EXHIBIT 10.3
Bear, Xxxxxxx & Co. BEAR XXXXXXX
00 Xxxxx Xxxxxx
Xxx Xxxx, X.X. 00000
(000) 000-0000
WRITER'S DIRECT DIAL NUMBER
April 30, 1985
Xxxxxx, Xxxxxxx
00 Xxxx 00xx. Xx.
X Xxxx, X.X. 00000
Xxxxxxxxx:
AGREEMENT FOR SECURITIES CLEARANCE SERVICES
This Agreement sets forth the terms and conditions under which
Bear, Xxxxxxx & Co. ("Bear Xxxxxxx") will act as your clearing broker to carry
and clear on a fully disclosed basis, your customer margin and cash accounts,
and you will become a correspondent of Bear Xxxxxxx.
1. Bear Xxxxxxx will carry such of your customer accounts as will be
mutually agreed by the parties hereto. These accounts are hereinafter called the
"Accounts" and the legal and beneficial owners thereof are hereinafter called
the "Customers".
2. (a) You shall have sole discretion to determine the amount of
commission charged to your Customers' accounts cleared by Bear Xxxxxxx. You
agree to pay Bear Xxxxxxx for its services pursuant to this agreement, on each
order executed on your behalf on a national stock exchange or over-the-counter,
such amounts as sat forth in Schedule A hereto.
(b) Bear Xxxxxxx agrees to pay to you monthly such commissions
received by Bear Xxxxxxx less any amounts due to Bear Xxxxxxx under this
agreement or otherwise and any expenses or other sums to third parties paid on
your behalf by Bear Xxxxxxx.
3. Bear Xxxxxxx agrees to notify your Customers in writing concerning
the respective obligations of the parties hereto pursuant to paragraphs 4-11 of
this agreement and any other Customer related responsibilities of the parties to
this Agreement.
4. You agree to supply Bear Xxxxxxx with copies of all financial
information and reports filed by you with the New York Stock Exchange, Inc. (if
a member), the National Association of Securities Dealers, Inc., and any other
National Securities Exchange (where a member) (including but not otherwise
limited to monthly and quarterly Financial and Operational Combined Uniform
Single Reports i.e., "FOCUS" Reports) simultaneous with the filing therewith.
You shall submit to Bear Xxxxxxx on a monthly basis or, if so requested by Bear
Xxxxxxx, at more frequent intervals, information and reports relating to your
financial integrity, including but not otherwise limited to information
regarding your aggregate indebtedness ratio and net capital.
5. You will be responsible to Bear Xxxxxxx for: (a) all payments
required so that all Accounts, cash and margin, shall be at all times in
compliance with Regulation T, as amended, promulgated by the Board of Governors
of the Federal Reserve Board, (b) maintaining margin in each margin Account to
the satisfaction of Bear Xxxxxxx, (c) the payment of any unsecured debit balance
in an Account, (d) until funds are credited to Bear Xxxxxxx, all payment to Bear
Xxxxxxx on checks received by it in connection with your Accounts (e) payment
and delivery of "when issued" transactions in the Accounts, and (f) the delivery
by Customers of securities in good deliverable form under all applicable rules
and practices. Bear Xxxxxxx has sole discretion to execute buy-ins or sell-outs
in any cash or margin Account whenever it determines such action appropriate
regardless whether the Account complies with applicable margin maintenance
requirements or has requested extension of time in which to make payment. Any
request by you that Bear Xxxxxxx should waive either buying-in or selling-out an
Account must be in writing signed by an officer, partner or principal of your
firm and you agree that if Bear Xxxxxxx accedes to your request that you will
indemnify and hold Bear Xxxxxxx harmless against any loss, liability, damage,
claim, cost or expense (including but not limited to fees and expenses of legal
counsel) arising therefrom. Bear Xxxxxxx shall have sole discretion as to any
application for an extension of time for any Account to make any payment
required by Regulation T.
6. (a) Bear Xxxxxxx may, at its discretion, either buy back in the
"cash" market or borrow the day you are notified of option assignments affecting
shares which have been tendered and cause short positions in your Accounts as of
either the proration or withdrawal date. Shares purchased for cash or borrowed
will not be considered part of an Account's tendered position until such shares
are in Bear Xxxxxxx' actual possession. Bear Xxxxxxx will reduce the tender for
your firm accounts and the Accounts by the size of the short or unreceived
shares.
(b) During a tender period in which there are competing and
countertender offers for a security Bear Xxxxxxx will tender only on a trade
date basis the number of the shares net long in your firm account and the
Accounts as of either the proration or withdrawal date.
7. In the event you execute orders away from Bear Xxxxxxx, Bear Xxxxxxx
will on a best efforts oasis attempt to clear the transaction within a
reasonable period and utilize the same procedures it clears transactions on its
own behalf and on behalf of other firms clearing through Bear Xxxxxxx; but if
either you or the other broker for any reason whatsoever fail to settle the
transaction you will be solely liable to Bear Xxxxxxx for any and ail loss,
including expenses, caused thereby.
8. For each Account you agree to supply to Bear Xxxxxxx a new account
report on such forms as Bear Xxxxxxx will supply you and to supply any other
documentation end information which Bear Xxxxxxx may in its sole discretion,
request you to obtain from the Customer. Bear Xxxxxxx agrees to provide you with
copies of its Customer Agreement and such other forms necessary to enable you to
document each Account. In the event requested documentation or information is
not promptly received by Bear Xxxxxxx, Bear Xxxxxxx has the right to refuse to
accept orders for such Account, to close the Account and to withhold your
commissions and assess upon you any other penalties it sees fit.
9. Unless otherwise agreed to in writing by Bear Xxxxxxx, Bear Xxxxxxx
shall Issue confirmations, statements and notices directly to your Customers on
Bear Xxxxxxx' forms for such purpose which shall state in front of your name
"Through the Courtesy of" and will send you duplicate confirmations, statements
and notices.
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10. You agree that before you commence any trading in options for any
account you will have a Senior Registered Options Principal registered with
either the American Stock Exchange, Inc. or the National Association of
Securities Dealers, Inc.
11. (a) This Agreement and all transactions in the Accounts, will be
subject to the applicable Constitution, Rules, By-Laws, Regulations and customs
of any securities market, association, exchange or clearing house where such
transactions are effected or of which Bear Xxxxxxx is a member, and also to all
applicable U. S. Federal and state laws and regulations. All of the foregoing
are hereinafter called the "Applicable Rules".
