Exhibit (15)(g)
Form of
Shareholder Servicing Support Agreements
Between
PADCO Financial Services, Inc.
and
Selling Recipients
In Connection With the Plan of Distribution
for
The Rydex Institutional Money Market Fund
VERSION A
PADCO Financial Services, Inc.
0000 Xxxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
(000) 000-0000
SHAREHOLDER SERVICING SUPPORT AGREEMENT
Ladies and Gentlemen:
We are a party to a certain distribution agreement with Rydex Series
Trust (the "Trust"), on behalf of the Rydex Institutional Money Market Fund
(the "Fund"), a series of the Trust, under which agreement we serve as
exclusive agent for the Fund for the sale of the Fund's shares of
beneficial interest ("Shares"). You have indicated that you wish to act as
agent for your customers in connection with the purchase, sale, and
redemption of Shares of the Fund as are qualified for sale in the states in
which you have branch offices. We agree to honor your request, subject to
the terms set forth below.
1. In all sales of Shares you shall act as agent for your
customers, and in no transaction shall you have any authority to act as
agent for the Fund or for us. You agree to be responsible for opening,
approving, and monitoring customers' accounts. You also agree to be
responsible for any and all credit that you may extend to your customers,
to the extent such extension of credit is permitted under applicable rules
and regulations, and for compliance with all regulatory requirements
respecting such extension of such credit. You further agree to be
responsible for safeguarding your customers' funds and securities. We will
not have custody of your customer's funds or securities.
2. The customers in question are, for all purposes, your customers
and not customers of PADCO Financial Services, Inc. In receiving orders
from your customers who purchase Shares, PADCO Financial Services, Inc. is
not soliciting such customers, and has no responsibility for determining
whether Shares are suitable investments for such customers. This
responsibility is solely yours.
3. You will maintain all required books and records with respect
to your securities business, your customers and their transactions. You
acknowledge that the responsibility for maintenance of such books and
records is not the responsibility of PADCO Financial Services, Inc.
4. It is hereby understood that in all cases in which you place
orders with the Trust for the purchase of Shares: (a) you are acting as
agent for the customer; (b) the transactions are without recourse against
you by the customer; (c) as between you and the customer, the customer will
have full beneficial ownership of the securities; (d) each such transaction
is initiated solely upon the order of the customer; and (e) each such
transaction is for the account of the customer and not for your account.
5. You agree that you will fulfill any and all regulatory
requirements to supervise the activities of each of your employees,
representatives, and associated persons in a manner reasonably designed to
achieve compliance with applicable securities and banking laws and
regulations. You further agree that responsibility for proper supervision
shall rest with you, and PADCO Financial Services, Inc. shall have no
responsibility in this regard.
6. Orders authorized by and received from you will be accepted by
the Trust only at the regular public offering price applicable to each
order, as established by the then-current Prospectus of the Fund, subject
to the discounts defined in such Prospectus. Following receipt from you of
any order to purchase Shares for the account of a customer, the Trust shall
confirm such order to you in writing. You shall be responsible for sending
your customer a written confirmation of the order with a copy of the Fund's
current Prospectus. You shall send the Trust a copy of such confirmation.
All orders are subject to acceptance or rejection by the Trust in the
Trust's sole discretion. Unless other instructions have been given, you
shall also be responsible for preparing and mailing all periodic statements
of ownership to your customers and/or updates showing a customer's account
balance and integrating such statements with those of other transactions
and balances in the customer's accounts serviced by you.
7. The offering Prospectus and this Agreement set forth the terms
applicable to sales of Shares of the Fund through you and all other
representations or documents are subordinate. This Agreement is in all
respects subject to statements regarding the sale and repurchase or
redemption of shares made in offering Prospectus of the Fund, which in the
event of any inconsistency between this Agreement and such Prospectus, the
Prospectus shall control.
