EXHIBIT 99.6B
FORM OF DEALER SALES AGREEMENT
DEALER SALES AGREEMENT
To the undersigned Dealer:
Gentlemen:
ND Capital, Inc., the principal underwriter of shares, par value $.001,
issued by ND Insured Income Fund, Inc. (the "Fund"), an open-end, non-
diversified, management investment company registered under the Investment
Company Act of 1940, understands that you are a member in good standing of the
National Association of Securities Dealers, Inc. (the "NASD"), and that you and
any individuals who represent you are properly qualified and registered, if
required, with the Securities and Exchange Commission and with the state
securities administrators of the various states in which Fund shares are to be
offered for sale or sold by you. In consideration of the mutual promises stated
below, you and we hereby agree as follows:
1. Compliance with Prospectus. Offers and sales of shares by you will
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comply in all respects with the terms and conditions contained in the then-
current prospectus of the Fund.
2. Purchase Restrictions. You agree to purchase shares solely through us and
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only for the purpose of covering purchase orders already received from customers
or for your own bona fide investment. You agree not to purchase for any other
securities dealer unless you have an agreement with such other dealer or broker
to handle clearing arrangements and then only in the ordinary course of business
for such purpose and only if such other dealer has executed a Dealer Sales
Agreement with us. You also agree not to withhold any customer order so as to
profit therefrom.
3. Processing Orders. The procedures relating to the handling of orders shall
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be subject to instructions which we will forward from time to time to all
dealers with whom we have entered into a Dealer Sales Agreement. The minimum
initial and subsequent purchase order shall be specified in the Fund's then-
current prospectus. All purchase orders are subject to receipt of shares by us
from the Fund and to acceptance of such orders by us. We reserve the right in
our sole discretion to reject any order.
4. Purchase Orders. We shall accept orders only on the basis of the then-
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current offering price. You agree to place orders in respect of shares
immediately upon the receipt of orders from your customers for the same number
of shares. orders which you receive from your customers shall be deemed to be
placed with us when received by us. Orders which you receive prior to the close
of business, as defined in the prospectus, and placed with us within the time
frame set forth in the prospectus shall be priced at the
offering price next computed after they are received by you. We will not accept
a conditional order from you on any basis. All orders shall be subject to
confirmation by us.
5. Settlement. Unless otherwise agreed, settlement shall be made at the
office of the Fund's transfer agent within five (5) business days after our
acceptance of the order. If payment is not so received or made within ten (10)
business days of our acceptance of the order, we reserve the right to cancel the
sale or, at our option, to sell the shares to the Fund at the then-prevailing
net asset value. In this event, or in the event that you cancel the trade for
any reason, you agree to be responsible for any loss resulting to the Fund or to
us from your failure to make payments as aforesaid. You shall not be entitled
to any gains generated thereby.
6. Dealer Discounts. You shall receive for each sale of shares of the Fund,
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except shares sold which are not subject to a sales charge, a discount in
accordance with the table which follows, The amount of the discount is subject
to change by us without notice.
Sales Charge
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Allowed to
As a As a Dealers as a
Percentage of Percentage of Percentage of
Amount of Purchase Offering Price Net Asset Value, Offering
price
Less than $100.000 4.50% 4.71% 4.00%
100,000 but less than 250,000 3.50% 3.63% 3.00%
250,000 but less than 500,000 2.50% 2.56% 2.25%
500,000 but less than 1,000,000 2.00% 2.04% 1.75%
1,000,000 and over .10% .10% .10%
*Rounded to the nearest one-hundredth percent
7. Redemptions. Redemptions of shares by the Fund will be effected in the
manner and upon the terms described in the then-current prospectus. We will,
upon your request, assist you in processing orders for redemptions. If any
shares sold to you are redeemed by the Fund or are tendered to the Fund for
redemption within seven (7) business days after the date of our confirmation to
you of your original purchase order therefor, you agree to pay forthwith to us
the full amount of the discount allowed you on the sale.
8. Suspension of Sales and Amendments to Agreement. We reserve the right
in our discretion without notice to you to suspend sales or withdraw an offering
of shares entirely, to change the offering price as provided in the prospectus,
or, upon notice to you, to amend or cancel this Agreement. You agree that any
order to purchase shares placed by you after notice of any amendment to this
Agreement has been sent to you shall constitute your agreement to any such
amendment.