(b) Except as otherwise specified in this Agreement you are
solely responsible for the conduct of the Accounts, and ensuring that the
transactions conducted therein are in compliance with the Applicable Rules. Such
responsibility includes, but is not limited to: (i) using due diligence to learn
and on a continuing basis to know the essential facts of each Customer,
including verifying the address changes of each Customer, knowing all persons
holding power of attorney over any Account, being familiar with each order in
any Account and at all times to fully comply with Rule 405 of the New York Stock
Exchange, Inc., and any interpretations thereof, and all similar Applicable
Rules; (ii) selecting, investigating, training, and supervising all personnel
who open, approve or authorize transactions in the Accounts; (iii) establishing
written procedures for the conduct of the Accounts and ongoing review of all
transactions in Accounts, and maintaining compliance and supervisory personnel
adequate to implement such procedures; (iv) determining the suitability of all
transactions, including option transactions; (v) ensuring that there is a
reasonable basis for all recommendations made to Customers; (vi) determining the
appropriateness of the frequency of trading in Accounts; (vii) determining the
authorization and legality of each transaction in the Account; and (viii)
obtaining and maintaining all documents necessary for the performance of your
responsibilities under this Agreement and retaining such documents in accordance
with all the Applicable Rules.
(c) You will be responsible for responding to all your
Customer inquiries and complaints and you agree to promptly notify Bear Xxxxxxx
in writing of complaints concerning Bear Xxxxxxx.
(d) You hereby agree to indemnify and hold Bear Xxxxxxx
harmless against any loss, liability, damage, claim, cost or expense (including
but not limited to fees and expenses of legal counsel) caused by you directly or
indirectly as a result of your breach of any of the terms hereof. You hereby
agree and warrant that you will maintain appropriate brokers blanket bond
insurance policies covering any and all acts of your employees, agents and
partners adequate to fully protect and indemnify Bear Xxxxxxx against any loss,
liability, damage, claim, cost or expense (including but not limited to fees and
expenses of legal counsel) which Bear Xxxxxxx may suffer or incur, directly or
indirectly, as a result of any act of your employees, agents or partners.
12. Bear Xxxxxxx, unless otherwise agreed, will supply you on each
business day with copies of customer confirmations, margin status reports, money
line and a daily commission detail report. Unless you notify Bear Xxxxxxx within
a reasonable time of all mistakes or discrepancies in the above described
reports and information, Bear Xxxxxxx shall be entitled to consider all the
information supplied to you as correct.
13. (a) Bear Xxxxxxx agrees to: monitor and require your Customers to
(i) make prompt payment for purchases of securities, interest and other charges,
(ii) deliver securities sold, (iii) maintain money and securities in each
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Account as required by the Applicable Rules, and to comply with any additional
requirements as Bear Xxxxxxx may as clearing broker, in its sole discretion
require, upon reasonable notice to you and your Customers; advise you of the
necessity for buying in or selling out positions in Accounts for failure to
comply with payment or delivery requirements and Bear Xxxxxxx shall have the
right at its discretion to execute buy-ins or sell-outs if you decline or fail
to act; arrange the extension of credit for margin purchases in Accounts in
accordance with the Applicable Rules, and with Bear Xxxxxxx' own additional
requirements; transfer securities to and from accounts; provide custody,
safekeeping and segregation of money and securities of Customers carried by Bear
Xxxxxxx; and arrange for the receipt and delivery of securities in exchange and
tender offers, rights and warrants offerings, redemptions and other similar type
transactions.
(b) Bear Xxxxxxx agrees to maintain all books and records as
are required by the Applicable Rules governing brokers having custody of money
and securities in the Accounts.
(c) Bear Xxxxxxx agrees to promptly notify you in writing of
complaints concerning you, your employees or your agents.
14. Errors, misunderstandings or controversies, except those
specifically otherwise covered in this Agreement, between the Accounts and you
or any of your employees, which shall arise out of your acts or omissions
(including, without limiting the foregoing, your failure of you to deliver
promptly to Bear Xxxxxxx any instructions received by you from an Account with
respect to the voting, tender or exchange of shares held in such Account) shall
be your sole and exclusive responsibility. In the event, that by reason of such
error, misunderstanding or controversy, you in your discretion deem it advisable
to commence an action or proceeding against an Account, you shall indemnify and
hold Bear Xxxxxxx harmless from any loss, liability, damage, claim, cost or
expense (including but not limited to fees and expenses of legal counsel) which
Bear Xxxxxxx may incur or sustain directly or indirectly in connection therewith
or under any settlement thereof. If such error, misunderstanding or controversy
shall result in the bringing of any action or proceeding against Bear Xxxxxxx,
you shall indemnify and hold Bear Xxxxxxx harmless from any loss, liability,
damage, claim, cost or expense (including but not limited to fees and expenses
of legal counsel) which Bear Xxxxxxx may incur or sustain directly or indirectly
in connection therewith or under any settlement thereof.
15. Each party hereto agrees to indemnify the other and hold the other
harmless from and against any loss, liability, damage, claim, cost or expense
(including but not limited to fees and expenses of legal counsel) arising out of
or resulting from any failure by the indemnifying party or any of its employees
to carry out fully the duties and responsibilities assigned to such herein or
any breach of any representation, warranty or covenant herein by such party
under this Agreement. You hereby agree to indemnify and hold Bear Xxxxxxx
harmless from and against any loss, liability, damage, claim, cost or expense
(including but not limited to fees and expenses of legal counsel) sustained or
incurred in connection herewith in the event any Account fails to meet any
initial margin call or maintenance call.
16. You represent, warrant and covenant to Bear Xxxxxxx as follows:
(i) You will immediately notify Bear Xxxxxxx when (1) your
Aggregate Indebtedness Ratio reaches or exceeds 10 to 1 or (2) if you have
elected to operate under paragraph (f) of Rule 15c3-l of the Securities Exchange
Act of 1934, as amended, when your net capital is less than the greater of
$100,000 or 5% of aggregate debit items computed in accordance with Rule 15c3-3.
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(ii) You are a member in good standing of the National
Association of Securities Dealers, Inc., or if you have applied for membership
of the National Association of Securities Dealers, Inc. you agree to furnish
Bear Xxxxxxx upon your receipt thereof, with the National Association of
Securities Dealers, Inc.'s notification to you concerning the result of your
membership application and if your membership application is refused for any
reason whatsoever, Bear Xxxxxxx has the right to forthwith terminate this
agreement. You are a member in good standing of every national securities
exchange or other securities association of which you are a member and you agree
to promptly notify Bear Xxxxxxx of any additional exchange memberships or
affiliations. You shall also comply with whatever non-member access rules have
been promulgated by any national securities exchange or any other securities
exchange of which you are not a member.
(iii) You are and during the term of this Agreement will
remain duly registered or licensed and in good standing as a broker/dealer under
the Applicable Rules.
(iv) You have all the requisite authority in conformity with
all Applicable Rules to enter into this Agreement and to retain the services of
Bear Xxxxxxx in accordance with the terms hereof and you have taken all
necessary action to authorize the execution of this Agreement and the
performance of the obligations hereunder.
(v) You are in compliance, and during the term of this
Agreement will remain in compliance with (1) the capital and financial reporting
requirements of every national securities exchange or other securities exchange
and/or securities association of which you are a member, (2) the capital
requirements of the Securities and Exchange Commission, and (3) the capital
requirements of every state in which you are licensed as a broker/dealer.