8. Any sales charges and dealers' concessions will be as set forth
in the current Prospectus of the Fund. On each order for Shares of the
Fund that is accepted by the Trust, you will be entitled to receive the
applicable commission as set forth in the Prospectus. Any and all
commissions or concessions set forth in the Fund's Prospectus are subject
to change without notice by the Trust and will comply with any changes in
regulatory requirements.
9. We are also authorized to pay you continuing service fees with
respect to the Shares of the Fund to compensate you for providing certain
services under this Agreement for your clients such as processing purchase
a n d redemption transactions, establishing shareholder accounts, and
providing certain information and assistance with respect to the Fund,
provided you meet certain service-related criteria.
10. Where payment is due hereunder, we agree to send payment for
concessions and securities to your address as your address appears on our
records. You must notify us of address changes and promptly negotiate such
payments. Any such payments that remain outstanding for twelve (12)
months shall be void and the obligation represented thereby shall be
extinguished.
11. Any order by you for the purchase of Shares of the Fund from
the Trust shall be accepted at the time when the order is received by the
Trust (or any clearinghouse agency that the Trust may designate from time
to time), and at the offering and sale price next determined, unless
rejected by the Trust. In addition to the right to reject any order for
the purchase of Shares of the Fund, the Trust has reserved the right to
withhold Shares from sale temporarily or permanently. The Trust will not
accept any order from you which is placed on a conditional basis or subject
to any delay or contingency prior to execution. The procedure relating to
the handling of orders shall be subject to instructions which the Trust
shall forward from time to time to you. The Shares of the Fund purchased
will be issued by the Trust only against receipt of the purchase price, in
collected clearing house funds subject to deduction of all commissions on
such sale (reallowance of any commissions to which you are entitled on
purchases at net asset value will be paid through our direct purchase
commission system). Payment for Shares of the Fund ordered from the Trust
shall be in the form of a wire transfer to Star Bank, N.A., the Fund's
custodian (the "Custodian") at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000.
Payment shall be made within five (5) business days after the Trust's
acceptance of the order placed on behalf of your customer, or such shorter
time period as may be required by law. If payment for the Shares purchased
is not received within such time period, the Trust reserves the right to
cancel the sale or, at the Trust's option, to sell the Shares to the Fund
at the then-prevailing net asset value. In this event, you agree to be
responsible for any loss, expense, liability, or damage, including loss of
profit suffered by the Trust and/or the Fund resulting from your delay or
failure to make payment as aforesaid.
12. You are obliged to date and time stamp all orders received by
you and promptly transmit all orders to the Trust in time to provide for
processing at the price next determined after receipt by you, in accordance
with the Prospectus. You are not to withhold placing with the Trust orders
received from any customers for the purchase of Shares so as to profit
yourself as a result of such withholding. You shall not purchase Shares
through the Trust except for the purpose of covering purchase orders
already received from your customers, or, if permitted by applicable law,
for your bona fide investment.
13. You shall be solely responsible for the accuracy, timeliness,
and completeness of any orders transmitted by you on behalf of your
customers by wire or telephone for purchases, exchanges, or redemptions,
and shall indemnify and hold the Trust harmless against all claims, damage,
liability, costs, and expenses (including attorneys fees and costs of
investigation) incurred by the Trust arising out of or based upon your
relationship with your customers through your own actions or omissions,
including, but not limited to, any claims by your customers that you failed
to transmit properly their instructions, properly service their account, or
otherwise caused them injury.
14. If your customer's account is established without your customer
signing the application form, you represent that the instructions relating
to the registration (including the customer's tax identification number)
and selected options furnished to the Trust (whether on the application
form, in some other document, or orally) are in accordance with the
customer's instructions, and you agree to indemnify the Trust, the Trust's
transfer agent, shareholder servicing agent, and the Fund for any loss or
liability resulting from acting upon such instructions. The Trust agrees
to hold harmless and indemnify you for any loss or liability arising out of
our negligence in processing such instructions.
