PAGE 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM S-1
IDS INVESTORS CERTIFICATE
POST-EFFECTIVE AMENDMENT NO. 11 TO
REGISTRATION STATEMENT NO. 33-26844
UNDER
THE SECURITIES ACT OF 1933
IDS CERTIFICATE COMPANY
(Exact name of registrant as specified in charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
6725
(Primary Standard Industrial Classification Code Number)
41-6009975
(I.R.S. Employer Identification No.)
IDS Tower 10, Minneapolis, MN 55440, (612) 671-3131
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
Bruce A. Kohn IDS Tower 10, Minneapolis, MN 55440-0010,
(612) 671-2221
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
The Registrant has registered an indefinite number of certificates
under the Securities Act of 1933 pursuant to Section 24-f of the
Investment Company Act of 1940. Registrant's Rule 24f-2 Notice for
its most recent fiscal year (December 31) will be filed on or about
February 28, 1996.
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PART I. CROSS REFERENCE SHEET FOR PROSPECTUS
PURSUANT TO RULE 404(c)
IDS INVESTORS CERTIFICATE
AND VARIATIONS
Item Caption in
Number Prospectus
Item 1. Forepart of the
Registration Statement
and Outside Front Cover
Page of Prospectus.
Item 2. Inside Front and Where to Get Information
Outside Back Cover Pages about the Issuer. Table of
of Prospectus. Contents.
Item 3. Summary Informa- Table of Contents.
tion, Risk Factors
and Ratio of Earnings
to Fixed Charges.
Item 4. Use of Proceeds. Invested and Guaranteed By
the Issuer; Government
Regulation; Investment
Policies.
Item 5. Determination of Not Applicable.
Offering Price.
Item 6. Dilution. Not Applicable.
Item 7. Selling Security Not Applicable.
Holders
Item 8. Plan of How Your Money
Distribution. is Managed.
Item 9. Description of About the Certificate;
Securities to Be Tax Treatment of Your
Registered. Investment; Investment
Policies.
Item 10. Interests of Not Applicable.
Named Experts and Counsel.
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PART I. CROSS REFERENCE SHEET FOR PROSPECTUS
PURSUANT TO RULE 404(c) (Continued)
Item Caption in
Number Prospectus
Item 11. Information with About the Certificate; How to
Respect to the Registrant. Invest and Withdraw Funds.
Item 12. Disclosure of How Your Money is Used and
Commission Position on Protected; How Your Money
Indemnification for is Managed.
Securities Act Liabilities.
PAGE 4
IDS Investors Certificate
Prospectus
April 24, 1996
IDS Investors Certificates are issued by IDS Certificate Company
(the Issuer). The IDS Investors Certificate is a security
purchased with a single investment. You may purchase this
certificate by selecting a term of 1, 2, 3, 6, 12, 24 or 36 months,
and an initial investment of at least $100,000 but not more than $5
million (unless you receive prior authorization to invest more),
exclusive of interest. Your principal and interest are guaranteed
by the Issuer. The Issuer guarantees a fixed rate of interest
depending upon the term you select. You may invest in successive
terms up to a total of 20 years from the issue date of the
certificate. Your interest rate will be determined as described in
"About the certificate."
This prospectus describes IDS Investors Certificate issued by the
Issuer and distributed by American Express Financial Advisors Inc.
American Express Bank International (AEBI) has an arrangement with
American Express Financial Advisors Inc. under which the
certificate is offered to AEBI's clients who are neither citizens
nor residents of the United States, and to certain U.S. trusts.
The certificate is currently available through AEBI offices located
in Florida and New York. The certificate is also available to
certain clients of Coutts & Co (USA) International (Coutts) through
its office in California.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
This prospectus describes terms and conditions of your IDS
Investors Certificate. It contains facts that can help you decide
if the certificate is the right investment for you. Read the
prospectus before you invest and keep it for future reference. No
one has the authority to change the terms and conditions of the IDS
Investors Certificate as described in the prospectus, or to bind
the Issuer by any statement not in it.
THIS CERTIFICATE IS NOT A DEPOSIT OR OBLIGATION OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK OR OTHER ENTITY, AND IS NOT FEDERALLY
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD, OR ANY OTHER AGENCY.
Issuer: IDS Certificate Company
IDS Tower 10
Minneapolis, MN 55440-0010
1-800-437-3133 (toll free)
PAGE (612) 671-3800
(Minneapolis/St. Paul area)
TTY numbers:
1-800-846-4293 (toll free) or
(612) 671-1630 (Minneapolis/St. Paul area)
PAGE 5
Distributor:
American Express Financial Advisors Inc.
IDS Tower 10
Minneapolis, MN 55440-0010
Selling Agents:
American Express Bank International
American Express Tower
World Financial Center
New York, NY 10285-2300
Coutts & Co (USA) International
421 North Rodeo Drive
Penthouse 1
Beverly Hills, CA 90210-4539
Where to get information about the Issuer
The Issuer is subject to the reporting requirements of the
Securities Exchange Act of 1934. Reports and other information on
the Issuer are filed with the Securities and Exchange Commission
(SEC). Copies can be obtained from the Public Reference Section of
the SEC, 450 5th St. NW, Washington, DC 20549, at prescribed
rates. Or you can inspect and copy information in person at the
SEC's Public Reference Section and at the following regional
offices:
Northeast Regional Office
7 World Trade Center
Suite 1300
New York, NY 10048
Midwest Regional Office
Northwestern Atrium Center
500 West Madison Street
Suite 1400
Chicago, IL 60611
Pacific Regional Office
5670 Wilshire Blvd.
11th Floor
Los Angeles, CA 90036
Initial Interest Rates
The Issuer guarantees a fixed rate of interest for each term. For
the initial term, the rate will be within a specified range of
certain average interest rates generally referred to as the London
Interbank Offered Rates (LIBOR) as explained under "About the
certificate."
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Here are the interest rates in effect on the date of this
prospectus, April 24, 1996*:
Actual
Simple Compound Effective
Interest Yield for Annualized
Term Rate* the Term ** Yield ***
1 month
2 month
3 month
6 month
12 month
24 month
36 month
* These are the rates for investments of $1 million. Rates may
depend on factors described in "Rates for new purchases" under
"About the certificate."
** Assuming monthly compounding for the number of months in the
term and a $1 million purchase.
*** Assuming monthly compounding for 12 months and a $1 million
purchase.
These rates may or may not be in effect when you apply to purchase
your certificate. Rates for future terms are set at the discretion
of the Issuer and may also differ from the rates shown here.
The Issuer reserves the right to issue other securities with
different terms.
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Contents
Table of Contents
About the certificate
Investment amounts and terms
Face amount and principal
Value at maturity
Receiving cash during the term
Interest
Rates for new purchases
Rates for future terms
Additional investments
How to invest and withdraw funds
Buying your certificate
Full and partial withdrawals
When your certificate term ends
Transferring certificate ownership
Giving instructions and written notification
Purchases by bank wire
Tax treatment of your investment
Withholding taxes
Estate tax
Trusts
How your money is used and protected
Invested and guaranteed by the Issuer
Regulated by government
Backed by our investments
Investment policies
How your money is managed
Relationship between the Issuer and American Express Financial
Corporation
Capital structure and certificates issued
Investment management and services
Distribution
Selling agreement with AEBI and Coutts
Employment of other American Express affiliates
Directors and officers
Auditors
About American Express Bank International
About American Express Company
Additional information about IDS Investors certificate
Annual financial information
Summary of selected financial information
Management's discussion and analysis of
financial condition and results of operations
Report of independent auditors
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Financial statements
Notes to financial statements
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About the certificate
Investment amounts and terms
You may purchase the IDS Investors Certificate with an initial
payment of at least $100,000 payable in U.S. currency. Unless you
receive prior authorization, your total amount paid in any one or
more certificates, in the aggregate over the life of the
certificate, less withdrawals, cannot exceed $5 million.
