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EXHIBIT (d)
ADVISORY AGREEMENT
THIS AGREEMENT is made as of August 1, 2000, by and between AMBASSADOR
FUNDS, a Delaware business trust (the "Fund"), and AMBASSADOR CAPITAL
MANAGEMENT, L.L.C., a Michigan Limited Liability Company (the "Adviser").
WHEREAS, the Fund is an open-end, diversified management investment
company, registered under the Investment Company Act of 1940 (the "1940 Act"),
with two present series of shares each having its own investment objective,
policies and limitations, known as the "Ambassador Money Market Fund" and the
"Ambassador Short-Term Government Fund" (collectively referred to herein as the
"Funds");
WHEREAS, the Fund desires to retain the Adviser to render investment
advisory and management services under the terms hereof; and
WHEREAS, the Adviser has been organized to operate as an investment
adviser and desires to provide investment advisory services to the Fund, and is
registered as an Investment Adviser under the Investment Advisers Act of 1940,
as amended.
NOW THEREFORE, in consideration of the mutual covenants hereinafter
contained, it is hereby agreed by and between the parties hereto as follows:
1. Employment of the Adviser. The Fund hereby employs the Adviser to
act as the investment adviser for and to manage the investment and reinvestment
of the assets of the Funds in accordance with the investment objectives and
policies and limitations for each Fund, and to administer its affairs to the
extent requested by and subject to the supervision of the Trustees of the Fund
for the period and upon the terms herein set forth. The investment of monies
shall be subject to all applicable restrictions of the Declaration of Trust and
Bylaws of the Fund as may from time to time be in force. The Fund and the
Adviser agree that, with respect to any additional series of shares of the Fund
created in the future, they may negotiate and execute a separate advisory
contract or one, which is supplementary and/or amendatory hereto.
The Adviser accepts such employment and agrees during such period to
render such services, to furnish office facilities and equipment and clerical
services for the Fund, and to assume the obligations herein set forth for the
compensation herein provided. Subject to the supervision and direction of the
Trustees, to the restrictions of the Declaration of Trust and Bylaws of the
Fund, as amended from time to time, to the provisions of the 1940 Act and to the
statements relating to the Funds investment objectives, investment policies and
investment restrictions as the same are set forth in the currently effective
prospectus relating to the shares of the beneficial interest of each Fund under
the Securities Act of 1933, as amended (the "Prospectus"), the services provided
by the Adviser include, but are not be limited to: furnishing continuously an
investment program and determining from time to time which securities shall be
purchased, sold or exchanged and what portion of the assets of each Fund shall
be held in authorized securities or cash; making decisions for the Fund as to
the manner in which voting rights, rights to consent to action and any other
rights pertaining to the
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Funds' portfolio securities shall be exercised; implementing investment policies
and strategies; taking, on behalf of each Fund, all actions which the Adviser
deems necessary to implement the investment policies determined as provided
above, and in particular placing all orders for the purchase or sale of
portfolio securities for each Fund's account with brokers or dealers selected by
it, and to that end, giving instructions to the Custodian of each Fund as to
deliveries of securities and payments of cash for the account of each Fund. The
Adviser shall for all purposes herein provided be deemed to be an independent
contractor and, unless otherwise expressly provided or authorized, shall have no
authority to act for or represent the Fund in any way or otherwise be deemed an
agent of the Fund. It is understood and agreed that the Adviser, by separate
agreements with the Fund, may also serve the Fund in other capacities.
2. Compensation of the Adviser. For the services and facilities
described in Section 1, the Fund will pay to the Adviser at the end of each
calendar month, an investment advisory and management fee, computed daily and
payable monthly, at an annual rate of 0.20% of average net assets of the
Ambassador Money Market Fund; and 0.25% of average net assets of the Ambassador
Short-Term Government Fund. For the month and year in which this Agreement
becomes effective or terminates, there shall be an appropriate proration on the
basis of the number of days that the Agreement is in effect during the month and
year, respectively. The services of the Adviser to the Fund under this Agreement
are not to be deemed exclusive, and the Adviser shall be free to render similar
services or other services to others.