15. If any Share is repurchased by the Fund or is tendered thereto
for redemption within seven (7) business days after confirmation by the
Trust of the original purchase order from you for such security you shall
forthwith refund to the Trust the full commissions paid to you on the
original sale.
16. You shall not, if acting as principal, purchase any Share of
the Fund from a record holder at a price lower than the net asset value
next determined by or for the Fund's Shares. You shall, however, be
permitted to sell any Shares for the account of a shareholder of the Fund
at the net asset value currently quoted by or for the Fund's Shares, and
may charge a fair service fee for handling the transaction provided you
disclose the fee to the record owner.
17. We shall furnish you, without charge, reasonable quantities of
offering Prospectuses, with any supplements currently in effect, and copies
of current shareholder reports of the Fund, and sales materials issued by
us from time to time. You shall deliver copies of current shareholder
reports, Prospectuses, and any supplements to those of your customers whose
Shares are held in book-entry form on the books of the Fund. In the
purchase of Shares of the Fund from the Trust, you are entitled to rely
only on the information contained in the offering Prospectuses. You may not
publish any advertisement or distribute sales literature or other written
material to the public which makes reference to the Trust, the Fund, or us
(except material which we furnished to you) without our prior written
approval.
18. No person is authorized to make any representations concerning
Shares of the Fund except those contained in the applicable current
Prospectus and printed information subsequently issued by the Trust, the
Fund, or us as information supplemental to such Prospectus. You agree that
you will not make Shares available to your customers except under
circumstances that will result in compliance with applicable Federal and
state securities and banking laws. You further agree to indemnify and hold
harmless the Trust, the Fund, and us against any and all losses, claims,
damages, liabilities, expenses, or settlements to which the Trust, the
Fund, and/or we may become subject under any statute or regulation insofar
as such losses, claims, damages, liabilities, expenses, or settlements are
related to the purchase or sale of Shares by your customers and arise out
of or are based upon your statements or representations to your customers
concerning the Shares (other than statements or representations contained
in the applicable current Prospectus and printed information subsequently
issued by the Trust, the Fund, or us).
19. Shares sold hereunder shall be available in book-entry form on
the books of the Fund's transfer agent unless other instructions have been
given.
20. You shall make available Shares of the Fund only through us.
In no transaction (whether of purchase or sale) shall you have any
authority to act as agent for, partner of, or participant in a joint
venture with us or with the Trust or the Fund or any other entity having
either a shareholder servicing support agreement or other agreement with
us.
21. All sales will be made subject to our receipt of Shares from
the Fund. We reserve the right, in our discretion, without notice, to
modify, suspend, or withdraw entirely the offering of any Shares and, upon
notice, to change the sales charge or discount or to modify, cancel, or
change the terms of this Agreement. You agree that any order to purchase
Shares of the Fund placed by you after any notice of amendment to this
Agreement has been sent to you shall constitute your agreement to any such
amendment.
22. Sales and exchanges of Shares may be made only in those states
and jurisdictions where Shares are registered or qualified for sale to the
public. We agree to advise you currently of the identity of those states
and jurisdictions in which the Shares are registered or qualified for sale,
and you agree to indemnify us, the Trust, and/or the Fund for any claim,
liability, expense, or loss in any way arising out of sale of Shares in any
state or jurisdiction not identified by us as a state or jurisdiction in
which such Shares are so registered or qualified. We agree to indemnify
you for any claim, liability, expense, or loss attributable to such Shares
not being registered or qualified if such state or jurisdiction was
identified by us as a state or jurisdiction in which Shares are so
registered or qualified.
23. We act solely as agent for the Trust and the Fund, and are not
responsible for qualifying the Fund or the Fund's Shares for sale in any
state or jurisdiction. We also are not responsible for the issuance, form,
validity, enforceability, or value of Shares of the Fund.
