Exhibit 15(ii) under Form N-1A
Exhibit 1 under Item 601/Reg. S-K
FORM OF
RULE 12B-1 AGREEMENT
This Agreement is made between the Financial Institution executing this
Agreement ("Administrator") and Federated Securities Corp. ("FSC") for the
mutual funds (referred to individually as the "Fund" and collectively as the
"Funds") for which FSC serves as Distributor of shares of beneficial interest or
capital stock ("Shares") and which have adopted a Rule 12b-1 Plan ("Plan") and
approved this form of agreement pursuant to Rule 12b-1 under the Investment
Company Act of 1940. In consideration of the mutual covenants hereinafter
contained, it is hereby agreed by and between the parties hereto as follows:
1. FSC hereby appoints Administrator to render or cause to be rendered
sales and administrative support services to the Funds with respect to the
Classes thereof and their shareholders.
2. The services to be provided under Paragraph 1 may include, but are
not limited to, the following:
(a) communicating account openings through computer terminals located on
the Administrator's premises ("computer terminals"), through a
toll-free telephone number or otherwise;
(b) communicating account closings via the computer terminals, through a
toll-free telephone number or otherwise;
(c) entering purchase transactions through the computer terminals, through
a toll-free telephone number or otherwise;
(d) entering redemption transactions through the computer terminals,
through a toll-free telephone number or otherwise;
(e) electronically transferring and receiving funds for Fund Share
purchases and redemptions, and confirming and reconciling all such
transactions;
(f) reviewing the activity in Fund accounts;
(g) providing training and supervision of its personnel;
(h) maintaining and distributing current copies of prospectuses and
shareholder reports;
(i) advertising the availability of its services and products;
(j) providing assistance and review in designing materials to send to
customers and potential customers and developing methods of making
such materials accessible to customers and potential customers; and
(k) responding to customers' and potential customers' questions about the
Funds.
The services listed above are illustrative. The Administrator is not required to
perform each service and may at any time perform either more or fewer services
than described above.
3. During the term of this Agreement, FSC will pay the Administrator fees
for each Fund as set forth in a written schedule delivered to the Administrator
pursuant to this Agreement. FSC's fee schedule for Administrator may be changed
by FSC sending a new fee schedule to the Administrator pursuant to Paragraph 12
of this Agreement. For the payment period in which this Agreement becomes
effective or terminates, there shall be an appropriate proration of the fee on
the basis of the number of days that the Rule 12b-1 Agreement is in effect
during the quarter.
4. The Administrator will not perform or provide any duties which would
cause it to be a fiduciary under Section 4975 of the Internal Revenue Code, as
amended. For purposes of that Section, the Administrator understands that any
person who exercises any discretionary authority or discretionary control with
respect to any individual retirement account or its assets, or who renders
investment advice for a fee, or has any authority or responsibility to do so, or
has any discretionary authority or discretionary responsibility in the
administration of such an account, is a fiduciary.
5. The Administrator understands that the Department of Labor views ERISA
as prohibiting fiduciaries of discretionary ERISA assets from receiving
administrative service fees or other compensation from funds in which the
fiduciary's discretionary ERISA assets are invested. To date, the Department of
Labor has not issued any exemptive order or advisory opinion that would exempt
fiduciaries from this interpretation. Without specific authorization from the
Department of Labor, fiduciaries should carefully avoid investing discretionary
assets in any fund pursuant to an arrangement where the fiduciary is to be
compensated by the fund for such investment. Receipt of such compensation could
violate ERISA provisions against fiduciary self-dealing and conflict of interest
and could subject the fiduciary to substantial penalties.
6. The Administrator agrees not to solicit or cause to be solicited
directly, or indirectly at any time in the future, any proxies from the
shareholders of any or all of the Funds in opposition to proxies solicited by
management of the Fund or Funds, unless a court of competent jurisdiction shall
have determined that the conduct of a majority of the Board of Trustees of the
Fund or Funds constitutes willful misfeasance, bad faith, gross negligence or
reckless disregard of their duties. This paragraph 6 will survive the term of
this Agreement.
7. With respect to each Fund this Agreement shall continue in effect for
one year from the date of its execution, and thereafter for successive periods
of one year if the form of this Agreement is approved at least annually by the
Trustees of the Fund, including a majority of the members of the Board of
Trustees of the Fund who are not interested persons of the Fund and have no
direct or indirect financial interest in the operation of the Fund's Plan or in
any related documents to the Plan ("Disinterested Trustees") cast in person at a
meeting called for that purpose.
