Exhibit (d)(2)
ALLEGIANT ADVANTAGE FUND
ADVISORY AGREEMENT
AGREEMENT made as of April 24, 2009 between ALLEGIANT
ADVANTAGE FUND, a Massachusetts business trust, located in King of Prussia,
Pennsylvania (the "Trust") and ALLEGIANT ASSET MANAGEMENT COMPANY, located in
Cleveland, Ohio (the "Adviser").
WHEREAS, the Trust is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended ("1940
Act"); and
WHEREAS, the Trust desires to retain the Adviser as investment
adviser to the Institutional Money Market Fund (the "Fund");
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, it is agreed among the parties hereto as follows:
1. DELIVERY OF DOCUMENTS. The Adviser acknowledges that it has received
copies of each of the following:
(a) The Trust's Declaration of Trust, as filed with the
State Secretary of the Commonwealth of Massachusetts
on May 18, 1993 and all amendments thereto (such
Declaration of Trust, as presently in effect and as
it shall from time to time be amended, is herein
called the "Declaration of Trust");
(b) The Trust's Code of Regulations, and amendments
thereto (such Code of Regulations, as presently in
effect and as it shall from time to time be amended,
is herein called the "Code of Regulations");
(c) Resolutions of the Trust's Board of Trustees
authorizing the appointment of the Adviser and
approving this Agreement;
(d) The Trust's Notification of Registration on Form N-8A
under the 1940 Act as filed with the Securities and
Exchange Commission ("SEC") on July 6, 1993 and all
amendments thereto;
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(e) The Trust's Registration Statement on Form N-1A under
the Securities Act of 1933, as amended ("1933 Act")
(File No. 33-488) and under the 1940 Act as filed
with the SEC on July 6, 1993 and all amendments
thereto; and
(f) The Trust's most recent prospectuses and statements
of additional information with respect to the Funds
(such prospectuses and statements of additional
information, as presently in effect and all
amendments and supplements thereto are herein called
individually, a "Prospectus," and collectively, the
"Prospectuses").
The Trust will furnish the Adviser from time to time with
execution copies of all amendments of or supplements to the foregoing.
2. SERVICES. The Trust hereby appoints the Adviser to act as investment
adviser to the Funds for the period and on the terms set forth in this
Agreement. Intending to be legally bound, the Adviser accepts such
appointment and agrees to furnish the services required herein to the
Funds for the compensation hereinafter provided.
Subject to the supervision of the Trust's Board of Trustees,
the Adviser will provide a continuous investment program for the Funds,
including investment research and management with respect to all securities
and investments and cash equivalents in the Funds. The Adviser will
determine from time to time what securities and other investments will be
purchased, retained or sold by the Funds. The Adviser will provide the
services under this Agreement in accordance with the Funds' investment
objectives, policies, and restrictions as stated in the Prospectus and
resolutions of the Trust's Board of Trustees applicable to the Funds.
3. SUBCONTRACTORS. It is understood that the Adviser may from time to
time employ or associate with itself such person or persons as the
Adviser may believe to be particularly fitted to assist in the
performance of this Agreement; provided, however, that the compensation
of such person or persons shall be paid by the Adviser and that the
Adviser shall be as fully responsible to the Trust for the acts and
omissions of any subcontractor as it is for its own acts and omissions.
Without limiting the generality of the foregoing, it is agreed that
investment advisory services to the Funds may be provided by a
sub-adviser agreeable to the Adviser and approved in accordance with
the provisions of the 1940 Act. Any such sub-advisers are hereinafter
referred to as the "Sub-Advisers." In the event that any Sub-Adviser
appointed hereunder is terminated, the Adviser may provide investment
advisory services pursuant to this Agreement to the Funds involved
without further shareholder approval. Notwithstanding the employment of
any Sub-Adviser, the Adviser shall in all events: (a) establish and
monitor general investment criteria and policies for the Funds; (b)
review investments in the Funds on a periodic basis for compliance with
their investment objectives, policies and restrictions as stated in the
Prospectus; (c) review periodically any Sub-Adviser's policies with
respect to the placement of orders for the purchase and sale of
portfolio securities; (d) review, monitor, analyze and report to the
Board of Trustees on the performance of any Sub-Adviser; (e) furnish to
the Board of Trustees or any Sub-Adviser, reports, statistics and
economic information as may be reasonably requested; and (f) recommend,
either in its sole discretion or in conjunction with any Sub-Adviser,
potential changes in investment policy.
