EXHIBIT 6(b)
Distribution Agreement between Integrity Management & Research, Inc.,
Integrity Investments, Inc. and The Valiant Fund
DISTRIBUTION AGREEMENT
THIS AGREEMENT is made as of this 29th day of July, 1993 by and between
INTEGRITY MANAGEMENT & RESEARCH, INC., ("Integrity Management"), a Florida
corporation, THE VALIANT FUND ("Valiant or the "Trust"), a Massachusetts
business trust, and INTEGRITY INVESTMENTS, INC., a Florida corporation
("Distributor.")
WITNESSETH
WHEREAS, Valiant is a Massachusetts business trust, registered as an
open-end, diversified management investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, Integrity Management is responsible for the management of the
business affairs and the investments of the portfolios of Valiant pursuant to
that certain Management Agreement dated July 29, 1993, between Valiant and
Integrity Management; and
WHEREAS, Valiant is currently offering units of beneficial interest (the
"Shares"), representing interests in the following investment portfolios:
U.S. Treasury Money Market Portfolio, U.S. Government Money Market Portfolio,
General Money Market Portfolio, Tax-Exempt Money Market Portfolio
(individually a "Fund" and collectively the "Funds"); and
WHEREAS, Valiant desires to retain the Distributor as distributor for the
Funds to provide for the sale and distribution of the Shares, and the
Distributor is prepared to provide such services;
NOW THEREFORE, in consideration of the premises and mutual covenants set
forth herein and intending to be legally bound hereby the parties hereto
agree as follows:
1. SERVICE AS DISTRIBUTOR
1.1 The Distributor will act as agent for the distribution of the Shares
covered by the registration statement and prospectus then in effect under the
Securities Act of 1933.
1.2 The Distributor agrees to use appropriate efforts to solicit orders
for the sale of the Shares and will undertake such advertising and promotion
as it believes reasonable in connection with such solicitation.
1.3 The Distributor shall, at its own expense, finance appropriate
activities which it deems reasonable which are primarily intended to result
in the sale of the Shares, including, but not limited to, advertising,
compensation of underwriters, dealers and sales personnel, the printing and
mailing of prospectuses to other than current shareholders, and the printing
and mailing of sales literature.
1.4 All activities by the Distributor and its agents and employees as
distributor of Shares shall comply with all applicable laws, rules and
regulation, including, without limitation, all rules and regulations made or
adopted pursuant to the 1940 Act by the Securities and Exchange Commission or
any securities association registered under the Securities Exchange Act of
1934.
1.5 The Distributor will provide one or more persons, during normal
business hours, to respond to telephone questions with respect to the Funds.
1.6 The Distributor will transmit any orders received by it for purchase
or redemption of the Shares to Valiant's transfer agent and custodian.
1.7 Whenever in their judgment such action is warranted by unusual
market, economic or political conditions, or by abnormal circumstances of any
kind, Valiant's officers may decline to accept any orders, for, or make any
sales of the Shares until such time as those officers deem it advisable to
accept such orders and to make such sales.
1.8 The Distributor will act only on its own behalf as principal if it
chooses to enter into selling agreements with selected dealers or others.
1.9 Valiant agrees at its own expense to execute any and all documents
and to furnish any and all information and otherwise to take all actions that
may be reasonably necessary in connection with the qualification of the
Shares for sale in such states as the Distributor may designate.
1.10 Valiant shall furnish from time to time, for use in connection with
the sale of the Shares such written information with respect to the Funds and
the Shares as the Distributor may reasonably request; and Valiant warrants
that the statements contained in any such information shall fairly show or
represent what they purport to show or represent. Valiant shall also furnish
the Distributor upon request with: (a) unaudited semi-annual statements of
the Fund's books and accounts, (b) quarterly earnings statements of the
Funds, (c) a monthly itemized list of the securities in the Funds, (d)
monthly balance sheets as soon as practicable after the end of each month,
and (e) from time to time such additional information regarding the Funds'
financial condition as the Distributor may reasonably request.
