Exhibit m(vi) under Form N-1A
Exhibit 1 under Item 601/ Reg. S-K
SALES AGREEMENT WITH FEDERATED SECURITIES CORP.
This Agreement is entered into between the financial institution executing
this Agreement ("Financial Institution") and Federated Securities Corp. ("FSC")
for SouthTrust Funds (the "Trust"), which may be offered in one or more series
(the "Funds") and classes (the "Classes") of shares ("Shares"), for which FSC
serves as Distributor of shares of beneficial interest or capital stock. The
Funds or Classes to which this Agreement applies are set forth in Schedule A
hereto.
1. STATUS OF FINANCIAL INSTITUTION AS "BANK" OR REGISTERED
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BROKER-DEALER.
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The Financial Institution represents and warrants to FSC that:
(a) It is either a "bank" as that term is defined in Section 3(a)(6) of the
Securities Exchange Act of 1934 ("Exchange Act") or a broker-dealer
registered with the Securities and Exchange Commission.
(b) If the Financial Institution is a "bank", it is a duly organized and
validly existing bank in good standing under the laws of the
jurisdiction in which it is organized. The Financial Institution agrees
to give written notice to FSC promptly in the event that it shall cease
to be a "bank" as defined in Section 3(a)(6) of the Exchange Act. In
that event, this Agreement shall be automatically terminated upon such
written notice.
(c) If the Financial Institution is a registered broker-dealer, it is a
member of the NASD and it agrees to abide by all of the rules and
regulations of the NASD including, without limitation, the NASD Rules
of Fair Practice. The Financial Institution agrees to notify FSC
immediately in the event of (1) its expulsion or suspension from the
NASD, or (2) its being found to have violated any applicable federal or
state law, rule or regulation arising out of its activities as a
broker-dealer or in connection with this Agreement, or which may
otherwise affect in any material way its ability to act in accordance
with the terms of this Agreement. The Financial Institution's expulsion
from the NASD will automatically terminate this Agreement immediately
without notice. Suspension of the Financial Institution from the NASD
for violation of any applicable federal or state law, rule or
regulation will terminate this Agreement effective immediately upon
FSC's written notice of termination to the Financial Institution.
2. FINANCIAL INSTITUTION ACTS AS AGENT FOR ITS CUSTOMERS.
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The parties agree that in each transaction in the Shares of the Trust: (a)
the Financial Institution is acting as agent for the customer; (b) each
transaction is initiated solely upon the order of the customer; (c) as between
the Financial Institution and its customer, the customer will have full
beneficial ownership of all Shares of the Trust to which this Agreement applies;
(d) each transaction shall be for the account of the customer and not for the
Financial Institution's account; and (e) each transaction shall be without
recourse to the Financial Institution provided that the Financial Institution
acts in accordance with the terms of this Agreement. The Financial Institution
shall not have any authority in any transaction to act as FSC's agent or as
agent for the Trust.
3. EXECUTION OF ORDERS FOR PURCHASE AND REDEMPTION OF SHARES.
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(a) All orders for the purchase of any Shares shall be executed at the then
current public offering price per share (i.e., the net asset value per
share plus the applicable sales load, if any) and all orders for the
redemption of any Shares shall be executed at the net asset value per
share, plus any applicable redemption charge, in each case as described
in the prospectus of the Fund or Class. FSC and the Trust reserve the
right to reject any purchase request at their sole discretion. If
required by law, each transaction shall be confirmed in writing on a
fully disclosed basis and, if confirmed by FSC, a copy of each
confirmation shall be sent simultaneously to the Financial Institution
if the Financial Institution so requests.
(b) The procedures relating to all orders and the handling of them will be
subject to the terms of the prospectus of each Fund or Class and FSC's
written instructions to the Financial Institution from time to time.
(c) Payments for Shares shall be made as specified in the applicable Fund
or Class prospectus. If payment for any purchase order is not received
in accordance with the terms of the applicable Fund or Class
prospectus, FSC reserves the right, without notice, to cancel the sale
and to hold the Financial Institution responsible for any loss
sustained as a result thereof.