After determining the amount you wish to invest, you select a term
of 1, 2, 3, 6, 12, 24 or 36 months for which the Issuer will
guarantee a specific interest rate. The Issuer guarantees the
principal of your certificate. At the end of the term, you may
have interest earned on the certificate during its term credited to
your certificate or paid to you. Investments in the certificate
may continue for successive terms up to a total of 20 years from
the issue date of the certificate. Generally, you will be able to
select any of the terms offered. But if your certificate is
nearing its 20-year maturity, you will not be allowed to select a
term that would carry the certificate past its maturity date.
Face amount and principal
The face amount of the certificate is the amount of your initial
investment, and will remain the same over the life of the
certificate. Any investment or withdrawal within 15 days of the
end of a term will be added on or deducted to determine principal
for the new term. A withdrawal at any other time is taken first
from interest credited to your investment during that term. The
principal is the amount that is reinvested at the beginning of each
subsequent term, and is calculated as follows:
Principal equals Face Amount (initial investment)
plus At the end of a term, interest credited to
your account during the term
minus Any interest paid to you in cash
plus Any additional investments to your
certificate
minus Any withdrawals, fees and applicable
penalties
Principal may change during a term as described in "Full and
partial withdrawals."
For example: Assume your initial investment (face amount) of
$500,000 earned $7,500 of interest during the term. You have not
taken any interest as cash or made any withdrawals. You have
invested an additional $250,000 prior to the beginning of the next
term. Your principal for the next term will equal:
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$500,000 face amount (initial investment)
plus 7,500 interest credited to your account
minus (0) interest paid to you in cash
plus 250,000 additional investment to your certificate
minus (0) withdrawals and applicable penalties or fees
$757,500 PRINCIPAL AT THE BEGINNING OF THE NEXT TERM
Value at maturity
You may continue to invest for successive terms for up to a total
of 20 years. Your certificate matures at 20 years from its issue
date. At maturity, the value of your certificate will be the total
of your purchase price, plus additional investments and any
credited interest not paid to you in cash, less any withdrawals and
penalties. Some fees may apply as described in "How to invest and
withdraw funds."
Receiving cash during the term
If you need your money before your certificate term ends, you may
withdraw part or all of its value at any time, less any penalties
that apply.
Procedures for withdrawing money, as well as conditions under which
penalties apply, are described in "Full and partial withdrawals"
under "How to invest and withdraw funds."
Interest
Your investments earn interest from the date they are credited to
your account. Interest is compounded and credited at the end of
each certificate month (on the monthly anniversary of the issue
date). Interest may be paid to you monthly in cash if you maintain
a principal balance of at least $500,000.
The Issuer declares and guarantees a fixed rate of interest for
each term during the life of your certificate. We calculate the
amount of interest you earn each certificate month by:
o applying the interest rate then in effect to
your balance each day
o adding these daily amounts to get a monthly
total
o subtracting interest accrued on any amount
you withdraw during the certificate month.
Interest is calculated on a 30-day month and 360-day year basis.
Rates for new purchases
When your application is accepted and we have received your initial
investment, we will send you a confirmation of your purchase
showing the rate that your investment will earn. The Issuer
guarantees that the rate in effect for your initial term will be
within a 100 basis point (1%) range tied to certain average
interest rates for comparable length dollar deposits available on
an interbank basis in the London market, and generally referred to
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as the London Interbank Offered Rates (LIBOR). For investments of
$1 million or more, initial rates for specific terms are determined
as follows:
1 month Within a range of 80 basis points below to 20 basis
points above the 1-month LIBOR rate.
2 months Within a range of 80 basis points below to 20 basis
points above the 1-month LIBOR rate. (A 2-month LIBOR
rate is not published.)
3 months Within a range of 80 basis points below to 20 basis
points above the 3-month LIBOR rate.
6 months Within a range of 80 basis points below to 20 basis
points above the 6-month LIBOR rate.
12 months Within a range of 80 basis points below to 20 basis
points above the 12-month LIBOR rate.
24 months Within a range of 50 basis points below to 50 basis
points above the 12-month LIBOR rate.
36 months Within a range of 50 basis points below to 50 basis
points above the 12-month LIBOR rate.
For investments from $250,000 to $999,999 initial rates for
specific terms are determined as follows:
1 month Within a range of 100 basis points below to 0 basis
points above the 1-month LIBOR rate.
2 months Within a range of 100 basis points below to 0 basis
points above the 1-month LIBOR rate. (A 2-month LIBOR
rate is not published.)
3 months Within a range of 100 basis points below to 0 basis
points above the 3-month LIBOR rate.
6 months Within a range of 100 basis points below to 0 basis
points above the 6-month LIBOR rate.
12 months Within a range of 100 basis points below to 0 basis
points above the 12-month LIBOR rate.
24 months Within a range of 70 basis points below to 30 points
above the 12-month LIBOR rate. (A 24-month LIBOR rate is
not published.)
36 months Within a range of 70 basis points below to 30 points
above the 12-month LIBOR rate. (A 36-month LIBOR rate is
not published.)
For investments of $100,000 to $249,999, initial rates for specific
terms are determined as follows:
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1 month Within a range of 175 basis points below to 75 basis
points below the 1-month LIBOR rate.
2 months Within a range of 175 basis points below to 75 basis
points below the 1-month LIBOR rate. (A 2-month LIBOR
rate is not published.)
3 months Within a range of 175 basis points below to 75 basis
points below the 3-month LIBOR rate.
6 months Within a range of 175 basis points below to 75 basis
points below the 6-month LIBOR rate.
12 months Within a range of 175 basis points below to 75 basis
points below the 12-month LIBOR rate.
24 months Within a range of 145 basis points below to 45 basis
points below the 12-month LIBOR rate. (A 24-month LIBOR
rate is not published.)
36 months Within a range of 145 basis points below to 45 basis
points below the 12-month LIBOR rate. (A 36-month LIBOR
rate is not published.)
For example, if the LIBOR rate published on the date rates are
determined with respect to a 6-month deposit is 6.50%, the rate
declared on a 6-month IDS Investors Certificate greater than
$250,000 would be between 5.50% and 6.50%. If the LIBOR rate
published for a given week with respect to 12-month certificates is
7.00%, the Issuer's rates in effect that week for the 24- and 36-
month IDS Investors Certificates greater than $250,000 would be
between 6.30% and 7.30%. When your application is accepted, you
will be sent a confirmation showing the rate that your investment
will earn for the first term.
LIBOR is the interbank-offered rates for dollar deposits at which
major commercial banks will lend for specific terms in the London
market. Generally, LIBOR rates quoted by major London banks will
be the same. However, market conditions, including movements in
the U.S. prime rate and the internal funding position of each bank,
may result in minor differences in the rates offered by different
banks. LIBOR is a generally accepted and widely quoted interest-
rate benchmark. The average LIBOR rate used by the Issuer is
published in The Wall Street Journal.
Rates for new purchases are reviewed and may change daily. The
guaranteed rate that is in effect for your chosen term on the day
your application is accepted at the Issuer's corporate office in
Minneapolis, Minnesota, U.S.A. will apply to your certificate. The
interest rates printed in the front of this prospectus may or may
not be in effect on the date your application to invest is
accepted. Rates for new purchases may vary depending on the amount
you invest, but will always be within the 100 basis point range
described above. You may obtain the current interest rates by
calling your AEBI or Coutts representative.