1.11 Valiant represents to the Distributor that all registration
statements and prospectuses filed by Valiant with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "1933 Act"),
with respect to the Shares have been prepared in conformity with the
requirements of the 1933 Act and rules and regulations of the Securities and
Exchange Commission thereunder. As used in this agreement the terms
"registration statement" and "prospectus" shall mean any registration
statement and prospectus filed with the Securities and Exchange Commission
and any amendments and supplements thereto, including statements of
additional information incorporated therein by reference, which at any time
shall have been filed with the Securities and Exchange Commission. Valiant
represents and warrants to the Distributor that any registration statement
and prospectus when such registration statement
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becomes effective, will contain all statements required to be stated therein
in conformity with the 1933 Act and the rules and regulations of the
Securities and Exchange Commission; that all statements of fact contained in
any such registration statement and prospectus will be true and correct when
such registration statement becomes effective; and that neither any
registration statement nor any prospectus when such registration statement
becomes effective will include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading to a purchaser of the Shares. Valiant
may, but shall not be obligated to, propose from time to time such amendment
or amendments to any registration statement and such supplement or
supplements to any prospectus, as, in the light of future developments, may,
in the opinion of Valiant's counsel, be necessary or advisable. Valiant
shall promptly notify the Distributor of any advice given to it by Valiant's
counsel regarding the necessity or advisability so to amend or supplement
such registration statement or prospectus. Valiant shall not file any
amendment to any registration statement or supplement to any prospectus
without giving the Distributor reasonable notice thereof in advance;
provided, however, that nothing contained in this agreement shall in any way
limit Valiant's right to file at any time such amendments to any registration
statement and/or statements to any prospectus, of whatever character, as
Valiant may deem advisable, such right being in all respects absolute and
unconditional.
1.12 Valiant authorizes the Distributor and dealers to use the current
prospectus in the form furnished from time to time in connection with the
sale of the Shares. Valiant agrees to indemnify, defend and hold the
Distributor, its several officers and directors, and any person who controls
the Distributor within the meaning of Section 15 of the 1933 Act, free and
harmless from and against any and all claims, demands, liabilities and
expenses (including the cost of investigating or defending such claims,
demands or liabilities and any counsel fees incurred in connection therewith)
which the Distributor, its officers and directors, or any such controlling
person, may incur under the 1933 Act, or under common law or otherwise,
arising out of or based upon any untrue statement, or alleged untrue
statement, of a material fact contained in any registration statement or any
prospectus or arising out of or based upon any omission, or alleged omission,
to state a material fact required to be stated in either any registration
statement or any prospectus or necessary to make the statements in either
thereof not misleading; provided, however, that Valiant's agreement to
indemnify the Distributor, its officers or directors, and any such
controlling person shall not be deemed to cover any claims, demands,
liabilities or expenses arising out of any statements or representations
contained in any registration statement or in any prospectus that were
furnished in writing to Valiant or its counsel by the Distributor and used in
the answers to the registration statement or in the corresponding statements
made in the prospectus, or arising out of or based upon any omission or
alleged omission to state a material fact in connection with the giving of
such information required to be stated in such answers or necessary to make
the answers not misleading; and further provided that Valiant's agreement to
indemnify the Distributor and Valiant's representations and warranties
hereinbefore set forth in paragraph 1.11 shall not be deemed to cover any
liability to Valiant or its shareholders to which the Distributor would
otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of the
Distributor's reckless disregarding of its obligations and duties under this
Agreement. Valiant's agreement to indemnify the Distributor, its officers
and directors, or any such controlling person, as aforesaid,
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is expressly conditioned upon Valiant's being notified of any action brought
against the Distributor, its officers and directors, or any such controlling
person, such notification to be given by letter or by telegram addressed to
Valiant at its principal office in Worcester, Massachusetts and sent to
Valiant by the person against whom such action is brought, within 10 days
after the summons or other first legal process shall have been served. The
failure so to notify Valiant of any such action shall not relieve Valiant
from any liability which Valiant may have to the person against whom such
action is brought by reason of any such untrue, or allegedly untrue,
statement of omission, or alleged omission, otherwise than on account of
Valiant's indemnity agreement contained in this paragraph 1.12. Valiant will
be entitled to assume the defense of any suit brought to enforce any such
claim, demand or liability, but in such case, such defense shall be conducted
by counsel of good standing chosen by Valiant and approved by the
Distributor, which approval shall not be unreasonably withheld. In the event
Valiant elects to assume the defense of any such suit and retain counsel of
good standing approved by the Distributor, the defendant or defendants in
such suit shall bear the fees and expenses of any additional counsel retained
by them; but in case Valiant does not elect to assume the defense of any such
suit, or in case the Distributor reasonably does not approve of counsel
chosen by Valiant, Valiant will reimburse the Distributor, its officers and
directors, or the controlling person or persons named as defendant or
defendants in such suit, for the fees and expenses of any counsel retained by
the Distributor or them. Valiant's indemnification agreement contained in
this paragraph 1.12 and Valiant's representations and warranties in this
Agreement shall remain operative in full force and effect regardless of any
investigation made by or on behalf of the Distributor, its officers and
directors, or any controlling person, and shall survive the delivery of any
Shares. This agreement of indemnity will inure exclusively to the
Distributor's benefit, to the benefit of its several officers and directors,
and their respective estates, and to the benefit of the controlling persons
and their successors. Valiant agrees promptly to notify the Distributor of
the commencement of any litigation or proceedings against Valiant or any of
its officers or trustees in connection with the issue and sale of any Shares.
