CUSTODY AGREEMENT
BETWEEN
THE HUNTINGTON NATIONAL BANK
EMBARCADERO FUNDS INC.
TABLE OF CONTENTS
Definitions 1
ARTICLE II - Appointment; Acceptance; and Furnishing of Documents
II. A. Appointment of Custodian. 2
II. B. Acceptance of Custodian. 2
II. C. Documents to be Furnished. 2
II. D. Notice of Appointment of Dividend and Transfer Agent. 2
ARTICLE III - Receipt of Trust Assets
III. A. Delivery of Moneys. 2
III. B. Delivery of Securities. 2
III. C. Payments for Shares. 3
III. D. Duties Upon Receipt. 3
ARTICLE IV - Disbursement of Trust Assets
IV. A. Declaration of Dividends by Trust. 3
IV. B. Segregation of Redemption Proceeds. 3
IV. C. Disbursements of Custodian. 3
IV. D. Payment of Custodian Fees. 3
ARTICLE V - Custody of Trust Assets
V. A. Separate Accounts for Each Fund. 3
V. B. Segregation of Non-Cash Assets. 3
V. C. Securities in Bearer and Registered Form. 3
V. D. Duties of Custodian as to Securities. 3
V. E. Certain Actions Upon Written Instructions. 4
V. F. Custodian to Deliver Proxy Materials. 4
V. G. Custodian to Deliver Tender Offer Information. 4
V. H. Custodian to Deliver Security and Transaction Information. 4
ARTICLE VI - Purchase and Sale of Securities
VI. A. Purchase of Securities. 5
VI. B. Sale of Securities. 5
VI. C. Delivery Versus Payment for Purchases and Sales. 5
VI. D. Payment on Settlement Date. 5
VI. E. Segregated Accounts. 5
VI. F. Advances for Settlement. 6
ARTICLE VII - Trust Indebtedness
VII. A. Borrowings. 6
VII. B. Advances. 6
ARTICLE VIII - Concerning the Custodian
VIII. A. Limitations on Liability of Custodian. 6
VIII. B. Actions not Required by Custodian. 7
VIII. C. No Duty to Collect Amounts Due From Dividend and Transfer Agent. 7
VIII. D. No Enforcement Actions. 8
VIII. E. Authority to Use Agents and Sub-Custodians. 8
VIII. F. No Duty to Supervise Investments. 8
VIII. G. All Records Confidential. 8
VIII. H. Compensation of Custodian. 8
VIII. I. Reliance Upon Instructions. 8
VIII. J. Books and Records. 8
VIII. K. Internal Accounting Control Systems. 8
VIII. L. No Management of Assets by Custodian. 8
VIII. M. Assistance to Trust. 9
ARTICLE IX - Termination
IX. A. Termination. 9
IX. B. Failure to Designate Successor Custodian. 9
ARTICLE X - Force Majeure
ARTICLE XI - Miscellaneous
XI. A. Designation of Authorized Persons. 9
XI. B. Limitation of Personal Liability. 9
XI. C. Authorization By Board. 10
XI. D. Custodian's Consent to Use of Its Name. 10
XI. E. Notices to Custodian. 10
XI. F. Notices to Trust. 10
XI. G. Amendments In Writing. 10
XI. H. Successors and Assigns. 10
XI. I. Governing Law. 10
XI. J. Jurisdiction. 10
XI. K. Counterparts. 10
XI. L. Headings. 10
APPENDIX A
APPENDIX B
APPENDIX C
APPENDIX D
APPENDIX E
CUSTODY AGREEMENT
This agreement (the "Agreement") is entered into as of the 15th day of
June 2007, by and between the __________, a business trust (the "Trust") and The
Huntington National Bank, (the "Custodian"), a national banking association
having its principal office at 00 Xxxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxx 00000.
WHEREAS, the Trust and the Custodian desire to enter into this
Agreement to provide for the custody and safekeeping of the assets of the Trust
as required by the Act (as hereafter defined).
THEREFORE, in consideration of the mutual promises hereinafter set
forth, the Trust and the Custodian agree as follows:
DEFINITIONS
The following words and phrases, when used in this Agreement, unless the
context otherwise requires, shall have the following meanings:
ACT - the Investment Company Act of 1940, as amended. 1934 ACT - the
Securities and Exchange Act of 1934, as amended.
AUTHORIZED PERSON - any person, whether or not any such person is an
officer or employee of the Trust, who is duly authorized by the Board of
Trustees of the Trust to give Oral Instructions and Written Instructions
on behalf of the Trust or any Fund, and named in Appendix A attached
hereto and as amended from time to time by resolution of the Board of
Trustees, certified by an Officer, and received by the Custodian.
BOARD OF TRUSTEES - the Trustees from time to time serving under the
Trust's Agreement and Declaration of Trust, as from time to time amended.
BOOK-ENTRY SYSTEM - a federal book-entry system as provided in Subpart O
of Treasury Circular Xx. 000, 00 XXX 306, in Subpart B of 31 CFT Part
350, or in such book-entry regulations of federal agencies as are
substantially in the form of Subpart O.
BUSINESS DAY - any day recognized as a settlement day by The New York
Stock Exchange, Inc. and any other day for which the Trust computes the
net asset value of Shares of any fund.
DEPOSITORY - The Depository Trust Company ("DTC"), a limited purpose
trust company, its successor(s) and its nominee(s). Depository shall
include any other clearing agency registered with the SEC under Section
17A of the 1934 Act which acts as a system for the central handling of
Securities where all Securities of any particular class or series of an
issuer deposited within the system are treated as fungible and may be
transferred or pledged by bookkeeping entry without physical delivery of
the Securities provided that the Custodian shall have received a copy of
a resolution of the Board of Trustees, certified by an Officer,
specifically approving the use of such clearing agency as a depository
for the Funds.
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DIVIDEND AND TRANSFER AGENT - the dividend and transfer agent appointed,
from time to time, pursuant to a written agreement between the dividend
and transfer agent and the Trust.