(vi) Unless otherwise agreed to in writing by Bear Xxxxxxx,
you shall not generate any statements, xxxxxxxx or confirmations representing
any Account.
(vii) You shall keep confidential any information you may
acquire as a result of this Agreement regarding the business and affairs of Bear
Xxxxxxx, which requirements shall survive the life of this Agreement.
17. Bear Xxxxxxx represents, warrants and covenants to you as follows:
(i) Bear Xxxxxxx is a member in good standing of the National
Association of Securities Dealers, Inc., the New York Stock Exchange, Inc., the
American Stock Exchange, Inc., the Boston Stock Exchange, Incorporated, the
Midwest Stock Exchange, Incorporated, the Philadelphia Stock Exchange, Inc., the
Pacific Stock Exchange Incorporated and the Chicago Board Options Exchange, Inc.
(ii) Bear Xxxxxxx is and during the term of this Agreement
will remain duly licensed and in good standing as a broker/dealer under the
Applicable Rules.
(iii) Bear Xxxxxxx has all the requisite authority, in
conformity with all Applicable Rules to enter into and perform this Agreement
and has taken all necessary action to authorize the execution of this Agreement
and the performance of the obligations hereunder.
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(iv) Bear Xxxxxxx is in compliance, and during the term of
this Agreement will remain in compliance with (1) the capital and financial
reporting requirements of every national securities exchange and/or other
securities exchange or association of which it is a member, (2) the capital
requirements of the Securities and Exchange Commission, and (3) the capital
requirements of every state in which it is licensed as a broker/dealer.
(v) Bear Steams represents and warrants that the names and
addresses of your customers which have or which may come to its attention in
connection with the clearing and related functions it has assumed under this
Agreement are confidential and shall not be utilized by Bear Steams except in
connection wi
th the functions performed by Bear Xxxxxxx pursuant to this
Agreement. Notwithstanding the foregoing, should an Account request, on an
unsolicited basis, that Bear Xxxxxxx become its broker, acceptance of such
Account by Bear Steams shall in no way violate this representation and warranty,
nor result in a breach of this Agreement.
(vi) Bear Xxxxxxx shall keep confidential any information it
may acquire as a result of this Agreement regarding your business and affairs,
which requirement shall survive the life of this Agreement.
18. Notwithstanding any provision in this Agreement, the following
events or occurrences shall constitute an Event of Default under this Agreement:
(i) either party hereto shall fail to perform or observe any
term, covenant or condition to be performed hereunder and such failure shall
continue to be unremedied for a period of 30 days after written notice from the
non-defaulting party to the defaulting party specifying the failure and
demanding that the same be remedied; or
(ii) any representation or warranty made by either party shall
prove to be incorrect at any time in any material respect; or
(iii) a receiver, liquidator or trustee of either party hereto
or of any property held by either party, is appointed by court order and such
order remains in effect for more than 30 days; or either party is adjudicated
bankrupt or insolvent; or any property of either party is sequestered by court
order and such order remains in effect for more than 30 days; or a petition is
filed against either party under any bankruptcy, reorganization, arrangement,
insolvency, readjustment of debt, dissolution or liquidation law of any
jurisdiction, whether. now or hereafter in effect, and is not dismissed within
30 days after such filing; or
(iv) either party hereto files a petition in voluntary
bankruptcy or seeks relief under any provision of any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation law of any jurisdiction, whether now or hereafter in effect, or
consents to the filing of any petition against it under any such law; or
(v) either party hereto makes an assignment for the benefit of
its creditors, or admits in writing its inability to pay its debts generally as
they become due, or consents to the appointment of a receiver, trustee or
liquidator of either party, or of any property held by either party.
Upon the occurrence of any such Event of Default, the
nondefaulting party may, at its option, by notice to the defaulting party
declare that this Agreement shall be thereby terminated and such termination
shall be effective as of the date such notice has been communicated to the
6
defaulting party. Upon the occurrence by you of an Event of Default pursuant to
paragraphs (iii), (iv), or (v) above, Bear Xxxxxxx shall be entitled to, upon
the consent of the Customer, to accept instructions directly from the Customer
and to transfer the Account directly to Bear Xxxxxxx.
19. In the event that you execute your own orders and give Bear
Xxxxxxx' name to the other broker for clearance and settlement, you agree that
you will only execute bona fide orders where you have reasonable grounds to
believe that the account and the other broker have the financial capability to
complete the transaction. Bear Xxxxxxx reserves the right at any time to place a
limit (of either dollars or number of securities) on the size of transactions
that Bear Xxxxxxx in these circumstances will accept for clearance. If after you
have received notice of such limitation you execute an order in excess of the
limit established by Bear Xxxxxxx, Bear Xxxxxxx shall have the right to notify
the other party and other broker that it will not accept the transaction for
clearance and settlement. In the event any claim is asserted against Bear
Xxxxxxx by the other broker because of such action by Bear Xxxxxxx, you agree to
indemnify and hold Bear Xxxxxxx harmless from any loss, liability, damage, cost
or expense (including but not limited to fees and expenses of legal counsel)
arising directly or indirectly therefrom.
20. (a) Bear Xxxxxxx shall limit its services pursuant to the terms of
this Agreement to that of clearing functions and the related services expressly
set forth herein and you shall not hold yourself out as an agent of Bear Xxxxxxx
or of any subsidiary or company controlled directly or indirectly by or
affiliated with Bear Xxxxxxx. Neither this Agreement nor any operation hereunder
shall create a general or limited partnership, association or joint venture or
agency relationship between you and Bear Xxxxxxx.
(b) You shall not, without the prior written approval of Bear
Xxxxxxx, place any advertisement in any newspaper, publication, periodical or
any other media if such advertisement in any manner makes reference to Bear
Xxxxxxx or to the clearing arrangements and the services embodied in this
Agreement.
(c) Should you in any way hold yourself out as, advertise or
represent that you are the agent of Bear Xxxxxxx, Bear Xxxxxxx shall have the
power, at its option, to terminate this Agreement and you shall be liable for
any loss, liability, damage, claim, cost or expense (including but not limited
to fees and expenses of legal counsel) sustained or incurred by Bear Xxxxxxx as
a result of such a representation of agency or apparent authority to act as an
agent of Bear Xxxxxxx or agency by estoppel. Notwithstanding the provisions of
paragraph 24 below that any dispute or controversy between the parties relating
to or arising out of this Agreement shall be referred to and settled by
arbitration, in connection with any breach by you of this paragraph 20, Bear
Xxxxxxx may, at any time prior to the initial arbitration hearing pertaining to
such dispute or controversy, seek by application to the United States District
Court for the Southern District of New York or the Supreme Court of the State of
New York for the County of New York any such temporary or provisional relief or
remedy ("provisional remedy") provided for by the laws of the United States of
America or the laws of the State of New York as would be available in an action
based upon such dispute or controversy in the absence of an agreement to
arbitrate. The parties acknowledge and agree that it is their intention to have
any such application for a provisional remedy decided by the Court to which it
is made and that such application shall not be referred to or settled by
arbitration. No such application to either said Court for a provisional remedy,
nor any act or conduct by either party in furtherance of or in opposition to
such application, shall constitute a relinquishing or waiver of any right to
have the underlying dispute or controversy with respect to which such
application is made settled by arbitration in accordance with paragraph 24
below.
