EXHIBIT 5(d)
SubAdviser Agreement between Integrity Management & Research, Inc.
and Xxxxx X. Xxxxxx & Co. Inc.
SUB-ADVISER AGREEMENT
Sub-Adviser Agreement executed as of June 30, 1995 between Integrity
Management & Research, Inc. (the "Manager") and Xxxxx X. Xxxxxx & Co. Inc.
(the "Sub-Adviser").
Witnesseth:
That in consideration of the mutual covenants herein contained, it is
agreed as follows:
1. SERVICES TO BE RENDERED BY SUB-ADVISER TO THE TRUST
(a) Subject always to the control of the Trustees of The Valiant Fund
(the "Trust"), a Massachusetts business trust, the Sub-Adviser, at its
expense, will furnish continuously an investment program for each of
the following series of shares of the Trust: U.S. Treasury Money
Market Portfolio, U.S. Treasury Income Portfolio (formerly, U.S.
Government Money Market Portfolio), General Money Market Portfolio,
and Tax-Exempt Money Market Portfolio and such other series of shares
as the Trust, the Manager and the Sub-Adviser may from time to time
agree on (as set forth in a notice attached hereto stating the name of
any other series, with the applicable compensation schedule),
(together, the "Funds"). The Sub-Adviser will make investment
decisions on behalf of each of the Funds, and place all orders for the
purchase and sale of portfolio securities. In the performance of its
duties, the Sub-Adviser will comply with the provisions of the
Agreement and Declaration of Trust and Bylaws of the Trust and the
objectives and policies of each of the Funds, as set forth in the
current Registration Statement of the Trust filed with the Securities
and Exchange Commission ("SEC") and any applicable federal and state
laws, and will comply with other policies which the Trustees of the
Trust (the "Trustees") or the Manager, as the case may be, may from
time to time determine and which are furnished to the Sub-Adviser.
The Sub-Adviser shall make its officers and employees available to the
Manager from time to time at reasonable times to review investment
policies of the Funds and to consult with the Manager regarding the
investment affairs of the Funds.
In the performance of its duties hereunder, the Sub-Adviser is
and shall be an independent contractor and, unless otherwise expressly
provided or authorized, shall have no authority to act for or
represent the Trust in any way or otherwise be deemed to be an agent
of the Trust.
(b) The Sub-Adviser shall place all orders for the purchase and sale
of portfolio investments for each Fund with issuers, brokers or
dealers selected by the Sub-Adviser which may include brokers or
dealers affiliated with the Sub-Adviser. In the selection of such
brokers or dealers and the placing of such orders, the Sub-Adviser
always shall seek best execution, (except to the extent permitted by
the next sentence hereof) which is to place portfolio transactions
where each Fund can obtain the most favorable combination of price and
execution services in particular transactions or provided on a
continuing basis by a broker or dealer, and to deal directly with a
principal market maker in connection
with over-the-counter transactions, except when it is believed that best
execution is obtainable elsewhere. Subject to such policies as the
Trustees may determine, the Sub-Adviser shall not be deemed to have
acted unlawfully or to have breached any duty created by this Agreement
or otherwise solely by reason of its having caused the Trust to pay a
broker or dealer that provides brokerage and research services an
amount of commission for effecting a portfolio investment transaction
in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction, if the Sub-Adviser
determines in good faith that such excess amount of commission was
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 of the
Sub-Adviser and its affiliates with respect to the Trust and to other
clients of the Sub-Adviser as to which the Sub-Adviser or any
affiliate of the Sub-Adviser exercises investment discretion.
2. OTHER AGREEMENTS
It is understood that any of the shareholders, Trustees, officers and
employees of the Trust may be a shareholder, partner, director, officer
or employee of, or be otherwise interested in, the Sub-Adviser, and in
any person controlled by or under common control with the Sub-Adviser,
and that the Sub-Adviser and any person controlled by or under common
control with the Sub-Adviser may have an interest in the Trust. It
is also understood that the Sub-Adviser and persons controlled by or
under common control with the Sub-Adviser have and may have advisory,
management service or other contracts with other organizations and
persons, and may have other interests and businesses.
3. COMPENSATION TO BE PAID BY THE MANAGER TO THE SUB-ADVISER
The Manager will pay to the Sub-Adviser as compensation for the Sub-
Adviser's services rendered and for the expenses borne by the
Sub-Advisers pursuant to Section 1, a fee, determined as described in
Schedule A which is attached hereto and made a part hereof.
Such a fee shall be paid by the Manager and not by the Trust.
4. AMENDMENTS OF THIS AGREEMENT
This Agreement (including Schedule A hereto) shall not be amended as
to any Fund unless such amendment is approved at a meeting by the
affirmative vote of a majority of the outstanding voting securities of
the Fund, and by the vote, cast in person at a meeting called for the
purpose of voting on such approval, of a majority of the Trustees who
are not interested persons of the Trust, or of the Manager or of the
Sub-Adviser.
