Through the Stifel Smart Rate Program (the “Program”), Stifel, Nicolaus & Company, Incorporated (“Stifel,” “we,” or “us”) makes available to its eligible clients a money market deposit account (“MMDA”), a type of deposit account at Stifel affiliated banks (Stifel Bank & Trust or Stifel Bank (the “Banks”)), the deposits of which are insured by the Federal Deposit Insurance Corporation (“FDIC”). All deposits into, and withdrawals from, your MMDA will be directed by you to one of the Banks as described below in Section III. Operation of the Program. The Program is part of the broader securities brokerage and other services Stifel makes available to clients, is intended for deposits by clients made for the purpose of purchasing securities, and is subject to applicable Stifel customer agreements for Securities Accounts (as defined below).
Your MMDA earns a higher interest rate than a traditional sweep option in exchange for allowing fewer withdrawals. In order to allow you to make more withdrawals, we will make available to you a demand deposit account (“DDA”) into which we will transfer all your MMDA balances if you make more than five (5) withdrawals from your MMDA during any Withdrawal Period (as defined below). If funds are transferred to the DDA, in exchange for the greater liquidity provided by the DDA, the balances in the DDA will earn significantly less interest than balances in the MMDA for the remainder of the Withdrawal Period. Your balances will be moved from the DDA back to the MMDA at the beginning of the next Withdrawal Period. The MMDA and DDA are each a “Deposit Account” and collectively the “Deposit Accounts.”
The Program is available to eligible Stifel clients. Stifel will act as your agent and custodian in establishing and maintaining the Deposit Accounts at one or both of the Banks. Although the Deposit Accounts are an obligation of the Bank(s) at which they are deposited and not Stifel, you will not have a direct relationship with the Bank(s). All deposits and withdrawals will be made by Stifel on your behalf at your direction, including your authorization and direction to withdraw funds to satisfy debit balances in your Securities Account. Information about your Deposit Accounts may be obtained from Stifel, rather than from the Bank(s).