PAGE 13
In determining rates based on the amount of your investment, the
Issuer may offer a rate based on your aggregate investment
determined by totaling only the amounts invested in each
certificate that has a current balance exceeding a specified level.
The current balance considered in this calculation may be exclusive
of interest. Part of the balance may be required to be invested in
terms of a specified minimum length. The certificates whose
balances are aggregated must have identical ownership. The rate
may be available only for a certificate whose current balance
exceeds a specified level or that is offered through a specified
distributor or selling agent.
Interest rates for the term you have selected will not change once
the term has begun.
Rates for future terms
Interest on your certificate for future terms may be greater or
less than the rates you receive during your first term. In setting
future interest rates for subsequent terms, a primary consideration
will be the prevailing investment climate, including the LIBOR
rates. Nevertheless, the Issuer has complete discretion as to what
interest rates it will declare beyond the initial term. The Issuer
will send you notice at the end of each term of the rate your
certificate will earn for the new term. You have a 15-day grace
period to withdraw your certificate without a withdrawal charge.
If LIBOR is no longer publicly available or feasible to use, the
Issuer may use another, similar index as a guide for setting rates.
Additional Investments
You may add to your investment when your term ends. If your new
term is a one-month term, you may add to your investment on the
first day of your new term (the renewal date) or the following
business day if the renewal date is a non-business day. If your
new term is greater than one month, you may add to your investment
within the 15 days following the end of your term. A $25,000
minimum additional investment is required, payable in U.S.
currency. Your confirmation will show the applicable rate.
However, unless you receive prior approval from the Issuer, your
investment may not bring the aggregate net investment of any one or
more certificates held by you (excluding any interest added during
the life of the certificate and less withdrawals) over $5 million.
Additional investments of at least $25,000 may be made by bank
wire.
The Issuer must receive your additional investment within the 15
days following the end of a certificate's current term (unless your
new investment is a one-month term), if you wish to increase your
principal investment as of the first day of the new term. Interest
accrues from the first day of the new term or the day your
additional investment is accepted by the Issuer, whichever is
later, at the rate then in effect for your account. If your new
term is a one-month term, your additional investment must be
received by the end of the certificate's current term.
The interest rate for these additional investments is the rate then
in effect for your account. If your additional investment
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increases the principal of your certificate so that your
certificate's principal has exceeded a break point for a higher
interest rate, the certificate will earn this higher interest rate
for the remainder of the term, from the date the Issuer accepts the
additional investment.
Earning interest
At the end of each certificate month, interest is compounded and
credited to your account. A certificate month is the monthly
anniversary of the issue date. Interest may be paid to you monthly
in cash if you maintain a principal balance of at least $500,000.
The amount of interest you earn each certificate month is
determined by applying the interest rate then in effect to the
daily balance of your certificate, and subtracting from that total
the interest accrued on any amount withdrawn during the month.
Interest is calculated on a 360-day year basis. This means
interest is calculated on the basis of a 30-day month even though
terms are determined on a calendar month.
How to invest and withdraw funds
Buying your certificate
This certificate is available only to AEBI clients who are neither
citizens nor residents of the United States, and to U.S. trusts
organized under the laws of any state in the United States, so long
as the following are true:
o the trust is unconditionally revocable by the grantor or
grantors (the persons or persons who put the money into the
trust);
o there are no more than 10 grantors of the trust;
o all the grantors are neither citizens nor residents of the
United States;
o each grantor provides an appropriately certified Form W-8 (or
approved substitute), as described under "Tax Treatment of
Your Investment;"
o the trustee of the trust is a bank organized under the laws of
the United States or any state in the United States; and
o the trustee supplies IDS Certificate Company with appropriate
tax documentation.
The certificate is available through AEBI offices located in
Florida and New York, and to the limited extent as described in the
section "Selling Agreements with AEBI and Coutts," through a Coutts
office located in California. An AEBI or Coutts representative
will help you prepare your purchase application. The Issuer will
process the application at our corporate offices in Minneapolis,
MN, U.S.A. When your application is accepted and we have received
your initial investment, we will send you a confirmation of your
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purchase, indicating your account number and applicable rate of
interest for your first term, as described under "Rates for new
purchases." See "Purchase policies" below.
Important: When opening an account, you must provide the Issuer
with a Form W-8 or approved substitute. See "Taxes on your
earnings."
Purchase policies:
o You have 15 days from the date of purchase to cancel your
investment without penalty by notifying your AEBI or Coutts
representative, or by writing or calling the Client Service
Organization at the address or phone number on the cover of
this prospectus. If you decide to cancel your certificate
within this 15-day period, you will not earn any interest.
o The Issuer has complete discretion to determine whether to
accept an application and sell a certificate.
Full and partial withdrawals
You may receive all or part of your money at any time. However:
o Full and partial withdrawals of principal are subject to
penalties, described below.
o Partial withdrawals during a term must be at least
$10,000. You may not make a partial withdrawal if it
would reduce your certificate balance to less than
$100,000. If you request such a withdrawal, we will
contact you for revised instructions.
o If a withdrawal reduces your account value to a point where we
pay a lower interest rate, you will earn the lower rate from
the date of the withdrawal.
o Withdrawals before the end of the certificate month will
result in loss of interest on the amount withdrawn.
You'll get the best result by timing a withdrawal at the
end of the certificate month.
o If your certificate is pledged as collateral, any withdrawal
will be delayed until we get approval from the secured party.
Penalties for early withdrawal during a term:
When you request a full or partial withdrawal, we pay the amount
you request:
o first from interest credited during the current term
o then from the principal of your certificate.
Any additional investments or withdrawals during a term are added
to or deducted from the principal and are used in determining any
withdrawal charges.
PAGE 16
Withdrawal penalties: For withdrawals during the term of more than
the interest credited that term, a 2% withdrawal penalty will be
deducted from the account's remaining balance.
For example, assume you invest $1 million in a certificate and
select a six-month term. Four months later assume you have earned
$27,000 in interest. The following demonstrates how the withdrawal
charge is deducted:
When you withdraw a specific amount of money, the Issuer has to
withdraw somewhat more from your account to cover the withdrawal
charge. For instance, suppose you request a $100,000 check on a $1
million investment. The first $27,000 paid to you is interest
earned that term, and the remaining $73,000 paid to you is
principal. The Issuer would send you a check for $100,000 and
deduct a withdrawal charge of $1,460 (2% of $73,000) from the
remaining balance of your certificate. Your new balance would be
$925,540.
Total investments $1,000,000
Interested credited $ 27,000
Total balance $1,027,000
Requested check $100,000
Credited interest withdrawn ( 27,000)
Withdrawal charge percent 2%
Actual withdrawal charge $1,460
Balance prior to withdrawal $1,027,000
Requested withdrawal check ($100,000)
Withdrawal charge ($1,460)
Total balance after withdrawal $925,540
Additionally, if you make a withdrawal during a certificate month,
you will not earn interest for the month on the amount withdrawn.
For more information on withdrawal charges, talk with your AEBI or
Coutts representative.
When your certificate term ends
Shortly before the end of the term you have selected for your
certificate, the Issuer will send you a notice indicating the
interest rate that will apply to the certificate for the new term.
When your certificate term ends, the Issuer will automatically
renew your certificate for the same term unless you notify your
AEBI or Coutts representative otherwise. If you wish to select a
different term, you must notify your representative in writing
before the end of the grace period. You will not be allowed to
select a term that would carry the certificate past its maturity
date.
The interest rates that will apply to your new term will be those
in effect on the day the new term begins. We will send you a
PAGE 17
confirmation showing the rate of interest that will apply to the
new term you have selected. This rate of interest will not be
changed during that term.
If you want to withdraw your certificate without a withdrawal
charge, you must notify us within 15 calendar days following the
end of a term.
