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EXHIBIT 6
DISTRIBUTION AGREEMENT
This Distribution Agreement is made as of September 15, 1997 between
TIME HORIZON FUNDS, a Delaware Business Trust (herein called the "Company"),
and PROVIDENT DISTRIBUTORS, INC., (herein called "Distributor").
WHEREAS, the Company is an open-end, management investment company and
is so registered under the Investment Company Act of 1940; and
WHEREAS, the Company will offer and maintain the following investment
portfolios: Portfolio I, II, and III (each individually a "Fund" and
collectively the "Funds"); and
WHEREAS, the Company desires to retain Distributor as distributor for
the Funds to provide for the sale, distribution and redemption of shares of
beneficial interest of the Funds (herein collectively called "Shares"), and
Distributor is willing to render such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
set forth herein the parties hereto agree as follows:
I. DELIVERY OF DOCUMENTS
The Company has delivered to Distributor copies of each of the
following documents and shall deliver to it all future amendments and
supplements thereto, if any:
(a) The Company's Declaration of Trust and all amendments thereto
(such Declaration of Trust, as presently in effect and as it
shall from time to time be amended, herein called the
"Declaration");
(b) Bylaws of the Company (such Bylaws, as presently in effect and
as they shall from time to time be amended, herein called the
"Bylaws");
(c) Resolutions of the Board of Trustees of the Company
authorizing the execution and delivery of this Agreement;
(d) The Company's registration statement under the Securities Act
of 1933, as amended (the "1933 Act"), and the Investment
Company Act of 1940, as amended (the "1940 Act"), on Form N-1A
as filed with the Securities and Exchange Commission (the
"Commission") relating to the Shares, and all
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subsequent amendments thereto (said registration statement, as
presently in effect and as amended or supplemented from time
to time, is herein called the "Registration Statement");
(e) Notification of Registration of the Company under the 1940 Act
on Form N-8A as filed with the Commission; and
(f) Prospectuses and statements of additional information of the
Company and of the Funds (such prospectuses and statements of
additional information, as presently in effect and as they
shall from time to time be amended and supplemented, herein
called individually the "Prospectus" and collectively the
"Prospectuses").
II. DISTRIBUTION
1. APPOINTMENT OF DISTRIBUTOR.
The Company hereby appoints Distributor as Distributor of the Funds'
Shares and Distributor hereby accepts such appointment and agrees to
render the services and duties set forth in this Section II. The
Distributor shall for all purposes herein be deemed to be an
independent contractor and shall, unless otherwise expressly provided
herein or authorized by the Board of Trustees of the Company from time
to time, have no authority to act for or represent the Company in any
way or otherwise be deemed its agent. The services furnished by the
Distributor hereunder are not deemed exclusive, and the Distributor
shall be free to furnish similar services to others so long as its
services under this Agreement are not impaired thereby.
2. SERVICES AND DUTIES.
(a) The Company agrees to sell through Distributor, as agent, from
time to time during the term of this Agreement, Shares of the
Funds upon the terms and at the current offering price as
described in the applicable Prospectus. Distributor shall act
only on its own behalf as principal in making agreements for
the sale and redemption of Shares, and shall sell Shares only
at the offering price thereof as set forth in the applicable
Prospectus. Distributor shall devote its best efforts to
effect sales of Shares of each of the Funds, but shall not be
obligated to sell any certain number of Shares.
(b) In all matters relating to the sale and redemption of Shares,
Distributor shall act in conformity with the Company's
Declaration, Bylaws and Prospectuses and with the instructions
and directions of the Board of Trustees of the
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Company, and shall conform to and comply with the requirements
of the 1933 Act, the 1940 Act, the regulations of the NASD
Regulations, Inc. and all other applicable federal or state
laws and regulations. In connection with such sales,
Distributor acknowledges and agrees that it is not authorized
to provide any information or make any representations other
than as contained in the Company's Registration Statement and
Prospectuses and any sales literature specifically approved by
the Company. The Company shall furnish from time to time, for
use in connection with the sale of the Shares, such
information with respect to the Funds and the Shares as
Distributor may reasonably request.