24. You represent that you are (a) a properly registered or
licensed broker or dealer under applicable Federal and state securities
laws and regulations and a member in good standing of the National
Association of Securities Dealers, Inc., or (b) a "bank," as defined in
Section 3(a)(6) of the Securities Exchange Act of 1934 (the "1934 Act") (or
other financial institution), and that you are not otherwise required to
register as a broker or dealer under the 1934 Act or any state laws. You
agree to notify us immediately in writing if this representation ceases to
be true. We recognize that, in addition to applicable provisions of
Federal and state securities laws, you may be subject to the provisions of
the Xxxxx-Xxxxxxxx Act and other laws governing, among other things, the
conduct of activities by Federal and state chartered and supervised
financial institutions and their affiliated organizations. Because you
will be the only entity having a direct relationship with the customer in
connection with securities purchases hereunder, you will be responsible in
that relationship for insuring compliance with all laws and regulations,
including those of all applicable Federal and state regulatory authorities
and bodies having jurisdiction over you or your customers to the extent
applicable to securities purchases hereunder.
25. Either of us, upon request of the other party, shall provide
the other party with data or documents needed by the requesting party to
carry out all allocated functions herein.
26. Each of us shall cooperate with all appropriate governmental or
self regulatory authorities (including, without limitation, the Securities
and Exchange Commission, the National Association of Securities Dealers,
Inc., and state securities regulators) and shall permit such authorities
reasonable access to books and records in connection with any inspection,
inquiry, or investigation relating to this Agreement or the transactions
contemplated thereby.
27. Either of us may cancel this Agreement at any time by written
notice to the other.
28. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule, or otherwise, the remainder of
the Agreement shall not be affected thereby.
29. All communications to us should be sent to the above address.
Any notice to you shall be duly given if mailed or telegraphed to you at
the address specified by you below.
30. The names of your customers shall remain your sole property and
shall not be used by us for any purpose except for servicing and
information mailings in the normal course of business to Fund shareholders.
31. We agree to compensate you for your services provided under
this Agreement within ten (10) days of the end of each fiscal quarter of
the Trust, at an annualized rate not to exceed 0.___% of the net asset
value of all Shares of the Fund owned beneficially or of record by (i) you
or (ii) your investment advisory or other clients, and/or accounts as to
which you are a fiduciary or custodian or co-fiduciary or co-custodian,
during the quarter ("Qualified Holdings"); provided, however, that no
payments shall be made to you for any quarter in which your Qualified
Holdings do not equal or exceed, at the end of the quarter, the asset
minimum ("Minimum Qualified Holdings"), which Minimum Qualified Holdings
shall be set from time to time by us with the approval of the Trustees of
the Trust who are not "interested persons" of the Trust, as defined in the
Investment Company Act of 1940, and who have no direct or indirect
financial interest in the operation of the distribution plan adopted by the
Trust in connection with the distribution of the Shares of the Fund by us
or in any agreements related to this distribution plan; and provided,
further, however, that no payments shall be made to you for any quarter
unless and until PADCO Financial Services, Inc. has received the full
amount of reimbursement payments from the Trust, in connection with the
aforementioned distribution plan, for distribution expenses incurred by
PADCO Financial Services, Inc. during that quarter in promoting the sale of
Fund shares pursuant to Rule 12b-1 under the 1940 Act.
Execute this Agreement in duplicate and return one of the duplicate
originals to us for our file. This Agreement (i) may be amended by
notification from us and orders received following such notification shall
be deemed to be an acceptance of any such amendment and (ii) shall be
construed in accordance with the laws of the State of Maryland.
Accepted: Very truly yours,
Name of Selling Recipient
By: By:
Name: Name:
Title Title: Address:
Date:
VERSION B
PADCO Financial Services, Inc.