1.13 The Distributor agrees to indemnify, defend and hold Valiant, its
several officers and trustees, and any person who controls Valiant within the
meaning of Section 15 of the 1933 Act, free and harmless from and against any
and all claims, demands, liabilities and expenses (including the costs of
investigating or defending such claims, demands or liabilities and any
counsel fees incurred in connection therewith) which Valiant, its officers or
trustees or any such controlling person, may incur under the 1933 Act, or
under common law or otherwise, but only to the extent that such liability or
expense incurred by Valiant, its officers or trustees, or such controlling
person resulting from such claims or demands, shall arise out of or be based
upon any untrue, or alleged untrue, statement of a material fact contained in
information furnished in writing by the Distributor to Valiant or its counsel
and used in the answers to any of the items of the registration statement or
in the corresponding statements made in the prospectus, or shall arise out of
or be based upon any omission, or alleged omission, to state a material fact
in connection with such information furnished in writing by the Distributor
to Valiant or its counsel required to be stated in such answers or necessary
to make such information not misleading. The agreement of the Distributor to
indemnify Valiant, its officers and trustees, and any such controlling
person, as aforesaid, is expressly conditioned upon the Distributor's being
notified of any action brought against Valiant, its officers or trustees, or
any such controlling person, such
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notification to be given by letter or telegram addressed to the Distributor
at its principal offices in Sarasota, Florida, and sent to the Distributor by
the person against whom such action is brought, within 10 days after the
summons or other first legal process shall have been served. The failure so
to notify the Distributor of any such action shall not relieve the
Distributor from any liability which the Distributor may have to Valiant, its
officers or trustees, or to such controlling person by reason of any such
untrue or alleged untrue statement, or omission or alleged omission,
otherwise than on account of the Distributor's indemnity agreement contained
in this paragraph 1.13. The Distributor shall have the right of first
control of the defense of such action, with counsel of its own choosing,
satisfactory to Valiant, if such action is based solely upon such alleged
misstatement or omission on the Distributor's part, and in any other event,
Valiant, its officers or trustees or such controlling person shall each have
the right to participate in the defense or preparation of the defense of any
such action. In the event the Distributor elects to assume the defense of
any such suit and retain counsel of good standing approved by Valiant, the
defendant or defendants in such suit shall bear the fees and expenses of any
additional counsel retained by any of them; but in case the Distributor does
not elect to assume the defense of any such suit, or in the case Valiant
reasonably does not approve of counsel chosen by the Distributor, the
Distributor will reimburse Valiant, its officers and trustees, or the
controlling person or persons named as defendant or defendants in such suit,
for the fees and expenses of any counsel retained by Valiant or them. The
Distributor's indemnification agreement contained in this paragraph 1.13 and
the Distributor's representations and warranties in this Agreement shall
remain operative in full force and effect regardless of any investigation
made by or on behalf of Valiant, its officers and Trustees, or any
controlling person, and shall survive the delivery of any Shares. This
agreement of indemnity will inure exclusively to Valiant's benefit, to the
benefit of its several officers and Trustees, and their respective estates,
and to the benefit of the controlling persons and their successors. The
Distributor agrees promptly to notify Valiant of the commencement of any
litigation or proceedings against the Distributor or any of its officers or
directors in connection with the issue and sale of any Shares.