(d) The Financial Institution agrees to provide such security as is
necessary to prevent any unauthorized use of the Trust's recordkeeping
system, accessed via any computer hardware or software provided to the
Financial Institution by FSC.
4. FEES PAYABLE TO THE FINANCIAL INSTITUTION FROM SALES LOADS.
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(a) On each order accepted by FSC, in exchange for the performance of sales
and/or administrative services, the Financial Institution will be
entitled to receive from the amount paid by the Financial Institution's
customer the applicable percentage of the sales load, if any, as
established by FSC. The sales loads for any Fund or Class shall be
those set forth in its prospectus. The portion of the sales load
payable to the Financial Institution may be changed at any time at
FSC's sole discretion upon thirty (30) days' written notice to the
Financial Institution.
(b) Transactions may be settled by the Financial Institution: (1) by
payment of the full purchase price to FSC less an amount equal to the
Financial Institution's applicable percentage of the sales load, or (2)
by payment of the full purchase price to FSC, in which case FSC shall
pay to the Financial Institution, not less frequently than monthly, the
aggregate fees due it on orders received and settled.
5. DELIVERY OF PROSPECTUSES TO CUSTOMERS.
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The Financial Institution will deliver or cause to be delivered to each
customer, at or prior to the time of any purchase of Shares, a copy of the
prospectus of the Fund or Class. The Financial Institution shall not make any
representations concerning any Shares other than those contained in the
prospectus of the Fund or Class or in any promotional materials or sales
literature furnished to the Financial Institution by FSC or the Fund or Class.
6. INDEMNIFICATION.
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(a) The Financial Institution shall indemnify and hold harmless FSC, the
Trust, the transfer agents of the Trust, and their respective
subsidiaries, affiliates, officers, directors, agents and employees
from all direct or indirect liabilities, losses or costs (including
attorneys fees) arising from, related to or otherwise connected with:
(1) any breach by the Financial Institution of any provision of this
Agreement; or (2) any actions or omissions of FSC, the Trust, the
transfer agents of the Trust, and their subsidiaries, affiliates,
officers, directors, agents and employees in reliance upon any oral,
written or computer or electronically transmitted instructions believed
to be genuine and to have been given by or on behalf of the Financial
Institution.
(b) FSC shall indemnify and hold harmless the Financial Institution and its
subsidiaries, affiliates, officers, directors, agents and employees
from and against any and all direct or indirect liabilities, losses or
costs (including attorneys fees) arising from, related to or otherwise
connected with: (1) any breach by FSC of any provision of this
Agreement; or (2) any alleged untrue statement of a material fact
contained in the Trust's Registration Statement or Prospectuses, or as
a result of or based upon any alleged omission to state a material fact
required to be stated, or necessary to make the statements not
misleading.
(c) The agreement of the parties in this Paragraph to indemnify each other
is conditioned upon the party entitled to indemnification (Indemnified
Party) giving notice to the party required to provide indemnification
(Indemnifying Party) promptly after the summons or other first legal
process for any claim as to which indemnity may be sought is served on
the Indemnified Party. The Indemnified Party shall permit the
Indemnifying Party to assume the defense of any such claim or any
litigation resulting from it, provided that counsel for the
Indemnifying Party who shall conduct the defense of such claim or
litigation shall be approved by the Indemnified Party (which approval
shall not unreasonably be withheld), and that the Indemnified Party may
participate in such defense at its expense. The failure of the
Indemnified Party to give notice as provided in this subparagraph (c)
shall not relieve the Indemnifying Party from any liability other than
its indemnity obligation under this Paragraph. No Indemnifying Party,
in the defense of any such claim or litigation, shall, without the
consent of the Indemnified Party, consent to entry of any judgment or
enter into any settlement that does not include as an unconditional
term the giving by the claimant or plaintiff to the Indemnified Party
of a release from all liability in respect to such claim or litigation.