FOREIGN SECURITIES - a) securities issued and sold primarily outside of
the United States by a foreign government, a national of any foreign
country, or a trust or other organization incorporated or organized under
the laws of any foreign country or; b) securities issued or guaranteed by
the government of the United States, by any state, by any political
subdivision or 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 of the United States.
FUND - each series of the Trust listed in Appendix B and any additional
series added pursuant to Proper Instructions. A series is individually
referred to as a "Fund" and collectively referred to as the "Funds."
MONEY MARKET SECURITY - debt obligations issued or guaranteed as to
principal and/or interest by the government of the United States or
agencies or instrumentalities thereof, commercial paper, obligations
(including certificates of deposit, bankers' acceptances, repurchase
agreements and reverse repurchase agreements with respect to the same),
and time deposits of domestic banks and thrift institutions whose
deposits are insured by the Federal Deposit Insurance Corporation, and
short-term corporate obligations where the purchase and sale of such
securities normally require settlement in federal funds or their
equivalent on the same day as such purchase and sale, all of which mature
in not more than thirteen (13) months.
NASD - the National Association of Securities Dealers, Inc.
OFFICER - the Chairman, President, Secretary, Treasurer, any Vice
President, Assistant Secretary or Assistant Treasurer of the Trust.
ORAL INSTRUCTIONS - instructions orally transmitted to and received by
the Custodian from an Authorized Person (or from a person that the
Custodian reasonably believes in good faith to be an Authorized Person)
and confirmed by Written Instructions in such a manner that such Written
Instructions are received by the Custodian on the Business Day
immediately following receipt of such Oral Instructions.
PROPER INSTRUCTIONS - Oral Instructions or Written Instructions. Proper
Instructions may be continuing Written Instructions when deemed
appropriate by both parties.
PROSPECTUS - With respect to each Fund, the Fund's then currently
effective prospectus and Statement of Additional Information, as filed
with and declared effective from time to time by the Securities and
Exchange Commission.
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SECURITY OR SECURITIES - Money Market Securities, common stock, preferred
stock, options, financial futures, bonds, notes, debentures, corporate
debt securities, mortgages, bank certificates of deposit, bankers'
acceptances, mortgage-backed securities or other obligations and any
certificates, receipts, warrants, or other instruments or documents
representing rights to receive, purchase, or subscribe for the same or
evidencing or representing any other rights or interest therein, or any
similar property or assets, including securities of any registered
investment company, that the Custodian has the facilities to clear and to
service. SEC - the Securities and Exchange Commission of the United
States of America. SHARES - with respect to a Fund, the units of
beneficial interest issued by the Trust on account of such Fund.
TRUST - the business trust organized under the laws of Ohio which is an
open-end management investment company registered under the Act.
WRITTEN INSTRUCTIONS - communications in writing actually received by the
Custodian from an Authorized Person. A communication in writing includes
a communication by facsimile, telex or between electro-mechanical or
electronic devices (where the use of such devices have been approved by
resolution of the Board of Trustees and the resolution is certified by an
Officer and delivered to the Custodian). All written communications shall
be directed to the Custodian, attention: Institutional Trust Custody
Group.
ARTICLE II
APPOINTMENT; ACCEPTANCE; AND FURNISHING OF DOCUMENTS
II. A. APPOINTMENT OF CUSTODIAN. The Trust hereby constitutes and appoints
the Custodian as custodian of all Securities and cash owned by each
Fund at any time during the term of this Agreement.
II. B. ACCEPTANCE OF CUSTODIAN. The Custodian hereby accepts appointment
as such custodian and agrees to perform the duties thereof as
hereinafter set forth.
II. C. DOCUMENTS TO BE FURNISHED. The following documents, including any
amendments thereto, will be provided contemporaneously with the
execution of the Agreement, to the Custodian by the Trust:
1.) A copy of the Declaration of Trust of the Trust certified by the
Secretary.
2.) A copy of the By-Laws of the Trust certified by the Secretary.
3.) A copy of the resolution of the Board of Trustees of the Trust
appointing the Custodian, certified by the Secretary.
4.) A copy of the then current Prospectuses.
5.) A Certificate of the President and Secretary of the Trust setting
forth the names and signatures of all Authorized Persons . II. D.
NOTICE OF APPOINTMENT OF DIVIDEND AND TRANSFER AGENT. The Trust
agrees to notify the Custodian in writing of the appointment,
termination or change in appointment of any Dividend and Transfer
Agent.
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ARTICLE III
RECEIPT OF TRUST ASSETS
III. A. DELIVERY OF MONEYS. During the term of this Agreement, the Trust
will deliver or cause to be delivered to the Custodian all moneys to
be held by the Custodian for the account of any Fund. The Custodian
shall be entitled to reverse any deposits made on any Fund's behalf
where such deposits have been entered and moneys are not finally
collected within 20 days of the making of such entry.
III. B. DELIVERY OF SECURITIES. During the term of this Agreement, the Trust
will deliver or cause to be delivered to the Custodian all Securities
to be held by the Custodian for the account of any Fund. The Custodian
will not have any duties or responsibilities with respect to such
Securities until actually received by the Custodian. The Custodian is
hereby authorized by the Trust, acting on behalf of a Fund, to
actually deposit any assets of the Fund in the Book-Entry System or in
a Depository, provided, however, that the Custodian shall always be
accountable to the Trust for the assets of the Fund so deposited.
Assets deposited in the Book-Entry System or the Depository will be
represented in accounts which include only assets held by the
Custodian for customers, including but not limited to accounts in
which the Custodian acts in a fiduciary or representative capacity.
III. C. PAYMENTS FOR SHARES. As and when received, the Custodian shall
deposit to the account(s) of a Fund any and all payments for Shares of
that Fund issued or sold from time to time as they are received from
the Trust's distributor or Dividend and Transfer Agent or from the
Trust itself.
III. D. DUTIES UPON RECEIPT. The Custodian shall not be responsible for any
Securities, moneys or other assets of any Fund until actually
received.
