EXHIBIT 6(b)
FORM OF SHAREHOLDER SERVICING SUPPORT AGREEMENT
BETWEEN _________________________ AND SELLING RECIPIENTS
VERSION A
_____________________________________
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 ____________________. In
receiving orders from your customers who purchase Shares,
___________________ 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 ____________________.
4. It is hereby understood that in all cases in which
you place orders with us 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 ___________________ shall have no
responsibility in this regard.
6. Orders authorized by and received from you will be
accepted by us 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, we 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 us a copy of such confirmation. All orders are
subject to acceptance or rejection by us in our 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 us, 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
2
notice by us 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 and 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 through us shall be accepted at the time when the order
is received by us (or any clearinghouse agency that we may
designate from time to time), and at the offering and sale
price next determined, unless rejected by us or the Fund. In
addition to the right to reject any order, the Fund has
reserved the right to withhold Shares from sale temporarily or
permanently. We 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 we
shall forward from time to time to you. The Shares purchased
will be issued by the Fund 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 ordered from us shall
be in the form of a wire transfer. Payment shall be made
within five (5) business days after our 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, we reserve
the right to cancel the sale or, at our option, to sell 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 us
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 us in time
to provide for processing at the price next determined after
3
receipt by you, in accordance with the Prospectus. You are
not to withhold placing with us 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 us 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 us harmless against all claims, damage, liability, costs,
and expenses (including attorneys fees and costs of
investigation) incurred by us 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 Fund (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 Fund,
the Fund's transfer agent, shareholder servicing agent, and us
for any loss or liability resulting from acting upon such
instructions. We agree 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 us of the original purchase order from
you for such security you shall forthwith refund to us 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
4
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 through us, 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 us or the Fund (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 Fund or by 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 Fund and us against
any and all losses, claims, damages, liabilities, expenses, or
settlements to which 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 Fund or by 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 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.
5
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 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 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,
6
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 agreement between us and the
Trust or in any agreements related to the distribution
agreement.
7
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:________________________
8
VERSION B
_____________________________________
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 ____________________. In
receiving orders from your customers who purchase Shares,
___________________ 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 ____________________.
4. It is hereby understood that in all cases in which
you place orders with us 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 ___________________ shall have no
responsibility in this regard.
6. Orders authorized by and received from you will be
accepted by us 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, we 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 us a copy of such confirmation. All orders are
subject to acceptance or rejection by us in our 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 us, 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
2
notice by us 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 and 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 through us shall be accepted at the time when the order
is received by us (or any clearinghouse agency that we may
designate from time to time), and at the offering and sale
price next determined, unless rejected by us or the Fund. In
addition to the right to reject any order, the Fund has
reserved the right to withhold Shares from sale temporarily or
permanently. We 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 we
shall forward from time to time to you. The Shares purchased
will be issued by the Fund 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 ordered from us shall
be in the form of a wire transfer. Payment shall be made
within five (5) business days after our 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, we reserve
the right to cancel the sale or, at our option, to sell 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 us
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 us in time
to provide for processing at the price next determined after
3
receipt by you, in accordance with the Prospectus. You are
not to withhold placing with us 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 us 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 us harmless against all claims, damage, liability, costs,
and expenses (including attorneys fees and costs of
investigation) incurred by us 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 Fund (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 Fund,
the Fund's transfer agent, shareholder servicing agent, and us
for any loss or liability resulting from acting upon such
instructions. We agree 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 us of the original purchase order from
you for such security you shall forthwith refund to us 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
4
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 through us, 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 us or the Fund (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 Fund or by 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 Fund and us against
any and all losses, claims, damages, liabilities, expenses, or
settlements to which 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 Fund or by 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 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.
5
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 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 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,
6
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 agreement between us and the
Trust or in any agreements related to the distribution
agreement.
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 Adviser'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
7
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:________________________
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