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EXHIBIT 6
DISTRIBUTION AGREEMENT
April 17, 1993
Fairfield Group, Inc.
000 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Gentlemen:
This is to confirm that, in consideration of the agreements hereinafter
contained, the undersigned, Navigator Tax-Free Money Market Fund, Inc. ("the
Fund"), a Maryland corporation, has agreed that Fairfield Group, Inc.
("Fairfield") shall be, for the period of this Agreement, the distributor of the
Fund's shares of common stock ("Shares").
1. Services as Distributor.
1.1 Fairfield 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 Fairfield 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. The
Fund understands that Fairfield is the distributor, and may in the future be the
distributor, of the shares of several investment companies ("Companies")
including Companies having investment objectives similar to those of the Fund.
The Fund further understands that investors and potential investors in the Fund
may invest in shares of such other Companies. The Fund agrees that Fairfield's
duties to such Companies shall not be deemed in conflict with its duties to the
Fund under this paragraph 1.2.
Fairfield 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.
1.3 All activities by Fairfield and its agents and employees
as distributor of the Shares shall comply with all applicable laws, rules and
regulations, including, without limitation, all rules and regulations made or
adopted pursuant to the Investment Company Act of 1940 (the "1940 Act") by the
Securities and Exchange Commission or any securities association registered
under the Securities Exchange Act of 1934.
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1.4 Fairfield will provide an adequate number of persons,
during normal business hours, to respond to telephone questions with respect to
the Fund.
1.5 Fairfield will transmit any orders received by it for
purchase or redemption of the Shares to the Fund's transfer agent and custodian.
1.6 Fairfield understands and agrees that whenever in its
judgment such action is warranted by unusual market, economic or political
conditions, or by abnormal circumstances of any kind, the Fund'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.
1.7 Fairfield will act only on its own behalf as principal if
it chooses to enter into selling agreements with selected dealers or others.
1.8 The Fund 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 Fairfield may designate.
1.9 The Fund shall furnish from time to time, for use in
connection with the sale of the Shares, such information with respect to the
Fund and the Shares as Fairfield may reasonably request; and the Fund warrants
that the statements contained in any such information shall fairly show or
represent what they purport to show or represent. The Fund shall also furnish
Fairfield upon request with: (a) unaudited semiannual statements of the Fund's
books and accounts prepared by the Fund, (b) quarterly earnings statements
prepared by the Fund, (c) a monthly itemized list of the securities in the Fund,
(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 Fund's
financial condition as Fairfield may reasonably request.
1.10 The Fund represents to Fairfield that all registration
statements and prospectuses filed by the Fund with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, with respect to the
Shares have been carefully prepared in conformity with the requirements of said
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
which at any time shall have been filed with the same
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Commission. The Fund represents and warrants to Fairfield that any registration
statement and prospectus, when such registration statement becomes effective,
will contain all statements required to be stated therein in conformity with
said Act and the rules and regulation of said Commission; that all statements of
facts 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. The Fund 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 the
Fund's counsel, be necessary or advisable. If the Fund shall not propose such
amendment or amendments and/or supplement or supplements within fifteen days
after receipt by the Fund or a written request from Fairfield to do so,
Fairfield may, at its option, terminate this Agreement. The Fund shall not file
any amendment to any registration statement or supplement to any prospectus
without giving Fairfield reasonable notice thereof in advance; provided,
however, that nothing contained in this agreement shall in any way limit the
Fund's right to file at any time such amendments to any registration statement
and/or supplements to any prospectus, of whatever character, as the Fund may
deem advisable, such right being in all respects absolute and unconditional.
1.11 The Fund authorizes Fairfield and dealers to use any
prospectus in the form furnished from time to time in connection with the sale
of the Shares. The Fund agrees to indemnify, defend and hold Fairfield, its
several officers and directors, and any person who controls Fairfield within the
meaning of Section 15 of the Securities Act of 1933, as amended, 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
Fairfield, its officers and directors, or any such controlling person, may incur
under the Securities Act of 1933, as amended, or under common law or otherwise,
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 the Fund's agreement to indemnify Fairfield, 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
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statements or representations as are contained in any prospectus and in such
financial and other statements as are furnished in writing to the Fund by
Fairfield 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 the Fund's agreement
to indemnify Fairfield and the Fund's representations and warranties
hereinbefore set forth in paragraph 1.10 shall not be deemed to cover any
liability to the Fund or its shareholders to which Fairfield would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of Fairfield's reckless disregard of its
obligations and duties under this agreement. The Fund's agreement to indemnify
Fairfield, its officers and directors, and any such controlling person, as
aforesaid, is expressly conditioned upon the Fund's being notified of any action
brought against Fairfield, its officers or directors, or any such controlling
person, such notification to be given by letter or by telegram addressed to the
Fund at its principal office in Horsham, Pennsylvania and sent to the Fund by
the person against whom such action is brought, within 10 days after the summon
or other first legal process shall have been served. The failure to so notify
the Fund of any such action shall not relieve the Fund from any liability which
the Fund may have to the person against whom such action is brought by reason of
any such untrue, or allegedly untrue, statement or omission, or alleged
omission, otherwise than on account of the Fund's indemnity agreement contained
this paragraph 1.11. The Fund 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 the Fund and
approved by Fairfield, which approval shall not unreasonably be withheld. In the
event the Fund elects to assume the defense of any such suit and retain counsel
of good standing approved by Fairfield, 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 Fund does not elect to assume the defense of any such
suit, or in case Fairfield reasonably does not approve of counsel chosen by the
Fund, the Fund will reimburse Fairfield, 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 Fairfield or them. The Fund's
indemnification agreement contained in this paragraph 1.11 and the Fund's
representations and warranties in this agreement shall remain operative and in
full force and effect regardless of any investigation made by or on behalf of
Fairfield, its officers and directors, or any controlling person, and shall
survive the delivery of any Shares. This agreement of indemnity will inure
exclusively to Fairfield's benefit, to the benefit of its several
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officers and Directors, and their respective estates, and to the benefit of the
controlling persons and their successors. The Fund agrees promptly to notify
Fairfield of the commencement of any litigation or proceedings against the Fund
or any of its officers or directors in connection with the issue and sale any
Shares.