ARTICLE IV
DISBURSEMENT OF TRUST ASSETS
IV. A. DECLARATION OF DIVIDENDS BY TRUST. The Trust shall furnish to the
Custodian a copy of the resolution of the Board of Trustees of the
Trust, certified by the Trust's Secretary, either (i) setting forth
the date of the declaration of any dividend or distribution in respect
of Shares of any Fund of the Trust, the date of payment thereof, the
record date as of which the Fund shareholders entitled to payment
shall be determined, the amount payable per share to Fund shareholders
of record as of that date, and the total amount to be paid by the
Dividend and Transfer Agent on the payment date, or (ii) authorizing
the declaration of dividends and distributions in respect of Shares of
a Fund on a daily basis and authorizing the Custodian to rely on
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Written Instructions setting forth the date of the declaration of any
such dividend or distribution, the date of payment thereof, the record
date as of which the Fund shareholders entitled to payment shall be
determined, the amount payable per share to Fund shareholders of
record as of that date, and the total amount to be paid by the
Dividend and Transfer Agent on the payment date. On the payment date
specified in the resolution or Written Instructions described above,
the Custodian shall segregate such amounts from moneys held for the
account of the Fund so that they are available for such payment.
IV. B. SEGREGATION OF REDEMPTION PROCEEDS. Upon receipt of Proper
Instructions so directing it, the Custodian shall segregate amounts
necessary for the payment of redemption proceeds to be made by the
Dividend and Transfer Agent from moneys held for the account of the
Fund so that they are available for such payment.
IV. C. DISBURSEMENTS OF CUSTODIAN. Upon receipt of a Written Instruction
directing payment and setting forth the name and address of the person
to whom such payment is to be made, the amount of such payment, the
name of the Fund from which payment is to be made, and the purpose for
which payment is to be made, the Custodian shall disburse amounts as
and when directed from the assets of that Fund. The Custodian is
authorized to rely on such directions and shall be under no obligation
to inquire as to the propriety of such directions.
IV. D. PAYMENT OF CUSTODIAN FEES. Upon receipt of Written Instructions
directing payment, the Custodian shall disburse moneys from the assets
of the Trust in payment of the Custodian's fees and expenses as
provided in Article VIII hereof.
ARTICLE V
CUSTODY OF TRUST ASSETS
V. A. SEPARATE ACCOUNTS FOR EACH FUND. As to each Fund, the Custodian
shall open and maintain a separate bank account or accounts in the
United States in the name of the Trust coupled with the name of such
Fund, subject only to draft or order by the Custodian acting pursuant
to the terms of this Agreement, and shall hold all cash received by it
from or for the account of the Fund, other than cash maintained by the
Fund in a bank account established and used by the Fund in accordance
with Rule 17f-3 under the Act. Moneys held by the Custodian on behalf
of a Fund may be deposited by the Custodian to its credit as Custodian
in the banking department of the Custodian. Such moneys shall be
deposited by the Custodian in its capacity as such, and shall be
withdrawable by the Custodian only in such capacity.
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V. B. SEGREGATION OF NON-CASH ASSETS. All Securities and non-cash
property held by the Custodian for the account of a Fund (other than
Securities maintained in a Depository or Book-entry System) shall be
physically segregated from other Securities and non-cash property in
the possession of the Custodian (including the Securities and non-cash
property of the other Funds) and shall be identified as subject to
this Agreement.
V. C. SECURITIES IN BEARER AND REGISTERED FORM. All Securities held which
are issued or issuable only in bearer form, shall be held by the
Custodian in that form; all other Securities held for a Fund may be
registered in the name of the Custodian, any sub-custodian appointed
in accordance with this Agreement, or the nominee of any of them. The
Trust agrees to furnish to the Custodian appropriate instruments to
enable the Custodian to hold, or deliver in proper form for transfer,
any Securities that it may hold for the account of any Fund and which
may, from time to time, be registered in the name of a Fund.
V. D. DUTIES OF CUSTODIAN AS TO SECURITIES. Unless otherwise instructed
by the Trust, with respect to all Securities held for the Trust, the
Custodian shall on a timely basis (concerning items 1 and 2 below, as
defined in the Custodian's Mutual Fund Custody Model, as amended from
time to time, annexed hereto as Appendix D):
1.) Collect all income due and payable with respect to such
Securities;
2.) Present for payment and collect amounts payable upon all
Securities which may mature or be called, redeemed, or retired,
or otherwise become payable;
3.) Surrender interim receipts or Securities in temporary form for
Securities in definitive form; and
4.) Execute, as Custodian, any necessary declarations or certificates
of ownership under the Federal income tax laws or the laws or
regulations of any other taxing authority, including any foreign
taxing authority, now or hereafter in effect.
V. E. CERTAIN ACTIONS UPON WRITTEN INSTRUCTIONS. Upon receipt of a
Written Instructions and not otherwise, the Custodian shall:
1.) Execute and deliver to such persons as may be designated in such
Written Instructions proxies, consents, authorizations, and any
other instruments whereby the authority of the Trust as
beneficial owner of any Securities may be exercised;
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2.) Deliver any Securities in exchange for other Securities or cash
issued or paid in connection with the liquidation,
reorganization, refinancing, merger, consolidation, or
recapitalization of any corporation, or the exercise of any
conversion privilege;
3.) Deliver any Securities to any protective committee,
reorganization committee, or other person in connection with the
reorganization, refinancing, merger, consolidation,
recapitalization, or sale of assets of any corporation, and
receive and hold under the terms of this Agreement such
certificates of deposit, interim receipts or other instruments or
documents as may be issued to it to evidence such delivery;
4.) Make such transfers or exchanges of the assets of any Fund and
take such other steps as shall be stated in the Written
Instructions to be for the purpose of effectuating any duly
authorized plan of liquidation, reorganization, merger,
consolidation or recapitalization of the Trust; and
5.) Deliver any Securities held for any Fund to the depository agent
for tender or other similar offers.
V. F. CUSTODIAN TO DELIVER PROXY MATERIALS. The Custodian shall promptly
deliver to the Trust all notices, proxy material and executed but
unvoted proxies pertaining to shareholder meetings of Securities held
by any Fund. The Custodian shall not vote or authorize the voting of
any Securities or give any consent, waiver or approval with respect
thereto unless so directed by Written Instructions.
V. G. CUSTODIAN TO DELIVER TENDER OFFER INFORMATION. The Custodian shall
promptly deliver to the Trust all information received by the
Custodian and pertaining to Securities held by any Fund with respect
to tender or exchange offers, calls for redemption or purchase, or
expiration of rights as described in the Mutual Fund Custody Model
attached as Appendix D. If the Trust desires to take action with
respect to any tender offer, exchange offer or other similar
transaction, the Trust shall notify the Custodian at least five
Business Days prior to the date on which the Custodian is to take such
action. The Trust will provide or cause to be provided to the
Custodian all relevant information for any Security which has unique
put/option provisions at least five Business Days prior to the
beginning date of the tender period.
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V. H. CUSTODIAN TO DELIVER SECURITY AND TRANSACTION INFORMATION. On each
Business Day that the Federal Reserve Bank is open, the Custodian
shall furnish the Trust with a detailed statement of monies held for
the Fund under this Agreement and with confirmations and a summary of
all transfers to or from the account of the Fund. At least monthly and
from time to time, the Custodian shall furnish the Trust with a
detailed statement of the Securities held for the Fund under this
Agreement. Where Securities are transferred to the account of the Fund
without physical delivery, the Custodian shall also identify as
belonging to the Fund a quantity of Securities in a fungible bulk of
Securities registered in the name of the Custodian (or its nominee) or
shown on the Custodian's account on the books of the Book-Entry System
or the Depository. With respect to information provided by this
section, it shall not be necessary for the Custodian to provide notice
as described by Article XI Section F. Notices to Trust; it shall be
sufficient to communicate by such means as shall be mutually agreeable
to the Trust and the Custodian.
ARTICLE VI
PURCHASE AND SALE OF SECURITIES
VI. A. PURCHASE OF SECURITIES. Promptly after each purchase of Securities
by the Trust, the Trust shall deliver to the Custodian (i) with
respect to each purchase of Securities which are not Money Market
Securities, Written Instructions, and (ii) with respect to each
purchase of Money Market Securities, Proper Instructions, specifying
with respect to each such purchase the;
1.) name of the issuer and the title of the Securities
2.) the number of shares, principal amount purchased (and accrued
interest, if any) or other units purchased,
3.) date of purchase and settlement,
4.) purchase price per unit,
5.) total amount payable,
6.) name of the person from whom, or the broker through which, the
purchase was made,
7.) the name of the person to whom such amount is payable, and
8.) the Fund for which the purchase was made
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The Custodian shall, against receipt of Securities purchased by or for
the Trust, pay out of the moneys held for the account of such Fund the
total amount specified in the Written Instructions, or Oral
Instructions, if applicable, to the person named therein. The
Custodian shall not be under any obligation to pay out moneys to cover
the cost of a purchase of Securities for a Fund, if in the relevant
Fund custody account there is insufficient cash available to the Fund
for which such purchase was made. With respect to any repurchase
agreement transaction for the Funds, the Custodian shall assure that
the collateral reflected on the transaction advice is received by the
Custodian.
VI. B. SALE OF SECURITIES. Promptly after each sale of Securities by a
Fund, the Trust shall deliver to the Custodian (i) with respect to
each sale of Securities which are not Money Market Securities, Written
Instructions, and (ii) with respect to each sale of Money Market
Securities, Proper Instructions, specifying with respect to each such
sale the:
1.) Name of the issuer and the title of the Securities
2.) Number of shares, principal amount sold (and accrued interest, if
any) or other units sold,
3.) Date of sale and settlement,
4.) Sale price per unit,
5.) Total amount receivable,
6.) Name of the person to whom, or the broker through which, the sale
was made,
7.) Name of the person to whom such Securities are to be delivered,
and
8.) Fund for which the sale was made The Custodian shall deliver the
Securities against receipt of the total amount specified in the
Written Instructions, or Oral Instructions, if applicable.
VI. C. DELIVERY VERSUS PAYMENT FOR PURCHASES AND SALES. Purchases and
sales of Securities effected by the Custodian will be made on a
delivery versus payment basis. The Custodian may, in its sole
discretion, upon receipt of Written Instructions, elect to settle a
purchase or sale transaction in some other manner, but only upon
receipt of acceptable indemnification from the Fund.
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VI. D. PAYMENT ON SETTLEMENT DATE. On contractual settlement date, the
account of the Fund will be charged for all purchased Securities
settling on that day, regardless of whether or not delivery is made.
Likewise, on contractual settlement date, proceeds from the sale of
Securities settling that day will be credited to the account of the
Fund, irrespective of delivery. Exceptions to contractual settlement
on purchases and sales, that will continue to settle delivery versus
payment, include real estate, venture capital, international trades,
open-ended mutual funds, non standard depository settlements and
in-kind trades.
VI. E. SEGREGATED ACCOUNTS. The Custodian shall, upon receipt of Proper
Instructions so directing it, establish and maintain a segregated
account or accounts for and on behalf of a Fund. Cash and/or
Securities may be transferred into such account or accounts for
specific purposes, to-wit:
1.) in accordance with the provision of any agreement among the
Trust, the Custodian, and a broker-dealer registered under the
1934 Act, and also a member of the NASD (or any futures
commission merchant registered under the Commodity Exchange Act),
relating to compliance with the rules of the Options Clearing
Corporation and of any registered national securities exchange,
the Commodity Futures Trading Commission, any registered contract
market, or any similar organization or organizations requiring
escrow or other similar arrangements in connection with
transactions by the Fund;
2.) for purposes of segregating cash or Securities in connection with
options purchased, sold, or written by the Fund or commodity
futures contracts or options thereon purchased or sold by the
Fund;
3.) for the purpose of compliance by the Fund with the procedures
required for reverse repurchase agreements, firm commitment
agreements, standby commitment agreements, short sales, or any
other securities by Act Release No. 10666, or any subsequent
release or releases or rule of the SEC relating to the
maintenance of segregated accounts by registered investment
companies;
4.) for the purpose of segregating collateral for loans of Securities
made by the Fund; and
5.) for other proper corporate purposes, but only upon receipt of, in
addition to Proper Instructions, a copy of a resolution of the
Board of Trustees, certified by an Officer, setting forth the
purposes of such segregated account.
Each segregated account established hereunder shall be established and
maintained for a single Fund only. All Proper Instructions relating to
a segregated account shall specify the Fund involved.
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VI. F. ADVANCES FOR SETTLEMENT. Except as otherwise may be agreed upon by
the parties hereto, the Custodian shall not be required to comply with
any Written Instructions to settle the purchase of any Securities on
behalf of a Fund unless there is sufficient cash in the account(s)
pertaining to such Fund at the time or to settle the sale of any
Securities from such an account(s) unless such Securities are in
deliverable form. Notwithstanding the foregoing, if the purchase price
of such Securities exceeds the amount of cash in the account(s) at the
time of such purchase, the Custodian may, in its sole discretion,
advance the amount of the difference in order to settle the purchase
of such Securities. The amount of any such advance shall be deemed a
loan from the Custodian to the Trust payable on demand and bearing
interest accruing from the date such loan is made up to but not
including the date such loan is repaid at the rate per annum
customarily charged by the Custodian on similar loans.
ARTICLE VII
TRUST INDEBTEDNESS
VII. A. BORROWINGS. In connection with any borrowings by the Trust, the
Trust will cause to be delivered to the Custodian by a bank or broker
requiring Securities as collateral for such borrowings (including the
Custodian if the borrowing is from the Custodian), a notice or
undertaking in the form currently employed by such bank or broker
setting forth the amount of collateral. The Trust shall promptly
deliver to the Custodian Written Instructions specifying with respect
to each such borrowing: (a) the name of the bank or broker, (b) the
amount and terms of the borrowing, which may be set forth by
incorporating by reference an attached promissory note duly endorsed
by the Trust, or a loan agreement, (c) the date, and time if known, on
which the loan is to be entered into, (d) the date on which the loan
becomes due and payable, (e) the total amount payable to the Trust on
the borrowing date, and (f) the description of the Securities securing
the loan, including the name of the issuer, the title and the number
of shares or other units or the principal amount. The Custodian shall
deliver on the borrowing date specified in the Written Instructions
the required collateral against the lender's delivery of the total
loan amount then payable, provided that the same conforms to that
which is described in the Written Instructions. The Custodian shall
deliver, in the manner directed by the Trust, such Securities as
additional collateral, as may be specified in Written Instructions, to
secure further any transaction described in this Article VII. The
Trust shall cause all Securities released from collateral status to be
returned directly to the Custodian and the Custodian shall receive
from time to time such return of collateral as may be tendered to it.
The Custodian may, at the option of the lender, keep such collateral
in its possession, subject to all rights therein given to the lender
because of the loan. The Custodian may require such reasonable
conditions regarding such collateral and its dealings with third-party
lenders as it may deem appropriate.
VII. B. ADVANCES. With respect to any advances of cash made by the
Custodian to or for the benefit of a Fund for any purpose which
results in the Fund incurring an overdraft at the end of any Business
Day, such advance shall be repayable immediately upon demand made by
the Custodian at any time. The Custodian may, in its sole discretion,
charge interest accruing from the date of such overdraft to but not
including the date of such repayment at the rate per annum customarily
charged by the Custodian on similar overdrafts.
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ARTICLE VIII
CONCERNING THE CUSTODIAN
VIII. A. LIMITATIONS ON LIABILITY OF CUSTODIAN. Except as otherwise provided
herein, the Custodian shall not be liable for any loss or damage,
including counsel fees, resulting from its action or omission to act
or otherwise, except for any such loss or damage arising out of its
negligence or willful misconduct. The Trust, on behalf of the Fund and
only from assets of the Fund (or insurance purchased by the Trust with
respect to its liabilities on behalf of the Fund hereunder), shall
defend, indemnify and hold harmless the Custodian and its directors,
officers, employees and agents with respect to any loss, claim,
liability or cost (including reasonable attorneys' fees) arising or
alleged to arise from or relating to the Trust's duties hereunder or
any other action or inaction of the Trust or its Trustees, officers,
employees or agents, except such as may arise from the negligent
action, negligent omission, willful misconduct or any breach of this
Agreement by the Custodian, its directors, officers, employees or
agents.. The Custodian shall defend, indemnify and hold harmless the
Trust and its trustees, officers, employees or agents with respect to
any loss, claim, liability or cost (including reasonable attorneys'
fees) arising or alleged to arise from or relating to the Custodian's
duties as specifically set forth in this agreement with respect to the
Fund hereunder or any other action or inaction of the Custodian or its
directors, officers, employees, agents, nominees, or Sub-Custodians as
to the Fund, except such as may arise from the negligent action,
omission or willful misconduct of the Trust, its trustees, officers,
employees, or agents. The Custodian may, with respect to questions of
law apply for and obtain the advice and opinion of counsel to the
Trust at the expense of the Fund, or of its own counsel at its own
expense, and shall be fully protected with respect to anything done or
omitted by it in good faith in conformity with the advice or opinion
of counsel to the Trust, and shall be similarly protected with respect
to anything done or omitted by it in good faith in conformity with
advice or opinion of its counsel, unless counsel to the Fund shall,
within a reasonable time after being notified of legal advice received
by the Custodian, have a differing interpretation of such question of
law. The Custodian shall be liable to the Trust for any proximate loss
or damage resulting from the use of the Book-Entry System or any
Depository arising by reason of any negligence, misfeasance or
misconduct on the part of the Custodian or any of its employees,
agents, nominees or Sub-Custodians, but not for any special,
incidental, consequential, or punitive damages; provided, however,
that nothing contained herein shall preclude recovery by the Trust, on
behalf of the Fund, of principal and of interest to the date of
-12-
recovery on Securities incorrectly omitted from the Fund's account or
penalties imposed on the Trust, in connection with the Fund, for any
failures to deliver Securities. In any case in which one party hereto
may be asked to indemnify the other or hold the other harmless, the
party from whom indemnification is sought (the "Indemnifying Party")
shall be advised of all pertinent facts concerning the situation in
question, and the party claiming a right to indemnification (the
"Indemnified Party") will use reasonable care to identify and notify
the Indemnifying Party promptly concerning any situation which
presents or appears to present a claim for indemnification against the
Indemnifying Party. The Indemnifying Party shall have the option to
defend the Indemnified Party against any claim which may be the
subject of the indemnification, and in the event the Indemnifying
Party so elects, such defense shall be conducted by counsel chosen by
the Indemnifying Party and satisfactory to the Indemnified Party and
the Indemnifying Party will so notify the Indemnified Party and
thereupon such Indemnifying Party shall take over the complete defense
of the claim and the Indemnifying Party shall sustain no further legal
or other expenses in such situation for which indemnification has been
sought under this paragraph, except the expenses of any additional
counsel retained by the Indemnified Party. In no case shall any party
claiming the right to indemnification confess any claim or make any
compromise in any case in which the other party has been asked to
indemnify such party (unless such confession or compromise is made
with such other party's prior written consent. The provisions of this
section VIII. A. shall survive the termination of this Agreement.
