SUB ITEM 77Q 1(E)(I)
THE HUNTINGTON FUNDS
INVESTMENT ADVISORY AGREEMENT
This Agreement is made as of the 23rd day of June, 2006 by and between THE
HUNTINGTON FUNDS, a statutory trust organized under the laws of the State of
Delaware (herein called the "Trust"), and HUNTINGTON ASSET ADVISORS, INC.
(herein called the "Investment Adviser").
WHEREAS, the Trust is registered as an open-end, diversified, management
investment company under the Investment Company Act of 1940; and
WHEREAS, the Trust desires to retain the Investment Adviser to render
investment advisory and other services to the investment portfolios of the Trust
identified on Schedule A hereto (each a "Fund" and collectively the "Funds"),
and the Investment Adviser is willing to render such services as a discretionary
investment adviser on the terms and conditions hereinafter set forth;
WITNESSETH: That in consideration of the promises and mutual covenants
hereinafter contained, the parties hereto agree as follows:
1. Appointment. The Trust being duly authorized hereby appoints the
Investment Adviser to act as discretionary investment adviser to the Trust for
the Funds for the period and on the terms set forth in this Agreement. The
Investment Adviser accepts such appointment and agrees to render the services
herein set forth for the compensation herein provided.
2. Management. Subject to the supervision of the Board of Trustees of
the Trust (the "Trustees"), the Investment Adviser will provide a continuous
investment program for each of the Funds, including, investment research and
management with respect to all securities, investments, cash and cash
equivalents in the Funds. The Investment Adviser will determine from time to
time what securities and other instruments will be purchased, retained or sold
by the Trust for the Funds. The Investment Adviser will provide the services
rendered by it hereunder in accordance with the Funds' respective investment
objectives and policies as stated in the Prospectus which is a part of the
Trust's effective Registration Statement as amended from time to time. The
Investment Adviser agrees that it:
(a) will conform with all applicable Rules and Regulations of the
Securities and Exchange Commission (herein called the "Rules") and with the
Securities Act of 1933, the Securities Exchange Act of 1934, the Investment
Company Act of 1940 and the Investment Advisers Act of 1940, all as amended, and
will in addition conduct its activities under this Agreement in accordance with
all applicable Rules and Regulations of the Comptroller of the Currency
pertaining to the investment advisory activities of national banks;
(b) will place orders pursuant to its investment determinations for each
of the Funds either directly with the issuer of the instrument to be purchased
or with any broker or dealer selected by it. In placing orders with brokers and
dealers, the Investment Adviser will use its reasonable best efforts to obtain
the best net price and execution of its orders, after taking into account all
factors it deems relevant, including the breadth of the market in the security,
the price of the security, the financial condition and execution capability of
the broker or dealer, and the reasonableness of the commission, if any, both for
the specific transaction and on a continuing basis. However, this
responsibility shall not be deemed to obligate the Investment Adviser to solicit
competitive bids for each transaction. Consistent with its obligation, the
Investment Adviser may, to the extent permitted by law, purchase and sell
portfolio securities to and from brokers and dealers who provide brokerage and
research services (as those terms are defined in Section 28(e) of the Securities
Exchange Act of 1934), statistical quotations, specifically the quotations
necessary to determine a Fund's net asset value, and other information provided
to the applicable Fund or to the Investment Adviser or its affiliates to or for
the benefit of any Fund and/or other accounts over which the Investment Adviser
or any of its affiliates exercises investment discretion. Subject to the review
of the Trustees from time to time with respect to the extent and continuation of
the policy, the Investment Adviser is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for effecting a
securities transaction for any Fund which is in excess of the amount of
commission another broker or dealer would have charged for effecting the
transaction if the Investment Adviser determines in good faith that such
commission was reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer, viewed in terms of either that
particular transaction or the overall responsibilities of the Investment Adviser
with respect to the accounts as to which it or its affiliates exercise
investment discretion;
(c) will maintain books and records with respect to the securities
transactions of each Fund and will render to the Trustees such periodic and
special reports as the Trustees may reasonably request; and
(d) will treat confidentially and as proprietary information of the Trust
all records and other information relative to the Trust and prior, present, or
potential shareholders of the Trust learned by, or disclosed to, the Investment
Adviser in the course of its performance of its responsibilities and duties
under this Agreement, and will not use such records and information for any
purpose other than performance of its responsibilities and duties hereunder,
except after prior notification to and approval in writing by the Trust, which
approval shall not be unreasonably withheld and may not be withheld where the
Investment Adviser may be exposed to civil, regulatory, or criminal sanctions
for failure to comply when requested to divulge such information by duly
constituted authorities, or when so requested by the Trust.