1.14 No Shares shall be offered by either the Distributor or Valiant
under any of the provisions of this Agreement and no orders for the purchase
or sale of Shares hereunder shall be accepted by Valiant if and so long as
effectiveness of the registration statement then in effect or any necessary
amendments thereto shall be suspended under any provisions of the 1933 Act,
if and so long as a current prospectus as required by Section 10(a)(2) of
said Act, is not on file with the Securities and Exchange Commission;
provided, however, that nothing contained in this paragraph 1.14 shall in any
way restrict or have any application to or bearing upon Valiant's obligation
to repurchase Shares from any shareholder in accordance with the provisions
of Valiant's prospectus or Declaration of Trust.
1.15 Valiant agrees to advise the Distributor as soon as reasonably
practical by a notice in writing delivered to the Distributor:
(a) of any request by the Securities and Exchange Commission for
amendments to the registration statement or prospectus then in effect
or for additional information;
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(b) in the event of the issuance by the Securities and Exchange Commission
of any stop order suspending the effectiveness of the registration
statement or prospectus then in effect or the initiation by service of
process on Valiant of any proceeding for that purpose;
(c) of the happening of any event that makes untrue any statement of a
material fact made in the registration statement or prospectus then in
effect or which requires the making of a change in such registration
statement or prospectus in order to make the statements therein not
misleading; and
(d) of all action of the Securities and Exchange Commission with respect
to any amendment to any registration statement or prospectus which may
from time to time be filed with the Securities and Exchange
Commission.
For purposes of this section, informal requests by or acts of the Staff
of the Securities and Exchange Commission shall not be deemed actions of or
requests by the Securities and Exchange Commission.
1.16 The Distributor agrees on behalf of itself and its employees to
treat confidentially and as proprietary information of Valiant all records
and other information relative the Valiant and its prior, present or
potential shareholders, and not to 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 Valiant, which
approval shall not be unreasonably withheld and may not be withheld where the
Distributor 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 Valiant.
1.17 This Agreement shall be governed by the laws of The Commonwealth of
Massachusetts.
1.18 The names "The Valiant Fund" and "Trustees of The Valiant Fund"
refer respectively to the Trust created and the Trustees as trustee but not
individually or personally, acting form time to time under a Declaration of
Trust dated January 29, 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 at the principal office of the Trust. The obligations of
the "The Valiant 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.
1.19 The Distributor shall not be liable for any error of judgment or
mistake of law or for any loss suffered by Valiant or Integrity Management in
connection with the performance by the Distributor of its services hereunder,
except for a loss resulting from willful misfeasance, bad
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faith or gross negligence on the part of the Distributor in the performance
of its duties or from reckless disregard by it of its obligations and duties
under this Agreement.
2. COMPENSATION
As sole compensation for the services rendered by the Distributor during
the term of this Agreement, Integrity Management will pay the Distributor
such fees as the parties may agree from time to time in writing. The
Distributor may also receive payments for distribution assistance and support
services pursuant to Valiant's Distribution and Shareholder Servicing Plan
dated July 29, 1993.
3. TERM
This Agreement shall become effective on July 29, 1993 and, unless sooner
terminated as provided herein, shall continue until July 29, 1995 and
thereafter shall continue automatically for successive annual periods ending
on July 29th of each year, provided such continuance is specifically approved
at least annually by (i) Valiant's Board of Trustees or (ii) by a vote of a
majority (as defined in the ▇▇▇▇ ▇▇▇) of the outstanding voting securities of
the Fund, PROVIDED that in either event the continuance is also approved by a
majority of Valiant's trustees who are not parties to this Agreement and who
are not interested persons (as defined in the ▇▇▇▇ ▇▇▇) of any party to this
Agreement, by vote cast in person at a meeting called for the purpose of
voting on such approval. This agreement is terminable without penalty, on
sixty days' notice, by Valiant's Board of Trustees, by vote of a majority (as
defined in the ▇▇▇▇ ▇▇▇) of the outstanding voting securities of the Fund, or
by the Distributor or Integrity Management. This Agreement will also
terminate automatically in the event of its assignment (as defined in the
1940 Act).
4. COUNTERPARTS
This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one
and the same instrument.
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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.
INTEGRITY MANAGEMENT & RESEARCH, INC.
Attest: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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INTEGRITY INVESTMENTS, INC.
Attest: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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THE VALIANT FUND
Attest: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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