5. EFFECTIVE PERIOD AND TERMINATION OF THIS AGREEMENT
This Agreement shall be effective as of the date executed, and shall
remain in full force and effect as to each Fund continuously
thereafter, until terminated as provided below.
A. Unless terminated as herein provided, this Agreement shall remain
in full force and effect for one year from the date hereof, and
shall continue in full force and effect for successive periods of
one year thereafter, but only so long as such continuance is
specifically approved at least annually (i) by the Trustees or by
the affirmative vote of holders of a majority of the votes
represented by the outstanding voting securities of a Fund, and
(ii) by a vote of a majority of the Trustees who are not
interested persons of the Trust or of the Manager or of any Sub-
Adviser, by vote cast in person at a meeting called for the
purpose of voting on such approval; provided, however, that if
the continuance of this Agreement is submitted to the
shareholders of a Fund for their approval and such shareholders
fail to approve such continuance of this Agreement as provided
herein, the Sub-Adviser may continue to serve hereunder as the
Sub-Adviser to such Fund in a manner consistent with the
Investment Company Act of 1940, as amended ("1940 Act") and the
rules and regulations thereunder.
B. This Agreement may be terminated as to any Fund without the
payment of any penalty by the Manager, subject to the approval of
the Trustees, by vote of the Trustees, or by vote of a majority
of the outstanding voting securities of such Fund at any annual
or special meeting or by the Sub-Adviser on sixty days' written
notice.
6. CERTAIN DEFINITIONS
For the purposes of this Agreement, the "affirmative vote of a
majority of the outstanding voting securities" means the
affirmative vote, at a duly called and held meeting of
shareholders, (a) of the holders of 67% or more of the shares of
a Fund present (in person or by proxy) and entitled to vote at
such meeting are present or represented by proxy; or (b) of the
holders of more than 50% of the outstanding shares of the Fund,
if the holders of more than 50% of the outstanding shares of the
Fund entitled to vote at such meeting, whichever is less.
For the purposes of this Agreement, the terms "control",
"interested person" and "assignment" shall have their respective
meanings defined in the 1940 Act and rules and regulations
thereunder, subject, however, to such exemptions as may be granted
by the SEC under said Act; the term "specifically approved at
least annually" shall be construed in a manner consistent
with the 1940 Act and the rules and regulations thereunder; and
the term "brokerage and research services" shall have the meaning
given in the Securities Exchange Act of 1934 and the rules and
regulations thereunder.
7. LIMITATION OF LIABILITY OF SUB-ADVISER
The Sub-Adviser shall be under no liability to the Manager, the
Trust or its Shareholders or creditors for any matter or thing in
connection with the performance of any of the Sub-Adviser's
services hereunder or for any losses sustained or that may be
sustained in the purchase, sale or retention of any investment
for the Funds of the Trust made by it in good faith; provided,
however, that nothing herein contained shall be construed
to protect the Sub-Adviser against any liability to the Manager or
the Trust by reason of the Sub-Adviser's own willful misfeasance,
bad
faith or gross negligence in the performance of its duties or
by reason of its reckless disregard of its obligations
and duties hereunder.
8. LIMITATIONS OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS
A copy of the Trust's Agreement and Declaration of Trust is on
file with the Secretary of The Commonwealth of Massachusetts,
and notice is hereby given that this instrument is executed by
the Trustees as Trustees and not individually and that the
obligations of this instrument are not binding upon any of
the Trustees, officers or shareholders individually but
are binding only upon the assets and property of the
appropriate Fund.
IN WITNESS WHEREOF, Integrity Management & Research, Inc. has
caused this instrument to be signed in duplicate on its behalf by
its duly authorized representative and Xxxxx X. Xxxxxx & Co. Inc.
has caused this instrument to be signed in duplicate on its
behalf by its duly authorized representative, all as of the day
and year first above written.
INTEGRITY MANAGEMENT & RESEARCH, INC.
By/s/ Xxxxx Xxxxxxxxxx
-------------------------
XXXXX X. XXXXXX & CO. INC.
By /s/ Xxxxxx X. Xxxxxx
-------------------------
Accepted and Agreed to
as of the day and year
first above written:
THE VALIANT FUND
By /s/ SB
--------------------
SCHEDULE A
The Manager will pay to the Sub-Adviser as full
compensation for the Sub-Adviser's services rendered a monthly
fee, computed and paid monthly at an annual rate based
on the aggregate average daily net assets of the U.S. Treasury
Money Market Portfolio, U.S. Treasury Income Portfolio
(formerly, U.S. Government Money Market Portfolio),
General Money Market Portfolio and Tax-Exempt Money Market
Portfolio under the following schedule. The fee for each
month shall be payable within ten (10) business days after
the end of the month.
ASSETS RATE
First $500 million .10%
Over $500 million .05%
The average daily net assets of each Fund shall
be determined by taking an average of all of the determinations
of net asset value during each month at the close of business
on each business day during such month while this Agreement is
in effect.
If the Sub-Adviser shall serve for any period less than a
full month, the foregoing compensation shall be prorated
according to the proportion which such period bears to a
full month.