3. Services Not Exclusive. The investment management services rendered
by the Investment Adviser hereunder are not to be deemed exclusive, and the
Investment Adviser shall be free to render similar services to others so long as
its services under this Agreement are not impaired thereby. The Investment
Adviser shall provide fair and equitable treatment to the Funds in the selection
of portfolio instruments and the allocation of investment opportunities; the
Investment Adviser is not required to give the Funds preferential treatment.
4. Books and Records. In compliance with the requirements of Rule 31a-
3 promulgated under the Investment Company Act of 1940, as amended, the
Investment Adviser hereby agrees that all records which it maintains for the
Funds are the property of the Trust and further agrees to surrender promptly to
the Trust any of such records up on the Trust's request. The Investment Adviser
further agrees to preserve for the periods prescribed by Rule 31a-2 the records
required to be maintained by Rule 31a-1 and to comply in full with the
requirements of Rule 204-2 under the Investment Advisers Act of 1940 pertaining
to the maintenance of books and records.
5. Expenses. During the term of this Agreement, the Investment Adviser
will pay all expenses incurred by it in connection with its activities under
this Agreement other than the cost of securities (including brokerage
commissions and taxes, if any) or other investment instruments purchased for the
Funds.
In addition, if the expenses borne by any Fund other than the Huntington
Florida Tax-Free Money Fund (including fees payable pursuant to this Agreement
and the Administration Agreement but excluding interest, taxes, brokerage and,
if permitted by the relevant state securities commissions, extraordinary
expenses) in any fiscal year of such Fund exceed the applicable expense
limitations imposed by the securities regulations of any state in which the
shares of any such Fund are registered or qualified for sale to the public, the
Investment Adviser shall reimburse such Fund monthly for a portion of any such
excess in an amount equal to the proportion that the fees otherwise payable to
the Investment Adviser bear to the total amount of investment advisory and
administration fees otherwise payable to the Investment Adviser during such
fiscal year pursuant to paragraph 6 hereof.
6. Compensation. For the services provided and the expenses assumed
pursuant to this Agreement with respect to each Fund, the Trust will pay the
Investment Adviser, and the Investment Adviser will accept as full compensation
therefore, a fee representing the percentage of the average daily net asset
value of such Fund, computed daily and payable monthly at the annual rate set
forth on Schedule A hereto.
7. Limitation of Liability of the Investment Adviser; Indemnification.
(a) The Investment Adviser shall not be liable for any error of judgment
or mistake of law or for any loss suffered by the Trust in connection with the
matters to which this Agreement relates, except a loss resulting from a breach
of fiduciary duty with respect to the receipt of compensation for services or a
loss resulting from willful misfeasance, bad faith or gross negligence on the
part of the Investment Adviser in the performance of its duties or from reckless
disregard by it of its obligations and duties under this Agreement.
(b) Subject to the limitations contained in Section 7(c) below:
(i) the Trust shall indemnify and hold harmless the Investment
Adviser, its directors, officers and employees and each person who controls the
Investment Adviser (hereinafter referred to as "Covered Persons") to the fullest
extent permitted by law, against any and all claims, demands and liabilities
(and all reasonable expenses in connection therewith) to which the Investment
Adviser or any of its directors, officers, employees or controlling persons may
become subject by virtue of the Investment Adviser being or having been the
Investment Adviser of the Trust;
(ii) the words "claims, actions, suits, or proceedings" shall apply
to all claims, actions, suits or proceedings (civil, criminal or other,
including appeals), actual or threatened while in office or thereafter, and the
words "liabilities" and "expenses" shall include, without limitation, attorneys'
fees and expenses, costs, judgments, amounts paid in settlement, fines,
penalties and other liabilities.