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21. The enumeration herein of specific remedies shall not be exclusive
of any other remedies. Any delay or failure by any party to this Agreement to
exercise any right herein contained, now or hereafter existing under the
Applicable Rules shall not be construed to be a waiver of such right, or to
limit the exercise of such right. No single, partial or other exercise of any
such right shall preclude the further exercise thereof or the exercise of any
other right.
22. This Agreement shall be submitted to and approved by the New York
Stock Exchange, Inc., or other regulatory and self-regulatory bodies vested with
the authority to review and approve this Agreement or any amendment or
modifications hereto. In the event of disapproval, the parties hereto agree to
bargain in good faith to achieve the requisite approval.
23. (a) This Agreement supersedes all other agreements between the
parties with respect to the transactions contemplated herein. This Agreement may
not be amended except by a writing signed by both parties hereto and may be
terminated upon thirty (30) days written notice to the other party. Bear Xxxxxxx
agrees that it will send to you copies of all written notices sent to Customers.
Notices to you shall be sent to:
Notices to Bear Steams shall be sent to: the Director of Clearance Services,
Bear, Xxxxxxx & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, X.X. 00000, with a copy to the
Director of Legal & Compliance Department. Termination shall not affect any of
the rights and liabilities of the parties hereto incurred before the date of
receipt of such notice of termination.
(b) This Agreement shall be binding upon and inure to the
benefit of the respective successors of the parties. Neither party may assign
any of its rights or obligations hereunder without the prior written consent of
the other party.
24. (a) This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
(b) All disputes and controversies relating to or any way
arising out of this Agreement shall be settled by arbitration before and under
the rules of the Arbitration Committee of the New York Stock Exchange, Inc.,
unless the transaction which gives rise to such dispute or controversy is
effected in another United States market which provides arbitration facilities,
in which case it shall be settled by arbitration under such facilities.
Please evidence your agreement to the foregoing by
executing and delivering to Bear Xxxxxxx the enclosed copy hereof, whereupon you
and Bear Xxxxxxx shall have entered into this Agreement.
Very truly yours,
BEAR, XXXXXXX & CO.
/s/
By________________________________
Managing Director
Accepted and Agreed to:
/s/ Xxxxxx, Xxxxxxx Inc.
________________________________
/s/
By:_____________________________
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Options Procedures for Correspondents
It is each Correspondent's responsibility to have each account
in which it effects listed option transactions approved by its or ROP, and to
ensure (1) that each account carried on its books has received an appropriate
Options Risk Disclosure Document no later than the first day an option
transaction is effected in the account, (2) that it obtains a signed
"Correspondent"s Customer Option Agreement (form no. 3000-96-350) within fifteen
business days of the first trace. Both Bear Xxxxxxx and each Correspondent have
overlapping responsibilities concerning option trading.
In order for a Correspondent to meet its responsibilities, it
must have sufficient information in its files to comply with the rules of the
option exchanges concerning the opening of accounts and the suitability of the
recommended transaction. Each Correspondent is required to send to each of its
accounts the option risks disclosure document titled "Understanding the Risks
and Uses of Listed Options" and a combined Option Agreement/New Account Form for
the customer's signature. Where applicable the Correspondent must also send the
appropriate supplementary risk disclosure documents and option agreements for
index, currency, or debt options.
In order that Bear Xxxxxxx be assured that the foregoing has
been accomplished, you must provide Bear Xxxxxxx with a copy of the
"Correspondent's Customer's Option Approval Form" form # 0000-00-0000 (4/83) (or
the form currently in effect at the time of the initial transaction) within
fifteen days of the first option trade. Bear Xxxxxxx will withhold from that
Correspondent its share of the commissions generated on those option accounts or
which Bear Xxxxxxx has not received the option approval form within the required
time. Bear Xxxxxxx will only remit the retained commissions upon timely receipt
of the correct documentation and if the necessary papers continue to be received
late from that Correspondent, Bear Xxxxxxx will not recredit that Correspondent
with retained commissions.
ADDENDUM TO CLEARANCE AGREEMENT
BETWEEN
BEAR, XXXXXXX SECURITIES CORP.
XXXXXX, XXXXXXX INC.
DATED: APRIL 30,1985
EFFECTIVE WITH JANUARY 1997 BUSINESS
Equity Business Customer
Tickets Per Month* Per Ticket Charge**
0-1000 $22.50
1001-1500 $21.50
1501-2500 $20.50
2501-3500 $20.00
3501-4500 $19.00
4501-5500 $18.00
5501-6500 $17.00
6501-8000 $16.00
8001 - up $15.00
PRINCIPAL CROSS TRADES IN YOUR TRADING ACCOUNT - (MARKET MAKING)
Equities (OTC) - $9 per dealer transaction; Customer transactions refer to your
equity business customer matrix.
*This count is based upon your agency equity business and your equity principal
crosses from your trading account (Syndicate transactions excluded).
**The per ticket charge is effective for all trades within this group.
MUTUAL FUNDS
Bear Xxxxxxx shall retain $15 per ticket, plus 5% of the 12-B-I fees.
$5 per Intra Fund switch (Roundturn)
/s/
APPROVED:_____________________________
Xxxxxx, Xxxxxxx Inc.
/s/
APPROVED:_____________________________
Bear, Xxxxxxx Securities Corp.
DATED: 4/7/97
BEAR XXXXXXX Bear, Xxxxxxx Securities Corp.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
ADDENDUM TO CLEARANCE AGREEMENT
BETWEEN
BEAR, XXXXXXX SECURITIES CORP.
XXXXXX, XXXXXXX INC.
DATED: APRIL30, 1985
EFFECTIVE WITH SEPTEMBER 1996 BUSINESS
INTEREST RATES
CUSTOMER
Credit Interest
Customer accounts will receive interest at the Bear Steams
credit interest rate (presently 2% below Bear Steams call) on
balances of $1 and up.
/s/
APPROVED:_____________________________
Xxxxxx, Xxxxxxx Inc.
/s/
APPROVED:_____________________________
Bear, Xxxxxxx Securities Corp.
DATED: September 24, 1996
BEAR XXXXXXX Bear, Xxxxxxx Securities Corp.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
ADDENDUM TO CLEARANCE AGREEMENT
BETWEEN
BEAR, XXXXXXX SECURITIES CORP.
XXXXXX, XXXXXXX INC.
