The Hilliard Lyons Bank Deposit Program Disclosure Document

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Right of Set-Off. Under the terms of your Hilliard Lyons Account agreement, Hilliard Lyons maycharge or offset funds in the PNC Bank deposit account against indebtedness or obligations you mayhave to Hilliard Lyons. For further information on the right of Hilliard Lyons regarding suchindebtedness or obligations, you should review your Hilliard Lyons Account agreement. Thisprovision does not apply where otherwise prohibited by law.Account StatementsYour Hilliard Lyons Account statements, for each statement period, will reflect:• Program deposits to and withdrawals from the PNC Bank deposit account• Your closing Program balance in the PNC Bank deposit account• Interest earned on your Program account balanceYou should retain all account statements. You must notify Hilliard Lyons immediately of anydiscrepancies noted on your account statement, and in no event later then ten (10) days after the dateof the account statement on which the problem or error first occurred. You should also notify HilliardLyons if there is unauthorized activity in your account or if you have general complaints regarding theProgram. You will not receive a separate statement from PNC Bank. You can also access informationabout your Hilliard Lyons Account online at http://currentrates.hilliard.com.Tax ReportingFor most clients, interest earned on deposits in the bank deposit account will be taxed as interestincome in the year it is received. A Form 1099-INT will be sent to you each year showing the amountof interest income you have earned on deposits in the PNC Bank deposit account.Your Relationship with Hilliard LyonsHilliard Lyons is acting as your agent in establishing and maintaining the PNC Bank deposit account,including depositing your money to and withdrawing your money from PNC Bank. Hilliard Lyons is aregistered broker-dealer in securities and is a member of the Financial Industry RegulatoryAssociation, the New York Stock Exchange, Inc., and other major exchanges. Hilliard Lyons is aregistered investment adviser under the Investment Advisers Act of 1940.Personal Information.Hilliard Lyons and its service providers may share information concerning you and your accounts inconnection with providing the services contemplated by these Terms and Conditions, and maydisclose information about the bank deposits to any affiliate of Hilliard Lyons in accordance withapplicable laws, The PNC Financial Services Group, Inc. Privacy Policy, and customary brokerageand banking practices. Hilliard Lyons, PNC Bank and their service providers may obtain suchinformation as may be necessary for legitimate business needs in connection with the operation of theProgram. For information regarding the collection, processing, and use of your personal informationand your rights to limit the use and disclosure of such information, you should refer to The PNCFinancial Services Groups, Inc. Privacy Policy as presented on www.hilliard.com, or ask your HilliardLyons financial consultant for a copy of The PNC Financial Services Group, Inc. Privacy Policy.Differences Between Hilliard Lyons Bank Deposit Program and Money MarketMutual FundsThe bank deposit account available through the Program at PNC Bank is regulated by federal bankregulatory agencies under various banking laws and regulations. The bank deposit account balance isan obligation of PNC Bank and qualifies for FDIC insurance protection per depositor in eachrecognized insurable capacity in accordance with the rules of the FDIC. The discussion belowpresents more information on FDIC Operations and Limitations, as well as on money market mutualfunds and SIPC coverage.FDIC Operations and Limitations.PNC Bank is a Member FDIC. Deposits into a PNC Bank account are insured by the FDIC, anindependent agency of the federal government backed by the full faith and credit of the United States.These deposits are insured up to the FDIC’s applicable limit per depositor. The applicable limitincludes your bank deposit account principal and accrued interest, when aggregated with all otherdeposits held by you directly, or through others, in the same, recognized legal capacity at PNC Bank.The FDIC protects you against loss of your insured deposits in the event PNCBank fails. If youseparately maintain deposit accounts with PNC Bank, your funds might exceed the applicable FDIClimit and any such funds would not be insured by the FDIC. The Program account is in the name of
Hilliard Lyons, as custodian. However, FDIC regulations permit “pass-through” insurance coveragefor funds being held in a representative or custodial capacity so long as certain requirements are met.Thus, while the account holds the funds of several Hilliard Lyons clients, each client’s interest in theProgram account will be afforded separate FDIC Insurance coverage, up to the maximum permitted bylaw, assuming certain requirements are met. Hilliard Lyons and PNC Bank have taken all necessarysteps to comply with such FDIC regulations so that individual interest will be afforded pass-throughinsurance coverage.The limitations on FDIC coverage apply to your deposits, whether made by you individually onyour own or through the Program. If you have or make a deposit on your own with PNC Bank,Hilliard Lyons would not be aware of these deposits. For the purpose of calculating your FDICcoverage, you must aggregate all deposits that you maintain with PNC Bank in the sameinsurable capacity, including deposits you hold directly with PNC Bank and deposits you holdthrough Hilliard Lyons and other intermediaries. By way of example, any funds swept into adeposit account at PNC Bank through the Program will be aggregated with any CDs issued toyou by PNC Bank and held in the same insurable capacity. You are responsible for monitoringthe total amount of deposits that you have at PNC Bank and through the Program for purposesof calculating your FDIC coverage.In the unlikely event that payments under the federal deposit insurance program become necessary,payments of insured deposits will be made by the FDIC, or the deposit may be assumed by anotherinstitution. However, there is no specific time period during which the FDIC must make insurancepayments available. Furthermore, you may be required to provide certain documentation to the FDICbefore insurance payments are made.Questions About FDIC Deposit Insurance Coverage.You may wish to seek advice from your own attorney concerning FDIC Insurance coverage ofdeposits held in more than one capacity. You may also obtain information by contacting the FDIC,Division of Supervision and Consumer Protection, by letter (550 17th Street, N.W., Washington,D.C., 20429), or by phone (877.275.3342, 800.925.4618 TDD), by email (dcainternet@fdic.gov), orby accessing the FDIC website at www.fdic.govSIPC Coverage and Money Market Mutual Fund Features.SIPC is a nonprofit membership corporation created by the Securities Investor Protection Act of 1970,funded primarily by its member’s securities brokerage firms registered with the U. S. Securities andExchange Commission. SIPC provides protection against custodial risk to clients of securitiesbrokerage firms, such as Hilliard Lyons, in the event such firms become insolvent. Unlike FDICinsurance, SIPC does not insure against the loss of your investment. Nor does SIPC insurance insurethe quality of investments or protect against a decline or fluctuations in the value of your investments.SIPC protects against the loss of client securities and cash up to a total of $500,000 (of which up to$100,000 may be cash) per client under SIPC rules. In the event the SIPC limits are not sufficient,Hilliard Lyons has purchased additional protection up to $100,000,000 firm aggregate through a thirdparty insurance carrier. Similar to SIPC protection, this coverage protects your securities, moneymarket fund shares and cash held by Hilliard Lyons should Hilliard Lyons be required to liquidate.Unlike the money market fund shares held in your Hilliard Lyons Account, balances in the bankdeposit accounts are not covered by SIPC or the additional insurance discussed above, but isguaranteed by the FDIC, subject to certain limitations. If you have questions about SIPC coverage andadditional coverage provided through Hilliard Lyons, ask your Hilliard Lyons financial consultant fordetails. You may also obtain information about SIPC coverage, including a brochure that describesSIPC and SIPC insurance, by accessing the SIPC Web site at www.sipc.org.Other TermsAbandoned Accounts.Hilliard Lyons and PNC Bank may be required by law to turn over (escheat) funds in the bankdeposits account to a state, typically your state of residence, based on inability to locate you, asrequired by applicable state law. If funds are remitted to the state, you may file a claim with the stateto recover the funds.Transferability.
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The Hilliard Lyons Bank Deposit Program Disclosure Document

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