3. Expenses Borne By the Fund. In addition to the fee of the Adviser,
the Fund shall assume and pay any expenses for services rendered by a Custodian
or by the Transfer and Dividend Disbursing Agent for the safekeeping of the
Fund's securities or other property, for keeping its books of account, and for
any other charges of the Custodian or of the Transfer and Dividend Disbursing
Agent. The Adviser shall not be required to pay and the Fund shall assume and
pay the charges and expenses of the Fund's operations, including compensation of
the Trustees, of the Administrator and Distributor, charges and expenses of
independent auditors, of legal counsel, any registrar of the Fund, costs of
acquiring and disposing of portfolio securities, interest, if any, on
obligations incurred by the Fund, cost of share certificates, if any, and of
reports, membership dues in the Investment Company Institute or any similar
organization, reports and notices to shareholders, other like miscellaneous
expenses and all taxes, costs and fees payable to federal, state or other
governmental agencies or others on account of the registration of securities
issued by the Fund, filing of corporate documents or otherwise. The Fund shall
not pay or incur any obligation for any expenses for which the Fund intends to
seek reimbursement from the Adviser or adjustment of the Adviser's fee as herein
provided without first obtaining the written approval of the Adviser.
4. Expense Reimbursement. If expenses borne by the Fund for those Funds
which the Adviser manages in any fiscal year (including the Adviser's fee),
exceed any expense limitation imposed by applicable law, the Adviser will reduce
its fee or reimburse the Fund for any such excess. The expense limitation
guarantee shall be allocated to each such Fund upon a fee reduction or
reimbursement based upon the relative average daily net assets of each such
Fund. If for any month the expenses of the Fund properly chargeable to the
income account shall exceed the expense limitation on monthly basis, payment to
the Adviser for that month shall be reduced and, if necessary, the Adviser shall
make a refund payment to the Fund so the total net expense will not exceed such
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limitation. As of the end of the Fund's fiscal year, however, the foregoing
computations and payments shall be readjusted so that the aggregate compensation
payable to the Adviser for the year is equal to the percentages set forth in
Section 2 hereof with respect to the average net asset values as determined as
described herein throughout the fiscal year, diminished to the extent necessary
so that the total of the aforementioned expense items shall not exceed the
expense limitation. The aggregate of repayments, if any, by the Adviser to the
Fund for the year shall be the amount necessary to limit the said net expense as
required.
5. Allocation of Brokerage. The Adviser shall place all orders for the
Purchase or sale of portfolio securities for the accounts of the Funds with
brokers or dealers selected by the Adviser, and to that end the Adviser is
authorized as the agent of the Fund to give instructions to the Custodians of
each Fund as to deliveries of securities and payment of cash for the account of
the Funds. In connection with the selection of such brokers or dealers and the
placing of such orders, the Adviser shall use its best efforts to seek to
execute security transactions at prices that are advantageous to the Funds and
(when a disclosed Commission is being charged) at reasonably competitive
commission rates. In selecting brokers or dealers qualified to execute a
particular transaction, brokers or dealers may be selected who also provide
brokerage and research services (as those terms are defined in Section 28(e) of
the Securities Exchange Act of 1934) to the Adviser and the Adviser is expressly
authorized to pay any broker or dealer who provides such brokerage and research
services a commission for executing a security transaction which is in excess of
the amount of commission another broker or dealer would have charged for
effecting that transaction if the Adviser determines in good faith that such
amount of commission is 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 that the Adviser and
its affiliates have with respect to accounts over which they exercise investment
discretion. Subject to the requirement set forth in the second sentence of this
paragraph, the Adviser is authorized to consider, as a factor in the selection
of any broker or dealer with whom purchase or sale orders may be placed, the
fact that such broker or dealer has sold or is selling shares of the Funds, or
any other series of the Fund, or of other investment companies sponsored by the
Adviser or its affiliates.