DATED: APRIL 30, 1985
EFFECTIVE WITH DECEMBER 1994 BUSINESS
MONEY MARKET REBATES
A rebate will be given to your firm based upon your Money Market
balances as follows:
Up to $10 million 25 Basis Points
$10 - $25million 30 Basis Points
$25 - $35million 35 Basis Points
Over $35million 40 Basis Points
This rate is contingent upon the fund's continued payment of rebates.
If your firm does not utilize the automated money market sweep program,
a $5.00 fee will be charged on all manual money market transactions.
/s/
APPROVED:_____________________________
Xxxxxx, Xxxxxxx Inc.
APPROVED:_____________________________
Bear, Xxxxxxx Securities Corp.
DATED:
BEAR XXXXXXX Bear, Xxxxxxx Securities Corp.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
ADDENDUM TO CLEARANCE AGREEMENT
BETWEEN
BEAR, XXXXXXX SECURITIES CORP.
XXXXXX, XXXXXXX INC.
DATED: APRIL 30, 1985
EFFECTIVE WITH MARCH 1994 BUSINESS
AGENCY BUSINESS - EQUITIES
Bear Xxxxxxx will retain $22.50 per ticket.
PRINCIPAL CROSS TRADES IN YOUR TRADING ACCOUNT (MARKET MAKING)
Equities (Listed and OTC) - $12 per dealer transaction; $22.50 per customer
transaction.
/s/
APPROVED:_____________________________
Xxxxxx, Xxxxxxx Inc.
/s/
APPROVED:_____________________________
Bear, Xxxxxxx Securities Corp.
DATED: 3/15/94
BEAR XXXXXXX Bear, Xxxxxxx Securities Corp.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
ADDENDUM TO CLEARANCE AGREEMENT
BETWEEN
BEAR, XXXXXXX SECURITIES CORP.
XXXXXX, XXXXXXX INC.
DATED: APRIL 30, 1985
EFFECTIVE WITH AUGUST 1995 BUSINESS
Equity Business Customer
Tickets Per Month* Per Ticket Charge**
0-1000 $22.50
1001-1500 $21.50
1501-2500 $20.50
2501-3500 $20.00
3501-up $19.00
Bear Xxxxxxx Executions
Listed orders entered on our terminal will be billed as follows:
Market Orders (up to 30,099 shares): $.0025 per share
Limit Orders (up to 99,099 shares):
Execution under 2 minutes = $.0025 per share Execution over 2
minutes = $.01 per share
Shorts = $.0125 per share
All other executions on a listed exchange will be billed at $.01 5 per share.
*This count is based upon your agency equity business and your equity principal
crosses from your trading account. (Syndicate transactions excluded)
**The per ticket charge is effective for all trades within this group.
/s/
APPROVED:_____________________________
Xxxxxx, Xxxxxxx Inc.
/s/
APPROVED:_____________________________
Bear, Xxxxxxx Securities Corp.
DATED: August 14, 1995
BEAR XXXXXXX Bear, Xxxxxxx Securities Corp.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
ADDENDUM TO CLEARANCE AGREEMENT
BETWEEN
BEAR, XXXXXXX SECURITIES CORP.
XXXXXX, XXXXXXX INC.
DATED: APRIL 30, 1985
EFFECTIVE WITH DECEMBER 1994 BUSINESS
MONEY MARKET REBATES
A rebate will be given to your firm based upon your Money Market
balances as follows:
Up to $10 million 25 Basis Points
$10 - $25 million 30 Basis Points
$25 - $35 million 35 Basis Points
Over $35 million 40 Basis Points
This rate is contingent upon the fund's continued payment of rebates.
If your firm does not utilize the automated money market sweep program,
a $5.00 fee will be charged on all manual money market transactions.
/s/
APPROVED:_____________________________
Xxxxxx, Xxxxxxx Inc.
/s/
APPROVED:_____________________________
Bear, Xxxxxxx Securities Corp.
DATED: 12/9/94
BEAR XXXXXXX Bear, Xxxxxxx Securities Corp.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
ADDENDUM TO CLEARANCE AGREEMENT
BETWEEN
BEAR, XXXXXXX SECURITIES CORP.
XXXXXX, XXXXXXX INC.
DATED:APRIL30, 1985
EFFECTIVE WITH DECEMBER 1994 BUSINESS
OVERSEAS SETTLEMENT
Agency Basis:
Customer transaction: $60 per ticket plus local bank custodial fees.
Institutional DVP transaction: $110 per ticket.
Principal Cross Trades into and out of your Trading Account:
Dealer transaction: $60 per ticket plus local bank custodial fees.
Retail transaction: $25 per ticket plus local bank custodial fees.
Institutional DVP transaction: $60 per ticket.
Gross Credits - Bear Xxxxxxx (Trades Bought from or Sold to a Bear
Xxxxxxx Trading Account):
Customer transaction: $25 per ticket plus local bank custodial fees.
Institutional DVP transaction: $60 per ticket.
In addition, non-Euroclear transactions may incur bank transaction
fees.
/s/
APPROVED:_____________________________
Xxxxxx, Xxxxxxx Inc.
/s/
APPROVED:_____________________________
Bear, Xxxxxxx Securities Corp.
DATED: 12/8/94
BEAR XXXXXXX Bear, Xxxxxxx Securities Corp.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
ADDENDUM TO CLEARANCE AGREEMENT
BETWEEN
BEAR, XXXXXXX SECURITIES CORP.
XXXXXX, XXXXXXX INC.
DATED: APRIL 30, 1985
EFFECTIVE WITH AUGUST 1993 BUSINESS
PRINCIPAL CROSS TRADES IN YOUR TRADING ACCOUNT (MARKET MAKING)
Equities (Listed and OTC) -$15 per dealer transaction; $35 per customer
transaction.
/s/
APPROVED:_____________________________
Xxxxxx, Xxxxxxx Inc.
/s/
APPROVED:_____________________________
Bear, Xxxxxxx Securities Corp.
DATED: 8/3/93
BEAR XXXXXXX Bear, Xxxxxxx Securities Corp.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
BETWEEN
BEAR, XXXXXXX SECURITIES CORP.
XXXXXX, XXXXXXX INC.
DATED: APRIL 30, 1985
EFFECTIVE WITH DECEMBER 1994 BUSINESS
OVERSEAS SETTLEMENT
Agency Basis:
Customer transaction: $60 per ticket plus local bank custodial fees.
Institutional DVP transaction: $110 per ticket.
Principal Cross Trades into and out of your Trading Account:
Dealer transaction: $60 per ticket plus local bank custodial fees.
Retail transaction: $25 per ticket plus local bank custodial fees.
Institutional DVP transaction: $60 per ticket.
Gross Credits - Bear Xxxxxxx (Trades Bought from or Sold to a Bear
Xxxxxxx Trading Account):
Customer transaction: $25 per ticket plus local bank custodial fees.
Institutional DVP transaction: $60 per ticket.
In addition, non-Euroclear transactions may incur bank transaction
fees.