0000 Xxxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
(000) 000-0000
SHAREHOLDER SERVICING SUPPORT AGREEMENT
Ladies and Gentlemen:
We are a party to a certain distribution agreement with Rydex Series
Trust (the "Trust"), on behalf of the Rydex Institutional Money Market Fund
(the "Fund"), a series of the Trust, under which agreement we serve as
exclusive agent for the Fund for the sale of the Fund's shares of
beneficial interest ("Shares"). You have indicated that you wish to act as
agent for your customers in connection with the purchase, sale, and
redemption of Shares of the Fund as are qualified for sale in the states in
which you have branch offices. We agree to honor your request, subject to
the terms set forth below.
1. In all sales of Shares you shall act as agent for your
customers, and in no transaction shall you have any authority to act as
agent for the Fund or for us. You agree to be responsible for opening,
approving, and monitoring customers' accounts. You also agree to be
responsible for any and all credit that you may extend to your customers,
to the extent such extension of credit is permitted under applicable rules
and regulations, and for compliance with all regulatory requirements
respecting such extension of such credit. You further agree to be
responsible for safeguarding your customers' funds and securities. We will
not have custody of your customer's funds or securities.
2. The customers in question are, for all purposes, your customers
and not customers of PADCO Financial Services, Inc. In receiving orders
from your customers who purchase Shares, PADCO Financial Services, Inc. is
not soliciting such customers, and has no responsibility for determining
whether Shares are suitable investments for such customers. This
responsibility is solely yours.
3. You will maintain all required books and records with respect
to your securities business, your customers and their transactions. You
acknowledge that the responsibility for maintenance of such books and
records is not the responsibility of PADCO Financial Services, Inc.
4. It is hereby understood that in all cases in which you place
orders with the Trust for the purchase of Shares: (a) you are acting as
agent for the customer; (b) the transactions are without recourse against
you by the customer; (c) as between you and the customer, the customer will
have full beneficial ownership of the securities; (d) each such transaction
is initiated solely upon the order of the customer; and (e) each such
transaction is for the account of the customer and not for your account.
5. You agree that you will fulfill any and all regulatory
requirements to supervise the activities of each of your employees,
representatives, and associated persons in a manner reasonably designed to
achieve compliance with applicable securities and banking laws and
regulations. You further agree that responsibility for proper supervision
shall rest with you, and PADCO Financial Services, Inc. shall have no
responsibility in this regard.
6. Orders authorized by and received from you will be accepted by
the Trust only at the regular public offering price applicable to each
order, as established by the then-current Prospectus of the Fund, subject
to the discounts defined in such Prospectus. Following receipt from you of
any order to purchase Shares for the account of a customer, the Trust shall
confirm such order to you in writing. You shall be responsible for sending
your customer a written confirmation of the order with a copy of the Fund's
current Prospectus. You shall send the Trust a copy of such confirmation.
All orders are subject to acceptance or rejection by the Trust in the
Trust's sole discretion. Unless other instructions have been given, you
shall also be responsible for preparing and mailing all periodic statements
of ownership to your customers and/or updates showing a customer's account
balance and integrating such statements with those of other transactions
and balances in the customer's accounts serviced by you.
7. The offering Prospectus and this Agreement set forth the terms
applicable to sales of Shares of the Fund through you and all other
representations or documents are subordinate. This Agreement is in all
respects subject to statements regarding the sale and repurchase or
redemption of shares made in offering Prospectus of the Fund, which in the
event of any inconsistency between this Agreement and such Prospectus, the
Prospectus shall control.
8. Any sales charges and dealers' concessions will be as set forth
in the current Prospectus of the Fund. On each order for Shares of the
Fund that is accepted by the Trust, you will be entitled to receive the
applicable commission as set forth in the Prospectus. Any and all
commissions or concessions set forth in the Fund's Prospectus are subject
to change without notice by the Trust and will comply with any changes in
regulatory requirements.
9. We are also authorized to pay you continuing service fees with
respect to the Shares of the Fund to compensate you for providing certain
services under this Agreement for your clients such as processing purchase
a n d redemption transactions, establishing shareholder accounts, and
providing certain information and assistance with respect to the Fund,
provided you meet certain service-related criteria.