(d) The provisions of this Paragraph 6 shall survive the termination of
this Agreement.
7. CUSTOMER NAMES PROPRIETARY TO THE FINANCIAL INSTITUTION.
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(a) The names of the Financial Institution's customers are and shall remain
the Financial Institution's sole property and shall not be used by FSC
or its affiliates for any purpose except the performance of its duties
and responsibilities under this Agreement and except for servicing and
informational mailings relating to the Trust. Notwithstanding the
foregoing, this Paragraph 7 shall not prohibit FSC or any of its
affiliates from utilizing the names of the Financial Institution's
customers for any purpose if the names are obtained in any manner other
than from the Financial Institution pursuant to this Agreement.
(b) Neither party shall use the name of the other party in any manner
without the other party's written consent, except as required by any
applicable federal or state law, rule or regulation, and except
pursuant to any mutually agreed upon promotional programs.
(c) The provisions of this Paragraph 7 shall survive the termination of
this Agreement.
8. SOLICITATION OF PROXIES.
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The Financial Institution agrees not to solicit or cause to be solicited
directly, or indirectly, at any time in the future, any proxies from the
shareholders of the Trust in opposition to proxies solicited by management of
the Trust, unless a court of competent jurisdiction shall have determined that
the conduct of a majority of the Board of Trustees of the Trust constitutes
willful misfeasance, bad faith, gross negligence or reckless disregard of their
duties. This Paragraph 8 will survive the term of this Agreement.
9. CERTIFICATION OF CUSTOMERS' TAXPAYER IDENTIFICATION NUMBERS.
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The Financial Institution agrees to obtain any taxpayer identification
number certification from its customers required under Section 3406 of the
Internal Revenue Code, and any applicable Treasury regulations, and to provide
FSC or its designee with timely written notice of any failure to obtain such
taxpayer identification number certification in order to enable the
implementation of any required backup withholding.
10. NOTICES.
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Except as otherwise specifically provided in this Agreement, all notices
required or permitted to be given pursuant to this Agreement shall be given in
writing and delivered by personal delivery or by postage prepaid, registered or
certified United States first class mail, return receipt requested, or by telex,
telegram or similar means of same day delivery (with a confirming copy by mail
as provided herein). Unless otherwise notified in writing, all notices to FSC
shall be given or sent to FSC at its offices located at Federated Xxxxxxxxx
Xxxxx, Xxxxxxxxxx, XX 00000-0000, and all notices to the Financial Institution
shall be given or sent to it at its address shown below.
11. TERMINATION AND AMENDMENT.
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(a) This Agreement shall become effective in this form as of the date set
forth below and may be terminated at any time by either party upon
thirty (30) days' prior notice to the other party. This Agreement
supersedes any prior sales agreements between the parties.
(b) This Agreement may be amended by FSC from time to time by the following
procedure. FSC will mail a copy of the amendment to the Financial
Institution's address, as shown below. If the Financial Institution
does not object to the amendment within thirty (30) days after its
receipt, the amendment will become part of the Agreement. The Financial
Institution's objection must be in writing and be received by FSC
within such thirty (30) days.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
13. GOVERNING LAW.
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This Agreement shall be construed in accordance with the laws of the
Commonwealth of Pennsylvania.
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FINANCIAL INSTITUTION
Address
City State Zip Code
Dated:
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Authorized
Signature
Title
Print Name or Type Name
FEDERATED SECURITIES CORP.