For most terms, you may also add to your investment within the 15
calendar days following the end of your term. See "Additional
investments" under "About the Certificate."
Other full and partial withdrawal policies:
o If you request a partial or full withdrawal of a certificate
recently purchased or added to by a check or money order that
is not guaranteed, we will wait for your check to clear.
Please expect a minimum of 10 days from the date of your
payment before IDSC mails a check to you. A check may be
mailed earlier if your bank provides evidence that your check
has cleared.
o If your certificate is pledged as collateral, any withdrawal
will be delayed until we get approval from the secured party.
o Any payments to you may be delayed under applicable rules,
regulations or orders of the SEC.
Transferring Certificate Ownership
While this instrument is not a negotiable instrument, it may be
transferred or assigned on the Issuer's records if proper written
notice is received by the Issuer. Ownership may be assigned or
transferred to individuals or an entity who, for U.S. tax purposes,
is considered to be neither a citizen nor resident of the United
States. You may also pledge the certificate to AEBI or another
American Express Company affiliate or to Coutts as collateral
security. Your AEBI or Coutts representative can help you transfer
ownership.
Giving Instructions and Written Notification
Your AEBI or Coutts representative will be happy to handle
instructions concerning your account. Written instructions may be
provided to either your representative's office or directly to the
Issuer.
Proper written notice to your AEBI or Coutts representative or the
Issuer must:
o be addressed to your AEBI or Coutts office or the Issuer's
corporate office, in which case it must identify your AEBI or
Coutts office,
PAGE 18
o include your account number and sufficient information for the
Issuer to carry out your request, and
o be signed and dated by all registered owners.
The Issuer will acknowledge your written instructions. If your
instructions are incomplete or unclear, you will be contacted for
revised instructions.
In the absence of any other written mandate or instructions you
have provided to AEBI or Coutts, you may elect in writing, on your
initial or any subsequent purchase application, to authorize AEBI
or Coutts to act upon the sole verbal instructions of any one of
the named owners, and in turn to instruct the Issuer with regard to
any and all actions in connection with the certificate referenced
in the application as it may be modified from time to time by term
changes, renewals, additions or withdrawals. The individual
providing verbal instructions must be a named owner of the
certificate involved. In providing such authorization you agree
that the Issuer, its transfer agent, AEBI and Coutts will not be
liable for any loss, liability, cost or expense arising in
connection with implementing such instructions, reasonably believed
by the Issuer, AEBI or Coutts, or their representatives, to be
genuine. You may revoke such authority at any time by providing
proper written notice to your AEBI or Coutts office.
All amounts payable to or by the Issuer in connection with this
certificate are payable at the Issuer's corporate office unless you
are advised otherwise.
Purchases By Bank Wire
You may wish to lock in a specific interest rate by using a bank
wire to purchase a certificate. Your representative can instruct
you about how to use this procedure. Using this procedure will
allow you to start earning interest at the earliest possible time.
The minimum that may be wired to purchase a new certificate is
$100,000.
Wire orders will be accepted only in U.S. currency and only on days
your bank, the Issuer and Norwest Bank Minneapolis are open for
business. The payment must be received by the Issuer before 12
noon Central U.S.A. time to be credited that day. Otherwise, it
will be processed the next business day. The wire purchase will
not be made until the wired amount is received and the purchase is
accepted by the Issuer. Wire transfers not originating from AEB
are accepted by IDSC's corporate office only from banks located in
the United States of America. Any delays that may occur in wiring
the funds, including delays in processing by the banks, are not the
responsibility of the Issuer. Wire orders may be rejected if they
do not contain complete information.
While the Issuer does not charge a service fee for incoming wires,
you must pay any charge assessed by your bank for the wire service.
If a wire order is rejected, all money received will be returned
promptly less any costs incurred in rejecting it.
PAGE 19
Tax treatment of your investment
Interest paid on your certificate is "portfolio interest" as
defined in U.S. Internal Revenue Code Section 871(h) if earned by a
nonresident alien who has supplied the Issuer with Form W-8,
Certificate of Foreign Status. Form W-8 must be supplied with both
a current mailing address and an address of foreign residency, if
different. The Issuer will not accept purchases of certificates by
nonresident aliens without an appropriately certified Form W-8 (or
approved substitute). The Form W-8 must be resupplied every three
calendar years. If you have supplied a Form W-8 that certifies
that you are a nonresident alien, the interest income will be
reported at year end to you and to the U.S. Government on a Form
1042S, Foreign Person's U.S. Source Income Subject to Withholding.
We are required to attach your Form W-8 to the forms sent to the
Internal Revenue Service (IRS). Your interest income will be
reported to the IRS even though it is not taxed by the U.S.
Government. The United States participates in various tax treaties
with foreign countries. Those treaties provide that tax
information may be shared upon request between the United States
and such foreign governments.
Withholding taxes
If you fail to provide a Form W-8 as required above, you will be
subject to backup withholding on interest payments and surrenders.
Estate tax
In the event of the death of a nonresident alien who owns a
certificate, depending on the circumstances the Issuer generally
will not act on instructions with regard to the certificate unless
the Issuer first receives at a minimum a statement in a form
satisfactory to the Issuer, from persons that it reasonably
believes are knowledgeable about and responsible for the deceased
person's estate. The statement must inform the Issuer that, on the
date of death, the estate did not include any property in the
United States for U.S. estate tax purposes. In other cases, the
Issuer generally will not act on instructions with regard to the
certificate unless the Issuer first receives a transfer certificate
from the IRS or evidence satisfactory to the Issuer that the estate
is being administered by an executor or administrator appointed,
qualified and acting within the United States. In general, a
transfer certificate requires the opening of an estate in the
United States and provides assurance that the IRS will not claim
the certificate to satisfy estate taxes.
Trusts
If the investor is a trust described in "Buying your certificate"
under "How to invest and withdraw funds," the policies and
procedures described above will apply with regard to each grantor.
Invested and guaranteed by the Issuer
IDS Certificate Company, an American Express company, issues the
IDS Investors Certificate. The Issuer is by far the largest issuer
PAGE 20
of face amount certificates in the United States, with total assets
of more than $___ billion and a net worth in excess of $___ million
on Dec. 31, 1995.
We back your certificates by investing the money received and
keeping the invested assets on deposit. Our investments generate
interest and dividends, out of which we pay:
o interest to certificate owners
o various expenses, including taxes, fees to American Express
Financial Corporation for advisory and other services and
distribution fees to American Express Financial Advisors Inc.
For a review of significant events relating to our business, see
"Management's discussion and analysis of financial condition and
results of operations." Our certificates are not rated by a
national rating agency.
Most banks and thrifts offer investments known as certificates of
deposit (CDs) that are similar to our certificates in many ways.
Early withdrawals of bank CDs often result in penalties. Banks and
thrifts generally have federal deposit insurance for their deposits
and lend much of the money you deposit to individuals, businesses
and other enterprises. Other financial institutions may offer
investments with comparable combinations of safety and return on
investment.
Regulated by government
Because the IDS Investors Certificate is a security, its offer and
sale are subject to regulation under United States federal and
state securities laws. (It is a face-amount certificate--not a
bank product, an equity investment, a form of life insurance or an
investment trust.)
The federal Investment Company Act of 1940 requires us to keep
investments on deposit in a segregated custodial account to protect
all of our outstanding certificates. These investments back the
entire value of your certificate account. Their amortized cost
must exceed the required carrying value of the outstanding
certificates by at least $250,000. As of Dec. 31, 1995, the
amortized cost of these investments exceeded the required carrying
value of our outstanding certificates by more than $___ million.
Backed by our investments
The Issuer's investments are varied and of high quality. This was
the composition of our portfolio as of Dec. 31, 1995.