10. Where payment is due hereunder, we agree to send payment for
concessions and securities to your address as your address appears on our
records. You must notify us of address changes and promptly negotiate such
payments. Any such payments that remain outstanding for twelve (12)
months shall be void and the obligation represented thereby shall be
extinguished.
11. Any order by you for the purchase of Shares of the Fund from
the Trust shall be accepted at the time when the order is received by the
Trust (or any clearinghouse agency that the Trust may designate from time
to time), and at the offering and sale price next determined, unless
rejected by the Trust. In addition to the right to reject any order for
the purchase of Shares of the Fund, the Trust has reserved the right to
withhold Shares from sale temporarily or permanently. The Trust will not
accept any order from you which is placed on a conditional basis or subject
to any delay or contingency prior to execution. The procedure relating to
the handling of orders shall be subject to instructions which the Trust
shall forward from time to time to you. The Shares of the Fund purchased
will be issued by the Trust only against receipt of the purchase price, in
collected clearing house funds subject to deduction of all commissions on
such sale (reallowance of any commissions to which you are entitled on
purchases at net asset value will be paid through our direct purchase
commission system). Payment for Shares of the Fund ordered from the Trust
shall be in the form of a wire transfer to Star Bank, N.A., the Fund's
custodian (the "Custodian") at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000.
Payment shall be made within five (5) business days after the Trust's
acceptance of the order placed on behalf of your customer, or such shorter
time period as may be required by law. If payment for the Shares purchased
is not received within such time period, the Trust reserves the right to
cancel the sale or, at the Trust's option, to sell the Shares to the Fund
at the then-prevailing net asset value. In this event, you agree to be
responsible for any loss, expense, liability, or damage, including loss of
profit suffered by the Trust and/or the Fund resulting from your delay or
failure to make payment as aforesaid.
12. You are obliged to date and time stamp all orders received by
you and promptly transmit all orders to the Trust in time to provide for
processing at the price next determined after receipt by you, in accordance
with the Prospectus. You are not to withhold placing with the Trust orders
received from any customers for the purchase of Shares so as to profit
yourself as a result of such withholding. You shall not purchase Shares
through the Trust except for the purpose of covering purchase orders
already received from your customers, or, if permitted by applicable law,
for your bona fide investment.
13. You shall be solely responsible for the accuracy, timeliness,
and completeness of any orders transmitted by you on behalf of your
customers by wire or telephone for purchases, exchanges, or redemptions,
and shall indemnify and hold the Trust harmless against all claims, damage,
liability, costs, and expenses (including attorneys fees and costs of
investigation) incurred by the Trust arising out of or based upon your
relationship with your customers through your own actions or omissions,
including, but not limited to, any claims by your customers that you failed
to transmit properly their instructions, properly service their account, or
otherwise caused them injury.
14. If your customer's account is established without your customer
signing the application form, you represent that the instructions relating
to the registration (including the customer's tax identification number)
and selected options furnished to the Trust (whether on the application
form, in some other document, or orally) are in accordance with the
customer's instructions, and you agree to indemnify the Trust, the Trust's
transfer agent, shareholder servicing agent, and the Fund for any loss or
liability resulting from acting upon such instructions. The Trust agrees
to hold harmless and indemnify you for any loss or liability arising out of
our negligence in processing such instructions.
15. If any Share is repurchased by the Fund or is tendered thereto
for redemption within seven (7) business days after confirmation by the
Trust of the original purchase order from you for such security you shall
forthwith refund to the Trust the full commissions paid to you on the
original sale.
16. You shall not, if acting as principal, purchase any Share of
the Fund from a record holder at a price lower than the net asset value
next determined by or for the Fund's Shares. You shall, however, be
permitted to sell any Shares for the account of a shareholder of the Fund
at the net asset value currently quoted by or for the Fund's Shares, and
may charge a fair service fee for handling the transaction provided you
disclose the fee to the record owner.
