EXHIBIT 23(G)(VIII) UNDER FORM N-1A
EXHIBIT 10(G) UNDER ITEM 601/REG. S-K
FOREIGN CUSTODY AGREEMENT
AGREEMENT, dated as of June 23, 2006 between THE HUNTINGTON NATIONAL
BANK, a national banking association having its principal office and place of
business at 00 Xxxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxx 00000 ("Huntington") and THE
BANK OF NEW YORK, a New York corporation authorized to do a banking business
having its principal office and place of business at Xxx Xxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000.
W I T N E S S E T H:
WHEREAS, Huntington serves as the custodian to the portfolios identified
on Schedule II hereto (as such schedule may be amended from time to time, the
"Portfolios") of The Huntington Funds, a Delaware statutory trust (the "Trust");
WHEREAS, Huntington desires that The Bank of New York serve as the sub-
custodian (hereinafter, the "Custodian") of the Portfolios' foreign assets on
the terms and conditions contained herein, and the Trust desires the Custodian
to serve as the "Primary Custodian" (as that term is defined by Rule 17f-7 under
the Investment Company Act of 1940) of the Portfolios;
WHEREAS, Custodian desires to serve as the sub-custodian of the
Portfolios' foreign assets and to perform the duties set forth herein on the
terms and conditions contained herein;
NOW THEREFORE, in consideration of the mutual promises hereinafter
contained in this Agreement, Huntington and Custodian hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words shall have the
meanings set forth below:
1. "AUTHORIZED PERSON" shall be any person, whether or not an officer or
employee of Huntington, duly authorized to execute any Certificate or to give
any Oral Instruction with respect to one or more Accounts, such persons to be
designated in a Certificate annexed hereto as Schedule I or such other
Certificate as may be received by Custodian from time to time.
2. "COUNTRY RISKS" shall mean with respect to any Foreign Depository:
(a) the financial infrastructure of the country in which it is organized, (b)
such country's prevailing custody and settlement practices, (c) nationalization,
expropriation or other governmental actions, (d) such country's regulation of
the banking or securities industry, (e) currency controls, restrictions,
devaluations or fluctuations, and (f) market conditions which affect the order
execution of securities transactions or affect the value of securities.
3. "CUSTODIAN AFFILIATE" shall mean any office, branch or subsidiary of
The Bank of New York Company, Inc.
4. "BOOK-ENTRY SYSTEM" shall mean the Federal Reserve/Treasury book-entry
system for receiving and delivering securities, its successors and nominees.
5. "BUSINESS DAY" shall mean any day on which Custodian and relevant
Depositories are open for business.
6. "CERTIFICATE" shall mean any notice, instruction, or other instrument
in writing, authorized or required by this Agreement to be given to Custodian,
which is actually received by Custodian by letter or facsimile transmission and
signed on behalf of Huntington by an Authorized Person or a person reasonably
believed by Custodian to be an Authorized Person.
7. "COMPOSITE CURRENCY UNIT" shall mean the Euro or any other composite
currency unit consisting of the aggregate of specified amounts of specified
currencies, as such unit may be constituted from time to time.
8. "DEPOSITORY" shall include (a) the Book-Entry System, (b) the
Depository Trust Company, (c) any other clearing agency or securities depository
registered with the Securities and Exchange Commission identified to the Trust
from time to time, and (d) the respective successors and nominees of the
foregoing.
9. "FOREIGN DEPOSITORY" shall mean (a) Euroclear, (b) Clearstream
Banking, societe anonyme, (c) each Eligible Securities Depository as defined in
the Rule identified to the Trust from time to time, and (d) the respective
successors and nominees of the foregoing.
10."FOREIGN SECURITIES" shall include, without limitation, Securities
issued by a government other than the United States government or a corporation
or other entity organized under the laws of any country other than the United
States and Securities issued by the United States government or by any state or
any political subdivision thereof or by any agency thereof or by any entity
organized under the laws of the United States or of any state thereof which have
been issued and sold primarily outside the United States.
11. "INSTRUCTIONS" shall mean communications actually received by
Custodian by S.W.I.F.T., tested telex, letter, facsimile transmission, or other
method or system specified by Custodian as available for use in connection with
the services hereunder.
12."ORAL INSTRUCTIONS" shall mean verbal instructions received by
Custodian from an Authorized Person or from a person reasonably believed by
Custodian to be an Authorized Person.
13."PORTFOLIOS" shall have the meaning assigned to that term in the
Recitals to this Agreement.
14."RULE" shall mean Rule 17f-7 under the 1940 Act, as it may be amended
from time to time.
15. "SECURITIES" shall include, without limitation, any common stock and
other equity securities, bonds, debentures and other debt securities, notes,
mortgages or other obligations, and any instruments representing rights to
receive, purchase, or subscribe for the same, or representing any other rights
or interests therein (whether represented by a certificate or held in a
Depository or by a Subcustodian).
16."SUBCUSTODIAN" shall mean a bank (including any branch thereof) or
other financial institution (other than a Foreign Depository) located outside
the U.S. which is utilized by Custodian in connection with the purchase, sale or
custody of Foreign Securities hereunder and identified to the Trust from time to
time, and their respective successors and nominees.
17."TRUST" shall have the meaning assigned to that term in the Recitals
to this Agreement.
17. "1940 ACT" shall mean the Investment Company Act of 1940.
ARTICLE II
APPOINTMENT OF CUSTODIAN; ACCOUNTS;
REPRESENTATIONS, WARRANTIES, AND COVENANTS
1. (a)Huntington hereby appoints Custodian as custodian of all Foreign
Securities and cash at any time delivered to Custodian during the term of this
Agreement with respect to the Portfolios, and authorizes Custodian to hold
Foreign Securities in registered form in its name or the name of its nominees.