VIII. B. ACTIONS NOT REQUIRED BY CUSTODIAN. Without limiting the generality
of the foregoing, the Custodian, acting in the capacity of Custodian
hereunder, shall be under no obligation to inquire into, and shall not
be liable for:
1.) The validity of the issue of any Securities purchased by or for
the account of any Fund, the legality of the purchase thereof, or
the propriety of the amount paid therefor;
2.) The legality of the sale of any Securities by or for the account
of any Fund, or the propriety of the amount for which the same
are sold;
3.) The legality of the issue or sale of any Shares of any Fund, or
the sufficiency of the amount to be received therefor;
4.) The legality of the redemption of any Shares of any Fund, or the
propriety of the amount to be paid therefor;
5.) The legality of the declaration or payment of any dividend by the
Trust in respect of Shares of any Fund;
6.) The legality of any borrowing by the Trust on behalf of the Trust
or any Fund, using Securities as collateral;
7.) Whether the Trust or a Fund is in compliance with the 1940 Act,
the regulations thereunder, the provisions of the Trust's charter
documents or by-laws, or its investment objectives and policies
as then in effect.
-13-
VIII. C. NO DUTY TO COLLECT AMOUNTS DUE FROM DIVIDEND AND TRANSFER AGENT.
The Custodian shall not be under any duty or obligation to take action
to effect collection of any amount due to the Trust from any Dividend
and Transfer Agent of the Trust nor to take any action to effect
payment or distribution by any Dividend and Transfer Agent of the
Trust of any amount paid by the Custodian to any Dividend and Transfer
Agent of the Trust in accordance with this Agreement.
VIII. D. NO ENFORCEMENT ACTIONS. Notwithstanding Section D of Article V, the
Custodian shall not be under any duty or obligation to take action, by
legal means or otherwise, to effect collection of any amount, if the
Securities upon which such amount is payable are in default, or if
payment is refused after due demand or presentation, unless and until
(i) it shall be directed to take such action by Written Instructions
and (ii) it shall be assured to its satisfaction (including prepayment
thereof) of reimbursement of its costs and expenses in connection with
any such action.
VIII. E. AUTHORITY TO USE AGENTS AND SUB-CUSTODIANS. The Trust acknowledges
and hereby authorizes the Custodian to hold Securities through its
various agents described in Appendix C annexed hereto. In addition,
the Trust acknowledges that the Custodian may appoint one or more
financial institutions, as agent or agents or as sub-custodian or
sub-custodians, including, but not limited to, banking institutions
located in foreign countries, for the purpose of holding Securities
and moneys at any time owned by the Fund. The Custodian shall not be
relieved of any obligation or liability under this Agreement in
connection with the appointment or activities of such agents or
sub-custodians. Any such agent or sub-custodian shall be qualified to
serve as such for assets of investment companies registered under the
Act. The Funds shall reimburse the Custodian for all costs incurred by
the Custodian in connection with opening accounts with any such agents
or sub-custodians. Upon request, the Custodian shall promptly forward
to the Trust any documents it receives from any agent or sub-custodian
appointed hereunder which may assist trustees of registered investment
companies to fulfill their responsibilities under Rule 17f-5 of the
Act.
VIII. F. NO DUTY TO SUPERVISE INVESTMENTS. The Custodian shall not be under
any duty or obligation to ascertain whether any Securities at any time
delivered to or held by it for the account of the Trust are such as
properly may be held by the Trust under the provisions of the
Declaration of Trust and the Trust's By-Laws.
-14-
VIII. G. ALL RECORDS CONFIDENTIAL. The Custodian shall treat all records and
other information relating to the Trust and the assets of all Funds as
confidential and shall not disclose any such records or information to
any other person unless (i) the Trust shall have consented thereto in
writing or (ii) such disclosure is compelled by law.
VIII. H. COMPENSATION OF CUSTODIAN. The Custodian shall be entitled to
receive and the Trust agrees to pay to the Custodian, for the Fund's
account from the Fund's assets only, such compensation as shall be
determined pursuant to Appendix E attached hereto, or as shall be
determined pursuant to amendments to Appendix E as approved by the
Custodian and the Trust. The Custodian shall be entitled to charge
against any money held by it for the accounts of the Fund the amount
of any loss, damage, liability or expense, including counsel fees, for
which it shall be entitled to reimbursement under the provisions of
this Agreement as determined by agreement of the Custodian and the
Trust or by the final order of any court or arbitrator having
jurisdiction and as to which all rights of appeal shall have expired.