(c) Except to the extent permitted by a plan adopted by the
Company under Rule 12b-1 of the 1940 Act, Distributor shall
bear the cost of (i) printing and distributing any Prospectus
(including any supplement thereto), and (ii) preparing,
printing and distributing any literature, advertisement or
material which is primarily intended to result in the sale of
the Shares; provided, however, that Distributor shall not be
obligated to bear the expenses incurred by the Company in
connection with (1) the preparation and printing of any
supplement or amendment to any Registration Statement or
Prospectus necessary for the continued effective registration
of the Shares under the 1933 Act or any state securities laws;
and (2) the printing and distribution of any Prospectus,
supplement or amendment thereto for existing shareholders of
the Fund described therein.
(d) The Company, or any agent of the Company designated in writing
by the Company, shall be promptly advised of all purchase
orders for Shares received by the Distributor.
(e) The Distributor shall provide the services of certain persons
who may be appointed as officers of the Company by the
Company's Board of Trustees.
(f) It is understood that certain expenses to be incurred in
connection with the shares may be paid as provided in a
shareholder service plan or similar plan adopted by the
Company. The Distributor agrees to be responsible for the
operation of such plan in accordance with the terms thereof.
(g) The Company shall have the right at any time to inspect the
records of the company (including work papers and the other
related documents) in the possession of the Distributor.
3. SALES AND REDEMPTIONS.
(a) Shares of the Company are to be sold by the Distributor to
shareholders at
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the offering price as set forth in the Prospectuses then in
effect.
(b) The Company shall pay all costs and expenses in connection
with the registration of the Shares under the 1933 Act, and
all expenses in connection with maintaining facilities for the
issue and transfer of the Shares and for supplying
information, prices and other data to be furnished by the
Company hereunder, and all expenses in connection with
preparing, printing and distributing the Prospectuses except
as set forth in subsection 2c of Section II hereof or in any
other agreement entered into by the Company.
(c) The Company shall execute all documents, furnish all
information and otherwise take all actions which may be
reasonably necessary in the discretion of the Company's
officers in connection with the qualification of the Shares
for sale in such states as Distributor may designate to the
Company and the Company may approve, and the Company shall pay
all filing fees which may be incurred in connection with such
qualification. Distributor shall pay all expenses connected
with its qualification as a dealer under state or federal laws
and, except as otherwise specifically provided in this
Agreement, all other expenses incurred by Distributor in
connection with the sale of the Shares as contemplated in this
Agreement.
(d) Any of the outstanding Shares of the Company may be tendered
for redemption at any time, and the Company agrees to
repurchase or redeem the Shares so tendered in accordance with
the Company's Charter, Bylaws and Prospectuses. The price to
be paid to redeem or repurchase the Shares shall be equal to
the net asset value per Share determined as set forth in the
applicable Prospectus (the "redemption price"). All payments
by the Company hereunder shall be made in the manner set forth
in Section 3(e) below.
(e) The Company (or its agent) shall pay the total amount of the
redemption price pursuant to the instructions of the
Distributor on or before the seventh calendar day subsequent
to the Company (or its agent) having received the notice of
redemption in proper form. The proceeds of any redemption of
shares shall be paid by the Company (or its agent) to or for
the account of the redeeming shareholder, in each case in
accordance with the applicable provisions of the applicable
Prospectus.
(f) The Company shall have the right to suspend the sale of Shares
of any Fund at any time in response to conditions in the
securities markets or otherwise, and to suspend the redemption
of Shares of any Fund at any time as permitted by the 1940 Act
or the rules of the Commission ("Rules").
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(g) The Company reserves the right to reject in its discretion
any order for Shares.
III. PAYMENTS
Distributor shall receive and may retain any portion of any front-end
or contingent deferred sales charge which is imposed on sales and
redemptions of Shares, as set forth in the Prospectuses and not
reallowed to others. Upon termination of this Agreement for any
reason, the obligation to pay any such contingent deferred sales
charge on Shares sold prior to the date of termination shall survive
the termination, and the Company or its agent shall collect and pay
any such charges thereafter imposed on such Shares to Distributor.
It is understood that certain shareholder servicing expenses to be
incurred in connection with the Shares may be paid as provided in a
Shareholder Service Plan adopted by the Company, as the same may be
amended by the Company from time to time. Distributor agrees to be
responsible for the operation of such Plan in accordance with the
terms thereof.
The Company has adopted certain Distribution and Administrative
Service Plans pursuant to Rule 12b-1 under the 1940 Act, pursuant to
which Distributor shall be entitled to receive certain payments as set
forth in such Plan, as the same may be amended from time to time.
Distributor agrees to be responsible for the operation of such Plan in
accordance with the terms thereof.
IV. LIMITATIONS OF LIABILITY
Distributor shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Company or any Fund in
connection with the matters to which this Agreement relates, except a
loss resulting from willful misfeasance, bad faith or negligence on
its part in the performance of its duties or from reckless disregard
by it of its obligations and duties under this Agreement.
V. CONFIDENTIALITY
Distributor shall treat confidentially and as proprietary information
of the Company all records and other information relative to the
Company and the Funds and prior or present shareholders or those
persons or entities who respond to Distributor's inquiries concerning
investment in the Company, and shall not use such records and
information for any purpose other than the performance of its
responsibilities and duties hereunder or under any other agreement
with the Company, except after prior notification to and approval in
writing by the Company, which approval shall not be unreasonably
withheld and may not be withheld where Distributor may be
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exposed to civil or criminal contempt proceedings for failure to
comply, when Distributor is requested to divulge such information by
duly constituted authorities, or when Distributor is so requested by
the Company.
VI. INDEMNIFICATION
1. COMPANY REPRESENTATIONS.
The Company represents and warrants to Distributor that (a) it is duly
organized as a Delaware business trust and is and at all times will
remain duly authorized to enter into and perform this Agreement, and
(b) at all times the Registration Statement and Prospectuses will in
all material respects conform to the applicable requirements of the
1933 Act and the Rules and will not include any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, except that
no representation or warranty in this subsection shall apply to
statements or omissions made in reliance upon and in conformity with
written information furnished to the Company by or on behalf of and
with respect to Distributor expressly for use in the Registration
Statement or Prospectuses.
2. DISTRIBUTOR REPRESENTATIONS.
Distributor represents and warrants to the Company that (a) it is duly
organized as a Delaware corporation and is and at all times will
remain duly authorized and licensed to carry out its services as
contemplated herein (b) at all times any written information furnished
to the Company by or on behalf of Distributor expressly for use in the
Registration Statement or Prospectuses will not include any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading and (c) Distributor is at all times during the term of this
Agreement a registered broker-dealer under the Securities Exchange Act
of 1934.
3. COMPANY INDEMNIFICATION.
The Company shall indemnify, defend and hold harmless Distributor, its
several officers and partners, and any person who controls Distributor
within the meaning of Section 15 of the 1933 Act, from and against any
losses, claims, damages or liabilities, joint or several, to which any
of them may become subject under the 1933 Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions or proceedings
in respect thereof) arise out of, or are based upon, any untrue
statement or alleged untrue statement of a material fact contained in
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Registration Statement, the Prospectuses or any application or other
document executed by or on behalf of the Company, or arise out of, or
are based upon, information furnished by or on behalf of the Company
filed in any state in order to qualify the Shares under the securities
or blue sky laws thereof ("Blue Sky Application"), or arise out of, or
are based upon, the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and shall reimburse Distributor,
its several officers and partners, and any person who controls
Distributor within the meaning of Section 15 of the 1933 Act, for any
legal or other expenses reasonably incurred by any of them in
investigating, defending or preparing to defend any such action,
proceeding or claim; provided, however, that the Company shall not be
liable in any case to the extent that such loss, claim, damage or
liability arises out of, or is based upon, any untrue statement,
alleged untrue statement, or omission or alleged omission made in the
Registration Statement, the Prospectuses, any Blue Sky Application or
any application or other document executed by or on behalf of the
Company in reliance upon and in conformity with written information
furnished to the Company by or on behalf of and with respect to
Distributor specifically for inclusion therein.
The Company shall not indemnify any person pursuant to this subsection
3 of Section VI hereof unless the court or other body before which the
proceeding was brought has rendered a final decision on the merits
that such person was not liable by reason of his willful misfeasance,
bad faith or negligence in the performance of his duties, or his
reckless disregard of obligations and duties, under this Agreement
("disabling conduct") or, in the absence of such a decision, a
reasonable determination (based upon a review of the facts) that such
person was not liable by reason of disabling conduct has been made by
the vote of a majority of a quorum of trustees of the Company who are
neither "interested persons" of the Company (as defined in the 0000
Xxx) nor parties to the proceeding, or by an independent legal counsel
in a written opinion.
Each Fund shall advance attorneys' fees and other expenses incurred by
any person in defending any claim, demand, action or suit which is the
subject of a claim for indemnification pursuant to this subsection 3
of Section VI hereof, so long as:
(a) such person shall undertake to repay all such advances unless
it is ultimately determined that he is entitled to
indemnification hereunder; and
(b) such person shall provide security for such undertaking, or
the Fund shall be insured against losses arising by reason of
any lawful advances, or a majority of a quorum of the
disinterested, non-party trustees of the Company (or an
independent legal counsel in a written opinion) shall
determine based on a review of readily available facts (as
opposed to a full trial-type inquiry)
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that there is reason to believe that such person ultimately
will be found entitled to indemnification hereunder.
4. DISTRIBUTOR INDEMNIFICATION.
Distributor shall indemnify, defend and hold harmless the Company,
each Fund, the Company's several officers and trustees and any person
who controls the Company or any Fund within the meaning of Section 15
of the 1933 Act, from and against any losses, claims, damages or
liabilities, joint or several, to which any of them may become subject
under the 1933 Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof)
arise out of, or are based upon, any breach of its representations and
warranties in subsection 2 of Section VI or its agreements in
subsection 2 of Section II hereof, or which arise out of, or are based
upon, any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement, the Prospectuses, any
Blue Sky Application or any application or other document executed by
or on behalf of the Company, or the omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, which
statement or omission was made in reliance upon and in conformity with
information furnished in writing to the Company or any of its several
officers and trustees by or on behalf of and with respect to
Distributor specifically for inclusion therein, and shall reimburse
the Company, each Fund, the Company's several officers and trustees,
and any person who controls the Company or any Fund within the meaning
of Section 15 of the 1933 Act, for any legal or other expenses
reasonably incurred by any of them in investigating, defending or
preparing to defend any such action, proceeding or claim.
5. GENERAL INDEMNITY PROVISIONS.
No indemnifying party shall be liable under its indemnity agreement
contained in subsection 3 or 4 of Section VI hereof with respect to
any claim made against such indemnifying party unless the indemnified
party shall have notified the indemnifying party in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the
indemnified party (or after the indemnified party shall have received
notice of such service on any designated agent), but failure to notify
the indemnifying party of any such claim shall not relieve it from any
liability which it may otherwise have to the indemnified party. The
indemnifying party shall be entitled to participate at its own expense
in the defense or, if it so elects, to assume the defense of any suit
brought to enforce any such liability, and if the indemnifying party
elects to assume the defense, such defense shall be conducted by
counsel chosen by it and
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reasonably satisfactory to the indemnified party. In the event the
indemnifying party elects to assume the defense of any such suit and
retain such counsel, the indemnified party shall bear the fees and
expenses of any additional counsel retained by the indemnified party.
6. NAMES.
The name "Time Horizon Funds, Inc., a Delaware Business Trust" refers
to a Trust created and the Trustees, as Trustees but not individually
or personally, acting from time to time under a Declaration of Trust
dated June 12, 1995, as amended, which is hereby referred to and a
copy of which is on file at the principal office of the Company. The
trustees, officers, employees and agents of the Company shall not
personally be bound by or liable under any written obligation,
contract, instrument, certificate or other interest or undertaking of
the Company made by the Trustees or by an officer, employee or agent
of the Company, in his or her capacity as such, nor shall resort be
had to their private property for the satisfaction of any obligation
or claim thereunder. All persons dealing with any series or class of
shares of the Company may enforce claims against the Company only
against the assets belonging to such series or class.
VII. DURATION AND TERMINATION
This Agreement shall become effective as of the date hereof and,
unless sooner terminated as provided herein, shall continue in effect
with respect to each Fund until October 31, 1998. Thereafter, if not
terminated, this Agreement shall continue automatically for successive
terms of one year, provided that such continuance is specifically
approved at least annually (a) by a vote of a majority of those
members of the Board of Trustees of the Company who are not parties to
this Agreement or "interested persons" of any such party, cast in
person at a meeting called for the purpose of voting on such approval,
and (b) by the Board of Trustees of the Company or by vote of a
"majority of the outstanding voting securities" of the Funds as to
which the Agreement is effective; provided, however, that this
Agreement may be terminated by the Company at any time, without the
payment of any penalty, by vote of a majority of the entire Board of
Trustees of the Company or by a vote of a "majority of the outstanding
voting securities" of such Funds on ninety (90) days' prior written
notice to Distributor, or by Distributor at any time, without the
payment of any penalty, on ninety (90) days' prior written notice to
the Company. This Agreement shall automatically and immediately
terminate in the event of its "assignment." As used in this
Agreement, the terms "majority of the outstanding voting securities,"
"interested person" and "assignment" shall have the same meanings as
such terms have in the 1940 Act. Any documents, records or work
papers prepared by the Distributor on behalf of the Company in order
to maintain
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the regulatory records of the Funds shall become the property of the
Company. In the event of termination, the Distributor shall promptly,
upon written request, turn over such documents, records or work papers
to the Company.
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VIII. AMENDMENT OF THIS AGREEMENT
No provision of this Agreement may be changed, waived, discharged or
terminated except by an instrument in writing signed by the party
against whom an enforcement of the change, waiver, discharge or
termination is sought.
IX. NOTICES
Notices of any kind to be given to the Company hereunder by
Distributor shall be in writing and shall be duly given if mailed or
delivered to the Company at:
Time Horizon Funds, Inc.,
a Delaware Business Trust
c/o PFPC Inc.
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
With a copy to
Xxxxx X'Xxxxx
Vedder, Price, Xxxxxxx & Kammholz
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Notices of any kind to be given to Distributor hereunder by the
Company shall be in writing and shall be duly given if mailed or
delivered to Distributor at:
Xxxxxx Xxxxxxx
Provident Distributors, Inc.
Four Falls Corporate Center, 0xx Xxxxx
Xxxx Xxxxxxxxxxxx, XX 00000-0000
X. MISCELLANEOUS
The obligations of each fund under this Agreement shall be several
(and not joint, or joint and several) obligations of each fund. 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. Subject to the provisions of Section VII hereof,
this Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and
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shall be governed by Delaware law (without regard to principles of
conflicts of law); provided, however, that nothing herein shall be
construed in a manner inconsistent with the 1940 Act or any rule or
regulation of the Commission thereunder. This Agreement may be
executed in two or more parts which together shall constitute a single
Agreement.
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.
TIME HORIZON FUNDS,
A DELAWARE BUSINESS TRUST
By /S/ Xxxxxx X. Xxxxxxx
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President
PROVIDENT DISTRIBUTORS, INC.
By: /S/ Xxxxxx Xxxxxx
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Chief Executive Officer
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