Type of investment Net amount invested
Corporate and other bonds 31%
Government agency bonds 27%
Preferred stocks 23%
Mortgages 9%
Municipal bonds 5%
Cash and cash equivalents 5%
PAGE 21
More than 95% of the Issuer's securities portfolio (bonds and
preferred stocks) are rated investment grade. For additional
information regarding securities ratings, please refer to Note 3B
in the financial statements.
Most of the Issuer's investments are on deposit with American
Express Trust Company, Minneapolis, although the Issuer also
maintains separate deposits as required by certain states.
American Express Trust Company is a wholly owned subsidiary of
American Express Financial Corporation (AEFC). Copies of the
Issuer's Dec. 31, 1995 schedule of Investments in Securities of
Unaffiliated Issuers are available upon request. For comments
regarding the valuation, carrying values and unrealized
appreciation (depreciation) of investment securities, see Notes 1,
2 and 3 to the financial statements.
Investment policies
In deciding how to diversify the portfolio--among what types of
investments in what amounts--the officers and directors of the
Issuer use their best judgment, subject to applicable law. The
following policies currently govern our investment decisions:
Purchasing securities on margin:
The Issuer will not purchase any securities on margin or
participate on a joint basis or a joint-and-several basis in any
trading account in securities.
Commodities:
The Issuer has not and does not intend to purchase or sell
commodities or commodity contracts.
Underwriting:
The Issuer does not intend to engage in the public distribution of
securities issued by others. However, if the Issuer purchases
unregistered securities and later resells them, the Issuer may be
considered an underwriter under federal securities laws.
Borrowing money:
From time to time the Issuer has established a line of credit if
management believed borrowing was necessary or desirable. While a
line of credit does not currently exist, it may be established
again in the future. The Issuer may pledge some of its assets as
security. The Issuer may occasionally use repurchase agreements as
a way to borrow money. Under these agreements, the Issuer sells
debt securities to its lender, and repurchases them at the sales
price plus an agreed-upon interest rate within a specified period
of time.
Real estate:
The Issuer may invest directly in real estate, though we have not
generally done so in the past. The Issuer does invest in mortgage
loans.
PAGE 22
Lending securities:
The Issuer may lend some of its securities to broker-dealers and
receive cash equal to the market value of the securities as
collateral. The Issuer invests this cash in short-term securities.
If the market value of the securities goes up, the borrower pays
the Issuer additional cash. During the course of the loan, the
borrower makes cash payments to the Issuer equal to all interest,
dividends and other distributions paid on the loaned securities.
The Issuer will try to vote these securities if a major event
affecting the investment is under consideration.
When-issued securities:
Most of the Issuer's investments are in debt securities, some of
which are purchased on a when-issued basis. It may take as long as
45 days or more before these securities are issued and delivered to
the Issuer. The Issuer generally does not pay for these securities
or start earning on them until delivery. The Issuer has
established procedures to ensure that sufficient cash is available
to meet when-issued commitments.
Financial transactions:
The Issuer buys or sells various types of options contracts for
hedging purposes or as a trading technique to facilitate securities
purchases or sales. The Issuer buys interest rate caps for hedging
purposes. These pay a return if interest rates rise above a
specified level. The Issuer may enter into other financial
transactions, including futures and other derivatives, for the
purpose of managing the interest rate exposures associated with the
Issuer's assets or liabilities. Derivatives are financial
instruments whose performance is derived, at least in part, from
the performance of an underlying asset, security or index. A small
change in the value of the underlying asset, security or index may
cause a sizable gain or loss in the fair value of the derivative.
Illiquid securities: A security is illiquid if it cannot be sold
in the normal course of business within seven days at approximately
its current market value. Some investments cannot be resold to the
U.S. public because of their terms or government regulations. All
securities, however, can be sold in private sales, and many may be
sold to other institutions and qualified buyers or on foreign
markets. IDSC's investment advisor will follow guidelines
established by the board and consider relevant factors such as the
nature of the security and the number of likely buyers when
determining whether a security is illiquid. No more than 15% of
IDSC's investment portfolio will be held in securities that are
illiquid. In valuing its investment portfolio to determine this
15% illiquid securities limit, IDSC will use statutory accounting.
This means that, for this purpose, the portfolio will be valued in
accordance with applicable investment statutes rather than
generally accepted accounting principles.
PAGE 23
Restrictions:
There are no restrictions on concentration of investments in any
particular industry or group of industries or on rates of portfolio
turnover.
How your money is managed
Relationship between the Issuer and AEFC
The Issuer was originally organized as Investors Syndicate of
America, Inc., a Minnesota corporation, on Oct. 15, 1940, and began
business as an issuer of face amount investment certificates on
Jan. 1, 1941. The company became a Delaware corporation on Dec.
31, 1977, and changed its name to IDS Certificate Company (IDSC) on
April 2, 1984.
Before the Issuer was created, AEFC (formerly known as IDS
Financial Corporation), our parent company and organizer, had
issued similar certificates since 1894. As of Jan. 1, 1995, IDS
Financial Corporation changed its name to AEFC. The Issuer and
AEFC have never failed to meet their certificate payments.
During its many years in operation, AEFC has become a leading
manager in investments in mortgages and securities. As of Dec. 31,
1995, AEFC managed investments, including its own, of more than
$___ billion. American Express Financial Advisors Inc. provides a
broad range of financial planning services for individuals and
businesses through its nationwide network of more than ___ offices
and more than ____ financial advisors. American Express Financial
Advisors Inc. financial planning services are comprehensive,
beginning with a detailed written analysis that's tailored to your
needs. Your analysis may address one or all of these six essential
areas: financial position, protection planning, investment
planning, income tax planning, retirement planning and estate
planning.
AEFC itself is a wholly owned subsidiary of American Express
Company, a financial services company with executive offices at
American Express Tower, World Financial Center, New York, NY
10285. American Express Company is a financial services company
engaged through subsidiaries in other business including:
o travel related services (including American Express Card(R)
and Travelers Cheque operations through American Express
Travel Related Services Company, Inc. and its subsidiaries),
and
o international banking services (through American Express Bank
Ltd. and its subsidiaries).
American Express Financial Advisors Inc. is not a bank, and the
securities offered by it, such as face amount certificates issued
PAGE 24
by IDSC, are not backed or guaranteed by any bank, nor are they
insured by the FDIC.
Capital structure and certificates issued.
The Issuer has authorized, issued and has outstanding 150,000
shares of common stock, par value of $10 per share. AEFC owns all
of the outstanding shares.
As of Dec. 31, 1995, the Issuer had issued (in face amount)
$______________ of installment certificates and $______________ of
single payment certificates.
Investment management and services
Under an Investment Advisory and Services Agreement, AEFC acts as
our investment adviser and is responsible for:
o providing investment research,
o making specific investment recommendations, and
o executing purchase and sale orders according to our policy of
obtaining the best price and execution.
All these activities are subject to direction and control by our
board of directors and officers. The Issuer's agreement with AEFC
requires annual renewal by the Issuer's board, including a majority
of directors who are not interested persons of AEFC or IDSC as
defined in the federal Investment Company Act of 1940.
For its services, the Issuer pays AEFC a monthly fee, equal on an
annual basis to a percentage of the total book value of certain
assets (included assets):
Advisory and services fee computation:
Included assets Percentage of total book value
First $250 million 0.75%
Next 250 million 0.65%
Next 250 million 0.55%
Next 250 million 0.50%
Any amount over $1 billion 0.45%
Included assets are all assets of the Issuer except mortgage loans,
real estate, and any other asset on which we pay an advisory or a
service fee.
Advisory and services fees for past three years:
Percentage of
Year Total fees included assets
1995 $ %
1994 $13,565,432 0.51%
1993 $15,036,091 0.50%
PAGE 25
Estimated advisory and services fees for 1996 are $__________.
Other expenses payable by the Issuer:
The Investment Advisory and Services Agreement provides that the
issuer will pay:
o costs incurred in connection with real estate and mortgages,
o taxes,
o depository and custodian fees,
o brokerage commissions,
o fees and expenses for services not covered by other agreements
and provided to us at the Issuer's request, or by requirement,
by attorneys, auditors, examiners and professional consultants
who are not officers or employees of AEFC,
o fees and expenses of the Issuer's directors who are not
officers or employees of American Express Financial
Corporation,
o provision for certificate reserves (interest accrued on
certificate owner account), and
o expenses of customer settlements not attributable to sales
function.
Distribution
Under a Distribution Agreement with American Express Financial
Advisors Inc., the Issuer pays an annualized fee equal to 1% of the
amount outstanding for the distribution of this certificate.
Payments are made at the end of each term on certificates with a
1-, 2- or 3-month term. Payments are made each quarter from
issuance date on certificate with a 6-, 12-,24- or 36-month term.
Total distribution fees paid to American Express Financial Advisors
Inc. for all series of certificates amounted to $__________ during
the year ended Dec. 31, 1995. The Issuer expects to pay American
Express Financial Advisors Inc. distribution fees amount to
$__________ during 1996.
See Note 1 to financial statements regarding deferral of
distribution fee expense.
American Express Financial Advisors Inc. pays commissions to its
financial advisors and pays other selling expenses in connection
with services to the Issuer. The Issuer's board of directors,
including a majority of directors who are not interested persons of
AEFC or IDSC, approved this distribution agreement.
Selling Agreements with AEBI and Coutts
In turn, under Selling Agent Agreements with AEBI and Coutts,
American Express Financial Advisors compensates each for their
services as Selling Agents of this certificate as follows:
AEBI is paid an annualized fee ranging from 0.50% to 1.25% of the
reserve balance of each certificate, depending on the amount
PAGE 26
outstanding for each such certificate, with this exception: The
fee will be 0.30% of the reserve balance of each certificate with
an amount outstanding of $5 million or more when:
o the aggregate reserve balance for that certificate, and any
other certificate with identical ownership and an amount
outstanding of $5 million or more, is at least $20 million,
and
o at least $5 million of this aggregate reserve balance is
invested for a term of 12 months or longer.
Coutts is paid an annualized fee ranging from 0.425% to 0.68% of
the reserve balance of each certificate owned by a client who is a
former client of AEBI, depending on the amount outstanding for each
certificate. These clients must have continuously owned a
certificate since Nov. 10, 1994. Coutts is also compensated on
additional investments and exchanges made by such clients to other
certificates only to the extent that clients have the right to make
additional investments or exchanges.
American Express Financial Advisors has entered into a consulting
agreement with AEBI under which AEBI provides consulting services
related to any selling agent agreements between American Express
Financial Advisors and other Edge Act corporations. For these
services, American Express Financial Advisors pays AEBI a fee for
this certificate ranging from 0.075% to 0.12% of the reserve
balance of each certificate, depending on the amount outstanding
for each certificate for which another Edge Act corporation is the
selling agent.
Such payments will be made periodically in arrears.
These fees are not assessed to your certificate account.
Employment of other American Express affiliates
AEFC may employ affiliates of American Express Company as executing
broker for the Issuer's portfolio transactions only if:
o it is determined that the prices and executions are at least
as favorable as those offered by qualified independent brokers
performing similar services;
o the affiliate charges commissions consistent with those
charged to comparable unaffiliated customers for similar
transactions; and
o the affiliate's employment is consistent with the terms of the
current Investment Advisory and Services Agreement and federal
securities laws.
Directors and officers
The Issuer's directors, chairman, president and controller are
elected annually for a term of one year. The other executive
officers are appointed by the president.
PAGE 27
The Issuer paid a total of $______ during 1995 to directors not
employed by AEFC.
Board of directors
David R. Hubers*
Born in 1943
Director since 1987
President and chief executive officer of AEFC since 1993. Senior
vice president and chief financial officer of AEFC from 1984 to
1993.
Charles W. Johnson
Born in 1929
Director since 1989
Former vice president and group executive, Industrial Systems, with
Honeywell Inc. Retired 1989.
Edward Landes
Born in 1919
Director since 1984
Development consultant. Former sales manager - Supplies Division
and district manager - Data Processing Division of IBM Corporation.
Retired 1983.
John V. Luck Ph.D.
Born in 1926
Director since 1987
Former senior vice president - Science and Technology with General
Mills, Inc. Employed with General Mills Inc. since 1970. Retired
1987.
James A. Mitchell*
Born in 1941
Director since 1994
Chairman of the board of directors since 1994. Executive vice
president - marketing and products of AEFC since 1994. Senior vice
president - insurance operations of AEFC and president and chief
executive officer of IDS Life Insurance Company from 1986 to 1994.
Harrison Randolph
Born in 1916
Director since 1968
Gordon H. Ritz
Born in 1926
Director since 1968
President, Con Rad Broadcasting Corp. Director, Sunstar Foods and
Mid-America Publishing.
PAGE 28
Stuart A. Sedlacek*
Born in 1957
Director since 1994
President since 1994. Vice president - assured assets of AEFC
since 1994. Vice president and portfolio manager from 1988 to
1994. Executive vice president - assured assets of IDS Life
Insurance Company since March 1994.
*"Interested Person" of IDSC as that term is defined in Investment
Company Act of 1940.
Executive officers
Stuart A. Sedlacek
Born in 1957
President since 1994
Morris Goodwin Jr.
Born in 1951
Vice president and treasurer since 1989.
Vice president and corporate treasurer of AEFC since 1989. Chief
financial officer and treasurer of American Express Trust Company
from 1988 to 1989.
Timothy S. Meehan
Born in 1957
Secretary since 1995.
Secretary of AEFC and American Express Financial Advisors Inc.
since 1995. Senior counsel to AEFC since 1995. Counsel from 1990
to 1995.
Lorraine R. Hart
Born in 1951
Vice president-investments since 1994.
Vice President - insurance investments of AEFC since 1989. Vice
president, investments of IDS Life Insurance Company since 1992.
Jay C. Hatlestad
Born in 1957
Vice president and controller of IDS Certificate Company since
1994.
Manager of investment accounting of IDS Life Insurance Company from
1986 to 1994.
Bruce A. Kohn
Born in 1951
Vice president and general counsel since 1993
Counsel to AEFC since 1992. Associate counsel from 1987 to 1992.
PAGE 29
F. Dale Simmons
Born in 1937
Vice president - Real Estate Loan Management since 1993
Vice president of AEFC since 1992. Senior portfolio manager of
AEFC since 1989. Assistant vice president from 1987 to 1992.
The officers and directors as a group beneficially own less than 1%
of the common stock of American Express Company.
The Issuer has provisions in its bylaws relating to the
indemnification of its officers and directors against liability, as
permitted by law. Insofar as indemnification for liabilities
arising under the Securities Act of 1933 may be permitted to
directors, officers or persons controlling the registrant pursuant
to the foregoing provisions, the registrant has been informed that
in the opinion of the SEC such indemnification is against public
policy as expressed in the Act and is therefore unenforceable.
Auditors
A firm of independent auditors audits the Issuer's financial
statements at the close of each fiscal year (Dec. 31st). Copies of
the annual financial statements (audited) and semiannual financial
statements (unaudited) are available to any certificate owner upon
request.
Ernst & Young LLP, Minneapolis, has audited the financial
statements for each of the years in the three-year period ended
December 31, 1995. These statements are included in this
prospectus. Ernst & Young LLP is also the auditor for American
Express Company.
PAGE 30
About AEBI
AEBI is an Edge Act corporation organized under the provisions of
Section 25(a) of the Federal Reserve Act. It is a wholly owned
subsidiary of American Express Bank Ltd. (AEBL). As an Edge Act
corporation, AEBI is subject to the provisions of Section 25(a) of
the Federal Reserve Act and Regulation K of the Board of Governors
of the Federal Reserve System (the Federal Reserve). It is
supervised and regulated by the Federal Reserve.
AEBI has an extensive international high net-worth client base that
is serviced by a marketing staff in New York and Florida. The
banking and financial products offered by AEBI include checking,
money market and time deposits, credit services, check collection
services, foreign exchange, funds transfer, investment advisory
services and securities brokerage services. As of December 31,
1995, AEBI had total assets of $___ million and total equity of
$___ million.
Coutts is an Edge Act corporation organized under the provisions of
Section 25(a) of the Federal Reserve Act. It is an indirect wholly
owned subsidiary of NatWest PLC. As an Edge Act corporation,
Coutts is subject to the provisions of Section 25(a) of the Federal
Reserve Act and Regulation K of the Board of Governors of the
Federal Reserve System (the Federal Reserve). It is supervised and
regulated by the Federal Reserve.
Although AEBI and Coutts are banking entities, the IDS Investors
Certificate is not a bank product, nor is it backed or guaranteed
by AEBI or Coutts, by AEBL, by NatWest PLC or by any other bank,
nor is it guaranteed or insured by the FDIC or any other federal
agency. AEBI is registered where necessary as a securities broker-
dealer.
About American Express Company
American Express Company is a financial services company
principally engaged through subsidiaries in the following
businesses in addition to AEFC:
o travel related services (including American Express(R) Card
and Travelers Cheque operations through American Express
Travel Related Services Company, Inc. and its subsidiaries),
o investment and asset management services,
o international banking services (through American Express Bank
Ltd. and its subsidiaries).
American Express Company's executive offices are located at
American Express Tower, World Financial Center, New York, NY 10285.
PAGE 31
Additional information about IDS Investors Certificate
Issuer:
IDS Certificate Company
Executive Offices
IDS Tower 10
Minneapolis, MN 55440-0010
Independent Auditors:
Ernst and Young LLP
1400 Pillsbury Center
Minneapolis, MN 55402
Central Depository:
American Express Trust Company
1200 Northstar Center West
Minneapolis, MN 55402
Investment Manager:
American Express Financial Corporation Inc.
IDS Tower 10
Minneapolis, MN 55440-0010
Distributor:
American Express Financial Advisors Inc.
IDS Tower 10
Minneapolis, MN 55440-0010
Selling Agents:
American Express Bank International
American Express Tower
World Financial Center
New York, NY 10285-2300
Coutts & Co (USA) International
421 North Rodeo Drive
Penthouse 1
Beverly Hills, CA 90210-4539
PAGE 32
(Outside back cover)
Quick telephone reference
Selling Agent:
American Express Bank International
Region offices
101 East 52nd Street
29th Floor
New York, NY 10022
(212) 415-9500
1221 Brickell Avenue
8th Floor
Miami, FL 33131
(305) 350-7750
Selling agent
Coutts & Co. (USA) International
421 North Rodeo Drive
Penthouse 1
Beverly Hills, CA 90210
(310) 858-2924
American Express Financial Advisors Inc.
IDS Investors Certificate
IDS Tower 10
Minneapolis, MN 55440-0010
PAGE 33
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item
Number
Item 13. Other Expenses of Issuance and Distribution.
The expenses in connection with the issuance and
distribution of the securities being registered are to be
borne by the registrant.
Item 14. Indemnification of Directors and Officers.
The By-Laws of IDS Certificate Company provide that it
shall indemnify any person who was or is a party or is
threatened to be made a party, by reason of the fact that
he was or is a director, officer, employee or agent of
the company, or is or was serving at the direction of the
company, or any predecessor corporation as a director,
officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, to
any threatened, pending or completed action, suit or
proceeding, wherever brought, to the fullest extent
permitted by the laws of the state of Delaware, as now
existing or hereafter amended.
The By-Laws further provide that indemnification
questions applicable to a corporation which has been
merged into the company relating to causes of action
arising prior to the date of such merger shall be
governed exclusively by the applicable laws of the state
of incorporation and by the by-laws of such merged
corporation then in effect. See also Item 17.
Item 15. Recent Sales of Unregistered Securities.
(a) Securities Sold
Period of sale Title of securities Amount sold
1992 IDS Special Deposits $29,753,590.00
1993 IDS Special Deposits 8,367,601.13
1994 IDS Special Deposits 18,013,424.38
1995 IDS Special Deposits 56,855,953.53
(b) Underwriters and other purchasers
IDS Special Deposits are marketed by American Express Bank Ltd.
(AEBL), an affiliate of IDS Certificate Company, to private banking
clients of AEBL in the United Kingdom.
(c) Consideration
All IDS Special Deposits were sold for cash. The aggregate
offering price was the same as the amount sold in the table above.
Aggregate marketing fees to AEBL were $147,146.65 in 1992,
$153,318.21 in 1993, $88,686.14 in 1994, and $172,633.41 in 1995.
PAGE 34
(d) Exemption from registration claimed
IDS Special Deposits are marketed, pursuant to the exemption in
Regulation S under the Securities Act of 1933, by AEBL in the
United Kingdom to persons who are not U.S. persons, as defined in
Regulation S.
Item 16. Exhibits and Financial Statement Schedules.
(a) The following exhibits to this Post-Effective Amendment
No. 11 to Registration Statement No. 33-26844 are
incorporated herein by reference or attached hereto:
1. (a) Copy of Distribution Agreement dated November
18, 1988, between Registrant and IDS Financial
Services Inc., filed electronically as Exhibit
1(a) to the Registration Statement for the
American Express International Investment
Certificate (now called, the IDS Investors
Certificate), is incorporated herein by
reference.
(b) Form of the Distribution Agreement for the
American Express Savings Certificate between
the Registrant and American Express Service
Corporation, filed electronically as Exhibit
1(b) to the Registration Statement for the
American Express International Investment
Certificate (now called, the IDS Investors
Certificate), is incorporated herein by
reference.
(c)(c)Selling Agent Agreement dated June 1, 1990
between American Express Bank International and
IDS Financial Services Inc. for the IDS
Investors Certificate, filed electronically as
Exhibit 1 to the Pre-Effective Amendment 2 to
Registration Statement No. 33-26844 for the IDS
Investors Certificate is incorporated herein by
reference.
(d) Amendment to the Selling Agent Agreement dated
Dec. 12, 1994 between American Express Bank
International and IDS Financial Services Inc.
for the IDS Investors Certificate is filed
electronically as Exhibit 1(d) to Post-
Effective Amendment No. 9 to Registration
Statment No. 33-26844 for IDS Investors
Certificate is incorporated herein by
reference.
(e) Selling Agent Agreement dated Dec. 12, 1994
between American Express Bank International,
Coutts & Co (USA) International and IDS
Financial Services Inc. for the Investors
Certificate is filed electronically. As
Exhibit 1(e) to Post-Effective Amendment No. 9
to Registration Statment No. 33-26844 for IDS
PAGE 35
Investors Certificate is incorporated herein by
reference.
(f) Consulting Agreement dated Dec. 12, 1994
between American Express Bank and IDS Financial
Services Inc. for the IDS Investors Certificate
is filed electronically. As Exhibit 1(f) to
Post-Effective Amendment No. 9 to Registration
Statment No. 33-26844 for IDS Investors
Certificate is incorporated herein by
reference.