/s/
APPROVED:_____________________________
Xxxxxx, Xxxxxxx Inc.
APPROVED:_____________________________
Bear, Xxxxxxx Securities Corp.
DATED:__________________________
FEES FOR INTERNATIONAL SETTLEMENT/FULLY DISCLOSED BUSINESS
1. Equities and Non-Euro Bonds
Receipt or delivery with/without payment: $50.00 plus applicable agent
bank transaction fees (see schedule attached). The fee is a surcharge
to your normal ticket charge, i.e. if the normal ticket charge is $$$
per trade then an International Equity Movement would be: $$$ + $50.00
+ applicable agent bank transaction fee. There is a ticket charge of
$5 for Internal type 1 and 2 movements associated with foreign
denominated transactions.
It should be noted that sales of International Securities vs. U.S.
Dollars, wherein Bear, Xxxxxxx Securities Corp. must deliver
securities free, prior to U.S. Dollars being received, requires a
Release & Hold Harmless agreement to be in effect.
2. American Depositary Receipts (ADR'S)
Conversions of ADR's to ordinary shares (cancellations) or conversion
of ordinary shares to ADR'S (creations) require the movement of
ordinary shares. The fee for a conversion is $100.00.
3. Foreign Exchange Transactions (FX)
Bear Xxxxxxx' International Operations Group provides an FX order room
service for clearance firms, when the FX transaction is directly
related to a securities transaction cleared through Bear Xxxxxxx.
There is no surcharge for this service. We encourage all clients to
execute International Securities transactions in the related domestic
currency in order to facilitate securities settlements vs. payment.
4. Euro-bonds
Bear, Xxxxxxx is a member of both Euroclear and Cedel. There are no
surcharges for clearance of participant to participant settlements
within these systems. However, in addition to your normal ticket
charge as reflected on your schedule A, a 2 basis point per annum
custody charge based on the average monthly value of securities held
in Euroclear, will be billed monthly.
Other Notes
The above rates apply to "normal" transactions only. Additional
charges may result for special services. We settle overseas securities
within the related country or clearing organization(s) only. Under
most circumstances we will not deliver or receive physical foreign
securities outside of the accepted settlement mechanisms.
For any questions regarding communications of transactions, settlement practices
in various countries and other related International Clearance matters, please
contact one of the following Bear Xxxxxxx Personnel:
Xxxxxx Xxxxxxx Managing Director Ops. Adm. (000) 000-0000
Xxxxxx Xxxxx Associate Director Int'l. Ops. (000) 000-0000
Xxxxxxxxxxx Xxxx Associate Director Int'l. Ops. (000) 000-0000
Xxxxxxxx Xxxxx Associate Director Int'l. Ops. (000) 000-0000
August Xxxxxxxx Associate Director Int'l. Ops. (000) 000-0000
12/94
BEAR, XXXXXXX SECURITIES CORP.
INTERNATIONAL EQUITIES
CLEARANCE INSTRUCTIONS AND BANK FEES
Note: Custody fees are charged monthly based on the average market value of
securities held.
12/94
TRANSACTION
COUNTRY BANK/CLEARING ORG. FEES CUSTODY FEES
------- ------------------ ---------- -------------
Argentina Xxxxxx Guaranty Trust Co. 00 Xx 00 XX
Xxxxxx Xxxxx, Xxxxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #9809
Australia Citibank, N.A. 100A$ -
Melbourne, Australia
A/C Bear, Xxxxxxx Securities Corp.
A/C #203999
Belgium Xxxxxx Xxxxxxxx Xxxxx Xx. 00 Xx -
Xxxxxxxx, Xxxxxxx
A/C Bear Xxxxxxx Securities Corp.
A/C 687-32273107/46
Brazil Citibank, Brazil 50 U$ 16BP
Sao Paulo, Brazil
A/C Bear, Xxxxxxx Securities Corp.
A/C #2022
Canada Royal Bank Canada 00 Xx -
Xxxxxxx, Xxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #00002-102-624-4
China Citibank, N.A. 100 U$ 16 BP
Hong Kong
A/C Bear, Xxxxxxx Securities Corp.
A/C #925940
Columbia Citibank, Colombia 100 U$ 16 BP
A/C Bear Xxxxxxx Securities Corp.
A/C #3000000701
Denmark Xxxxxxx 000 XX -
Xxxxxxxxxx, Xxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #100089-45821-00
A/C #1871040
TRANSACTION
COUNTRY BANK/CLEARING ORG. FEES CUSTODY FEES
------- ------------------ ---------- -------------
Finland Kansallis-Osake-Pankki 000 XX 00 XX
Xxxxxxxx, Xxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #100089-45821-00-8
France Xxxxxx Guaranty Trust Co. Bonds:300 FF 0 XX
Xxxxx, Xxxxxx Equities: 220 FF
A/C Bear, Xxxxxxx Securities Corp.
A/C #014-73633-00-0
Germany Xxxxxx Guaranty Trust Co. 20 DM 0 XX
(Xxxxxx Xxxxxxxxx, Xxxxxxx
Shares) A/C Bear, Xxxxxxx Securities Corp.
A/C #50880000
Greece Citibank, Greece 150 U$ 85 BP
A/C Bear Xxxxxxx Securities Corp.
X/X #000000
Xxxx Xxxx Xxxxxxxx, Xxxx Xxxx 50 U$ 5 BP
Hong Kong
A/C Bear, Xxxxxxx Securities Corp.
A/C #924417
Indonesia Citibank, N.A. 000 Xx 00 XX
Xxxxxxx, Xxxxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #800260
Israel Bank Hapoalim Included in proceeds
Tel Aviv
A/C Bear Xxxxxxx Securities Corp.
A/C #21302
Italy Citibank, Milano 70,000 IL 4 BP-Bonds
Milan, Italy 7 BP-Equities
A/C Bear, Xxxxxxx Securities Corp.
A/C #0000000
Japan Citibank - Tokyo 2,700 JY 6BP
Tokyo, Japan
A/C Bear, Xxxxxxx Securities Corp.
A/C #310925
Korea Citibank, Korea 50,000 KW 19 BP
A/C Bear, Xxxxxxx Securities Corp.
A/C #7068-1
TRANSACTION
COUNTRY BANK/CLEARING ORG. FEES CUSTODY FEES
------- ------------------ ---------- -------------
Malaysia Citibank, N.A. 175 MYR .75 MYR PER
Kuala Lumpur, Malaysia 1,000 SHARES
A/C Bear, Xxxxxxx Securities Corp.
A/C #112249
Mexico Citibank Mexico Bonds: 30U$ 0 XX
Xxxxxx Xxxx, Xxxxxx Equities: 15U$ 6 BP
A/C Bear Xxxxxxx Securities Corp.