6. Permissible Investments. Subject to applicable statutes and
regulations, it is understood that Trustees, officers or agents of the Fund are
or may be interested in the Adviser as officers, directors, agents, shareholders
or otherwise, and that the officers, directors, shareholders and agents of the
Adviser may be interested in the Fund otherwise than as a director, officer or
agent.
7. Limitation on Adviser Liability. The Adviser shall not be liable for
any error of judgment or of law or for any loss suffered by the Fund in
connection with the matters to which this Agreement relates, except loss
resulting from willful misfeasance, bad faith or gross negligence on the part of
the Adviser in the performance of its obligations and duties or by reason of its
reckless disregard of its obligations and duties under this Agreement.
8. Term; Termination. This Agreement shall become effective with
respect to each Fund on the date hereof and shall remain in full force until
August 1, 2002 unless sooner terminated as hereinafter provided. This Agreement
shall continue in force from year to year thereafter with respect to each Fund,
but only as long as such continuance is specifically approved for each Fund at
least
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annually in the manner required by the 1940 Act and the rules and regulations
thereunder; provided, however, that if the continuation of this Agreement is not
approved for a Fund, the Adviser may continue to serve in such capacity for such
Fund in the manner and to the extent permitted by the 1940 Act and the rules and
regulations thereunder.
This Agreement shall automatically terminate in the event of its
assignment and may be terminated at any time without cause and without the
payment of any penalty by the Fund or by the Adviser on sixty (60) days written
notice to the other party. The Fund may effect termination with respect to any
Fund by action of the Trustees or by vote of a majority of the outstanding
voting securities of such Fund.
The terms "assignment" and "vote of a majority of the outstanding
voting securities" have the meanings set forth in the 1940 Act and the rules and
regulations thereunder.
Termination of this Agreement shall not affect the right of the Adviser
to receive payments on any unpaid balance of the compensation described in
Section 2 earned prior to the effective date of such termination.
9. Amendment. This Agreement may be amended at any time by mutual
written agreement of the parties; provided, however, that no amendment to this
Agreement for which approval by vote of a majority of the Fund's outstanding
voting securities is required under the 1940 Act shall be effective until such
approval is obtained.
10. Severability. If any provision of this Agreement shall be held or
made invalid or unenforceable by a court decision, statute, rule or otherwise,
the remainder shall not be thereby affected.
11. Notices. Any notice under this Agreement shall be in writing,
addressed and delivered or mailed, postage prepaid, to the other party at such
address as such other party may designate for the receipt of such notice.
12. Limitation of Fund Liability. The Declaration of Trust establishing
Ambassador Funds, filed March 22, 2000, a copy of which, together with all
amendments thereto (the "Declaration"), is on file in the office of the
Secretary of the State of Delaware, provides that the name "Ambassador Funds"
refers to the Trustees under the Declaration collectively as Trustees, but not
as individuals or personally; and no Trustee, shareholder, officer, employee or
agent of Ambassador Funds, shall be held to any personal liability, nor shall
resort be had to their private property for the satisfaction of any obligation
or claim or otherwise in connection with the affairs of said Ambassador Funds,
but the Fund Estate only shall be liable.
13. Defined Terms. Terms not defined herein shall have the same
meanings as such terms are used in the currently effective prospectus with
respect to shares of the Fund.
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IN WITNESS WHEREOF, the Fund and the Adviser have caused this Agreement
to be executed on the day and year first above written.
AMBASSADOR FUNDS
By: /s/ Xxxxxxx X. Xxxxx
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Its: Secretary
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AMBASSADOR CAPITAL MANAGEMENT, L.L.C.
By: /s/ Xxxxx X. Xxxxxxxx
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Its: President
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