Custodian hereby accepts such appointment and agrees to establish and maintain
one or more securities accounts and cash accounts for each Portfolio in which
Custodian will hold Foreign Securities and cash as provided herein. Custodian
shall maintain books and records segregating the assets of each Portfolio from
the assets of any other Portfolio. Such accounts (each, an "Account";
collectively, the "Accounts") shall be in the name of the Portfolio or the Trust
on behalf of the Portfolio, as circumstances warrant.
(a) Custodian may from time to time establish on its books and
records such sub-accounts within each Account as Huntington and Custodian may
agree upon (each a "Special Account"), and Custodian shall reflect therein such
assets as Huntington may specify in a Certificate or Instructions.
(b) Custodian may from time to time establish pursuant to a written
agreement with and for the benefit of a broker, dealer, future commission
merchant or other third party identified in a Certificate or Instructions such
accounts on such terms and conditions as Huntington and Custodian shall agree,
and Custodian shall transfer to such account such Foreign Securities and money
as Huntington may specify in a Certificate or Instructions.
2. Huntington hereby represents and warrants, which representations and
warranties shall be continuing and shall be deemed to be reaffirmed upon each
delivery of a Certificate or each giving of Oral Instructions or Instructions by
Huntington, that:
(a) It is duly organized and existing under the laws of the United
States of America, with full power to carry on its business as now conducted, to
enter into this Agreement, and to perform its obligations hereunder;
(b) This Agreement has been duly authorized, executed and delivered
by Huntington, approved by all necessary corporate action, constitutes a valid
and legally binding obligation of Huntington, enforceable in accordance with its
terms, and there is no statute, regulation, rule, order or judgment binding on
it, and no provision of its charter or by-laws, nor of any mortgage, indenture,
credit agreement or other contract binding on it or affecting its property,
which would prohibit its execution or performance of this Agreement;
(b) It is conducting its business as related to this Agreement in
substantial compliance with all applicable laws and requirements, both state and
federal, and has obtained all regulatory licenses, approvals and consents
necessary to carry on its business as related to this Agreement as now
conducted;
(c) It will not use the services provided by Custodian hereunder in
any manner that is, or will result in, a violation of any law, rule or
regulation applicable to the Trust;
(d) If the Custodian is not the Portfolios' foreign custody
manager, as defined in Rule 17f-5 under the 1940 Act, the board of the Trust or
the Portfolios' foreign custody manager has determined that use of each
Subcustodian (including any Replacement Custodian) which Custodian is authorized
to utilize in accordance with Section 1(a) of Article III hereof satisfies the
applicable requirements of the 1940 Act and Rule 17f-5 thereunder;
(e) The Trust or the Portfolios' investment adviser has determined
that the custody arrangements of each Foreign Depository provide reasonable
safeguards against the custody risks associated with maintaining assets with
such Foreign Depository within the meaning of the Rule;
(f) Huntington is (i) fully informed of the protections and risks
associated with various methods of transmitting Instructions and Oral
Instructions and delivering Certificates to Custodian, (ii) shall, and shall
cause each Authorized Person to, safeguard and treat with extreme care any user
and authorization codes, passwords and/or authentication keys, (iii) understands
that there may be more secure methods of transmitting or delivering the same
than the methods selected by it, and (iv) agrees that the security procedures
(if any) to be followed in connection therewith provide a commercially
reasonable degree of protection in light of its particular needs and
circumstances, and acknowledges and agrees that Instructions which appear to be
transmitted by an Authorized Signer need not be further reviewed by Custodian,
and may conclusively be presumed by Custodian to have been given by said
Authorized Person, and may be acted upon as given;
(g) Huntington's transmission or giving of Certificates,
Instructions, or Oral Instructions pursuant to this Agreement shall at all times
comply with the 1940 Act; and
(h) Huntington on behalf of the Trust has the right to make the
pledge and grant the security interest and security entitlement to Custodian
contained in Section 1 of Article V hereof, free of any right of redemption or
prior claim of any other person or entity, such pledge and such grants shall
have a first priority subject to no setoffs, counterclaims, or other liens or
grants prior to or on a parity therewith, and it shall take such additional
steps as Custodian may require to assure such priority.
3. Custodian hereby represents and warrants, which representations and
warranties shall be continuing and shall be deemed to be reaffirmed upon each
acceptance of a Certificate or each receipt of Oral Instructions or Instructions
from Huntington, that;
(a) It is a "U.S. Bank," as defined in Rule 17f-5 under the 1940
Act and is duly organized and existing under the laws of the State of New York,
with full power to carry on its business as now conducted, to enter into this
Agreement, and to perform its obligations hereunder;
(b) This Agreement has been duly authorized, executed and delivered
by Custodian, approved by all necessary corporate action, constitutes a valid
and legally binding obligation of Custodian, enforceable in accordance with its
terms, and there is no statute, regulation, rule, order or judgment binding on
it, and no provision of its charter or by-laws, nor of any mortgage, indenture,
credit agreement or other contract binding on it or affecting its property,
which would prohibit its execution or performance of this Agreement;
(c) It is conducting its business as related to this Agreement in
substantial compliance with all applicable laws and requirements, both state and
federal, and has obtained all regulatory licenses, approvals and consents
necessary to carry on its business as related to this Agreement as now
conducted;
(d) The Portfolios' "Foreign Custody Manager" (as defined in Rule
17f-5 under the 1940 Act), has determined that use of each Subcustodian
(including any Replacement Custodian) which Custodian is authorized to utilize
in accordance with Section 1(a) of Article III hereof satisfies the applicable
requirements of the 1940 Act and Rule 17f-5 thereunder;
(e) It will not provide services hereunder in any manner that is,
or will result in, a violation of any law, rule or regulation applicable to the
Trust; and
(f) Custodian's acting upon and reliance on Certificates,
Instructions, or Oral Instructions pursuant to this Agreement shall at all times
comply with the 1940 Act.
ARTICLE III
CUSTODY AND RELATED SERVICES
1. (a)Subject to the terms hereof, Huntington hereby authorizes Custodian
to hold any Foreign Securities received by it from time to time for the
Portfolios' account. Custodian shall be entitled to utilize, subject to
subsection (c) of this Section 1, Depositories, Subcustodians, and, subject to
subsection (d) of this Section 1, Foreign Depositories, to the extent possible
in connection with its performance hereunder. Foreign Securities and cash held
in a Depository or Foreign Depository will be held subject to the rules, terms
and conditions of such entity. Foreign Securities and cash held through
Subcustodians shall be held subject to the terms and conditions of Custodian's
agreements with such Subcustodians. Subcustodians may be authorized to hold
Foreign Securities in Foreign Depositories in which such Subcustodians
participate. Unless otherwise required by local law or practice or a particular
subcustodian agreement, Foreign Securities deposited with a Subcustodian, a
Depositary or a Foreign Depository will be held in a commingled account, in the
name of Custodian, holding only Securities held by Custodian as custodian for
its customers. Custodian shall identify on its books and records the Foreign
Securities and cash belonging to each Portfolio, whether held directly or
indirectly through Depositories, Foreign Depositories, or Subcustodians.
Custodian shall, directly or indirectly through Subcustodians, Depositories, or
Foreign Depositories, endeavor, to the extent feasible, to hold Foreign
Securities in the country or other jurisdiction in which the principal trading
market for such Foreign Securities is located, where such Foreign Securities are
to be presented for cancellation and/or payment and/or registration, or where
such Foreign Securities are acquired. Custodian at any time may cease utilizing
any Subcustodian and/or may replace a Subcustodian with a different Subcustodian
(the "Replacement Subcustodian"). In the event Custodian selects a Replacement
Subcustodian, Custodian shall not utilize such Replacement Subcustodian until
after the Trust's Board or foreign custody manager has determined that
utilization of such Replacement Subcustodian satisfies the requirements of the
1940 Act and Rule 17f-5 thereunder.
(a) Unless Custodian has received a Certificate or Instructions to
the contrary, Custodian shall hold Foreign Securities indirectly through a
Subcustodian only if (i) the Foreign Securities are not subject to any right,
charge, security interest, lien or claim of any kind in favor of such
Subcustodian or its creditors or operators, including a receiver or trustee in
bankruptcy or similar authority, except for a claim of payment for the safe
custody or administration of Foreign Securities on behalf of the Portfolios by
such Subcustodian, and (ii) beneficial ownership of the Foreign Securities is
freely transferable without the payment of money or value other than for safe
custody or administration.
(b) With respect to each Depository, Custodian (i) shall exercise
due care in accordance with reasonable commercial standards in discharging its
duties as a securities intermediary to obtain and thereafter maintain Foreign
Securities or financial assets deposited or held in such Depository, and (ii)
will provide, promptly upon request by the Trust, such reports as are available
concerning the internal accounting controls and financial strength of Custodian.
(c) With respect to each Foreign Depository, Custodian shall
exercise reasonable care, prudence, and diligence (i) to provide the Trust with
an analysis of the custody risks associated with maintaining assets with the
Foreign Depository, and (ii) to monitor such custody risks on a continuing basis
and promptly notify the Trust of any material change in such risks. The Trust
acknowledges and agrees that such analysis and monitoring shall be made on the
basis of, and limited by, information gathered from Subcustodians or through
publicly available information otherwise obtained by Custodian, and shall not
include any evaluation of Country Risks.
2. Custodian shall furnish Huntington with an advice of daily
transactions (including a confirmation of each transfer of Foreign Securities)
and a monthly summary of all transfers to or from the Accounts.
3. With respect to all Foreign Securities held hereunder, Custodian
shall, unless otherwise instructed to the contrary:
(a) Receive all income and other payments and advise Huntington as
promptly as practicable of any such amounts due but not paid;
(b) Present for payment and receive the amount paid upon all
Foreign Securities which may mature and advise Huntington as promptly as
practicable of any such amounts due but not paid;
(c) Forward to Huntington copies of all information or documents
that it may actually receive from an issuer of Foreign Securities which, in the
opinion of Custodian, are intended for the beneficial owner of Foreign
Securities;
(d) Execute, as custodian, any certificates of ownership,
affidavits, declarations or other certificates under any tax laws now or
hereafter in effect in connection with the collection of bond and note coupons;
(e) Hold directly or through a Depository, a Foreign Depository, or
a Subcustodian all rights and similar Foreign Securities issued with respect to
any Foreign Securities credited to an Account hereunder; and
(f) Endorse for collection checks, drafts or other negotiable
instruments.
4. (a)Custodian shall notify Huntington of rights or discretionary
actions with respect to Foreign Securities held hereunder, and of the date or
dates by when such rights must be exercised or such action must be taken,
provided that Custodian has actually received from the relevant Subcustodian,
Foreign Depository, or a nationally or internationally recognized bond or
corporate action service to which Custodian subscribes, timely notice of such
rights or discretionary corporate action or of the date or dates such rights
must be exercised or such action must be taken. Absent actual receipt of such
notice, Custodian shall have no liability for failing to so notify Huntington.
(a) Whenever Foreign Securities (including, but not limited to,
warrants, options, tenders, options to tender or non-mandatory puts or calls)
confer discretionary rights on the Trust or provide for discretionary action or
alternative courses of action by the Trust, Huntington shall be responsible for
making any decisions relating thereto and for directing Custodian to act. In
order for Custodian to act, it must receive Huntington's Certificate or
Instructions at Custodian's offices, addressed as Custodian may from time to
time request, not later than noon (New York time) at least two (2) Business Days
prior to the last scheduled date to act with respect to such Foreign Securities
(or such earlier date or time as Custodian may specify to Huntington). Absent
Custodian's timely receipt of such Certificate or Instructions, Custodian shall
not be liable for failure to take any action relating to or to exercise any
rights conferred by such Foreign Securities.
5. All voting rights with respect to Foreign Securities, however
registered, shall be exercised by a Trust or its designee. Custodian will make
available to the Trust proxy voting services upon the request of, and for the
jurisdictions selected by, Huntington in accordance with terms and conditions to
be mutually agreed upon by Custodian and Huntington.
6. Custodian shall promptly advise Huntington upon Custodian's actual
receipt of notification of the partial redemption, partial payment or other
action affecting less than all Foreign Securities of the relevant class. If
Custodian, any Subcustodian, any Depository, or any Foreign Depository holds any
Foreign Securities in which the Trust has an interest as part of a fungible
mass, Custodian, such Subcustodian, Depository, or Foreign Depository may select
the Foreign Securities to participate in such partial redemption, partial
payment or other action in any non-discriminatory manner that it customarily
uses to make such selection.
7. Custodian shall not under any circumstances accept bearer interest
coupons which have been stripped from United States federal, state or local
government or agency securities unless explicitly agreed to by Custodian in
writing.
8. Huntington shall be liable for all taxes, assessments, duties and
other governmental charges, including any interest or penalty with respect
thereto ("Taxes"), with respect to any cash or Foreign Securities held on behalf
of the Trust or any transaction related thereto. Huntington shall indemnify
Custodian and each Subcustodian for the amount of any Tax that Custodian, any
such Subcustodian or any other withholding agent is required under applicable
laws (whether by assessment or otherwise) to pay on behalf of, or in respect of
income earned by or payments or distributions made to or for the account of the
Trust (including any payment of Tax required by reason of an earlier failure to
withhold). Custodian shall, or shall instruct the applicable Subcustodian or
other withholding agent to, withhold the amount of any Tax which is required to
be withheld under applicable law upon collection of any dividend, interest or
other distribution made with respect to any Security and any proceeds or income
from the sale, loan or other transfer of any Security. In the event that
Custodian or any Subcustodian is required under applicable law to pay any Tax on
behalf of the Trust, Custodian is hereby authorized to withdraw cash from any
cash account in the amount required to pay such Tax and to use such cash, or to
remit such cash to the appropriate Subcustodian or other withholding agent, for
the timely payment of such Tax in the manner required by applicable law. If the
aggregate amount of cash in all cash accounts is not sufficient to pay such Tax,
Custodian shall promptly notify Huntington of the additional amount of cash (in
the appropriate currency) required, and Huntington shall directly deposit such
additional amount in the appropriate cash account promptly after receipt of such
notice, for use by Custodian as specified herein. In the event that Huntington
reasonably believes that the Trust are eligible, pursuant to applicable law or
to the provisions of any tax treaty, for a reduced rate of, or exemption from,
any Tax which is otherwise required to be withheld or paid on behalf of the
Trust under any applicable law, Huntington shall instruct Custodian to, or to
instruct the applicable Subcustodian or withholding agent to, either withhold or
pay such Tax at such reduced rate or refrain from withholding or paying such
Tax, as appropriate; provided that Custodian shall have received from Huntington
all documentary evidence of residence or other qualification for such reduced
rate or exemption required to be received under such applicable law or treaty.
In the event that Custodian reasonably believes that a reduced rate of, or
exemption from, any Tax is obtainable only by means of an application for
refund, Custodian and the applicable Subcustodian shall use reasonable efforts
to assist the Trust with respect to making such application. Huntington hereby
agrees to indemnify and hold harmless Custodian and each Subcustodian in respect
of any liability arising from any underwithholding or underpayment of any Tax
which results from the inaccuracy or invalidity of any such forms or other
documentation, and such obligation to indemnify shall be a continuing obligation
of Huntington, its successors and assigns notwithstanding the termination of
this Agreement.
9. (a)For the purpose of settling Foreign Securities and foreign exchange
transactions, Huntington shall provide Custodian with sufficient immediately
available funds for all transactions by such time and date as conditions in the
relevant market dictate. As used herein, "sufficient immediately available
funds" shall mean either (i) sufficient cash denominated in U.S. dollars to
purchase the necessary foreign currency, or (ii) sufficient applicable foreign
currency, to settle the transaction. Custodian shall provide Huntington with
immediately available funds each day which result from the actual settlement of
all sale transactions, based upon advices received by Custodian from
Subcustodians, Depositories, and Foreign Depositories. Such funds shall be in
U.S. dollars or such other currency as Huntington may specify to Custodian.
(a) Any foreign exchange transaction effected by Custodian in
connection with this Agreement may be entered with Custodian or a Custodian
Affiliate acting as principal or otherwise through customary banking channels.
Huntington may issue a standing Certificate or Instructions with respect to
foreign exchange transactions, but Custodian may establish rules or limitations
concerning any foreign exchange facility made available to Huntington.
Huntington shall bear all risks of investing in Foreign Securities or holding
cash denominated in a foreign currency.
(b) To the extent that Custodian has agreed to provide pricing or
other information services in connection with this Agreement, Custodian is
authorized to utilize any vendor (including brokers and dealers of Foreign
Securities) reasonably believed by Custodian to be reliable to provide such
information. Huntington understands that certain pricing information with
respect to complex financial instruments (e.g., derivatives) may be based on
calculated amounts rather than actual market transactions and may not reflect
actual market values, and that the variance between such calculated amounts and
actual market values may or may not be material. Where vendors do not provide
information for particular Foreign Securities or other property, an Authorized
Person may advise Custodian in a Certificate regarding the fair market value of,
or provide other information with respect to, such Foreign Securities or
property as determined by it in good faith. Custodian shall not be liable for
any loss, damage or expense incurred as a result of errors or omissions with
respect to any pricing or other information utilized by Custodian hereunder.
10. Until such time as Custodian receives a certificate to the contrary
from Huntington with respect to a particular Foreign Security, Custodian may not
release the identity of the Trust or Portfolios to any issuer which requests
such information pursuant to the Shareholder Communications Act of 1985 for the
specific purpose of direct communications between such issuer and shareholder.
ARTICLE IV
PURCHASE AND SALE OF FOREIGN SECURITIES;
CREDITS TO ACCOUNT
1. Promptly after each purchase or sale of Foreign Securities by a
Portfolio, Huntington shall deliver to Custodian a Certificate or Instructions,
or with respect to a purchase or sale of a Foreign Security generally required
to be settled on the same day the purchase or sale is made, Oral Instructions
specifying all information Custodian may reasonably request to settle such
purchase or sale. Custodian shall account for all purchases and sales of
Foreign Securities on the actual settlement date unless otherwise agreed by
Custodian.
2. Huntington understands that when Custodian is instructed to deliver
Foreign Securities against payment, delivery of such Foreign Securities and
receipt of payment therefor may not be completed simultaneously.
Notwithstanding any provision in this Agreement to the contrary, settlements,
payments and deliveries of Foreign Securities may be effected by Custodian or
any Subcustodian in accordance with the customary or established securities
trading or securities processing practices and procedures in the jurisdiction in
which the transaction occurs, including, without limitation, delivery to a
purchaser or dealer therefor (or agent) against receipt with the expectation of
receiving later payment for such Foreign Securities. Huntington assumes full
responsibility for all risks, including, without limitation, credit risks,
involved in connection with such deliveries of Foreign Securities.
3. Custodian may, as a matter of bookkeeping convenience or by separate
agreement with Huntington, credit the Account with the proceeds from the sale,
redemption or other disposition of Foreign Securities or interest, dividends or
other distributions payable on Foreign Securities prior to its actual receipt of
final payment therefor. All such credits shall be conditional until Custodian's
actual receipt of final payment and may be reversed by Custodian to the extent
that final payment is not received. Payment with respect to a transaction will
not be "final" until Custodian shall have received immediately available funds
which under applicable local law, rule and/or practice are irreversible and not
subject to any security interest, levy or other encumbrance, and which are
specifically applicable to such transaction.
ARTICLE V
OVERDRAFTS OR INDEBTEDNESS
1. If Custodian should in its sole discretion advance funds in respect of
any Portfolio which results in an overdraft (including, without limitation, any
day-light overdraft) because the money held by Custodian in an Account for such
Portfolio shall be insufficient to pay the total amount payable upon a purchase
of Foreign Securities specifically allocated to such Portfolio, as set forth in
a Certificate, Instructions or Oral Instructions, or if an overdraft arises in
the separate account of a Portfolio for some other reason, including, without
limitation, because of a reversal of a conditional credit or the purchase of any
currency, or if Huntington is for any other reason indebted to Custodian with
respect to a Portfolio (except a borrowing for investment or for temporary or
emergency purposes using Foreign Securities as collateral pursuant to a separate
agreement and subject to the provisions of Section 2 of this Article), such
overdraft or indebtedness shall be deemed to be a loan made by Custodian to
Huntington payable on demand and shall bear interest from the date incurred at a
rate per annum ordinarily charged by Custodian to its institutional customers,
as such rate may be adjusted from time to time. In addition, Huntington hereby
agrees that Custodian shall to the maximum extent permitted by law have a
continuing lien, security interest, and security entitlement in and to any
property, including, without limitation, any investment property or any
financial asset, of such Portfolio at any time held by Custodian for the benefit
of such Portfolio or in which such Portfolio may have an interest which is then
in Custodian's possession or control or in possession or control of any third
party acting in Custodian's behalf. Huntington authorizes Custodian, in its
sole discretion, at any time to charge any such overdraft or indebtedness
together with interest due thereon against any balance of account standing to
such Portfolio's credit on Custodian's books.
2. If Huntington borrows money from any bank for investment or for
temporary or emergency purposes using Foreign Securities held by Custodian
hereunder as collateral for such borrowings, Huntington shall deliver to
Custodian a Certificate specifying with respect to each such borrowing: (a) the
Portfolio to which such borrowing relates; (b) the name of the bank, (c) the
amount of the borrowing, (d) the time and date, if known, on which the loan is
to be entered into, (e) the total amount payable to the Trust on the borrowing
date, (f) the Foreign Securities to be delivered as collateral for such loan,
including the name of the issuer, the title and the number of shares or the
principal amount of any particular Foreign Securities, and (g) a statement
specifying whether such loan is for investment purposes or for temporary or
emergency purposes and that such loan is in conformance with the 1940 Act and
the Portfolio's prospectus. Custodian shall deliver on the borrowing date
specified in a Certificate the specified collateral against payment by the
lending bank of the total amount of the loan payable, provided that the same
conforms to the total amount payable as set forth in the Certificate.
Custodian may, at the option of the lending bank, keep such collateral in its
possession, but such collateral shall be subject to all rights therein given the
lending bank by virtue of any promissory note or loan agreement. Custodian
shall deliver such Foreign Securities as additional collateral as may be
specified in a Certificate to collateralize further any transaction described in
this Section. Huntington shall cause all Foreign Securities released from
collateral status to be returned directly to Custodian, and Custodian shall
receive from time to time such return of collateral as may be tendered to it.
In the event that Huntington fails to specify in a Certificate the Portfolio,
the name of the issuer, the title and number of shares or the principal amount
of any particular Foreign Securities to be delivered as collateral by Custodian,
Custodian shall not be under any obligation to deliver any Foreign Securities.
ARTICLE VI
SALE AND REDEMPTION OF SHARES
1. Whenever the Trust shall sell any shares issued by the Trust
("Shares"), Huntington shall deliver to Custodian a Certificate or Instructions
specifying the amount of money and/or Foreign Securities to be received by
Custodian and specifically allocated to an Account for such Portfolio.
2. Upon receipt of such money, Custodian shall credit such money to an
Account in the name of the Portfolio for which such money was received.
3. Except as provided hereinafter, whenever Huntington desires Custodian
to make payment out of the money held by Custodian hereunder in connection with
a redemption of any Shares, it shall furnish to Custodian a Certificate or
Instructions specifying the total amount to be paid to Huntington. Custodian
shall make payment of such total amount to the transfer agent specified in such
Certificate or Instructions out of the money held in an Account of the
appropriate Portfolio.
ARTICLE VII
CONCERNING CUSTODIAN
1. (a)Except as otherwise expressly provided herein, Custodian shall not
be liable for any costs, expenses, damages, liabilities or claims, including
attorneys' and accountants' fees (collectively, "Losses"), incurred by or
asserted against Huntington or the Trust, except those Losses arising out of
Custodian's, or its officer's, employee's or agent's own negligence or willful
misconduct. Custodian shall have no liability whatsoever for the action or
inaction of any Depositories or of any Foreign Depositories, except in each case
to the extent such action or inaction is a direct result of the Custodian's
failure to fulfill its duties hereunder. With respect to any Losses incurred by
the Trust as a result of the acts or any failures to act by any Subcustodian,
Custodian shall take appropriate action to recover such Losses from such
Subcustodian; and Custodian's sole responsibility and liability to Huntington
and the Trust shall be limited to amounts so received from such Subcustodian
(exclusive of costs and expenses incurred by Custodian). In no event shall
Custodian be liable to Huntington or the Trust or any third party for special,
indirect or consequential damages, or lost profits or loss of business, arising
in connection with this Agreement, nor shall Custodian be liable: (i) for acting
in accordance with any Certificate or Oral Instructions actually received by
Custodian and reasonably believed by Custodian to be given by an Authorized
Person; (ii) for acting in accordance with Instructions without reviewing the
same; (iii) for conclusively presuming that all Instructions are given only by
person(s) duly authorized; conclusively presuming that all disbursements of cash
directed by Huntington, whether by a Certificate, an Oral Instruction, or an
Instruction, are in accordance with Section 2(i) of Article II hereof; (iii) for
holding property in any particular country, including, but not limited to,
Losses resulting from nationalization, expropriation or other governmental
actions; regulation of the banking or securities industry; exchange or currency
controls or restrictions, devaluations or fluctuations; availability of cash or
Foreign Securities or market conditions which prevent the transfer of property
or execution of Foreign Securities transactions or affect the value of property;
(iv) for any Losses due to forces beyond the control of Custodian, including
without limitation strikes, work stoppages, acts of war or terrorism,
insurrection, revolution, nuclear or natural catastrophes or acts of God, or
interruptions, loss or malfunctions of utilities, communications or computer
(software and hardware) services; (v) for the insolvency of any Subcustodian,
any Depository, any Foreign Depository, or, except to the extent such action or
inaction is a direct result of the Custodian's failure to fulfill its duties
hereunder; or (vi) for any Losses arising from the applicability of any law or
regulation now or hereafter in effect, or from the occurrence of any event,
including, without limitation, implementation or adoption of any rules or
procedures of a Foreign Depository, which may affect, limit, prevent or impose
costs or burdens on, the transferability, convertibility, or availability of any
currency or Composite Currency Unit in any country or on the transfer of any
Foreign Securities, and in no event shall Custodian be obligated to substitute
another currency for a currency (including a currency that is a component of a
Composite Currency Unit) whose transferability, convertibility or availability
has been affected, limited, or prevented by such law, regulation or event, and
to the extent that any such law, regulation or event imposes a cost or charge
upon Custodian in relation to the transferability, convertibility, or
availability of any cash currency or Composite Currency Unit, such cost or
charge shall be for the account of the Trust, and Custodian may treat any
account denominated in an affected currency as a group of separate accounts
denominated in the relevant component currencies.
(a) Custodian may enter into subcontracts, agreements and
understandings with any Custodian Affiliate, whenever and on such terms and
conditions as it deems necessary or appropriate to perform its services
hereunder. No such subcontract, agreement or understanding shall discharge
Custodian from its obligations hereunder.
(b) Huntington agrees to indemnify Custodian and hold Custodian
harmless from and against any and all Losses sustained or incurred by or
asserted against Custodian by reason of or as a result of any good faith action
or inaction, or arising out of Custodian's performance hereunder, including
reasonable fees and expenses of counsel incurred by Custodian in a successful
defense of claims by Huntington or the Trust; provided however, that Huntington
shall not indemnify Custodian for those Losses arising out of Custodian's own
negligence or willful misconduct. This indemnity shall be a continuing
obligation of Huntington, its successors and assigns, notwithstanding the
termination of this Agreement.