A/C #203807
Netherlands Citibank, N.A. 00 XX 0 XX
Xxxxxxxxx, Xxxxxxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #710-781
New Zealand Citibank, N.A. 000 Xx -
Xxxxxxxx, Xxx Xxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #705088
Xxxxxx Xxx Xxxxxx Xxxxxxxxxx 000 XX 00 XX
Xxxx, Xxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #05005-0005920
Pakistan Citibank, Pakistan 000 Xx 00 XX
Xxxxxxx, Xxxxxxxx
A/C Bear Xxxxxxx Securities Corp.
X/X #0000-000000-000
Xxxx Xxxxxxxx, Xxxx 000 Xx 00 XX
Xxxx, Xxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #70256029
Philippines Citibank, Manila 00 Xx 00 XX
Xxxxxx, Xxxxxxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C # 200499
TRANSACTION
COUNTRY BANK/CLEARING ORG. FEES CUSTODY FEES
------- ------------------ ---------- -------------
Portugal Citibank Portugal 15,000 XX 00 XX
Xxxxxx, Xxxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #30675517
Singapore Citibank - Singapore 00 Xx 0 XX
Xxxxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #707053
South Africa Standard Bank of South Africa 45 SR 1.6 BP
Johannesburg Stock Exchange
A/C Bear Xxxxxxx Securities Corp
A/C #40556790
Spain Xxxxxx Guaranty Trust Co. 10,000 XX 00 XX
Xxxxxx, Xxxxx
A/C Bear, Xxxxxxx Securities Corp.
Sweden Xxxxxxxxxxxxx Xxxxxxxx Xxxxxx 000 XX 0 XX
Xxxxxxxxx, Xxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #A 00000-000-000
Switzerland Bank Leu 45 SF 2.5 BP
Zurich, Switzerland
A/C Bear, Xxxxxxx Securities Corp.
A/C #0000-00000-0
Thailand Citibank, N.A. 2,000 XX 00 XX
Xxxxxxx, Xxxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
Turkey Citibank 70 U$ 00 XX
Xxxxxxxx, Xxxxxx
A/C Bear Xxxxxxx Securities
Corporation
A/C #00325
United Kingdom Citibank, N.A. 00 XX -
Xxxxxx, Xxxxxx Xxxxxxx
A/C Bear, Xxxxxxx Securities Corp.
A/C #6970099074
TRANSACTION
COUNTRY BANK/CLEARING ORG. FEES CUSTODY FEES
------- ------------------ ---------- -------------
Venezuela Citibank, N.A. 100 U$ 31 BP
Caracas, Venezuela
A/C Bear, Xxxxxxx Securities Corp.
A/C #1-110670
Note: Bank fees are subject to change at any time.
12/94
ADDENDUM TO THE AGREEMENT FOR SECURITIES CLEARANCE SERVICES
FOR PRIME BROKERAGE
Dear Correspondent:
We refer to a certain Agreement for Securities Clearance Services
currently in effect between you and Bear Xxxxxxx Securities Corp. (the "Clearing
Agreement").
This Addendum conforms to the requirements outlined in a no-action
letter issued by the Securities and Exchange Commission on January 25, 1994 (the
"No-Action Letter") which sets forth the requirements for maintaining a prime
brokerage arrangement, and which takes effect on July 25, 1994.
The purpose of this Addendum is to set forth the obligations and
responsibilities of Bear, Xxxxxxx Securities Corp. ("Bear Xxxxxxx Securities")
and you in providing prime brokerage services to the Customer when you act as
the executing broker, as such term is defined in the No-Action Letter, Bear
Xxxxxxx Securities acts as your clearing agent, and the prime broker settles
such transactions and carries the positions for the Customer. All defined terms
herein shall have the same meanings as provided in the Clearing Agreement.
1. You hereby agree as follows:
a. You will notify Bear Xxxxxxx Securities with respect to
each account for which you intend to act as an executing broker in a prime
brokerage arrangement.
b. You are solely responsible for the conduct of the
Customer's account, including but not limited to the responsibilities to know
your customer, determine the suitability of all transactions, obtain all proper
documentation (including all new account documents), and conduct your own credit
review of the Customer.
c. Prior to effecting a short sale, you shall be responsible
for verifying with Bear Xxxxxxx Securities to ensure that all orders effected by
you will comply with all applicable short sale provisions in the Applicable
Rules, including but not limited to SEC Rule 10a-1 and NYSE Rule 440A, and you
will be responsible for verifying that securities can be borrowed in order to
effect a timely delivery against each short sale.
d. In the event of any execution error or trade discrepancy
between a trade as executed and a trade as recorded in the customer's account
with the prime broker, you shall be responsible for correcting such error or
resolving such discrepancy with Bear Xxxxxxx Securities or your customer by such
time as Bear Xxxxxxx Securities deems appropriate on the next business day after
trade date. You shall be liable to Bear Xxxxxxx Securities for any and all
losses, including expenses caused thereby, and Bear Xxxxxxx Securities shall
have no liability to you whatsoever in any circumstance. You agree to indemnify
and hold Bear Xxxxxxx Securities harmless from and against and pay promptly on
demand any loss, liability, damage, claim, cost or expense (including reasonable
fees and expenses of counsel) arising out of or incurred in connection with such
discrepancy or error.
e. You shall retain in your possession copies of all
agreements that are necessary to enable you to execute prime brokerage trades
and, except to the extent undertaken by Bear Xxxxxxx Securities in the Clearing
Agreement, you shall preserve all records relating to such trades, as required
of an executing broker by the Applicable Rules and any SEC No-Action Letters
pertaining to prime brokerage arrangements (collectively, "No-Action Letters").
2. Bear Xxxxxxx Securities hereby agrees as follows:
a. Bear Xxxxxxx Securities will, on your behalf and pursuant
to your instructions, inform the prime broker of all trade data, including but
not limited to the contract amount, security involved, number of shares or
number of units, and whether the transaction was a long or short sale or a
purchase, by the morning of the next business day after trade date.
b. Bear Xxxxxxx Securities will treat the customer as its own
customer and record the transactions in a cash or margin account at Bear Xxxxxxx
Securities. Bear Xxxxxxx Securities shall treat all disaffirmed and "DK'd"
trades as normal customer transactions. If the disaffirmed or "DK'd" trade is a
short sale, we shall treat the transaction as if it had been executed in a
customer margin account.
c. Bear Xxxxxxx Securities shall be responsible for issuing
confirmations directly to the customer for each trade executed by you at Bear
Xxxxxxx Securities unless Bear Xxxxxxx receives written instructions from the
customer explicitly requesting that the confirmations be sent to the customer in
care of its prime broker, in which case Bear Xxxxxxx Securities will send the
confirmations to such customer in care of the prime broker. In the event a trade
is disaffirmed or DK'd, Bear Xxxxxxx Securities will promptly send a
confirmation of the transaction to the customer in the manner described above.
d. If a customer account introduced by you to Bear Xxxxxxx
Securities is managed by an investment advisor, each confirmation may cover a
single bulk trade representing transactions that have been combined with those
of other accounts of such investment advisor.