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4. COVENANTS BY ADVISER. The Adviser agrees with respect to the
services provided to the Funds that it:
(a) will comply with all applicable Rules and Regulations of the
SEC and will in addition conduct its activities under this
Agreement in accordance with other applicable law;
(b) will use the same skill and care in providing such services
as it uses in providing services to similar fiduciary
accounts for which it has investment responsibilities;
(c) will not make loans to any person to purchase or carry
shares in the Funds, or make interest-bearing loans to the
Trust or the Funds;
(d) will maintain a policy and practice of conducting its
investment management activities independently of all
affiliates;
(e) will place orders pursuant to its investment determinations
for the Funds either directly with the issuer or with any
broker or dealer. In selecting brokers or dealers for
executing portfolio transactions, the Adviser will use its
best efforts to seek on behalf of the Trust and the Funds
the best overall terms available. In assessing the best
overall terms available for any transaction the Adviser
shall consider 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. In evaluating the best overall terms
available, and in selecting the broker or dealer to execute
a particular transaction, the Adviser may also consider the
brokerage and research services (as those terms are defined
in Section 28(e) of the Securities Exchange Act of 1934, as
amended) provided to the Funds and/or other accounts over
which the Adviser or any affiliate of the Adviser exercises
investment discretion. The Adviser is authorized, subject to
the prior approval of the Board, to negotiate and pay to a
broker or dealer who provides such brokerage and research
services a commission for executing a portfolio transaction
for any of the Funds which is in excess of the amount of
commission another broker or dealer would have charged for
effecting that transaction if, but only if, the 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 that particular transaction or in terms of the overall
responsibilities of the Adviser with respect to the accounts
as to which it exercises investment discretion. In no
instance will any of the Funds' securities be purchased from
or sold to the Adviser, any Sub-Adviser, Professional Funds
Distributors, LLC ("PFD") (or any other principal
underwriter to the Trust) or an affiliated person of either
the Trust, the Adviser, Sub-Adviser, or PFD (or such other
principal underwriter) unless permitted by an order of the
SEC or applicable rules. In executing portfolio transactions
for the Funds, the Adviser may, but shall not be obligated
to, to the extent permitted by applicable laws and
regulations, aggregate the securities to be sold or
purchased with those of other investment portfolios of the
Trust and its other clients where such aggregation is not
inconsistent with the policies set forth in the Trust's
registration statement. In such event, the Adviser will
allocate the securities so purchased or sold, and the
expenses incurred in the transaction, in the manner it
considers to be the most equitable and consistent with its
fiduciary obligations to the Funds and such other clients;
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(f) will maintain all books and records with respect to the
securities transactions for the Funds and furnish the
Trust's Board of Trustees such periodic and special reports
as the Board may request; and
(g) will treat confidentially and as proprietary information of
the Trust all records and other information relative to the
Funds and prior, present or potential shareholders, 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 and will be
deemed granted where the Adviser may be exposed to civil or
criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted
authorities, or when so requested by the Trust).
5. SERVICES NOT EXCLUSIVE. The services furnished by the Adviser
hereunder are deemed not to be exclusive, and the Adviser shall be free
to furnish similar services to others so long as its services under
this Agreement are not impaired thereby.
6. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Adviser hereby agrees that all records which it
maintains for the Trust are the property of the Trust and further
agrees to surrender promptly to the Trust any of such records upon the
Trust's request. The Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
7. EXPENSES. During the term of this Agreement, the 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, if any) purchased for the Funds.
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8. COMPENSATION. For the services provided to the Fund and the expenses
assumed pursuant to this Agreement, the Trust will pay the Adviser from
the assets belonging to the Fund and the Adviser will accept as full
compensation therefore fees, computed daily and paid monthly, at an
annual rate based on the average daily net assets as stated on Schedule
1 of this Agreement.
9. LIMITATION OF LIABILITY. The 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 performance of this Agreement, 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 Adviser
in the performance of its duties or from reckless disregard by it of
its obligations and duties under this Agreement.
10. DURATION AND TERMINATION. This Agreement will become effective with
respect to a Fund upon approval of this Agreement by vote of a majority
of the outstanding voting securities of such Fund, and, unless sooner
terminated as provided herein, shall continue in effect until August
31, 2009. Thereafter, if not terminated, this Agreement shall continue
in effect with respect to a Fund for successive twelve month periods
ending on August 31, provided such continuance is specifically approved
at least annually (a) by the vote of a majority of those members of the
Trust's Board of Trustees who are not interested persons of any party
to this Agreement, cast in person at a meeting called for the purpose
of voting on such approval, and (b) by the Trust's Board of Trustees or
by vote of a majority of the outstanding voting securities of such
Fund. Notwithstanding the foregoing, this Agreement may be terminated
at any time with respect to a Fund, without the payment of any penalty,
by the Trust (by the Trust's Board of Trustees or by vote of a majority
of the outstanding voting securities of such Fund), or by the Adviser
on 60 days' written notice. This Agreement will immediately terminate
in the event of its assignment. (As used in this Agreement, the terms
"majority of the outstanding voting securities," "interested persons"
and "assignment" shall have the same meaning of such terms in the 1940
Act.)
11. 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. No amendment of
this Agreement shall be effective with respect to a Fund until approved
by vote of a majority of the outstanding voting securities of such
Fund.
12. MISCELLANEOUS. 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.
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. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and
their respective successors and shall be governed by Ohio law.
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13. NAMES. The names "ALLEGIANT ADVANTAGE FUND" and "Trustees of
ALLEGIANT ADVANTAGE FUND" refer respectively to the Trust created and
the Trustees, as trustees but not individually or personally, acting
from time to time under a Declaration of Trust dated May 18, 1993 which
is hereby referred to and a copy of which is on file at the office of
the State Secretary of the Commonwealth of Massachusetts and the
principal office of the Trust. The obligations of "ALLEGIANT ADVANTAGE
FUND" entered into in the name or on behalf thereof by any of the
Trustees, representatives or agents are made not individually, but in
such capacities, and are not binding upon any of the Trustees,
shareholders, or representatives of the Trust personally, but bind only
the Trust property, and all persons dealing with any class of shares of
the Trust must look solely to the Trust property belonging to such
class for the enforcement of any claims against the Trust.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as of the day and
year first above written.
ALLEGIANT ADVANTAGE FUND
BY: /s/ Xxxxxxxx X. Xxxx
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Title: Chief Administrative Officer
ALLEGIANT ASSET
MANAGEMENT COMPANY
BY: /s/ Xxxxxx Xxxxx
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Title: Managing Director
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SCHEDULE 1
ALLEGIANT ADVANTAGE FUND
ADVISORY AGREEMENT
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INVESTMENT ADVISORY FEE
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Allegiant Advantage Fund 0.15%
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