1.12 Fairfield agrees to indemnify, defend and hold the Fund,
its several officers and directors, and any person who controls the Fund within
the meaning of Section 15 of the Securities Act of 1933, as amended, 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 the
Fund, its officers or directors or any such controlling person, may incur under
the Securities Act of 1933, as amended, or under common law or otherwise, but
only to the extent that such liability or expense incurred by the Fund, its
officers or directors, 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
Fairfield to the Fund 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 Fairfield to the Fund required to be stated in such answers or
necessary to make such information not misleading. Fairfield's agreement to
indemnify the Fund, its officers and directors, and any such controlling person,
as aforesaid, is expressly conditioned upon Fairfield's being notified of any
action brought against the Fund, its officers or directors, or any such
controlling person, such notification to be given by letter or telegram
addressed to Fairfield at its principal office in Horsham, Pennsylvania, and
sent to Fairfield by the person against whom such action is brought, within 10
days after the summons or other first legal process shall have been served.
Fairfield shall have the right of first control of the defense of such action,
with counsel of its own choosing, satisfactory to the Fund, if such action is
based solely upon such alleged misstatement or omission on Fairfield's part, and
in any other event the Fund, its officers or directors or such controlling
person shall each have the right to participate in the defense or preparation of
the defense of any such action. The failure so to notify Fairfield of any such
shall not relieve Fairfield from any liability which Fairfield may have to the
Fund, its officers or directors, 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 Fairfield's indemnity agreement contained in this
paragraph 1.12.
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1.13 No Shares shall be offered by either Fairfield or the
Fund under any of the provisions of this Agreement, and no orders for the
purchase or sale of Shares hereunder shall be accepted by the Fund, if and so
long as the effectiveness of the registration statement then in effect or any
necessary amendments thereto shall be suspended under any of the provisions of
the Securities Act of 1933, as amended, or if and so long as a current
prospectus as required by Section 10(b)(2) of said Act, as amended, is not on
file with the Securities and Exchange Commission; provided, however, that
nothing contained in this paragraph 1.13 shall in any way restrict or have an
application to or bearing upon the Fund's obligation to repurchase Shares from
any shareholder in accordance with the provisions of the Fund's prospectus or
Charter.
1.14 The Fund agrees to advise Fairfield as soon as reasonably
practical by a notice in writing delivered to Fairfield or its counsel:
(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;
(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 the Fund 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 actions 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.
1.15 Fairfield agrees on behalf of itself and its employees to
treat confidentially and as proprietary information of the Fund all records and
other information relative to the
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Fund 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 thereunder. Notwithstanding the foregoing, Fairfield
may, after prior notification to and approval in writing by the Fund, use such
records and other information relative to the Fund and prior, present or
potential shareholders if Fairfield may be exposed to civil or criminal contempt
proceedings for failure to comply or when requested to divulge such information
by duly constituted authorities. Fairfield may also use such records and other
information when so requested by the Fund.
2. Term.
This agreement shall become effective April 20, 1993, and, unless
sooner terminated as provided herein, shall continue until June 30, 1994 and
thereafter shall continue automatically for successive annual periods ending on
June 30 of each year, provided such continuance is specifically approved at
least annually by (i) the Fund's directors or (ii) by a vote of a majority (as
defined in the 0000 Xxx) of the Fund's outstanding voting securities, provided
that in either event the continuance is also approved by the majority of the
Fund's directors who are not parties to the Agreement or interested persons (as
defined in the 0000 Xxx) 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 not less than sixty days' notice, by the
Fund's directors, by vote of a majority (as defined in the 0000 Xxx) of the
Fund's outstanding voting securities, or by Fairfield. This agreement will also
terminate automatically in the event of its assignment (as defined in the 1940
Act).
3. Governing Law.
This agreement shall be governed by the laws of the Commonwealth of
Pennsylvania.
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Please confirm that the foregoing is in accordance with your understanding by
indicating your acceptance hereof at the place below indicated, whereupon it
shall become a binding agreement between us.
Yours very truly,
NAVIGATOR TAX-FREE
MONEY MARKET FUND, INC.
By: /s/Xxxxx X. Xxxxxx
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Accepted:
FAIRFIELD GROUP, INC.
By: /s/X.X. Xxxxxx
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