COPIES OF ANY NEW OR AMENDED REGISTRANT INVESTMENT
ADVISORY CONTRACTS
HUNTINGTON FUNDS
INVESTMENT ADVISORY AGREEMENT
This Agreement is made as of the 30th day of
October, 2002 by and between the Huntington Funds, a
business trust organized under the laws of the
Commonwealth of Massachusetts (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 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: Declaration 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, 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/ Xxxxx X. Xxxxxxxxx
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
HUNTINGTON ASSET ADVISORS, INC.
By: /s/ B. R. Xxxxxxx
Name: B. R. Xxxxxxx
Title: President
SCHEDULE A
TO THE
INVESTMENT ADVISORY AGREEMENT
BETWEEN
The Huntington Funds
and
Huntington Asset Advisors, Inc.
dated as of October 30, 2002
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
Fixed Income Securities Fund
..50%
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%
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