(g) Marketing Agreement dated October 10,1991,
between Registrant and American Express Bank
Ltd., filed electronically as Exhibit 1(d) to
Post-Effective Amendment No. 31 to Registration
Statement 2-55252, is incorporated herein by
reference.
2. Not Applicable.
3. (a) Certificate of Incorporation, dated December
31, 1977, filed electronically as Exhibit 3(a)
to Post-Effective Amendment No. 2 to
Registration Statement No. 2-95577, is
incorporated herein by reference.
(b) Certificate of Amendment, dated February 29,
l984, filed electronically as Exhibit 3(b) to
Post-Effective Amendment No. 2 to Registration
Statement No. 2-95577, is incorporated herein
by reference.
(c) By-Laws, dated December 31, 1977, filed
electronically as Exhibit 3(c) to Post-
Effective Amendment No. 2 to Registration
Statement No. 2-95577, is incorporated herein
by reference.
4. Not applicable.
5. Not applicable.
6 through 9. -- None.
10. (a) Investment Advisory and Services Agreement
between Registrant and IDS/American Express
Inc., dated January 12, 1984, filed
electronically as Exhibit 10(a) to Post-
Effective Amendment No. 2 to Registration
Statement No. 2-95577, is incorporated herein
by reference.
(b) Depository and Custodial Agreement, between IDS
Certificate Company and IDS Trust Company dated
September 30, 1985, filed electronically as
Exhibit 10(b) to Post-Effective Amendment No. 2
to Registration Statement No. 2-95577, is
incorporated herein by reference.
PAGE 36
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item 16.
(a) Continued
(c) Loan Agreement between Registrant and Investors
Syndicate Development Corporation, dated
October 13, 1970, filed electronically as
Exhibit 10(c) to Post-Effective Amendment No. 2
to Registration Statement No. 2-95577, is
incorporated herein by reference.
(d) Agreement for the servicing of Residential
Mortgage Loans between ISA and Advance Mortgage
Company, Ltd., dated August 31, 1980, filed
electronically as Exhibit 10(d) to Post-
Effective Amendment No. 2 to Registration
Statement No. 2-95577, is incorporated herein
by reference.
(e) Agreement for the servicing of Commercial
Mortgage Loans, between ISA and FBS Mortgage
Corporation, dated October 1, 1980, filed
electronically as Exhibit 10(e) to Post-
Effective Amendment No. 2 to Registration
Statement No. 2-95577, is incorporated herein
by reference.
(f) Agreement by and between Registrant and
Investors Diversified Services, Inc. (now IDS
Financial Services Inc.) providing for the
purchase by IDS of a block of portfolio
securities from Registrant, filed as Exhibit -
10.5 to the September 30, 1981 quarterly report
on Form 10-Q of Alleghany Corporation, is
incorporated herein by reference.
(g) Transfer Agent Agreements for the servicing of
the American Express Savings Certificate filed
electronically as Exhibit 10(g) to Pre-
Effective Amendment No. 1 to Registration
Statement No. 33-25385, are incorporated herein
by reference.
(h) Foreign Deposit Agreement dated November 24,
1990, between Registrant and IDS Bank & Trust,
filed electronically as Exhibit 10(h) to Post-
Effective Amendment No. 5 to Registration
Statement No. 33-26844, is incorporated herein
by reference.
11 through 24. -- None.
25. (a) Officers' Power of Attorney, dated May 17,
1994, filed electronically as Exhibit
25(a) to Post-Effective Amendment No. 9 to
Registration Statement No. 2-95577, is
incorporated herein by reference.
PAGE 37
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item 16.
(a) Continued
(b) Directors' Power of Attorney, dated May
13, 1994, filed electronically as Exhibit
25(b) to Post-Effective Amendment No. 9 to
Registration Statement No. 2-95577, is
incorporated herein by reference.
26 through 28. -- None.
(b) The financial statement schedules for IDS
Certificate Company, filed electronically as
Exhibit 16(b) to Post-Effective Amendment No.
37 to Registration Statement No. 2-55252 for
Series D-1 Investment Certificate, are
incorporated by reference herewith.
Item 17. Undertakings.
Without limiting or restricting any liability on the part
of the other, American Express Financial Advisors Inc.,
(formerly, IDS Financial Services Inc.) as underwriter,
and American Express Bank International and Coutts & Co
(USA) International, as selling agents, will assume any
actionable civil liability which may arise under the
Federal Securities Act of 1933, the Federal Securities
Exchange Act of 1934 or the Federal Investment Company
Act of 1940, in addition to any such liability arising at
law or in equity, out of any untrue statement of a
material fact made by their respective agents in the due
course of their business in selling or offering for sale,
or soliciting applications for, securities issued by the
Company or any omission on the part of their respective
agents to state a material fact necessary in order to
make the statements so made, in the light of the
circumstances in which they were made, not misleading (no
such untrue statements or omissions, however, being
admitted or contemplated), but such liability shall be
subject to the conditions and limitations described in
said Acts. American Express Financial Advisors Inc.,
American Express Bank International and Coutts & Co (USA)
International will also assume any liability of the
Company for any amount or amounts which the Company
legally may be compelled to pay to any purchaser under
said Acts because of any untrue statements of a material
fact, or any omission to state a material fact, on the
part of the respective agents of American Express
Financial Advisors Inc., American Express Bank
International, and Coutts & Co (USA) International to the
extent of any actual loss to, or expense of, the Company
in connection therewith. The By-Laws of the Registrant
contain a provision relating to Indemnification of
Officers and Directors as permitted by applicable law.
PAGE 38
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this amendment to this registration
statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Minneapolis and State of Minnesota,
on the 26th day of January, 1996.
IDS CERTIFICATE COMPANY
By /s/ Stuart A. Sedlacek*
Stuart A. Sedlacek, President
Pursuant to the requirements of the Securities Act of 1933, this
amendment has been signed below by the following persons in the
capacities on the 26th day of January, 1996.
Signature Capacity
/s/ Stuart A. Sedlacek* ** President and Director
Stuart A. Sedlacek (Principal Executive
Officer)
/s/ Morris Goodwin* Vice President and
Morris Goodwin Treasurer
(Principal Financial
Officer)
/s/ Jay C. Hatlestad* Vice President and
Jay C. Hatlestad Controller
(Principal Accounting
Officer)
/s/ David R. Hubers** Director
David R. Hubers
/s/ Charles W. Johnson** Director
Charles W. Johnson
/s/ Edward Landes** Director
Edward Landes
Signatures continued on next page.
PAGE 39
Signatures continued from previous page.
Signature Capacity
/s/ John V. Luck** Director
John V. Luck
/s/ James A. Mitchell** Chairman of the Board
James A. Mitchell of Directors and
Director
/s/ Harrison Randolph** Director
Harrison Randolph
/s/ Gordon H. Ritz** Director
Gordon H. Ritz
*Signed pursuant to Officers' Power of Attorney dated May 17, 1994
filed electronically as Exhibit 25(a) to Post-Effective Amendment
No. 10, to Registration Statement No. 33-26844 is incorporated
herein by reference.
__________________________________
Bruce A. Kohn
**Signed pursuant to Directors' Power of Attorney dated May 13,
1994 filed electronically as Exhibit 25(b) to Post-Effective
Amendment No. 10 to Registration Statement No. 33-26844 is
incorporated herein by reference.
__________________________________
Bruce A. Kohn
PAGE 40
CONTENTS OF THIS POST-EFFECTIVE AMENDMENT NO. 11 TO REGISTRATION
STATEMENT NO. 33-26844
Cover Page
Cross-reference sheet
Prospectus
Part II Information
Signatures