The expenses which the Custodian may charge against the account of a
Fund include, but are not limited to, the expenses of agents or
Sub-Custodians incurred in settling transactions involving the
purchase and sale of Securities of the Fund.
VIII. I. RELIANCE UPON INSTRUCTIONS. The Custodian shall be entitled to rely
upon any Proper Instructions if such reliance is made in good faith.
The Trust agrees to forward to the Custodian Written Instructions
confirming Oral Instructions in such a manner so that such Written
Instructions are received by the Custodian, whether by hand delivery,
telex, facsimile or otherwise, on the same Business Day on which such
Oral Instructions were given. The Trust agrees that the failure of the
Custodian to receive such confirming instructions shall in no way
affect the validity of the transactions or enforceability of the
transactions hereby authorized by the Trust. The Trust agrees that the
Custodian shall incur no liability to the Trust for acting upon Oral
Instructions given to the Custodian hereunder concerning such
transactions.
VIII. J. BOOKS AND RECORDS. The Custodian will (i) set up and maintain
proper books of account and complete records of all transactions in
the accounts maintained by the Custodian hereunder in such manner as
will meet the obligations of the Fund under the Act, with particular
attention to Section 31 thereof and Rules 3la-1 and 3la-2 thereunder
and those records are the property of the Trust, and (ii) preserve for
the periods prescribed by applicable Federal statute or regulation all
records required to be so preserved. All such books and records shall
be the property of the Trust, and shall be available, upon request,
for inspection by duly authorized officers, employees or agents of the
Trust and employees of the SEC.
-15-
VIII. K. INTERNAL ACCOUNTING CONTROL SYSTEMS. The Custodian shall send to
the Trust any report received on the systems of internal accounting
control of the Custodian, or its agents or sub-custodians, as the
Trust may reasonably request from time to time.
VIII. L. NO MANAGEMENT OF ASSETS BY CUSTODIAN. The Custodian performs only
the services of a custodian and shall have no responsibility for the
management, investment or reinvestment of the Securities or other
assets from time to time owned by any Fund. The Custodian is not a
selling agent for Shares of any Fund and performance of its duties as
custodian shall not be deemed to be a recommendation to any Fund's
depositors or others of Shares of the Fund as an investment. The
Custodian shall have no duties or obligations whatsoever except such
duties and obligations as are specifically set forth in this
Agreement, and no covenant or obligation shall be implied in this
Agreement against the Custodian.
VIII. M. ASSISTANCE TO TRUST. The Custodian shall take all reasonable
action, that the Trust may from time to time request, to assist the
Trust in obtaining favorable opinions from the Trust's independent
accountants, with respect to the Custodian's activities hereunder, in
connection with the preparation of the Fund's Form N- IA, Form N-SAR,
or other annual reports to the SEC.
ARTICLE IX
TERMINATION
IX. A. TERMINATION. Either party hereto may terminate this Agreement for
any reason 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. If such notice is given
by the Trust, it shall be accompanied by a copy of a resolution of the
Board of Trustees of the Trust, certified by the Secretary of the
Trust, electing to terminate this Agreement and designating a
successor custodian or custodians each of which shall be a bank or
trust company having not less than $100,000,000 aggregate capital,
surplus, and undivided profits. In the event such notice is given by
the Custodian, the Trust shall, on or before the termination date,
deliver to the Custodian a copy of a resolution of the Board of
Trustees of the Trust, certified by the Secretary, designating a
successor custodian or custodians to act on behalf of the Trust. In
the absence of such designation by the Trust, the Custodian may
designate a successor custodian which shall be a bank or trust company
having not less than $100,000,000 aggregate capital, surplus, and
undivided profits. Upon the date set forth in such notice this
Agreement shall terminate, and the Custodian, provided that it has
received a notice of acceptance by the successor custodian, shall
deliver, on that date, directly to the successor custodian all
Securities and monies then owned by the Fund and held by it as
Custodian. Upon termination of this Agreement, the Trust shall pay to
the Custodian on behalf of the Trust such compensation as may be due
as of the date of such termination. The Trust agrees on behalf of the
Trust that the Custodian shall be reimbursed for its reasonable costs
in connection with the termination of this Agreement.
-16-
IX. B. FAILURE TO DESIGNATE SUCCESSOR CUSTODIAN. If a successor custodian
is not designated by the Trust, or by the Custodian in accordance with
the preceding paragraph, or the designated successor cannot or will
not serve, the Trust shall, upon the delivery by the Custodian to the
Trust of all Securities (other than Securities held in the Book-Entry
System which cannot be delivered to the Trust) and moneys then owned
by the Trust, be deemed to be the custodian for the Trust, and the
Custodian shall thereby be relieved of all duties and responsibilities
pursuant to this Agreement, other than the duty with respect to
Securities held in the Book-Entry System, which cannot be delivered to
the Trust, which shall be held by the Custodian in accordance with
this Agreement.
ARTICLE X
FORCE MAJEURE
Neither the Custodian nor the Trust shall be liable for any failure or delay in
performance of its obligations under this Agreement arising out of or caused,
directly or indirectly, by circumstances beyond its reasonable control,
including, without limitation, acts of God; earthquakes; fires; floods; wars;
civil or military disturbances; sabotage; strikes; epidemics; riots; labor
disputes; acts of civil or military authority; governmental actions; or
inability to obtain labor, material, equipment or transportation; provided,
however, that the Custodian, in the event of a failure or delay, shall use its
best efforts to ameliorate the effects of any such failure or delay.