9. Dealer Status. In every transaction, you shall act as an independent
contractor and not as an agent for the Fund, the Fund's transfer agent, any
other dealer, or us. You agree that
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neither the Fund, the Fund's transfer agent, any other dealer, nor we shall be
deemed an agent of you. Nothing herein shall constitute you as a partner of the
Fund, the Fund's transfer agent, any other dealer, or us or render any of us
liable for your obligations.
10. Representations Concerning the Fund. No person is authorized to make any
representations concerning shares of the Fund except those contained in the
then-current prospectus. You shall not sell shares of the Fund pursuant to this
Agreement unless the then-current prospectus is furnished to the purchaser prior
to or at the time of purchase. You shall not use any supplemental sales
literature of any kind without our prior written approval unless it is furnished
by us for such purpose. In offering and selling shares of the Fund, you will
rely solely on the representations contained in the then-current prospectus.
11. Dealer's Representations and Agreements. By accepting this Agreement, you
represent that you: (i) are registered as a broker-dealer under the Securities
Exchange Act of 1934, as amended; (ii) are qualified to act as a dealer in the
states in which the Fund's shares are offered for sale or sold by you; (iii) are
a member in good standing of the NASD; and (iv) will maintain such
registrations, qualifications, and memberships throughout the term of this
Agreement. You agree to abide by the Rules of Fair Practice of the NASD and all
federal and state laws and rules and regulations that are now or may become
applicable to the transactions hereunder. Your expulsion from the NASD will
automatically terminate this Agreement without notice. Your suspension from the
NASD or violation of applicable state and federal laws and rules and regulations
will terminate this Agreement effective upon our notice to you. You shall not
be entitled to any compensation during any period in which you have been
suspended or expelled from membership in the NASD.
12. Indemnification. You hereby agree to indemnify and to hold harmless the
Fund and us and each person, if any, who controls the Fund or us within the
meaning of Section 15 of the Securities Act of 1933, as amended (the "Act"),
from and against any and all losses, claims, demands, or liabilities to which
the Fund or we may become subject under the Act, or otherwise, insofar as such
losses, claims, demands, or liabilities (or actions in respect thereof) arise
out of or are based upon any unauthorized use of sales materials by you or your
salesmen or upon alleged misrepresentations or omission to state material facts
in connection with statements made by you or your salesmen orally or by other
means or upon sales of shares in any state or jurisdiction in which the shares
are not registered or qualified for sale; and you will reimburse the Fund and us
for any legal or other expenses reasonably incurred in connection with the
investigation or defense of any such action or claim. We shall, after receiving
the first summons or other legal process disclosing the nature of the action
being served upon the Fund or us, in any proceeding in respect of which
indemnity may be sought by the Fund or us hereunder, notify
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you in writing of the commencement thereof within a reasonable time. In case
any such litigation be brought against the Fund or us, we shall notify you of
the commencement thereof, and you shall be entitled to participate in (and to
the extent you shall wish, to direct) the defense thereof at your expense, but
such defense shall be conducted by counsel in good standing satisfactory to the
Fund and us. If you shall fail to provide such defense, the Fund or we may
defend such action at your cost and expense. Your obligation under this Section
12 shall survive the termination of this Agreement.
13. Dealer's Expenses. All expenses incurred in connection with your
activities under this Agreement shall be borne by you.
14. Supervisory Responsibility. By accepting this Agreement, you assume full
responsibility for the registration, qualification, and training of your
representatives in connection with the offer and sale of shares of the Fund.
15. Prospectuses and Statements of Additional Information. We will supply you
with copies of the prospectus and statement of additional information of the
Fund (including any amendments thereto) in reasonable quantities upon request.
You will provide all customers with a prospectus prior to or at the time such
customer purchases shares. You will provide any customer who so requests a copy
of the statement of additional information on file with the Securities and
Exchange Commission.
16. Assignment. This Agreement may not be assigned by you without our consent.
17. Waiver. No failure, neglect, or forebearance on our part to require
strict performance of this Agreement shall be construed as a waiver of our
rights or remedies hereunder.
18. Termination. Either party may terminate this Agreement at anytime upon
giving written notice to the other party.
19. Governing Law. This Agreement shall be construed in accordance with the
laws of the State of North Dakota.
20. Entire Agreement. This Agreement constitutes the entire agreement
between the undersigned and supersedes all prior oral or written agreements
between the parties hereto.
ND CAPITAL, INC.
Date By
The undersigned accepts your invitation to become a dealer and agrees to
abide by the foregoing terms and conditions.
Date By
Signature and Title
Dealer Name
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