(c) No indemnification shall be provided hereunder to a Covered Person:
(i) who shall have been adjudicated by a court or body before which
the proceedings was brought (A) to be liable to the Trust or its Shareholders by
reason of willful misfeasance, bad faith, gross negligence or reckless disregard
of the duties involved in the conduct of its office or (B) not to have acted in
good faith in the reasonable belief that its action was in the best interest of
the Trust; or
(ii) in the event of a settlement, unless there has been a
determination that such Covered Person did not engage in willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of his office;
(A) by the court or other body approving the settlement; or
(B) by at least a majority of those Trustees who are neither
Interested Persons of the Trust (as defined in the Investment Company Act of
1940, as amended) nor are parties to the matter, based upon a review of readily
available facts (as opposed to a full trial-type inquiry); or
(C) by written opinion of independent legal counsel based upon
a review of readily available facts (as opposed to a full trial-type inquiry).
(d) The rights of indemnification herein provided may be insured against
by policies maintained by the Trust, shall be severable, shall not be exclusive
of or affect any other rights to which any Covered Person shall insure to the
benefit of the personal representatives, successors and assigns of each such
person. Nothing contained herein shall affect any rights to indemnification to
which Trust personnel and any other persons, other than a Covered Person, may be
entitled by contract or otherwise under law.
(e) Expenses in connection with the investigation, preparation and
presentation of a defense to any claim, suit or proceeding of the character
described in subsection (b) of this Section 7 shall be paid by the Trust or any
Fund from time to time prior to final disposition thereof, upon receipt of an
undertaking by or on behalf of such Covered Person that such amount will be paid
over by him to the Trust or any such Fund if its is ultimately determined that
he is not entitled to indemnification under this Section 7; provided however,
that either (i) such Covered Person shall have provided appropriate security for
such undertaking, (ii) the Trust shall be insured again losses arising out of
any such advance payments, or (iii) either a majority of the Trustees who are
neither Interested Persons of the Trust nor parties to the matter, or
independent legal counsel in a written opinion, shall have determined, based
upon a review of readily available facts (as opposed to a trial-type inquiry),
that there is reason to believe that such Covered Person will be entitled to
indemnification under this Section 7.
8. Duration and Termination. This Agreement shall be effective as of
the date of hereof, and unless sooner terminated as provided herein, shall
continue in effect as to any particular Fund through August 30, 2006 and for
successive periods of 12 months each, provided such continuance is specifically
approved at least annually (a) by the vote of a majority of those Trustees who
are not parties to this Agreement or interested persons of any such party, cast
in person at a meeting called for the purpose of voting on such approval, and
(b) by the Trustees or, with respect to any Fund, by vote of a majority of the
outstanding voting securities of such Fund; provided, however that this
Agreement may be terminated by the Trust as to any Fund or all the Funds at any
time, without the payment of any penalty, by the Trustees or, with respect to
any Fund, by a vote of a majority of the outstanding voting securities of such
Fund on 60 days' written notice to the Investment Adviser, or by the Investment
Adviser as to any Fund at any time, without payment of any penalty, on 90 days'
written notice to the Trust. This Agreement will immediately terminate in the
event of its assignment by either party hereto or by operation of law. (As used
in this Agreement, the terms "majority of the outstanding voting securities,"
"interested person" and "assignment" shall have the same meanings as such terms
have in the Investment Company Act of 1940, as amended).
9. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing, signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, and no amendment of this Agreement shall be
effective with respect to any Fund until approved by vote of a majority of the
Fund's outstanding voting securities.
10. (A)Representations and Warranties. The Investment Adviser hereby
represents and warrants as follows:
(1) The Investment Adviser is registered under the Investment
Advisers Act of 1940, as amended;
(2) The Investment Adviser has all requisite authority to enter
into, execute, deliver and perform its obligations under this
Agreement;
(3) This Agreement is the legal, valid and binding obligation of
the Investment Adviser, and is enforceable in accordance with
its terms; and
(4) The performance by the Investment Adviser of its obligations
under this Agreement does not conflict with any law or
regulation to which it is subject.
(B)Covenants. The Investment Adviser hereby covenants and agrees that,
so long as this Agreement shall remain in effect:
(1) The Investment Adviser shall maintain its registration under
the Investment Advisers Act of 1940; and
(2) The performance by the Investment Adviser of its obligations
under this Agreement shall not conflict with any law to which
it is then subject.
