ADMINISTRATIVE SERVICES AGREEMENT



     AGREEMENT dated as of August 1, 2000, between The BSG Funds (the "Trust"),

an Ohio business trust, and Diamond Hill Capital Management, Inc. ("DHCM"), an

Ohio corporation.



     WHEREAS, the Trust has been organized to operate as an open-end management

investment company registered under the Investment Company Act of 1940 (the

"Act"); and



     WHEREAS, the Trust has engaged DHCM to act as investment adviser to the

Diamond Hill Focus Fund (the "Fund"); and



     WHEREAS, the Trust has engaged Mutual Funds Service Co. to perform certain

administrative services for the Fund; and



     WHEREAS, the Trust wishes to retain DHCM to perform certain additional

administrative services as hereinafter described on behalf of the Fund; and



     WHEREAS, DHCM wishes to provide such services to the Fund under the

conditions set forth below;



     NOW, THEREFORE, in consideration of the promises and mutual covenants

contained in this Agreement, the Trust and DHCM agree as follows:



     1. EMPLOYMENT. The Trust, being duly authorized, hereby employs DHCM to

perform the services described in this Agreement. DHCM shall perform such

administrative services upon the terms and conditions hereinafter set forth. Any

administrative services undertaken by DHCM pursuant to this Agreement, as well

as any other activities undertaken by DHCM on behalf of the Trust pursuant

hereto, shall at all times be subject to any directives of the Board of Trustees

of the Trust.



     2. TRUST ADMINISTRATION. DHCM shall give the Trust the benefit of its best

judgment, efforts and facilities in rendering its administrative services. DHCM

shall at all times conform to: (i) all applicable provisions of the Act and any

rules and regulations adopted thereunder, (ii) the provisions of the

Registration Statement of the Trust under the Securities Act of 1933 and the Act

as amended from time to time, (iii) the provisions of the Agreement and

Declaration of Trust and the By-Laws of the Trust, and (iv) any other applicable

provisions of state and federal law.



     Subject to the direction and control of the Trust, DHCM shall supervise the

Fund's business affairs not otherwise supervised by other agents of the Trust.

To the extent not otherwise the primary responsibility of, or provided by, other

parties under agreement with the Trust, DHCM shall supply (i) non-investment

related statistical and research data, (ii) internal regulatory compliance

services, and (iii) executive and administrative services. DHCM shall supervise

the preparation of (i) tax returns, (ii) reports to shareholders of the Fund,

(iii) reports to and filings with the Securities and Exchange Commission, state

securities commissions and Blue Sky authorities including preliminary and

definitive proxy materials and post-effective amendments to the Fund's

registration statement, and (iv) necessary materials for meetings of the Trust's

Board of Trustees. DHCM shall provide personnel to serve as officers of the

Trust if so elected by the Board of Trustees. Executive and administrative

services include, but are not limited to, the coordination of all third parties

furnishing services to the Fund, review of the books and records of the Fund

maintained by such third parties, and the review and submission to the officers

of the Fund for their approval, of invoices or other requests for payment of





{PAGE}





Fund expenses; and such other action with respect to the Fund as may be

necessary in the opinion of DHCM to perform its duties hereunder.



     3. ALLOCATION OF CHARGES AND EXPENSES. DHCM will pay all operating expenses

of the Fund not specifically assumed by the Fund, including without limitation

the compensation and expenses of any employees of the Fund and of any other

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