Exhibit 10.18
October 13, 1999
Sun Hung Kai Online Limited
00xx Xxxxx, Xxx Xxxxxxx Xxxxx
00 Xxxxxxxxx
Xxxx Xxxx
Re: Joint Online Trading Agreement
------------------------------
Ladies and Gentlemen:
This Joint Online Trading Agreement (the "Agreement") sets forth our
agreement and understanding, entered into as of the date shown above (the
"Effective Date"), regarding the establishment of a joint arrangement between
Web Street Securities, Inc. ("Web Street") and Sun Hung Kai Online Limited ("Sun
Hung Kai"), whereby Web Street will be the exclusive on-line broker for Sun Hung
Kai Customers (as defined below) trading U.S. equities or options and the non-
exclusive online broker for Sun Hung Kai Customers trading U.S. mutual funds and
index options online on U.S. securities exchanges, and Sun Hung Kai will be the
exclusive broker for Web Street customers trading on the SEHK (as defined below)
and the Shenzen and Shanghai Stock Exchanges (collectively, the "Transaction")
as follows:
Definitions:
"Effective Date" means the date first written above.
"Party" means Sun Hung Kai or Web Street and collectively they are referred
to as the "Parties".
"SEHK" means the Stock Exchange of Hong Kong Limited, and includes its
successor Exchange as a business unit of the new, merged Exchanges known as
"Hong Exchanges and Clearing Limited".
"Sun Hung Kai" means Sun Hung Kai Online Limited.
"Sun Hung Kai Customers" means all persons who have customer accounts with
Sun Hung Kai Group.
"Sun Hung Kai Group" means Sun Hung Kai & Co Limited, its associated and
subsidiary companies, including without limitation Sun Hung Kai Securities
Limited, and Sun Hung Kai Investment Services Limited.
"Territory" means the Hong Kong Special Administrative Region of the
People's Republic of China, and the Portuguese colony of Macau (the future
Macau Special Administrative Region of the People's Republic of China) as
well as any other country or area which is agreed in writing by the Parties
to be subject to the terms and provisions of Article A of this Agreement.
"Web Street" means Web Street Securities Inc.
A. Hong Kong
1. Establishment of Online Trading System
(a) Sun Hung Kai and Web Street agree that they will cooperate in developing an
online trading system that will enable Sun Hung Kai Customers to trade
securities on the U.S. securities exchanges. Additionally, and subject to
the development of the interface to be created by the SEHK, known as AMS3,
Web Street and Sun Hung Kai will pursue the development of such system to
enable Web Street customers to trade on the SEHK, and on the Stock
Exchanges of Shenzen and Shanghai.
(b) Sun Hung Kai and Web Street will determine and agree upon the level of
technology assistance and/or technology transfer that will be given or made
by Web Street to Sun Hung Kai in connection with establishing any such
online trading system for the consideration to be agreed upon by the
Parties.
(c) In connection with the technology assistance and/or transfer given or made
by Web Street as described in Paragraph A.1.(b), it is understood and
agreed that:
(i) Web Street will be responsible for the cost of any computer
hardware necessary to enable Sun Hung Kai Customers to trade
securities on the U.S. securities exchanges.
(ii) Web Street will provide "help desk personnel" to Sun Hung Kai
customer service personnel in a Chinese language selected by
Sun Hung Kai, with the specific requirements for such service
personnel to be negotiated in good faith by the Parties.
(iii) If Sun Hung Kai determines that the "Web Street System"
(defined as Web Street's proprietary order entry and order
routing software and Web Street's proprietary software that
delivers dynamically updating securities market quotations as
well as the online display of portfolio positions and
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account balances in real time) is to be used to enable Sun Hung
Kai Customers to trade online on the SEHK, then Sun Hung Kai
will be responsible for the cost of any and all:
(A) equipment necessary to implement the Web Street system
for use by Sun Hung Kai Customers in trading securities
on the SEHK; and
(B) personnel necessary to implement, maintain and operate
the system for U.S. and Hong Kong trading.
(d) Sun Hung Kai will provide all Sun Hung Kai Customer service and local
marketing, and Web Street will provide all Web Street Customer service and
local marketing.
2. Establishment of Web Street Accounts for Sun Hung Kai Customers; Exclusive
Arrangement.
(a) On or after the Effective Date, until such time as Web Street has
implemented an "omnibus" account for Sun Hung Kai (thereby eliminating the
need for individual account applications for each Sun Hung Kai Customer),
Sun Hung Kai will procure and submit to Web Street Web Street's account
application, a copy of which is attached hereto as Exhibit A, on behalf of
each Sun Hung Kai Customer, with required signature[s] and standard
arbitration agreement and other paperwork customarily required of Web
Street customers. Sun Hung Kai Customers will complete and submit to Web
Street any other paperwork reasonably required by Web Street including,
without limitation, I.R.S. Forms W-8 and W-9 (where applicable), and other
documentation which may be incidental to the foreign national status of a
Web Street customer. It is understood that Sun Hung Kai Customers will not
have trading authority until all documentation and paperwork required as
set forth above has been satisfactorily completed and received by Web
Street, in its (or its Clearing Firm's) sole discretion. Sun Hung Kai will
commence offering U.S. equities and options to Sun Hung Kai Customers
within six (6) months of the Effective Date.
(b) Sun Hung Kai and Web Street have agreed that, subject to the limitations
set forth in this Paragraph A.2.(b), for the five-year term hereof, the
arrangement established by this Agreement will be "mutually exclusive";
viz., Web Street will be the only U.S. on-line broker used by Sun Hung Kai
and promoted by Sun Hung Kai to Sun Hung Kai Customers desiring to trade
U.S. equities or equity-based options; Web Street will consider all
brokerage business conducted through Web Street by individuals residing in
the Territory (who are not already as of the Effective Date Web Street
customers) to be conducted by Sun Hung Kai Customers, and Sun Hung Kai will
be credited accordingly. Sun Hung Kai will be the only Hong Kong broker
used by Web Street and promoted by Web Street to its customers desiring to
trade Hong Kong or China equities or equity-based options, but such
exclusivity shall apply only if Web Street customers are able to conduct
(i) trading through Sun Hung Kai within six (6) months of the Effective
Date and (ii) online trading on the SEHK within three (3) months of
implementation of AMS3 by the SEHK. Sun
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Hung Kai will consider all brokerage business conducted through Sun Hung
Kai by individuals residing in the United States of America (who are not
already as of the Effective Date Sun Hung Kai Customers) to be conducted by
Sun Hung Kai Customers, and Web Street will be credited accordingly. The
Parties have also agreed that Web Street will be the non-exclusive online
broker for Sun Hung Kai Customers trading U.S. mutual funds and index
options online.
3. Maintenance of Sun Hung Kai or Web Street Customer Accounts; Commission
Allocation.
(a) Sun Hung Kai Customer Accounts with Web Street and Web Street Customer
Accounts with Sun Hung Kai will be maintained in accordance with registered
person and statutory obligations in both jurisdictions, and in order to
protect the client and shareholder funds of both organizations.
(b) Orders for trades made by Sun Hung Kai Customers shall be placed in any
manner available to other Web Street customers, i.e., on-line (via the
Internet) or by telephone through a Web Street trader. Orders received
outside market hours (being 9:30 a.m. to 4:00 p.m. Eastern U.S. time) will
be placed at the opening or as near the opening of the applicable market as
is practicable the next business day.
(c) Sun Hung Kai Customers will have access to all Web Street services (subject
to any technological limitations beyond Web Street's control), including
stock quotes, research, news and portfolio management capabilities (see
Exhibit B for a listing of Web Street features and resources available as
of the date hereof).
(d) All charges for Sun Hung Kai Customers account activity shall be made
according to the Web Street commission schedule as in effect from time to
time. Web Street will provide reasonable advance notice to Sun Hung Kai of
any changes to the commission schedule. (The commission schedule in effect
at the date hereof is attached as Exhibit C).
(e) All Sun Hung Kai Customers will have the benefit of the same insurance
coverage for loss due to broker-dealer or clearing corporation error as
other Web Street customers, including SIPC insurance up to an aggregate of
$500,000 ($100,000 cash and $400,000 securities). Such coverage which
applies to Web Street customers as of the date hereof is set forth in the
attached Exhibit D.
(f) Sun Hung Kai Customers will have the ability to purchase options and to
purchase securities on margin according to the same terms and conditions as
other Web Street customers, subject only to Clearing Firm requirements.
The Clearing Firm will be responsible for the extension of credit under
Regulation T of the Federal Reserve and NASD Article III, Section 30,
Appendix A. Except as provided in the following sentence, all margin calls
issued to Sun Hung Kai Customers shall be met within twenty-four (24)
hours. All margin calls issued to Sun Hung Kai Customers whose accounts
consist of 25% or more equity securities shall be met within seventy-two
(72) hours. Web Street and Sun
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Hung Kai agree that any uncollected customer debits ("Margin Loss")
attributable to customers under this Agreement will be properly accounted
for and ****** ******* between the Parties. With respect to Sun Hung Kai's
share of any Margin Losses, Web Street will notify Sun Hung Kai of any such
Margin Loss, and after three business days following delivery of such
notice, Web Street shall have authority to transfer sufficient funds out of
the Sun Hung Kai internal account, and to charge Sun Hung Kai, to satisfy
Sun Hung Kai's share of the Margin Loss.
(g) All notices and other written materials required or permitted to be
prepared and submitted by Sun Hung Kai or Sun Hung Kai Customers shall
include complete and accurate English language versions or translations, as
applicable and otherwise as required under U.S. Securities laws and
regulations. Translations of original English language documents into
Chinese (including the Web Street web site) shall be made at the sole
expense of Sun Hung Kai.
(h) Sun Hung Kai shall be responsible for all printing, advertising and other
marketing costs and expenses in the Territory. Sun Hung Kai shall be
responsible for any errors in any such translation, and shall indemnify,
defend and hold Web Street harmless for all direct losses, costs, damages,
etc. incurred by Web Street and arising from any such translation errors.
(i) All clearing functions, including the preparation of order tickets, time
stamps, and confirmation and statement generation, shall be performed by
the Clearing Firm or such other clearing operation (including Web Street,
should it become self-clearing) as Web Street may in its sole discretion
designate.
(j) Web Street will promptly forward to Sun Hung Kai weekly Clearing Firm
reports relating to transactions involving Sun Hung Kai Customers.
(k) Web Street will promptly forward all confirmations to Sun Hung Kai
Customers and will promptly forward to Sun Hung Kai all monthly statements
for Sun Hung Kai Customer accounts with activity and quarterly statements
for all such accounts.
(l) The Clearing Firm will be the "direct inquirer" for Sun Hung Kai Customers
under Rule 17f-1 (Lost and Stolen Securities) as promulgated by the
Securities and Exchange Commission (the "SEC") under the Securities
Exchange Act of 1934, as amended.
(m) Web Street will answer or seek diligently to obtain answers and to comply
with Sun Hung Kai Customer complaints or requests regarding activities for
which Web Street has responsibility.
(n) Web Street shall be responsible for actions required in connection with
dividends, interest, redemptions, consolidations or splits, tender offers,
exchanges or warrant offers for all Sun Hung Kai Customer accounts.
***** This information is omitted pursuant to a confidential treatment
request filed with the SEC
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(o) It is understood and agreed that all transactions conducted pursuant to
this Agreement in U.S. equities, mutual funds, equity-based options and
index options will take place and be denominated in U.S. currency.
Conversely it is understood and agreed that all transactions conducted
pursuant to this Agreement in Hong Kong and Shenzen equities and equity-
based options will take place and be denominated in Hong Kong dollars.
Transactions conducted pursuant to this Agreement in Shanghai equities and
equity-based options will be denominated in U.S. currency. Neither Party
shall have any responsibility for currency losses incurred by the other
Party or their customers or any resulting from the conversion of
currencies, currency losses, repatriation costs or for any other reason.
(p) Revenues on trades executed for Sun Hung Kai Customers and Web Street
Customers shall be divided in the manner set forth in the attached Exhibit
E.
(q) Each Party acknowledges and agrees that neither Party will have
responsibility for any customer losses attributable to system failures or
outages.
4. Responsibilities of Sun Hung Kai.
(a) Sun Hung Kai will work jointly with Web Street in establishing a unique
destination on Sun Hung Kai's web site - Sun Hung Kai - XxxXxxxxx.xxx or a
variation thereof - which will be a co-branded site including translations
into both simplified and traditional Chinese characters. The site design
will be completed by Sun Hung Kai, with final approval by Web Street; and
the co-branded portion of the site will be housed with Web Street utilizing
Web Street's servers.
(b) Until such time as Web Street has implemented an omnibus account for Sun
Hung Kai, Sun Hung Kai will forward to Web Street all completed new account
documentation (including new account agreements, margin agreements, option
agreements, and Forms W-8 and W-9 [where applicable]) which have been
submitted to Sun Hung Kai or Sun Hung Kai Customers.
(c) Sun Hung Kai will provide Web Street copies of any complaints received by
Sun Hung Kai that relate to the Clearing Firm or Web Street within twenty-
four hours after receipt.
(d) Sun Hung Kai will furnish Sun Hung Kai Customers with the required
prospectus, when applicable, including supplements, amendments, option
prospectus and disclosure documents; and, when making sales of underwritten
securities, shall comply with all SEC and National Association of
Securities Dealers rules.
(e) Subject to local regulatory requirements, Sun Hung Kai will endeavour to
identify retail locations for co-branded Sun Hung Kai/Web Street's
Financial Services Centres in Hong Kong, Shanghai and elsewhere. Cost
allocations and other issues pertaining to such retail facilities will be
determined and agreed upon by the Parties.
5. Joint Marketing.
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Web Street hereby grants a royalty-free license to Sun Hung Kai to use,
reproduce and display the name "Web Street" and variations thereof (hereinafter
referred to as the "Web Street Marks"), as follows:
(a) The grant of license shall be co-terminous with the term of this Agreement.
(b) The grant of license shall be exclusive with respect to use of the Web
Street Marks in the Territory only. No use of the Web Street Marks outside
the Territory is contemplated or agreed to (except to the extent that
Territory-based web-sites may be accessible anywhere in the world).
(c) Included in the grant of license herein is the right to use Web Street
advertising and promotional materials (hereinafter referred to as the "Web
Street Materials") in the Territory.
(d) Sun Hung Kai will provide and be responsible for all translations into both
traditional and simplified Chinese characters of Web Street Materials. Sun
Hung Kai will provide Web Street with copies of all Web Street Materials
used by Sun Hung Kai; and Sun Hung Kai will obtain Web Street's advance
written approval of Sun Hung Kai's uses of any Web Street Xxxx and/or Web
Street Materials. Sun Hung Kai will indemnify, defend and hold Web Street
harmless for any violations of law resulting from Sun Hung Kai's use of Web
Street Marks or Web Street Materials in the Territory. Web Street will
indemnify, defend and hold Sun Hung Kai harmless for any violations of law
resulting from Web Street's use of Sun Hung Xxx Xxxxx or Sun Hung Kai
Materials in the Territory.
6. Term and Termination of Article A of the Agreement.
The initial term of Article A of this Agreement shall be five (5) years
("Initial Term"). Article A of this Agreement shall automatically renew on
each anniversary of the Effective Date; provided that, after the Initial
Term, Article A of this Agreement may be canceled by either Party upon
ninety (90) days written notice. In the event of a cancellation, Sun Hung
Kai will assist the Clearing Firm and Web Street in making an orderly
transition. Upon cancellation, the Parties shall pay all amounts owed to
the other or to the Clearing Firm.
B. Other Countries: Japan, Australia and China
7. Japan.
For a period of nine months following the date of this Agreement, Sun Hung
Kai will use its best efforts to introduce Web Street to Japanese firms to
enable Web Street to establish a joint arrangement to provide trading of
U.S. securities to residents of Japan, as further described in Paragraph
C.2 below.
8. Australia.
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For a period of six months following the date of this Agreement, Sun Hung
Kai will use its best efforts to assist Web Street in acquiring an interest
in Xxxxxx Capital Holdings Limited of Sydney, Australia ("Xxxxxx") and/or
in establishing a joint arrangement with Xxxxxx to provide trading of U.S.
securities to customers of Xxxxxx, as further described in Paragraph C.3
below.
9. China.
Web Street and Sun Hung Kai will pursue the formation of a limited
liability entity (domiciled in Hong Kong or another jointly selected
jurisdiction) for the purpose of conducting online trading (the "Joint
Venture"), when possible, in The Peoples Republic of China ("PRC"). Sun
Hung Kai will use its diligent best efforts to establish a relationship
with a PRC-based entity to serve as local partner to utilize the Web Street
system for trading U.S. securities on U.S. securities exchanges and for
trading in China. The ownership, voting control and profit-sharing of the
Joint Venture will be split 50-50 between Web Street and Sun Hung Kai. It
is understood and agreed by each Party that (i) prior to the formation of
the Joint Venture Sun Hung Kai will not engage in the online brokerage
business within the PRC with a third party in any manner or form unless Web
Street has first been offered equal participation with Sun Hung Kai and Web
Street has rejected such offer and (ii) if the Parties form the Joint
Venture neither Party nor any parent or subsidiary company or any
affiliate, indirectly or directly, will engage in the online brokerage
business within the PRC other than through and for the sole benefit of the
Joint Venture during the term of this Agreement and except as otherwise
provided in the agreements relating to the Joint Venture. The Parties
agree to negotiate in good faith additional terms relating to the Joint
Venture, including, but not limited to, management and control issues,
super majority, and procedures for dispute resolution.
10. Other Countries.
The Parties will negotiate the terms of a possible Sun Hung Kai equity
participation or equity buy-in for joint ventures established in the above
countries and others, which may include, without limitation, Malaysia and
the Philippines.
C. Web Street, Inc. Warrants.
1. Web Street, Inc., the parent company of Web Street, agrees to enter into
the Warrant Agreement attached hereto as Exhibit E concurrently with the
execution of this Agreement, which inter alia (but without limiting the
terms thereof) provides for the issuance immediately upon execution of
this Agreement to Sun Hung Kai of warrants to purchase 500,000 shares of
Web Street, Inc. common stock upon the terms and subject to the conditions
set forth in the Warrant Agreement.
2. Upon both the signing of a formal written agreement within nine months of
the Effective Date and the commencement of business within six months of
the signing of such agreement, with a Japanese partner firm which is a
"keiretsu" or a broadly based Japanese
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trading company of suitable size and reputation, introduced to Web Street
by Sun Hung Kai, Web Street, Inc. will issue to Sun Hung Kai a warrant to
purchase an additional 500,000 common shares upon the terms and subject to
the conditions set forth in the Warrant Agreement.
3. Upon both the signing of a formal written agreement with Xxxxxx and the
commencement of business within six months of the Effective Date, Web
Street Inc. will issue to Sun Hung Kai a warrant to purchase 200,000 common
shares upon the terms and subject to the conditions set forth in the
Warrant Agreement.
4. The Parties agree to negotiate in good faith the terms and conditions of
the registration rights applicable to the Warrants, which negotiations
shall include terms and conditions relating to customary piggyback
registration rights and other registration rights which would result in the
common shares being tradable without restriction.
D. Conditions to consummation of the Transaction.
Consummation of the Transaction contemplated by this Agreement shall be
subject only to satisfaction or waiver of the following conditions:
1. Due diligence conducted by each Party (made by its own personnel as well as
its accountants, legal counsel and other advisors) of the assets,
liabilities, properties, commitments, products, businesses and affairs of
the other Party. In this regard, each Party shall provide the other Party
and its accountants, counsel and other representatives with reasonable
access during normal business hours to all of its business operations,
properties, books, files and records and will do everything reasonably
necessary to enable the other Party to make a complete examination of the
business, finances, assets, liabilities, properties, commitments and
affairs of that Party and the conditions thereof. Each Party agrees to use
its best efforts to cause its accountants to cooperate with this
investigation, including providing reasonable access to their working
papers. This examination will be conducted in cooperation with the
officers of each Party in such a manner as to minimize any disruption or
interference with the normal business operations of that Party, and the
results of this due diligence investigation will at all times be held in
strictest confidence by both Parties pursuant to the terms of a definitive
Confidentiality Agreement to be entered into between the Parties.
2. Agreement regarding the nature and scope of the technology licenses and
transfers, technical cooperation, and other intellectual property licenses
necessary to consummate the Transaction.
3. All regulatory approvals or consents required from relevant governmental
and exchange authorities in the United States and Hong Kong in order to
consummate the Transaction shall have been obtained.
E. Miscellaneous.
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1. Binding Effect. This Agreement shall be binding upon and enure to the
benefit of the Parties hereto, their legal representatives, successors in
interest and permitted assigns.
2. Termination. This Agreement shall terminate upon the occurrence of any of
the following events, whichever should first occur:
a) The Parties mutually agree to terminate the Agreement; or
b) Notice of termination pursuant to Section A.6.
Notwithstanding the provisions of this Section E.2, upon breach by either
Party of any material provision of this Agreement (a "Material Breach"),
the other Party may elect to terminate this Agreement on ten (10) days
written notice. Such notice shall specify the Material Breach and unless
such Material Breach is cured during the ten (10) day notice period, this
Agreement shall terminate.
3. Confidentiality. The Parties agree that no public disclosure of, or
reference to, this Agreement or the Transaction shall be made without the
prior consent of the other Party, except as required by law or the rules of
the U.S. exchanges and the SEHK. Sun Hung Kai acknowledges that this
Agreement and the Transaction will be disclosed in Web Street's
Registration Statement on Form S-1 to be filed with the U.S. Securities and
Exchange Commission.
4. Expenses. Except as otherwise specifically set forth herein, the Parties
agree that each Party shall bear its own legal, accounting and other
expenses in connection with this Agreement and the Transaction.
5. Notices. All notices required or permitted under this Agreement shall be
in writing and personally delivered or sent by facsimile transmission as
follows:
If to Web Street c/o: Xxxxxx X. Xxxx
at: Web Street Securities, Inc.
000 Xxxx Xxxx Xxxx - 0xx Xxxxx
Xxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
If to Sun Hung Kai c/o: Xxxxxx Xxxx,
at: Sun Hung Kai Online Limited
00/X Xxxxxxx Xxxxx Xxx,
00 Xxxxxxxxx,
Xxxx Xxxx
Facsimile: 852.2520.6040
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or such other address as either Party may from time to time designate to
the other by notice duly given.
6. Survival. All representations, covenants and warranties shall survive the
execution of this Agreement. All indemnities made or given under this
Agreement shall survive the termination hereof. The covenants contained in
Paragraphs E.3, 4, 5, 6 and 8 shall survive termination of this Agreement.
7. Entire Agreement; Amendment. This Agreement contains the entire
understanding of the Parties, and supersedes any prior agreements or
understandings, with respect to the transactions contemplated by this
Agreement. This Agreement may be amended only with the express written
consent of the Parties hereto.
8. Governing Law and Dispute Resolution
a) All disputes arising in connection with this Agreement shall be
finally settled under the Rules of Arbitration of the International
Chamber of Commerce (the "Rules") by one arbitrator (the "Arbitral
Tribunal") appointed in accordance with the Rules.
b) The governing law of this Agreement shall be the substantive law of
New York and the proceedings before the Arbitral Tribunal shall be
governed by the Rules.
c) The place of arbitration shall be in Xxxxxxxxx, Xxxxxxx Xxxxxxxx,
Xxxxxx. Any award of the Arbitral Tribunal (the "Award") shall be
deemed to be made at the place of the arbitration. The Arbitral
Tribunal may, however, hold hearings, meetings or sessions anywhere
convenient.
d) The language of the arbitration shall be English.
e) The Parties agree that the arbitration shall be conducted
confidentially and any award made may be made public only with the
prior written consent of the Parties.
f) The Award shall:
(i) Be in writing;
(ii) State the reasons upon which it is based;
(iii) Be signed by the Arbitral Tribunal;
(iv) State its date;
(v) Be final and binding on the Parties as from the date that it is
made;
(vi) Insofar as it is monetary, be made in United States dollars.
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g) The Parties undertake to carry out the Award without delay, and waive
their right to any form of appeal or recourse to a court of law or
other judicial authority insofar as such waiver may be lawfully made.
h) Judgment on the Award may be entered in any court which has
jurisdiction.
9. Partial Invalidity. In the event any part or parts of this Agreement are
found to be invalid, illegal or unenforceable in any respect, it is the
intent of the Parties that a court so finding shall revise or modify the
provisions hereof found to be invalid, illegal or unenforceable, and the
remaining provisions hereof shall nevertheless be valid and binding with
the same force and effect as if the invalid, illegal or unenforceable part
or parts were originally deleted.
10. Waivers. Any term or provision of this Agreement may be waived, or the
time for its performance may be extended, by the Party or Parties entitled
to the benefit thereof. The failure of any Party hereto to enforce at any
time any provision of this Agreement shall not be construed to be a waiver
of such provision, nor in any way to affect the validity of this Agreement
or any part hereof or the right of any Party thereafter to enforce each and
every such provision. No waiver of any breach of this Agreement shall be
held to constitute a waiver of any other or subsequent breach.
11. Multiple Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be deemed an original hereof, and all of
which taken together shall be considered one and the same instrument.
12. Relationship of Parties. No provision of this Agreement shall be construed
to constitute Web Street and Sun Hung Kai as members of any partnership,
joint venture, association, syndicate or other entity except to the extent
expressly provided for herein. Nothing herein contained shall be construed
as constituting any Party as the agent or partner of the other Party or as
conferring on any Party the authority to enter into any contract or to make
any legal commitment or other binding obligation on behalf of the other
Party, except as expressly provided for in this Agreement.
13. Regulatory Requirements. Nothing in this Agreement shall be taken to
override any statutory or regulatory obligations which may be applied in
any of the effective jurisdictions. This shall include without limiting
the generality thereof, Rules and Guidelines issued for the governance of
registered persons by regulatory organizations such as the Securities and
Exchange Commission of the U.S.A., and the Securities and Futures
Commission of Hong Kong, the NASD, and the SEHK.
14. Assignment. Sun Hung Kai may assign all of its rights and obligations
under this Agreement to any member of the Sun Hung Kai Group or any wholly-
owned subsidiary and references in this Agreement to Sun Hung Kai shall
include any such assignee.
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If the foregoing accurately reflects the agreement and understanding of Sun
Hung Kai, please so indicate by signing below.
Very truly yours,
Web Street Securities, Inc.
By: /s/ Xxxxxx X. Xxxx
----------------------------------
Name: Xxxxxx X. Xxxx
Title: Executive Vice President
Web Street, Inc.
By: /s/ Xxxxxx X. Xxxx
-----------------------------------
ACKNOWLEDGED AND AGREED TO:
Sun Hung Kai Online Limited
By: /s/ Xxxxxx Xxxxxx Xxx
----------------------------
Date: 14/10/99
---------------------------
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EXHIBIT A
Web Street Account Application
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EXHIBIT B
Web Street Securities, Inc.
Features
A real-time trading pit to monitor stocks, options and mutual funds and check
balances and positions;
Quick executions on most marketable orders;
Online "pop-up" and mailed confirmations;
Flat $14.95 per online stock trade;
Option trades for $14.95 + $1.75 per contract;
Free online trades of 1,000 or more NASDAQ shares of more than $2 per share[NB
to be phased out];
Free (not real-time) monitoring of 10 separate Watchlists of up to 10 positions
each;
FREE Baseline company profiles that include company histories, market trends and
individual stock movements;
FREE Real Time balances and positions;
Optional Live Self Updating Real Time Quotes;
Free unlimited Real Time Snapshot Quotes;
Free news; and
Free Charts and Research.
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EXHIBIT C
Web Street Securities, Inc.
Commission Schedule
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Trades Executed via the Internet
-----------------------------------------------------------------------------------------
Any listed stock trade, any size $14.95
-----------------------------------------------------------------------------------------
NASDAQ Stock Trade under 1,000 shares $14.95
-----------------------------------------------------------------------------------------
NASDAQ Stock Trades 1,000 shares or more* FREE
-----------------------------------------------------------------------------------------
Equity and Index Options $14.95 plus
$1.75 per contact
-----------------------------------------------------------------------------------------
Mutual Funds Transaction $25.00
-----------------------------------------------------------------------------------------
*On stocks trading over $2.00 per share. For stocks trading $2.00 and under per share,
$14.95.
-----------------------------------------------------------------------------------------
Trades Executed via a Live Representative
Any listed stock trade, any size $24.95
-----------------------------------------------------------------------------------------
NASDAQ Stock Trade under 1,000 shares** $24.95
-----------------------------------------------------------------------------------------
NASDAQ Stock Trades 1,000 shares** or more $24.95
-----------------------------------------------------------------------------------------
Equity and Index Options $24.95 plus
$1.75 per contact
-----------------------------------------------------------------------------------------
Mutual Funds Transaction $25.00
-----------------------------------------------------------------------------------------
Bonds -- government, municipals, corporate Contact a Web Street
Account Executive for
pricing
-----------------------------------------------------------------------------------------
**On stocks trading over $2.00 per share.
-----------------------------------------------------------------------------------------
Margin Rates
0 - 4,999 2% above broker call
-----------------------------------------------------------------------------------------
5,000 - 9,999 1 3/4% above broker call
-----------------------------------------------------------------------------------------
10,000 - 14,999 1 1/2% above broker call
-----------------------------------------------------------------------------------------
15,000 - 19,999 1 1/4% above broker call
-----------------------------------------------------------------------------------------
20,000 - 24,999 1% above broker call
-----------------------------------------------------------------------------------------
25,000 and higher 3/4% above broker call*
-----------------------------------------------------------------------------------------
Broker call as quoted in Wall Street Journal
* over $100,000 rate is negotiable
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EXHIBIT D
Web Street Securities, Inc.
Insurance Coverage
Web Street is a member of Securities Investor's Protection Corporation ("SIPC").
SIPC insures the first $500,000 of each customer account ($100,000 cash;
$400,000 securities). Individual accounts are additionally protected through
Asset Guaranty Corp., up to $99.5 million per account.
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EXHIBIT E
Web Street Securities, Inc.
Transaction Costs and Fee Structure
The following sets forth Web Street's transaction costs and fee structure, so
long as Web Street is not self-clearing. In the event that Web Street becomes
self-clearing, Exhibit E shall be revised accordingly.
Ticket Charges -- Web Street currently pays to U.S. Clearing a charge of $8.00
U.S. for the clearing of any size equity transaction. This includes both market
and limit orders. Web Street currently pays to U.S. Clearing a charge of $8.50
U.S. plus an additional $1.25 per contract for all options transactions.
Transaction Revenues -- Web Street currently charges $14.95 commissions on all
equity transactions. Web Street currently charges no commissions on NASDAQ
trades of 1,000 or more if the stock is priced over $2.00. Both market and limit
orders. Web Street charges $14.95 plus $1.75 per contract on option trades.
Order Flow Rebates - Web Street currently receives the following rebates on
NASDAQ stock trades:
$.025 per share on NASDAQ stock priced over $2.00.
$.01 per share on NASDAQ stock priced $1.01 to $2.00.
Mutual Fund Expenses -- Web Street and Sun Hung Kai will share mutual fund loads
and commissions equally.
Revenue Sharing -- Web Street and Sun Hung Kai will ***** gross profits *****.
For these purposes, Gross profit will be agreed to consist of:
Total Transaction Revenues plus Order Flow Rebates plus rebate on margin
interest or spread of interest on margin funds, less Ticket Charges.
Sun Hung Kai's share of gross profits will be paid, to an account identified by
Sun Hung Kai, no later than the 15th calendar day following the close of the
"trading month." The "trading month" ends on the Tuesday preceding the last
Friday of each calendar month.
*****This information is omitted pursuant to a confidential treatment request
filed with the SEC.
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Sun Hung Kai
Transaction Costs and Fee Structure
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EXHIBIT F
This Warrant and the Common Stock issuable upon exercise hereof have not been
registered or qualified for sale under the Securities Act of 1933, as amended,
and may not be offered, sold or transferred in the absence of such registration
or an exemption therefrom under said Act.
WARRANT TO PURCHASE
SHARES OF COMMON STOCK
OF
WEB STREET, INC.
THIS IS TO CERTIFY that, for value received and subject to the provisions
hereinafter set forth, Sun Hung Kai Online Limited ("Sun Hung Kai"), or assigns,
is entitled to purchase from WEB STREET, INC., a Delaware corporation (the
"Corporation"), in accordance with the terms and conditions established pursuant
to Section 2 hereof and at any time prior to the expiration of this Warrant,
1,200,000 Warrant Shares (as hereinafter defined), as applicable, subject to the
provisions and adjustments and on the terms and conditions hereinafter set
forth, at the Exercise Price (as hereinafter defined) payable as provided
herein.
1. Definitions. In addition to the terms defined elsewhere in this
Warrant, the following terms have the following respective meanings:
"Board" means the Board of Directors of the Corporation.
"Common Stock" as used herein shall mean the Common Stock of the
Corporation, par value $.01 per share.
"Exercise Price" shall mean, collectively the Hong Kong Exercise Price, the
Japan Exercise Price and the Australia Exercise Price, as in effect from time to
time as provided in this Warrant.
"Number of Warrant Shares" shall mean, at the time of any determination
thereof (a) if no adjustments have theretofore been made pursuant to the
provisions of Section 4 hereof, the Original Number of Warrant Shares and (b) if
any one or more such adjustments have been so made, the amount to which the
Original Number of Warrant Shares shall have been so adjusted pursuant to the
terms of this Warrant.
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"Original Number of Warrant Shares" shall mean 1,200,00 fully paid and
non-assessable shares of Common Stock of the Corporation.
"Warrant Shares" shall mean shares of Common Stock purchased or
purchasable by the holder of this Warrant upon the exercise hereof.
"Warrants" as used herein shall mean this Warrant and any other Warrants
issued pursuant to the terms and provisions of Sections 10, 11 or 12 hereof.
2. Exercise of Warrant.
(a) Hong Kong Warrant. The Hong Kong Warrant entitles the Warrant
holder to purchase from the Corporation, in accordance with this Section 2(a)
and at any time prior to the expiration of this Warrant, 500,000 Warrant Shares.