(C)The Trust hereby covenants and agrees that, so long as this
Agreement shall remain in effect, it shall furnish the Investment Adviser from
time to time with copies of the following documents, if and when effective,
pertaining to the Trust or the Funds and all amendments and supplements thereto:
Agreement and Declaration of Trust, Certificates of Trust, By-Laws, Registration
Statement (including Prospectus and Statement of Additional Information),
Custodial Agreement, Transfer Agency Agreement, Administration Agreement,
Distribution Agreement, Rule 12b-1 Service Plan, Proxy Statement and any other
documents filed with the Securities and Exchange Commission, State securities
law administrators or other governmental agencies, and any other documents the
Investment Adviser may reasonably request.
11. Notices. Any notice required to be given pursuant to this Agreement
shall be deemed duly given if delivered or mailed by registered mail, postage
prepaid, (1) to the Investment Adviser at 00 Xxxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxx
00000, Attention: B. Xxxxxxxx Xxxxxxx or (2) to the Trust at 0000 Xxxxxxxxx
Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000, Attn.: Secretary.
12. Waiver. With full knowledge of the circumstances and the effect of
its action, the Investment Adviser hereby waives any and all rights which it may
acquire in the future against the property of any shareholder of the Trust,
other than shares of the Trust at their net asset value; which arise out of any
action or inaction of the Trust under this Agreement.
13. Captions. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
14. Severability. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected thereby.
15. Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors.
16. Governing Law. This Agreement is executed in the state of Ohio and
shall be governed by the laws of such State, without reference to conflict of
laws principles.
IN WITNESS WHEREOF, each of the parties hereto has caused this instrument
to be executed in its name and on its behalf by its duly authorized
representative and its seal to be hereunder affixed as of the date first above
written.
THE HUNTINGTON FUNDS
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
HUNTINGTON ASSET ADVISORS, INC.
By: /s/ B. Xxxxxxxx Xxxxxxx
Name: B. Xxxxxxxx Xxxxxxx
Title: President
SCHEDULE A
TO THE
INVESTMENT ADVISORY AGREEMENT
BETWEEN
THE HUNTINGTON FUNDS
and
HUNTINGTON ASSET ADVISORS, INC.
dated as of June 23, 2006
Pursuant to Section 6, the Trust shall pay the Adviser compensation at an annual
rate as follows:
PORTFOLIO FEE
(as a percentage of
average daily net assets)
Huntington U.S. Treasury Money Market Fund .20%
Huntington Growth Fund .60%
Huntington Income Equity Fund .60%
Huntington Fixed Income Securities Fund .50%
Huntington Short/Intermediate .50%
Fixed Income Securities Fund
Huntington Money Market Fund .30% on assets up to $500M
.25% on assets from $500M to $1B
.20% on assets in excess of $1B
Huntington Ohio Municipal Money Market Fund.30% on assets up to $500M
.25% on assets from $500M to $1B
.20% on assets in excess of $1B
Huntington Ohio Tax-Free Fund .50%
Huntington Michigan Tax Free Fund .50%
Huntington Mortgage Securities Fund .50%
Huntington Florida Tax-Free Money Fund .30% on assets up to $500M
.25% on assets from $500M to $1B
.20% on assets in excess of $1B
Huntington Intermediate Government Income Fund.50%
IN WITNESS WHEREOF, each of the parties hereto has caused this instrument
to be executed in its name and on its behalf by its duly authorized
representative and its seal to be hereunder affixed as of the date first above
written.
THE HUNTINGTON FUNDS
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
HUNTINGTON ASSET ADVISORS, INC.
By: /s/ B/ Xxxxxxxx Xxxxxxx
Name: B. Xxxxxxxx Xxxxxxx
By: President
AMENDMENT TO
INVESTMENT ADVISORY AGREEMENT
BETWEEN
THE HUNTINGTON FUNDS
AND
HUNTINGTON ASSET ADVISORS, INC.
This Amendment to the Investment Advisory Contract ("Agreement") dated
June 23, 2006, between THE HUNTINGTON FUNDS ("Fund") and HUNTINGTON ASSET
ADVISORS, INC. ("Service Provider") is made and entered into as of the 23rd day
of June, 2006.