3. You hereby represent and covenant that you have entered into all
agreements concerning the prime broker arrangement that are required by the
Applicable Rules and No-Action Letters to enable you to execute prime brokerage
trades.
4. Bear Xxxxxxx Securities hereby represents and covenants that Bear
Xxxxxxx Securities has and at all times during the term of this Addendum shall
maintain the minimum net capital required by the Applicable Rules and No-Action
Letters.
5. All of the terms and conditions of the Clearing Agreement remain in
full force and effect except insofar as a conflict exists between the provisions
thereof and this Addendum, in which event the term or condition of this Addendum
shall supersede the conflicting term or condition of the Clearing Agreement,
only to the extent of the conflict.
6. The terms of this Addendum may not be amended or waived unless
agreed to in writing by both parties.
This Addendum shall take effect on July 25, 1994.
Kindly acknowledge receipt and acceptance of this Addendum by signing
the duplicate in the space provided.
Received & Accepted by Very truly yours,
/s/ Xxxxxx Xxxxxxx
___________________________________ Bear, Xxxxxxx Securities Corp.
Name of Correspondent
/s/ /s/
----------------------------------- ------------------------------
Authorized Signature By
----------------------------------- ------------------------------
Title Title Managing Director
9/6/94 September 7, 1994
----------------------------------- -------------------------------
Date Date
ADDENDUM TO THE AGREEMENT FOR SECURITIES CLEARANCE SERVICES
FOR PRIME BROKERAGE
Dear Correspondent:
We refer to a certain Agreement for Securities Clearance Services
currently in effect between you and Bear Xxxxxxx Securities Corp. (the "Clearing
Agreement").
This Addendum conforms to the requirements outlined in a no-action
letter issued by the Securities and Exchange Commission on January 25, 1994 (the
"No-Action Letter") which sets forth the requirements for maintaining a prime
brokerage arrangement, and which takes effect on July 25, 1994.
The purpose of this Addendum is to set forth the obligations and
responsibilities of Bear, Xxxxxxx Securities Corp. ("Bear Xxxxxxx Securities")
and you in providing prime brokerage services to the Customer when you act as
the executing broker, as such term is defined in the No-Action Letter, Bear
Xxxxxxx Securities acts as your clearing agent, and the prime broker settles
such transactions and carries the positions for the Customer. All defined terms
herein shall have the same meanings as provided in the Clearing Agreement.
1. You hereby agree as follows:
a. You will notify Bear Xxxxxxx Securities with respect to
each account for which you intend to act as an executing broker in a prime
brokerage arrangement.
b. You are solely responsible for the conduct of the
Customer's account, including but not limited to the responsibilities to know
your customer, determine the suitability of all transactions, obtain all proper
documentation (including all new account documents), and conduct your own credit
review of the Customer.
c. Prior to effecting a short sale, you shall be responsible
for verifying with Bear Xxxxxxx Securities to ensure that all orders effected by
you will comply with all applicable short sale provisions in the Applicable
Rules, including but not limited to SEC Rule 10a-1 and NYSE Rule 440A, and you
will be responsible for verifying that securities can be borrowed in order to
effect a timely delivery against each short sale.
d. In the event of any execution error or trade discrepancy
between a trade as executed and a trade as recorded in the customer's account
with the prime broker, you shall be responsible for correcting such error or
resolving such discrepancy with Bear Xxxxxxx Securities or your customer by such
time as Bear Xxxxxxx Securities deems appropriate on the next business day after
trade date. You shall be liable to Bear Xxxxxxx Securities for any and all
losses, including expenses caused thereby, and Bear Xxxxxxx Securities shall
have no liability to you whatsoever in any circumstance. You agree to indemnify
and hold Bear Xxxxxxx Securities harmless from and against and pay promptly on
demand any loss, liability, damage, claim, cost or expense (including reasonable
fees and expenses of counsel) arising out of or incurred in connection with such
discrepancy or error.
e. You shall retain in your possession copies of all
agreements that are necessary to enable you to execute prime brokerage trades
and, except to the extent undertaken by Bear Xxxxxxx Securities in the Clearing
Agreement, you shall preserve all records relating to such trades, as required
of an executing broker by the Applicable Rules and any SEC No-Action Letters
pertaining to prime brokerage arrangements (collectively, "No-Action Letters").
2. Bear Xxxxxxx Securities hereby agrees as follows:
a. Bear Xxxxxxx Securities will, on your behalf and pursuant
to your instructions, inform the prime broker of all trade data, including but
not limited to the contract amount, security involved, number of shares or
number of units, and whether the transaction was a long or short sale or a
purchase, by the morning of the next business day after trade date.
b. Bear Xxxxxxx Securities will treat the customer as its own
customer and record the transactions in a cash or margin account at Bear Xxxxxxx
Securities. Bear Xxxxxxx Securities shall treat all disaffirmed and "DK'd"
trades as normal customer transactions. If the disaffirmed or "DK'd" trade is a
short sale, we shall treat the transaction as if it had been executed in a
customer margin account.
c. Bear Xxxxxxx Securities shall be responsible for issuing
confirmations directly to the customer for each trade executed by you at Bear
Xxxxxxx Securities unless Bear Xxxxxxx receives written instructions from the
customer explicitly requesting that the confirmations be sent to the customer in
care of its prime broker, in which case Bear Xxxxxxx Securities will send the
confirmations to such customer in care of the prime broker. In the event a trade
is disaffirmed or DK'd, Bear Xxxxxxx Securities will promptly send a
confirmation of the transaction to the customer in the manner described above.
d. If a customer account introduced by you to Bear Xxxxxxx
Securities is managed by an investment advisor, each confirmation may cover a
single bulk trade representing transactions that have been combined with those
of other accounts of such investment advisor.
3. You hereby represent and covenant that you have entered into all
agreements concerning the prime broker arrangement that are required by the
Applicable Rules and No-Action Letters to enable you to execute prime brokerage
trades.
4. Bear Xxxxxxx Securities hereby represents and covenants that Bear
Xxxxxxx Securities has and at all times during the term of this Addendum shall
maintain the minimum net capital required by the Applicable Rules and No-Action
Letters.
5. All of the terms and conditions of the Clearing Agreement remain in
full force and effect except insofar as a conflict exists between the provisions
thereof and this Addendum, in which event the term or condition of this Addendum
shall supersede the conflicting term or condition of the Clearing Agreement,
only to the extent of the conflict.
6. The terms of this Addendum may not be amended or waived unless
agreed to in writing by both parties.
This Addendum shall take effect on July 25, 1994.
Kindly acknowledge receipt and acceptance of this Addendum by signing
the duplicate in the space provided.
Received & Accepted by Very truly yours,
___________________________________ Bear, Xxxxxxx Securities Corp.
Name of Correspondent
/s/
----------------------------------- ------------------------------
Authorized Signature By
----------------------------------- ------------------------------
Title Title
----------------------------------- ------------------------------
Date Date