17. We shall furnish you, without charge, reasonable quantities of
offering Prospectuses, with any supplements currently in effect, and copies
of current shareholder reports of the Fund, and sales materials issued by
us from time to time. You shall deliver copies of current shareholder
reports, Prospectuses, and any supplements to those of your customers whose
Shares are held in book-entry form on the books of the Fund. In the
purchase of Shares of the Fund from the Trust, you are entitled to rely
only on the information contained in the offering Prospectuses. You may not
publish any advertisement or distribute sales literature or other written
material to the public which makes reference to the Trust, the Fund, or us
(except material which we furnished to you) without our prior written
approval.
18. No person is authorized to make any representations concerning
Shares of the Fund except those contained in the applicable current
Prospectus and printed information subsequently issued by the Trust, the
Fund, or us as information supplemental to such Prospectus. You agree that
you will not make Shares available to your customers except under
circumstances that will result in compliance with applicable Federal and
state securities and banking laws. You further agree to indemnify and hold
harmless the Trust, the Fund, and us against any and all losses, claims,
damages, liabilities, expenses, or settlements to which the Trust, the
Fund, and/or we may become subject under any statute or regulation insofar
as such losses, claims, damages, liabilities, expenses, or settlements are
related to the purchase or sale of Shares by your customers and arise out
of or are based upon your statements or representations to your customers
concerning the Shares (other than statements or representations contained
in the applicable current Prospectus and printed information subsequently
issued by the Trust, the Fund, or us).
19. Shares sold hereunder shall be available in book-entry form on
the books of the Fund's transfer agent unless other instructions have been
given.
20. You shall make available Shares of the Fund only through us.
In no transaction (whether of purchase or sale) shall you have any
authority to act as agent for, partner of, or participant in a joint
venture with us or with the Trust or the Fund or any other entity having
either a shareholder servicing support agreement or other agreement with
us.
21. All sales will be made subject to our receipt of Shares from
the Fund. We reserve the right, in our discretion, without notice, to
modify, suspend, or withdraw entirely the offering of any Shares and, upon
notice, to change the sales charge or discount or to modify, cancel, or
change the terms of this Agreement. You agree that any order to purchase
Shares of the Fund placed by you after any notice of amendment to this
Agreement has been sent to you shall constitute your agreement to any such
amendment.
22. Sales and exchanges of Shares may be made only in those states
and jurisdictions where Shares are registered or qualified for sale to the
public. We agree to advise you currently of the identity of those states
and jurisdictions in which the Shares are registered or qualified for sale,
and you agree to indemnify us, the Trust, and/or the Fund for any claim,
liability, expense, or loss in any way arising out of sale of Shares in any
state or jurisdiction not identified by us as a state or jurisdiction in
which such Shares are so registered or qualified. We agree to indemnify
you for any claim, liability, expense, or loss attributable to such Shares
not being registered or qualified if such state or jurisdiction was
identified by us as a state or jurisdiction in which Shares are so
registered or qualified.
23. We act solely as agent for the Trust and the Fund, and are not
responsible for qualifying the Fund or the Fund's Shares for sale in any
state or jurisdiction. We also are not responsible for the issuance, form,
validity, enforceability, or value of Shares of the Fund.
24. You represent that you are (a) a properly registered or
licensed broker or dealer under applicable Federal and state securities
laws and regulations and a member in good standing of the National
Association of Securities Dealers, Inc., or (b) a "bank," as defined in
Section 3(a)(6) of the Securities Exchange Act of 1934 (the "1934 Act") (or
other financial institution), and that you are not otherwise required to
register as a broker or dealer under the 1934 Act or any state laws. You
agree to notify us immediately in writing if this representation ceases to
be true. We recognize that, in addition to applicable provisions of
Federal and state securities laws, you may be subject to the provisions of
the Xxxxx-Xxxxxxxx Act and other laws governing, among other things, the
conduct of activities by Federal and state chartered and supervised
financial institutions and their affiliated organizations. Because you
will be the only entity having a direct relationship with the customer in
connection with securities purchases hereunder, you will be responsible in
that relationship for insuring compliance with all laws and regulations,
including those of all applicable Federal and state regulatory authorities
and bodies having jurisdiction over you or your customers to the extent
applicable to securities purchases hereunder.