8. Notwithstanding paragraph 7, this Agreement may be terminated as
follows:
(a) at any time, without the payment of any penalty, by the vote of a
majority of the Disinterested Trustees of the Fund or by a vote of a
majority of the outstanding voting securities of the Fund as defined
in the Investment Company Act of 1940 on not more than sixty (60)
days' written notice to the parties to this Agreement;
(b) automatically in the event of the Agreement's assignment as defined
in the Investment Company Act of 1940 or upon the termination of the
"Administrative Support and Distributor's Contract" or
"Distributor's Contract" between the Fund and FSC; and
(c) by either party to the Agreement without cause by giving the other
party at least sixty (60) days' written notice of its intention to terminate.
9. The termination of this Agreement with respect to any one Fund will not
cause the Agreement's termination with respect to any other Fund.
10. The Administrator 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.
11. This Agreement supersedes any prior service agreements between the
parties for the Funds.
12. 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
Administrator's address, as shown below. If the Administrator does not object to
the amendment within thirty (30) days after its receipt, the amendment will
become part of the Agreement. The Administrator's objection must be in writing
and be received by FSC within such thirty days.
13. This Agreement shall be construed in accordance with the Laws of the
Commonwealth of Pennsylvania.
ADMINISTRATOR
Address
City State Zip Code
Dated:
By:
Authorized Signature
Title
Print Name of Authorized Signature
FEDERATED SECURITIES CORP.
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
By:
Name:
Title:
Amendment No. 1
to
Schedule A to Rule 12b-1 Agreement with
Federated Securities Corp. ("FSC")
TOWER MUTUAL FUNDS
Portfolios
Tower Mutual Funds (the "Trust") consists of the following portfolios (the
"Funds") effective as of the dates set forth below:
Name Date
Tower Capital Appreciation Fund ("TCAF")
Class A Shares October 14, 1988
Class B Shares November 28, 1996
Tower Cash Reserve Fund ("TCRF")
Class A Shares October 14, 1988
Class B Shares March 10, 1998
Tower Louisiana Municipal Income Fund ("TLMIF") October 14, 1988
Tower U.S. Government Income Fund ("TUSGIF") October 14, 1988
Tower Total Return Bond Fund ("TTRBF") September 15, 1992
Tower U.S. Treasury Money Market Fund ("TUSTMMF") June 01, 1993
Administrative Fees
1. During the term of this Agreement, FSC will pay Administrator a
quarterly fee in respect of each Fund. With respect to TCAF Class A Shares, TCRF
Class A Shares, TLMIF, TUSGIF, TTRBF, and TUSTMMF, this fee will be computed at
the annual rate of .25 of 1% and, with respect to TCAF Class B Shares, at an
annual rate of .75 of 1% of the average net asset value of Shares held during
the quarter in accounts for which the Administrator provides services under this
Agreement, so long as the average net asset value of Shares in each Fund during
the quarter equals or exceeds such minimum amount as FSC shall from time to time
determine and communicate in writing to the Administrator.
2. For the quarterly period in which the Administrative Agreement becomes
effective or terminates, there shall be an appropriate proration of any fee
payable on the basis of the number of days that the Agreement is in effect
during the quarter.
Dated: March 10, 1998
Amendment No. 2
to
Schedule A to Rule 12b-1 Agreement with
Federated Securities Corp. ("FSC")
TOWER MUTUAL FUNDS
Portfolios
Tower Mutual Funds (the "Trust") consists of the following portfolios (the
"Funds") effective as of the dates set forth below:
Name Date
Tower Capital Appreciation Fund ("TCAF")
Class A Shares October 14, 1988
Class B Shares November 28, 1996
Tower Cash Reserve Fund ("TCRF")
Class A Shares October 14, 1988
Class B Shares March 10, 1998
Tower Louisiana Municipal Income Fund ("TLMIF") October 14, 1988
Tower U.S. Government Income Fund ("TUSGIF") October 14, 1988
Tower Total Return Bond Fund ("TTRBF") September 15, 1992
Tower U.S. Treasury Money Market Fund ("TUSTMMF") June 01, 1993
Tower Mid-Cap Equity Fund ("TMCEF")
Class A Shares March 10, 1998
Class B Shares March 10, 1998
Administrative Fees
1. During the term of this Agreement, FSC will pay Administrator a
quarterly fee in respect of each Fund. With respect to TCAF Class A Shares, TCRF
Class A Shares, TMCEF Class A Shares, TLMIF, TUSGIF, TTRBF, and TUSTMMF, this
fee will be computed at the annual rate of .25 of 1% and, with respect to TCAF
Class B Shares, TCRF Class B Shares and TMCEF Class B Shares, at an annual rate
of .75 of 1% of the average net asset value of Shares held during the quarter in
accounts for which the Administrator provides services under this Agreement, so
long as the average net asset value of Shares in each Fund during the quarter
equals or exceeds such minimum amount as FSC shall from time to time determine
and communicate in writing to the Administrator.
2. For the quarterly period in which the Administrative Agreement becomes
effective or terminates, there shall be an appropriate proration of any fee
payable on the basis of the number of days that the Agreement is in effect
during the quarter.
Dated: March 10, 1998