WHEREAS, the Fund has entered into the Agreement with the Service
Provider;
WHEREAS, the Securities and Exchange Commission has adopted Regulation S-P
at 17 CFR Part 248 to protect the privacy of individuals who obtain a financial
product or service for personal, family or household use;
WHEREAS, Regulation S-P permits financial institutions, such as the Fund,
to disclose "nonpublic personal information" ("NPI") of its "customers" and
"consumers" (as those terms are therein defined in Regulation S-P) to affiliated
and nonaffiliated third parties of the Fund, without giving such customers and
consumers the ability to opt out of such disclosure, for the limited purposes of
processing and servicing transactions (17 CFR {section} 248.14) ("Section 248.14
NPI"); for specified law enforcement and miscellaneous purposes (17 CFR
{section} 248.15) ("Section 248.15 NPI") ; and to service providers or in
connection with joint marketing arrangements (17 CFR {section} 248.13) ("Section
248.13 NPI");
WHEREAS, Regulation S-P provides that the right of a customer and consumer
to opt out of having his or her NPI disclosed pursuant to 17 CFR {section} 248.7
and 17 CFR {section} 248.10 does not apply when the NPI is disclosed to service
providers or in connection with joint marketing arrangements, provided the Fund
and third party enter into a contractual agreement that prohibits the third
party from disclosing or using the information other than to carry out the
purposes for which the Fund disclosed the information (17 CFR {section} 248.13);
NOW, THEREFORE, the parties intending to be legally bound agree as
follows:
1. The Fund and the Service Provider hereby acknowledge that the Fund may
disclose shareholder NPI to the Service Provider as agent of the Fund
and solely in furtherance of fulfilling the Service Provider's
contractual obligations under the Agreement in the ordinary course of
business to support the Fund and its shareholders.
2. The Service Provider hereby agrees to be bound to use and redisclose
such NPI only for the limited purpose of fulfilling its duties and
obligations under the Agreement, for law enforcement and miscellaneous
purposes as permitted in 17 CFR {section}{section} 248.15, or in
connection with joint marketing arrangements that the Funds may
establish with the Service Provider in accordance with the limited
exception set forth in 17 CFR {section} 248.13.
3. The Service Provider further represents and warrants that, in
accordance with 17 CFR {section} 248.30, it has implemented, and will
continue to carry out for the term of the Agreement, policies and
procedures reasonably designed to:
{circle}insure the security and confidentiality of records and NPI of Fund
customers,
{circle}protect against any anticipated threats or hazards to the security
or integrity of Fund customer records and NPI, and
{circle}protect against unauthorized access to or use of such Fund
customer records or NPI that could result in substantial harm or
inconvenience to any Fund customer.
4. The Service Provider may redisclose Section 248.13 NPI only to: (a)
the Funds and affiliated persons of the Funds ("Fund Affiliates"); (b)
affiliated persons of the Service Provider ("Service Provider Affiliates")
(which in turn may disclose or use the information only to the extent permitted
under the original receipt); (c) a third party not affiliated with the Service
Provider of the Funds ("Nonaffiliated Third Party") under the service and
processing ({section}248.14) or miscellaneous ({section}248.15) exceptions, but
only in the ordinary course of business to carry out the activity covered by the
exception under which the Service Provider received the information in the first
instance; and (d) a Nonaffiliated Third Party under the service provider and
joint marketing exception ({section}248.13), provided the Service Provider
enters into a written contract with the Nonaffiliated Third Party that prohibits
the Nonaffiliated Third Party from disclosing or using the information other
than to carry out the purposes for which the Funds disclosed the information in
the first instance.
5. The Service Provider may redisclose Section 248.14 NPI and Section
248.15 NPI to: (a) the Funds and Fund Affiliates; (b) Service Provider
Affiliates (which in turn may disclose the information to the same extent
permitted under the original receipt); and (c) a Nonaffiliated Third Party to
whom the Funds might lawfully have disclosed NPI directly.
6. The Service Provider is obligated to maintain beyond the termination
date of the Agreement the confidentiality of any NPI it receives from the Fund
in connection with the Agreement or any joint marketing arrangement, and hereby
agrees that this Amendment shall survive such termination.
WITNESS the due execution hereof this 23rd day of June, 2006.
THE HUNTINGTON FUNDS
By:/s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
HUNTINGTON ASSET ADVISORS, INC.
By: /s/ B. Xxxxxxxx Xxxxxxx
Name: B. Xxxxxxxx Xxxxxxx
Title: President
