency shall (to the extent consistent with
applicable law and standard market practice) at all times be segregated
from any assets controlled by the Sub-Custodian in other than a fiduciary
or custodian capacity.
6. The Custodian shall have no responsibility to review or consider the terms
or conditions of the Lending Agency Agreement, and shall be entitled to
rely on the Fund with respect to the appropriateness of those terms and
conditions.
7. The Sub-Custodian's duties hereunder shall be only as set forth herein.
The Sub-Custodian shall be liable to the Fund for any damages incurred by
a Portfolio with respect to the activities to be performed by the Sub-
Custodian under this Agreement that are the result of the Sub-Custodian's
failure to comply with the standard of care set forth in the Lending
Agency Agreement (subject to such limits on liability as are set forth in
the Lending Agency Agreement). The Fund shall indemnify the Sub-Custodian
with respect to damages to which the Sub-Custodian may be subject in
connection with the relationship set forth in this Agreement on the same
terms as the Fund on behalf of a Portfolio provides indemnification to the
Sub-Custodian with respect to damages to which the Sub-Custodian may be
subject in connection with the relationship set forth in the Lending
Agency Agreement. The Sub-Custodian shall not be liable to the Custodian
for any damages or expenses that the Custodian may incur in connection
with this Agreement.
8. The Sub-Custodian represents and warrants that it is authorized to act as
a custodian for registered investment company assets under the Investment
Company Act of 1940.
9. The Custodian shall not be responsible for any action or inaction on the
part of the Sub-Custodian or for any sub-custodian, depository or clearing
agency utilized by the Sub-Custodian. The Fund shall indemnify the
Custodian with respect to damages to which the Custodian may be subject in
connection with the relationship set forth in this Agreement on the same
terms as the Fund on behalf of a Portfolio provides indemnification to the
Custodian with respect to damages to which the Custodian may be subject in
connection with the relationship set forth in the Custodian Agreement.
10. Any assignment of this Agreement by the Sub-Custodian requires the written
consent of the Fund and the Custodian.
11. This Agreement may be amended only by an instrument in writing signed by
the parties.
12. Any party may terminate this Agreement on written notice to the other
parties. The terms of Sections 5, 6, 7 and 9 of this Agreement shall
survive termination of this Agreement.
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13. The parties agree that the terms of this Agreement are applicable only
with respect to the limited purposes set forth herein.
14. This Agreement shall be governed by Delaware law.
THE HUNTINGTON NATIONAL BANK PFPC TRUST COMPANY
By: /s/ Xxxxxxxxxx X. Xxxxxxxxx By: /s/ Xxx Xxxxxxxx
Title: Vice President Title: Senior Vice President
THE HUNTINGTON FUNDS
By: /s/ Xxxxxx X. Xxxxxxx
Title: Vice President
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