ARTICLE XI
MISCELLANEOUS
XI. A. DESIGNATION OF AUTHORIZED PERSONS. Appendix A sets forth the names
and the signatures of all Authorized Persons as of this date, as
certified by the Secretary of the Trust. The Trust agrees to furnish
to the Custodian a new Appendix A in form similar to the attached
Appendix A, if any present Authorized Person ceases to be an
Authorized Person or if any other or additional Authorized Persons are
elected or appointed. Until such new Appendix A shall be received, the
Custodian shall be fully protected in acting under the provisions of
this Agreement upon Oral Instructions or signatures of the then
current Authorized Persons as set forth in the last delivered Appendix
A.
-17-
XI. B. LIMITATION OF PERSONAL LIABILITY. No recourse under any obligation
of this Agreement or for any claim based thereon shall be had against
any organizer, shareholder, officer, trustee, past, present or future
as such, of the Trust or of any predecessor or successor, either
directly or through the Trust or any such predecessor or successor,
whether by virtue of any constitution, statute or rule of law or
equity, or by the enforcement of any assessment or penalty or
otherwise; it being expressly agreed and understood that this
Agreement and the obligations thereunder are enforceable solely
against the assets of the Trust, and that no such personal liability
whatever shall attach to, or is or shall be incurred by, the
organizers, shareholders, officers, or trustees of the Trust or of any
predecessor or successor, or any of them as such, because of the
obligations contained in this Agreement or implied therefrom and that
any and all such liability is hereby expressly waived and released by
the Custodian as a condition of, and as a consideration for, the
execution of this Agreement.
XI. C. AUTHORIZATION BY BOARD. The obligations set forth in this Agreement
as having been made by the Trust have been made by the Board of
Trustees, acting as such Trustees for and on behalf of the Trust,
pursuant to the authority vested in them under the laws of the State
of Ohio, the Declaration of Trust and the By-Laws of the Trust. This
Agreement has been executed by Officers of the Trust as officers, and
not individually, and the obligations contained herein are not binding
upon any of the Trustees, Officers, agents or holders of shares,
personally, but bind only the Trust and then only to the extent of the
assets of the Trust.
XI. D. CUSTODIAN'S CONSENT TO USE OF ITS NAME. The Trust shall obtain the
Custodian's consent prior to the publication and/or dissemination or
distribution, of the Prospectus and any other documents (including
advertising material) specifically mentioning the Custodian (other
than merely by name and address).
XI. E. NOTICES TO CUSTODIAN. Any notice or other instrument in writing,
authorized or required by this Agreement to be given to the Custodian,
shall be sufficiently given if addressed to the Custodian and mailed
or delivered to it at its offices at The Huntington National Bank,
Easton Business Service Center, 0 Xxxxxx Xxxx XX0X00, Xxxxxxxx, Xxxx,
00000, attention Director Mutual Fund Custody, or at such other place
as the Custodian may from time to time designate in writing.
XI. F. NOTICES TO TRUST. Any notice or other instrument in writing,
authorized or required by this Agreement to be given to the Trust
shall be sufficiently given when delivered to the Trust or on the
second Business Day following the time such notice is deposited in the
U.S. mail postage prepaid and addressed to the Trust at its office at
FUND ADDRESS or at such other place as the Trust may from time to time
designate in writing.
-18-
XI. G. AMENDMENTS IN WRITING. This Agreement, with the exception of the
Appendices, may not be amended or modified in any manner except by a
written agreement executed by both parties with the same formality as
this Agreement, and authorized and approved by a resolution of the
Board of Trustees of the Trust.
XI. H. SUCCESSORS AND ASSIGNS. 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 the Trust or by the Custodian, and no attempted
assignment by the Trust or the Custodian shall be effective without
the written consent of the other party hereto.
XI. I. GOVERNING LAW. This Agreement shall be construed in accordance with
the laws of the State of Ohio.
XI. J. JURISDICTION. Any legal action, suit or proceeding to be instituted
by either party with respect to this Agreement shall be brought by
such party exclusively in the courts of the State of Ohio or in the
courts of the United States for the Southern District of Ohio, and
each party, by its execution of this Agreement, irrevocably (i)
submits to such jurisdiction and (ii) consents to the service of any
process or pleadings by first class U.S. mail, postage prepaid and
return receipt requested, or by any other means from time to time
authorized by the laws of such jurisdiction.
XI. K. COUNTERPARTS. 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.
XI. L. HEADINGS. The headings of paragraphs in this Agreement are for
convenience of reference only and shall not affect the meaning or
construction of any provision of this Agreement.
-19-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective Officers, thereunto duly authorized as of the day
and year FIRST above written.
WITNESS: TRUST:
(FUND NAME)
__________________________ By:_____________________________________
Title:__________________________________
WITNESS: CUSTODIAN:
The Huntington National Bank
___________________________ By:_____________________________________
Title:__________________________________
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APPENDIX A
AUTHORIZED PERSONS SPECIMEN SIGNATURES
Chairman: _________________ __________________________________
President: _________________ __________________________________
Secretary: _________________ __________________________________
Treasurer: _________________ __________________________________
Senior Vice
President: _________________ __________________________________
Assistant
Secretary: _________________ _________________________________
Assistant
Treasurer: _________________ __________________________________
Adviser Employees: _________________ __________________________________
----------------- ----------------------------------
Transfer Agent/Fund Accountant
Employees: _________________ __________________________________
----------------- ----------------------------------
----------------- ----------------------------------
----------------- ----------------------------------
* Authority restricted; does not include: ____________________________________
-00-
XXXXXXXX X
Series of the Trust
-22-
APPENDIX C
AGENTS OF THE CUSTODIAN
The following agents are employed currently by The Huntington National Bank for
securities processing and control.
The Depository Trust Company (New York)
0 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
The Federal Reserve Bank
Cleveland Branch
Xxxxx Brothers Xxxxxxxx
000 Xxxxxxxx
Xxx Xxxx, XX 00000-0000
(For Foreign Securities and certain non-DTC eligible Securities)
-00-
XXXXXXXX X
MUTUAL FUND CUSTODY MODEL
Mutual Fund Custody Model document is attached.
-00-
XXXXXXXX X
MUTUAL FUND CUSTODY FEES
Mutual Fund Custody Pricing document is attached.
-25-