Federated Investors Tower
Pittsburgh, Pennsylvania
15222-3779
By:
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Name:
Title:
EXHIBIT A
FEE SCHEDULE FOR SALES AGREEMENT
WITH FEDERATED SECURITIES CORP. AS OF
September 27, 1999
SOUTHTRUST FUNDS:
SOUTHTRUST BOND FUND, SOUTHTRUST INCOME FUND, SOUTHTRUST VALUE FUND,
SOUTHTRUST GROWTH FUND, SOUTHTRUST ALABAMA TAX-FREE INCOME FUND
Advance Commissions: NONE
Asset-based Sales Charge: NONE
Shareholder Service Fee: NONE
Supplemental Payments: NONE
Initial Sales Load:
SOUTHTRUST BOND FUND, SOUTHTRUST INCOME FUND, SOUTHTRUST ALABAMA
TAX-FREE INCOME FUND:
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Amount Invested Sales Charge Sales Charge Dealer
as a % of as a % of Net Concession as
Offering Price Amount a % of
Invested Offering Price
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Less than $100,000 3.50% 3.63% 3.00%
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$100,000 up to 3.00% 3.09% 2.50%
$250,000
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$250,000 up to 2.50% 2.56% 2.00%
$500,000
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$500,000 up to $1 2.00% 2.04% 1.5%
million
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$1 million or more* 0% 0% 0%
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SOUTHTRUST VALUE FUND, SOUTHTRUST GROWTH FUND:
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Amount Invested Sales Charge Sales Charge Dealer
as a % of as a % of Net Concession as
Offering Price Amount a % of
Invested Offering Price
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Less than $50,000 4.50% 4.71% 4.00%
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$50,000 up to 4.00% 4.17% 3.50%
$100,000
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$100,000 up to 3.25% 3.36% 2.75%
$250,000
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$250,000 up to 2.75% 2.83% 2.25%
$500,000
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$500,000 up to $1 1.75% 1.78% 1.25%
million
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$1 million or more* 0% 0% 0%
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*A REDEMPTION FEE OF 1.00% MAY BE IMPOSED ON CERTAIN REDEMPTIONS MADE WITHIN ONE
YEAR OF PURCHASE. SEE "REDEMPTION OF SHARES" IN THE FUNDS' COMBINED PROSPECTUS.
FUND CUSIP
SOUTHTRUST FUNDS
SouthTrust Bond Fund 844734 20 2
SouthTrust Income Fund 844734 40 0
SouthTrust Value Fund 844734 30 1
SouthTrust Growth Fund 844734 50 9
SouthTrust Alabama Tax-Free Income Fund 844734 60 8
Financial Institutions who have executed this Agreement:
FINANCIAL INSTITUTION EXECUTION DATE
1. Sterne, Agee & Xxxxx, Inc.** 10/5/99
2. National Bank of Commerce 4/10/00
** See attachments for supplements to master agreement
SOUTHTRUST FUNDS
0000 XXXXXXXXX XXXXX
XXXXXXXXXX, XX 00000-0000
NOVEMBER 18, 1999
Sterne, Agee and Xxxxx, Inc.
000 Xxxxxx Xxxxx Xxxxxxx
Xxxxx 000X
Xxxxxxxxxx, XX 00000
RE: All Sterne, Agee and Xxxxx, Inc. Accounts
SEC Rule 15C3-3 requires that, in order for uncertificated mutual fund
shares carried by a fund in a Special Custody Account for the exclusive benefit
of customers of broker/dealer to be considered as good control locations under
SEC Rule 15C3-3, such mutual funds must provide an acknowledgment letter to the
broker/dealer demonstrating that there are no liens against the securities.
Accordingly, we confirm that all shares held in accounts for Sterne, Agee
and Xxxxx, Inc. are being held for the exclusive benefit of Sterne, Agee and
Xxxxx, Inc. clients, and the clients of its correspondents, and that to the best
of our knowledge, there are no liens, security interests or other encumbrances
on such shares on behalf of any third party. It is further agreed that such
shares will not be subject to any right, charge, security interest, lien or
other claim in favor of SouthTrust Funds or agent thereof, unless so directed by
Sterne, Agee and Xxxxx, Inc., or required by government authority.
SouthTrust Funds
/S/ C. XXXX XXXXXX
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By: C. Xxxx Xxxxxx
Title: Secretary