25. Either of us, upon request of the other party, shall provide
the other party with data or documents needed by the requesting party to
carry out all allocated functions herein.
26. Each of us shall cooperate with all appropriate governmental or
self regulatory authorities (including, without limitation, the Securities
and Exchange Commission, the National Association of Securities Dealers,
Inc., and state securities regulators) and shall permit such authorities
reasonable access to books and records in connection with any inspection,
inquiry, or investigation relating to this Agreement or the transactions
contemplated thereby.
27. Either of us may cancel this Agreement at any time by written
notice to the other.
28. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule, or otherwise, the remainder of
the Agreement shall not be affected thereby.
29. All communications to us should be sent to the above address.
Any notice to you shall be duly given if mailed or telegraphed to you at
the address specified by you below.
30. The names of your customers shall remain your sole property and
shall not be used by us for any purpose except for servicing and
information mailings in the normal course of business to Fund shareholders.
31. We agree to compensate you for your services provided under
this Agreement within forty-five (45) days of the end of each fiscal
quarter of the Trust, at an annualized rate not to exceed 0.___% of the net
asset value of all Shares of the Fund owned beneficially or of record by
(i) you or (ii) your investment advisory or other clients, and/or accounts
as to which you are a fiduciary or custodian or co-fiduciary or co-
custodian, during the quarter ("Qualified Holdings"); provided, however,
that no payments shall be made to you for any quarter in which your
Qualified Holdings do not equal or exceed, at the end of the quarter, the
asset minimum ("Minimum Qualified Holdings"), which Minimum Qualified
Holdings shall be set from time to time by us with the approval of the
Trustees of the Trust who are not "interested persons" of the Trust, as
defined in the Investment Company Act of 1940, and who have no direct or
indirect financial interest in the operation of the distribution plan
adopted by the Trust in connection with the distribution of the Shares of
the Fund by us or in any agreements related to this distribution plan; and
provided, further, however, that no payments shall be made to you for any
quarter unless and until PADCO Financial Services, Inc. has received the
full amount of reimbursement payments from the Trust, in connection with
the aforementioned distribution plan, for distribution expenses incurred by
PADCO Financial Services, Inc. during that quarter in promoting the sale of
Fund shares pursuant to Rule 12b-1 under the 1940 Act.
32. In addition to the compensation that we have agreed to pay you
under this Agreement pursuant to Paragraph 31, immediately above, PADCO
Advisors, Inc., the Trust's investment adviser (the "Advisor"), agrees, as
indicated by the Advisor's agreement and acceptance below, also to
compensate you from the Advisor's own resources (which may include profits
derived from the advisory fee the Advisor receives from the Fund), at an
annualized rate not to exceed 0.___% of the net asset value of your
Qualified Holdings held during a fiscal quarter of the Trust; provided,
however, that no payments shall be made to you for any quarter in which
your Qualified Holdings do not equal or exceed, at the end of the quarter,
the Minimum Qualified Holdings.
Execute this Agreement in duplicate and return one of the duplicate
originals to us for our file. This Agreement (i) may be amended by
notification from us and orders received following such notification shall
be deemed to be an acceptance of any such amendment and (ii) shall be
construed in accordance with the laws of the State of Maryland.
Accepted: Very truly yours,
Name of Selling Recipient
By: By:
Name: Name:
Title: Title:
Address:
Date:
AGREED AND ACCEPTED:
PADCO Advisors, Inc.
By:
Xxxxxx X. Xxxxxx, Xx.
President
Date:
