InterSecurities, Inc.
IDEX SERIES FUND 000 Xxxxxxxx Xxxxxx
XXXX XXXXXXXXXX XXXX Xxxxx, XX 00000-0000
Telephone: (000) 000-0000
Ladies and Gentlemen: Date:
Broker Dealer No:
PART I
IDEX SERIES FUND
DEALER'S SALES AGREEMENT
We have entered into an underwriting agreement with IDEX Series Fund (the
"IDEX Fund") whereby we will act as Principal Underwriter as defined in the
Investment Company Act of 1940, with the right to purchase shares of beneficial
interest of the IDEX Fund for sale of such shares to investors either directly
or indirectly through other broker-dealers. As Principal Underwriter, we offer
to sell to you the various series and classes of shares of the IDEX Fund
representing the various Portfolios of the IDEX Fund (each Portfolio and class
thereof referred to individually as a "Portfolio" or "Class", as applicable, and
collectively, the "Portfolios" or "Classes", as applicable), subject to the
following conditions:
1. In all sales of shares to the public you shall act as dealer for your
own account.
2. On purchases of Class A and Class T Portfolio shares, you shall receive
a discount amounting to a percentage of the applicable public offering price, as
set forth in the then current prospectus for the Portfolio. On purchases of
Class B Portfolio shares, you shall receive a commission amounting to a
percentage of the net asset value, as set forth in the then current prospectus
for the Portfolio. Such payment shall be subject to all of the terms and
conditions relating thereto as set forth in the then current prospectus for the
Class A, Class B and Class T shares of the Portfolio. In addition to the
discount or commission payable to you pursuant to this Section 2: (a) for your
distribution, marketing and/or administrative services in the promotion and sale
of Portfolio shares, we shall, providing this Agreement is in force, pay to you
a fee as to each Class of shares of a Portfolio sold by you, computed on an
annual basis and paid quarterly, to the extent and in the amount such fee, if
any, is set forth in the then current prospectus for the applicable Class of the
Portfolio based on a percentage of the average daily aggregate value (at net
asset value) of shares of the applicable Class of the Portfolio held by your
clients; and (b) for your personal service and/or maintenance of shareholder
accounts with respect to your customers who own shares of a Portfolio, we shall,
providing this Agreement is in force, pay to you a fee as to each Class of
shares of a Portfolio computed on an annual basis and paid quarterly, to the
extent and in the amount such fee, if any, is set forth in the then current
prospectus for the applicable Class of the Portfolio based on a percentage of
the average daily aggregate value (at net asset value) of shares of the
applicable Class of the Portfolio held by your clients. Payment of these fees or
the terms thereof, may be modified or terminated by us at any time.
3. You represent that you are, and at the time of purchasing any shares of
a Portfolio will be, a member in good standing of the National Association of
Securities Dealers, Inc. (the "NASD"), along with NASD Regulation, Inc.
4. Orders received from you will be accepted by us only at the public
offering price applicable to each order as established by the then current
Prospectus applicable to the particular shares of the IDEX Fund. The procedure
relating to handling orders shall be subject to instructions which we shall
forward to you from time to time. All orders are subject to acceptance or
rejection by us in our sole discretion.
5. You agree to purchase shares only from us or from your customers. If you
purchase shares from us, you agree that all such purchases shall be made only to
cover orders already received by you from your customers, or for your own bona
fide investment.
If you purchase shares from your customers, you agree to pay such customers
not less than the redemption price in effect on the date of purchase, as defined
in the then current Prospectus applicable to the particular shares of the IDEX
Fund. We in turn agree that we will not purchase any shares from the IDEX Fund
except for the purpose of covering purchase orders which we have already
received.
6. You shall sell shares only (a) to customers at the public offering price
then in effect and (b) to the IDEX Fund or to any dealer who is a member of the
NASD at the redemption price in effect with respect to the particular shares on
the date of sale.
7. Only unconditional orders for shares of a definite specified price will
be accepted.
8. If any shares sold to you under the terms of this agreement are
repurchased by the IDEX Fund or are tendered for redemption within seven
business days after the date of confirmation, it is agreed that you shall
forfeit your right to any discount received by you on such shares.
9. Remittance of the net amount due for shares purchased from us shall be
made payable to Idex Investor Services, Inc., Agent for the Underwriter,
promptly, but in no event later than the maximum amount of time legally
permissible after our confirmation of sale to you (currently, three business
days). Such payment should be sent, together with any stock transfer stamps
required on account of the sale by you, to Idex Investor Services, Inc., P. O.
Box 9015, Clearwater, FL 34618-9015, with your transfer instructions on the
appropriate copy of our confirmation of sale to you. If such payment is not
received by Idex Investor Services, Inc., we reserve the right, without notice,
forthwith to cancel the sale.
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10. Promptly upon receipt of payment, shares sold to you shall be deposited
by us or our agent, Idex Investor Services, Inc. No certificates will be issued
unless specifically requested.
11. No person is authorized to make any representations concerning shares
of a Portfolio except those contained in the then current Prospectus applicable
to the particular shares of the IDEX Fund and in supplements thereto. In
purchasing shares from us you shall rely solely on the representations contained
in the Prospectus applicable to the particular shares of the IDEX Fund and
supplements thereto.
12. Additional copies of the current Prospectus and supplements thereto and
other literature will be supplied by us in reasonable quantities upon request.
13. Certain of your registered representatives may, from time to time,
request access to certain account information with respect to the shares of the
IDEX Fund (the "Account Information") via downloading of such Account
Information to an electronic mailbox which will be accessed by the registered
representative through his or her personal computer. The Account Information
will be accessed by the registered representative via software purchased from an
outside vendor to whom the IDEX Fund provides access to the Account Information.
In exchange for the cooperation of the IDEX Fund and of InterSecurities, Inc. in
providing access to the Account Information for the convenience of the
registered representatives, you agree that it is your sole responsibility to
oversee and supervise your registered representatives in the utilization of such
Account Information, including verification of the accuracy of all written
material produced by a registered representative from the Account Information.
Further, you are solely responsible for ensuring that all NASD, SEC and other
regulations are fully complied with by the registered representatives in
connection with the utilization of and preparation of any written or oral
material from, the Account Information. You shall fully indemnify and hold
harmless the undersigned and the IDEX Fund from any and all claims made against
them by any party with respect to your registered representatives' use of such
Account Information.
14. We reserve the right in our discretion, without notice, to suspend
sales or withdraw the offering of shares entirely or to modify or cancel this
agreement.
15. We both hereby agree to abide by the rules of the NASD ("NASD Rules").
Specifically, and without limiting the foregoing, we both hereby agree that
sales of the shares of each Portfolio, and each Class thereof, shall be effected
in accordance with Section 2310 and Section 2830 of the NASD Rules, as
interpreted by the NASD.
16. All communications to us should be sent to the above address. Any
notice to you shall be duly given if mailed or telecopied to you at your address
specified below. This agreement shall be construed in accordance with the laws
of Florida, without regard to the choice of law principles thereof.
17. You agree to abide by the Sales Compliance Policies Relating to the
Multiple Class Distribution System, attached to this Agreement as Appendix A,
with respect to each Portfolio of the IDEX Fund and to include such Sales
Compliance Policies in your internal guidelines for sales compliance.
18. Your registered representatives may, from time to time, assist your
customers in determining and documenting such customers' eligibility for
reductions in, or waivers of, front end sales charges or contingent deferred
sales charges to which one or more Classes of shares may be subject. You agree
that it is your responsibility to oversee and supervise the activities of your
registered representatives in connection with the sale and redemption of shares
of the Portfolios, including verification of the eligibility of customers for
reductions in, or waivers of, sales charges to the extent that your registered
representatives assist customers in determining and documenting such
eligibility. You shall fully indemnify and hold harmless the undersigned and the
IDEX Fund from any and all losses sustained by them as a result of any
inaccurate, or incomplete, representations made by your registered
representatives or your customers in connection with eligibility for reductions
in, or waivers of, sales charges, if and to the extent that you or your
registered representatives knew, or should have known, of such inaccuracies or
omissions.
PART II
CASH EQUIVALENT FUND
SALES AGREEMENT
We have entered into a Services Agreement (the "Xxxxxx Agreement") with
Zurich Xxxxxx Investments, Inc. ("Xxxxxx"), the administrator, distributor and
principal underwriter for Cash Equivalent Fund ("CEF"), pursuant to which we
have agreed to sell shares of CEF and perform certain shareholder services and
provide certain facilities and equipment in connection with such services. The
Xxxxxx Agreement permits us to enter into agreements with other broker-dealers
pursuant to which such broker-dealers shall sell shares of CEF and we will
perform certain shareholder servicing functions with respect to CEF shares owned
by the clients of such broker-dealers. Accordingly, we agree as follows:
19. Sale of CEF Shares. You shall sell shares of CEF to the public in
accordance with the terms and conditions set forth in this Agreement:
(a) You shall offer and sell CEF shares only in states where they may
legally be sold.
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(b) In all sales of CEF shares to the public, you shall act as dealer
for your own account, and you shall not have authority to act as agent for
CEF, for Xxxxxx, for InterSecurities, Inc., or for any representative or
agent of such parties.
(c) All orders shall be subject to acceptance or rejection by Xxxxxx
in its sole discretion, and will be accepted by Xxxxxx only at the public
offering price applicable to each order as established by CEF's then
current prospectus. You may offer and sell CEF shares to your customers
only at the public offering price, which is the net asset value per share
as described in CEF's prospectus. Xxxxxx will not accept any conditional
orders for shares. You shall place orders for CEF shares in the manner set
forth in CEF's prospectus.
(d) You shall purchase shares only from Xxxxxx or your client, and you
shall not purchase shares from your clients at a price lower than that
quoted by or for CEF. You may sell shares for the account of your customer
to CEF, or to Xxxxxx as agent for CEF, at the price currently quoted by or
for CEF.
(e) You will purchase shares from Xxxxxx only to cover purchase orders
already received from your clients or for your own bona fide investment.
(f) You will not withhold placing with Xxxxxx orders received from
your clients so as to profit yourself as a result of such withholding.
(g) All sales will be made subject to receipt by Xxxxxx of shares from
CEF.
20. Unauthorized Representations. No person is authorized to make any
representations concerning shares of CEF except those contained in the current
prospectus of CEF and in supplemental printed information subsequently issued by
CEF or by Xxxxxx.
21. NASD Membership. You represent that you are, and at the time of
purchasing any shares of CEF will be, a member in good standing of the NASD.
22. Agreements of InterSecurities, Inc.
(a) We agree to supply you with such reasonable number of copies of
CEF's prospectus and sales literature as you may request.
(b) We shall perform the following services with respect to your
clients who own CEF shares: answer routine client inquiries regarding CEF,
assist clients in changing dividend options, account designations and
addresses, and similar coordination of shareholder matters with Xxxxxx and
CEF, provided, however, that we may terminate such service at any time upon
written notice to you. In the event that we cease to perform such services,
those services will be performed directly by Xxxxxx.
(c) We shall pay you a fee after the end of each calendar quarter in
the amount of .10 of 1% of the average aggregate daily net asset value of
CEF shares owned by your clients. In computing your fee, one-fourth of the
applicable fee rate shall be applied to the average aggregate daily net
asset value of such CEF shares owned by your clients for the quarter in
question.
Each quarter's fee shall be determined independently of every other
quarter's fee. For the quarter in which this Agreement becomes effective or
terminates, there shall be an appropriate proration on the basis of the
number of days that the Agreement is in effect during that quarter.
23. Reports. You shall prepare such reports as we may request in order to
comply with our reporting obligations to Xxxxxx.
24. Downloading of Account Information. Certain of your registered
representatives may, from time to time, request access to certain account
information with respect to the CEF shares (the "Account Information") via
downloading of such Account Information to an electronic mailbox which will be
accessed by the registered representative through his or her personal computer.
The Account Information will be accessed by the registered representative via
software purchased from an outside vendor to whom access to the Account
Information is provided. In exchange for the cooperation of the IDEX Fund and of
InterSecurities, Inc. in providing access to the Account Information for the
convenience of the registered representatives, you agree that it is your sole
responsibility to oversee and supervise your registered representatives in the
utilization of such Account Information, including verification of the accuracy
of all written material produced by a registered representative from the Account
Information. Further, you are solely responsible for ensuring that all NASD, SEC
and other regulations are fully complied with by the registered representatives
in connection with the utilization of and preparation of any written or oral
material from, the Account Information. You shall fully indemnify and hold
harmless the undersigned and the IDEX Fund from any and all claims made against
them by any party with respect to your registered representatives' use of such
Account Information.
25. Terms and Termination. This Agreement shall become effective on the
date hereof and continue in effect until terminated. This Agreement shall
automatically terminate in the event of its assignment and upon any termination
of the Xxxxxx Agreement. It may be terminated at any time by us or you on thirty
(30) days written notice.
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26. Notices and Communications. All notices and communications to us should
by sent to the above address. Any notice to you shall be duly given if mailed,
hand delivered or telegraphed to the address specified below.
Very truly yours,
InterSecurities, Inc.
By:_______________________________________
Registered Principal
The undersigned xxxxxx accepts and agrees to the terms of this Agreement.
Firm Name:________________________________
By:_______________________________________
Authorized Securities Principal
Name:_____________________________________
Title: ___________________________________
Address: _________________________________
_________________________________
Telephone: _______________________________
Federal Tax I.D.:_________________________
NASD CRD No.:_____________________________
(RETAIN A COPY AND RETURN THE ORIGINAL)
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APPENDIX A
TO
IDEX SERIES FUND
DEALER'S SALES AGREEMENT
SALES COMPLIANCE POLICIES RELATING TO THE
MULTIPLE CLASS DISTRIBUTION SYSTEM
Each portfolio of IDEX Series Fund (each a "Portfolio" and collectively,
the "Portfolios"), other than the IDEX Series Fund Growth Portfolio, which
includes four classes of shares, currently offers three classes of shares as
follows:
Class A shares are ordinarily purchased with a front-end sales load and are
currently subject to an annual 12b-1 fee of up to .35% of the average daily
net assets of that Portfolio's Class A shares.
Class B shares are purchased with no front-end sales charge and are
currently subject to an annual 12b-1 fee of 1.00% of the average daily net
assets of that Portfolio's Class B shares. Class B shares are also subject
to a contingent deferred sales charge at a declining rate, payable upon
redemption of the shares during the first six years after purchase. Class B
shares automatically convert to Class A shares eight years after purchase.
Class C shares are purchased with no front-end sales charge and are
currently subject to an annual 12b-1 fee of up to .90% (.60% for the
Tax-Exempt Portfolio) of the average daily net assets of that Portfolio's
Class C shares.
Class T Shares of IDEX Growth Portfolio will be subject to a maximum
initial 8.50% sales charge, but no ongoing annual 12b-1 fees. Class T
Shares will be available for sale only to existing Class T shareholders
(former shareholders of IDEX Fund and IDEX Fund 3). CLASS T SHARES WILL NOT
BE OFFERED OR SOLD TO NEW INVESTORS.
To assist investors in selecting the method of investing that best meets
their needs and to ensure proper supervision of mutual fund purchase
recommendations, we request that your internal guidelines include the following
policies:
(1) Any purchases of Portfolio shares for less than $500,000 may be of
shares either 1) subject to a front-end sales charge and an ongoing 12b-1 fee of
up to .35% of the average daily net assets of those shares (Class A Shares); 2)
subject to an ongoing 12b-1 fee of 1.00% of the average daily net assets of
those shares, a contingent deferred sales charge on the lesser of the original
purchase price or redemption proceeds at a declining rate for the six years
following purchase as follows: 5% during the first year, 4% during the second
year, 3% during the third year, 2% during the fourth year, 1% during the fifth
and sixth years, and 0% after the sixth year, and automatic conversion to Class
A shares eight years after purchase (Class B Shares); or 3) subject to no
front-end sales charge and a 12b-1 fee of up to .90% (.60% for the Tax-Exempt
Portfolio) of the average daily net assets of those shares (Class C Shares).
(Purchases of Growth Portfolio shares for less than $500,000 may also be of
Class T shares, if available to the investor (i.e., the investor is, at the time
of purchase, an existing Class T shareholder). Such shares are subject to a
front-end sales charge, but no ongoing annual 12b-1 fees).
(2) Any purchases of Portfolio shares for $500,000 or more but less than
$1,000,000 may be of shares either 1) subject to a front-end sales charge and an
ongoing 12b-1 fee of up to .35% of the average daily net assets of those shares
(Class A shares); or 2) subject to no front-end sales charge and a higher 12b-1
fee (Class C shares). (Purchases of Growth Portfolio shares for $500,000 or more
but less than $1,000,000 may also be of Class T shares, if available to the
investor (i.e., the investor is, at the time of purchase, an existing Class T
shareholder). Such shares are subject to a front-end sales charge, but no
ongoing annual 12b-1 fees). Purchases of $500,000 or more for Class B shares
will be declined.