2. Without limiting the generality of the foregoing, Custodian shall be
under no obligation to inquire into, and shall not be liable for:
(a) Any Losses incurred by the Trust or any other person as a
result of the receipt or acceptance of fraudulent, forged or invalid Foreign
Securities, or Foreign Securities which are otherwise not freely transferable or
deliverable without encumbrance in any relevant market;
(b) The validity of the issue of any Foreign Securities purchased,
sold, or written by or for the Trust, the legality of the purchase, sale or
writing thereof, or the propriety of the amount paid or received therefor;
(c) The legality of the sale or redemption of any Shares, or the
propriety of the amount to be received or paid therefor;
(d) The legality of any loan of portfolio Foreign Securities, nor
shall Custodian be under any duty or obligation to see to it that any cash or
collateral delivered to it by a broker, dealer or financial institution or held
by it at any time as a result of such loan of portfolio Foreign Securities is
adequate security for the Portfolio against any loss it might sustain as a
result of such loan, which duty or obligation shall be the sole responsibility
of Huntington. In addition, Custodian shall be under no duty or obligation to
see that any broker, dealer or financial institution to which portfolio Foreign
Securities of the Portfolio are lent makes payment to it of any dividends or
interest which are payable to or for the account of the Portfolio during the
period of such loan or at the termination of such loan, provided, however that
Custodian shall promptly notify Huntington in the event that such dividends or
interest are not paid and received when due;
(e) The sufficiency or value of any amounts of money and/or
Securities held in any Special Account in connection with transactions by the
Portfolio; whether any broker, dealer, futures commission merchant or clearing
member makes payment to the Portfolio of any variation margin payment or similar
payment which the Portfolio may be entitled to receive from such broker, dealer,
futures commission merchant or clearing member, or whether any payment received
by Custodian from any broker, dealer, futures commission merchant or clearing
member is the amount the Portfolio is entitled to receive, or to notify the
Trust of Custodian's receipt or non-receipt of any such payment; or
(f) Whether any Foreign Securities at any time delivered to, or
held by it or by any Subcustodian, for the account of the Trust and specifically
allocated to a Portfolio are such as properly may be held by the Trust or such
Portfolio under the provisions of its then current prospectus and statement of
additional information, or to ascertain whether any transactions by the
Portfolio, whether or not involving Custodian, are such transactions as may
properly be engaged in by the Portfolio.
3. Custodian may, with respect to questions of law specifically regarding
an Account, obtain the advice of counsel and shall be fully protected with
respect to anything done or omitted by it in good faith in conformity with such
advice.
4. Custodian shall be under no obligation to take action to collect any
amount payable on Foreign Securities in default, or if payment is refused after
a second due demand and presentment. However, the Custodian shall notify
Huntington when a Foreign Security is in default or if there has been a refusal
of payment after Custodian's second due demand and presentment.
5. Custodian shall have no duty or responsibility to inquire into, make
recommendations, supervise, or determine the suitability of any transactions
affecting any Account.
6. Huntington shall cause the Trust to pay to Custodian the fees and
charges as set forth on Schedule III hereto, as it may be amended by consent of
the parties from time to time, and such other fees and charges at Custodian's
standard rates for such services as may be applicable. Huntington shall
reimburse Custodian for all costs associated with the conversion of a
Portfolio's Foreign Securities hereunder and the transfer of Foreign Securities
and records kept in connection with this Agreement. Huntington shall also
reimburse Custodian for out-of-pocket expenses which are a normal incident of
the services provided hereunder.
7. Custodian has the right to debit any cash account for a Portfolio for
any amount payable by Huntington for services provided to such Portfolio of the
Trust.
8. Huntington agrees to forward to Custodian a Certificate or
Instructions confirming Oral Instructions by the close of business of the same
day that such Oral Instructions are given to Custodian. Huntington agrees that
the fact that such confirming Certificate or Instructions are not received or
that a contrary Certificate or contrary Instructions are received by Custodian
shall in no way affect the validity or enforceability of transactions authorized
by such Oral Instructions and effected by Custodian. If Huntington elects to
transmit Instructions through an on-line communications system offered by
Custodian, Huntington's use thereof shall be subject to the Terms and Conditions
attached as Appendix I hereto. If Custodian receives Instructions which appear
on their face to have been transmitted by an Authorized Person via (i) computer
facsimile, email, the Internet or other insecure electronic method, or (ii)
secure electronic transmission containing applicable authorization codes,
passwords and/or authentication keys, Huntington understands and agrees that
Custodian cannot determine the identity of the actual sender of such
Instructions and that Custodian shall conclusively presume that such Written
Instructions have been sent by an Authorized Person, and Huntington shall be
responsible for ensuring that only Authorized Persons transmit such Instructions
to Custodian. If Huntington elects (with Custodian's prior consent) to transmit
Instructions through an on-line communications service owned or operated by a
third party, Huntington agrees that Custodian shall not be responsible or liable
for the reliability or availability of any such service.
9. The books and records pertaining to the Trust which are in possession
of Custodian shall be the property of the Trust. Such books and records shall
be prepared and maintained as required by the 1940 Act and the rules thereunder.
Huntington, the Trust, or their respective authorized representatives, shall
have access to such books and records during Custodian's normal business hours.
Upon the reasonable request of Huntington, copies of any such books and records
shall be provided by Custodian to Huntington or the Trust or an authorized
representative. Upon the reasonable request of Huntington, Custodian shall
provide in hard copy or on computer disc any records included in any such
delivery which are maintained by Custodian on a computer disc, or are similarly
maintained.
00.Xx is understood that Custodian is authorized to supply any
information regarding the Accounts which is required by any law, regulation or
rule now or hereafter in effect. The Custodian shall provide Huntington with
any report obtained by the Custodian on the system of internal accounting
control of a Depository, and with such reports on its own system of internal
accounting control as Huntington may reasonably request from time to time.
11.Custodian shall have no duties or responsibilities whatsoever except
such duties and responsibilities as are specifically set forth in this
Agreement, and no covenant or obligation shall be implied against Custodian in
connection with this Agreement.
ARTICLE VIII
EFFECTIVE DATE AND TERMINATION
1. The terms of this Agreement shall govern the relationship between the
parties from until this Agreement is terminated.
2. Either of the parties hereto may terminate this Agreement by giving to
the other party a notice in writing specifying the date of such termination,
which shall be not less than ninety (90) days after the date of giving of such
notice. Upon the date set forth in such notice this Agreement shall terminate,
and Custodian shall upon written notice by Huntington deliver directly to
Huntington or to a successor subcustodian all Foreign Securities and money then
owned by the Portfolios and held by Custodian, after deducting all fees,
expenses and other amounts for the payment or reimbursement of which it shall
then be entitled.