(3) Sales personnel should determine which class of shares best meets the
investor's needs based on the relevant facts and circumstances, including, but
not limited to:
(a) the specific dollar amount of the purchase;
(b) the length of time the investor expects to hold his or her shares;
(c) any other relevant circumstances, such as the availability of
sales charge waivers or reductions on Class A and Class B shares (and Class
T shares, if available to the investor);
(d) the availability of breakpoints for reduced sales loads on Class A
shares (and Class T shares, if available to the investor); and
(e) sales of shares of each Portfolio, and each Class thereof, shall
be effected in accordance with Section 2310 (formerly Section 2) and
Section 2830 (formerly Section 26) of the NASD Rules, as interpreted by the
NASD.
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(4) Any purchase of Portfolio shares for $1,000,000 or more normally should
be for Class A shares because such a purchase will not be subject to a front-end
sales charge and will have lower ongoing 12b-1 fees than those imposed on Class
B or Class C shares. (If, however, Class T shares of the Growth Portfolio are
available to the investor (i.e., the investor is, at the time of purchase, an
existing Class T shareholder), the purchase of Growth Portfolio shares for
$1,000,000 or more normally should be for Class T shares, because such a
purchase will not be subject to a front-end sales charge and will have no
ongoing 12b-1 fees.) However, if no front-end sales charge is incurred because a
Class A or Class T purchase equals or exceeds $1,000,000, a deferred sales
charge of 1% will be imposed at redemption of such shares within the first
twelve months of the purchase.
(5) Investors who are eligible for a complete waiver of the front-end sales
charge on Class A shares, and in the case of the Growth Portfolio, are not
eligible to purchase Class T shares on such a basis, normally should purchase
Class A shares because the ongoing 12b-1 fees of such shares are lower than
those of Class B or Class C shares (keeping in mind that upon redemption of such
shares within the first twelve months of purchase, a 1% deferred sales charge
may be imposed on such redemption).
(6) With respect to the Growth Portfolio, investors who are eligible to
purchase Class T shares and are eligible for a complete waiver of the front-end
sales charge on Class T shares normally should purchase Class T shares because
Class T shares have no ongoing 12b-1 fees (keeping in mind that upon redemption
of such shares within the first twelve months of purchase, a 1% deferred sales
charge may be imposed on such redemption, unless the shares were purchased
through a qualified retirement plan).
Investors should consider both ongoing annual expenses and front-end and
contingent deferred sales charges, if any, in estimating the costs of investing
in the respective classes of Portfolio shares over time. For example, new
investors that qualify for a substantial reduction in a front-end sales charge
ordinarily should determine that a purchase of Class A shares, subject to lower
ongoing expenses, is preferable to a purchase of Class B shares which are
subject to higher ongoing 12b-1 fees and a contingent deferred sales charge or
of Class C shares which would be subject to payment of a higher ongoing 12b-1
fee.
Alternatively, an investor whose purchase of Portfolio shares would not
qualify for a reduction of the front-end sales charge, may wish to avoid the
sales charge and thus initially invest all of his or her dollars in Class B or
Class C shares. Such an investor should consider how long he or she plans to
hold such shares when deciding which class of shares to purchase. Certain
investors may elect to purchase Class B shares if they determine it to be most
advantageous to have all their funds invested initially and intend to hold their
shares for an extended period of time. Investors in Class B shares should take
into account whether they intend to remain invested until the end of the
conversion period and thereby take advantage of the reduction in ongoing fees
resulting from the conversion into Class A shares. Other investors may elect to
purchase Class C shares if they determine that it is advantageous to have all
their assets invested initially and they are uncertain as to the length of time
they intend to hold their assets in the Fund. See especially the sections
"Summary of Expenses," "Alternative Purchase Arrangements," "Shareholder
Information and Instructions - How to Buy Shares" and "Investment Advisory and
Other Services" in the prospectus for the respective Portfolio.
The above policies are reflected in a revised prospectus for the
Portfolios. These policies are in addition to, and not intended to override, any
other of your internal policies.