3. Upon the delivery by Custodian of all Foreign Securities (other than
Foreign Securities which cannot be delivered to the Trust) and money then owned
by the Trust, the Custodian shall thereby be relieved of all duties and
responsibilities pursuant to this Agreement, other than the duty with respect to
Foreign Securities which cannot be delivered to Huntington or a successor
subcustodian to hold such Foreign Securities hereunder in accordance with this
Agreement.
ARTICLE IX
MISCELLANEOUS
1. The Custodian shall take all reasonable action, as the Trust on behalf
of each applicable Portfolio may from time to time request, to obtain from year
to year favorable opinions from the Trust's independent accountants with respect
to the Custodian's activities hereunder in connection with the preparation of
each Trust's Form N-1A, Form N-Q, Form N-CSR and Form N-SAR or other shareholder
reports to the Securities and Exchange Commission.
2. The Custodian shall provide the Trust, on behalf of each of the
Portfolios at such times as the Trust may reasonably require, with a
copy of the SAS-70 prepared by its independent public accountants and
a certification by the Custodian's Chief Compliance Officer regarding
the operation of its accounting system and its internal accounting
control and procedures for safeguarding Foreign Securities as each
relates to the services provided by the Custodian under this
Agreement; such certification shall be of sufficient scope and
sufficient detail, as may reasonably be required by the Trust to
provide reasonable assurance that any material inadequacies would be
disclosed by such certification, and, if there are no such
inadequacies, the certification shall so state.
3. Huntington agrees to furnish to Custodian a new Certificate of
Authorized Persons in the event of any change in the then present
Authorized Persons. Until such new Certificate is received, Custodian
shall be fully protected in acting upon Certificates or Oral
Instructions of such present Authorized Persons.
4. Any notice, instruction or other instrument required to be given
hereunder may be delivered in person to the offices of the parties as
set forth herein during normal business hours or delivered prepaid
registered mail or by telex, cable or telecopy to the parties at the
following addresses or such other addresses as may be notified by any
party from time to time.
To Huntington: The Huntington National Bank
0 Xxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Xxxx Xxxx - Senior Vice President, Trust
Operations
Telephone:
Telecopy:
To a Trust: The Huntington Funds
c/o The Huntington National Bank
00 Xxxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: B. Xxxxxxxx Xxxxxxx, President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to: Xxxxxx X. Xxxxxxx, Secretary of the Trust
c/o Xxxx Xxxxx LLP
Federated Investors Tower
0000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
To the Custodian: The Bank of New York
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxx
Telephone: 000-000-0000
Telecopy: 000-000-0000
Such notice, instruction or other instrument shall be deemed to have been
sufficiently given to a party if received by that party at its address or
telecopy number as set forth above, or at such other address or telecopy number
as such party may designate from time to time to the other parties in writing.
5. Each and every right granted to the parties hereunder or under any
other document delivered hereunder or in connection herewith, or
allowed it by law or equity, shall be cumulative and may be exercised
from time to time. No failure on the part of the parties to exercise,
and no delay in exercising, any right will operate as a waiver
thereof, nor will any single or partial exercise by any party of any
right preclude any other or future exercise thereof or the exercise of
any other right.
6. In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any exclusive jurisdiction, the
validity, legality and enforceability of the remaining provisions
shall not in any way be affected thereby. This Agreement may not be
amended or modified in any manner except by a written agreement
executed by the parties, except that any amendment to the Schedule I
hereto need be signed only by Huntington and any amendment to Appendix
I hereto need be signed only by Custodian. This Agreement shall
extend to and shall be binding upon the parties hereto, and their
respective successors and assigns; provided, however, that this
Agreement shall not be assignable by either party without the written
consent of the other.
7. This Agreement shall be construed in accordance with the substantive
laws of the State of New York, without regard to conflicts of laws
principles thereof. Huntington and Custodian hereby consent to the
jurisdiction of a state or federal court situated in the Borough of
Manhattan, The City of New York in connection with any dispute arising
hereunder. Huntington hereby irrevocably waives, to the fullest
extent permitted by applicable law, any objection which it may now or
hereafter have to the laying of venue of any such proceeding brought
in such a court and any claim that such proceeding brought in such a
court has been brought in an inconvenient forum. Huntington and
Custodian each hereby irrevocably waives any and all rights to trial
by jury in any legal proceeding arising out of or relating to this
Agreement.
8. Huntington hereby acknowledges that Custodian is subject to federal
laws, including the Fund Identification Program (CIP) requirements
under the USA PATRIOT Act and its implementing regulations, pursuant
to which Custodian must obtain, verify and record information that
allows Custodian to identify Huntington and the Trust. Accordingly,
prior to opening an Account hereunder Custodian will ask Huntington to
provide certain information including, but not limited to, each of
Huntington's and the Trust's name, physical address, tax
identification number and other information that will help Custodian
to identify and verify Huntington's and the Trust's identity such as
organizational documents, certificate of good standing, license to do
business, or other pertinent identifying information. Huntington
agrees that Custodian cannot open an Account hereunder unless and
until Custodian verifies each of Huntington's and the Trust's identity
in accordance with its CIP.
9. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall,
together, constitute only one instrument.
IN WITNESS WHEREOF, Huntington and Custodian have caused this Agreement
to be executed by their respective officers, thereunto duly authorized, as of
the day and year first above written.
THE HUNTINGTON NATIONAL BANK
By: /s/ B. Xxxxxxxx Xxxxxxx
Name: B. Xxxxxxxx Xxxxxxx
Title: Executive Vice President and
Chief Investment Officer
THE BANK OF NEW YORK
By: /s/ Xxxxxx X. Xxxxxxxxxx
Name: Xxxxxx X. Xxxxxxxxxx
Title: Vice President
ACKNOWLEDGED AND AGREED:
THE HUNTINGTON FUNDS
By:/s/ B. Xxxxxxxx Xxxxxxx
Name: B. Xxxxxxxx Xxxxxxx
Title: President