Subject to the conditions hereinafter set forth, (i) commencing on each of one
hundred and eighty days (180) and three hundred and sixty (360) days following
the later of the date of this Warrant or the closing of the initial public
offering of the Corporation (the "Corporation's IPO") 100,000 Warrant Shares
may be exercised in whole or in part at an exercise price equal to the lesser of
(A) $20.00 per share and (B) the price to the public per share (before
underwriting discounts and commissions) of the Common Stock in the Corporation's
IPO plus $8.00; (ii) commencing three hundred and sixty (360) days after such
time as there have been 1,000 (U.S.) trades in the aggregate executed in a 10
consecutive day period, 100,000 Warrant Shares may be exercise in whole or in
part at an exercise price equal to the lesser of (A) $20.00 per share and (B)
the price to the public per share (before underwriting discounts and
commissions) of the Common Stock in the Corporation's IPO plus $8.00; and (iii)
commencing three hundred and sixty days (360) after the date the 5,000th funded
account is opened through Sun Hung Kai, 200,000 Warrant Shares may be exercised
in whole or in part, at an exercise price of $30.00 per share (the exercise
price in clauses (i) (ii) and (iii) being hereinafter referred to as the "Hong
Kong Exercise Price"). For purposes of subparagraph 2(a)(iii), an account shall
be deemed "funded" at such time as there is a deposit of either U.S. $1,000 cash
or securities having a total value not less than U.S. $1,000.
(b) Japanese Warrant. The Japanese Warrant entitles the Warrant holder to
purchase from the Corporation, in accordance with this Section 2(b) and at any
time prior to the expiration of this Warrant, 500,000 Warrant Shares. Subject to
the conditions hereinafter set forth, commencing on each of three hundred and
sixty days (360) and seven hundred and twenty days (720) following the signing
of a formal written agreement within nine months of the date of this Warrant
with a Japanese partner firm which is a "keiretsu" or a broadly based Japanese
trading company of suitable size and reputation, and commencement of business
with such partner firm within six months of the signing of such formal written
agreement, 250,000 Warrant Shares may be exercised in whole or in part, at an
exercise price equal to the lesser of (i) $20.00 per share and (ii) the price to
the public per share (before underwriting discounts and commissions) of the
Common Stock in the Corporation's IPO plus $8.00 (the "Japanese Exercise
Price"). If, at any time within nine months of the date of this Warrant, the
Corporation enters into a formal agreement with a firm in Japan to which the
Corporation was
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not introduced by Sun Hung Kai, the total number of Warrant Shares issuable upon
exercise of the Japanese Warrant shall be reduced to 50,000, at the Japanese
Exercise Price. Such Warrant Shares may be exercised in whole or in part
commencing 180 days following the later of the date of grant or the
Corporation's IPO.
(c) Australia Warrant. The Australia Warrant entitles the Warrant holder
to purchase from the Corporation, in accordance with this Section 2(c) and at
any time prior to the expiration of this Warrant, 200,000 Warrant Shares.
Subject to the conditions hereinafter set forth, commencing three hundred and
sixty (360) days following the signing of a formal written agreement and the
commencement of business with Xxxxxx Capital Holdings Limited of Sydney,
Australia ("Xxxxxx") within six months of the date of this Warrant, 200,000
Warrant Shares may exercised in whole or in part, at an exercise price equal to
the lesser of (i) $20.00 per share and (ii) the price to the public per share
(before underwriting discounts and commissions) of the Common Stock in the
Corporation's IPO plus $8.00 (the "Australia Exercise Price").
(d) If this Warrant is exercised in respect of less than all of the
Warrant Shares at the time purchasable hereunder, the holder hereof shall be
entitled to receive a new Warrant covering the number of shares in respect of
which this Warrant shall not have been exercised; provided, however, that this
Warrant and all rights and options hereunder shall expire at the close of
business on the fifth anniversary of the Effective Date. This Warrant and all
options and rights hereunder shall be wholly void to the extent this Warrant is
not exercised before it expires.
(e) The holder of this Warrant may, at its option, exchange this Warrant,
in whole or in part (a "Warrant Exchange"), into the number of Warrant Shares
determined in accordance with this subparagraph, by surrendering this Warrant at
the principal office of the Corporation or at the office of its stock transfer
agent, accompanied by a notice stating such Holder's intent to effect such
exchange, the number of Warrant Shares to be exchanged and the date on which the
holder requests that such Warrant Exchange occur (the "Notice of Exchange"). The
Warrant Exchange shall take place on the date specified in the Notice of
Exchange or, if later, the date the Notice of Exchange is received by the
Corporation (the "Exchange Date"). Certificates for the shares issuable upon
such Warrant Exchange and, if applicable, a new warrant dated the date hereof
and otherwise identical with this Warrant (except as to the number of shares of
Common Stock issuable pursuant thereto) evidencing the balance of the shares
remaining subject to this Warrant, shall be issued as of the Exchange Date and
delivered to the holder within five (5) days following the Exchange Date.
3. Reservation of Common Stock. The Corporation covenants and agrees
that during the period within which the rights represented by this Warrant may
be exercised, the Corporation will at all times have authorized, and in reserve,
a sufficient number of shares of its Common Stock to provide for the exercise of
the rights represented by this Warrant.
4. Protection Against Dilution.
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(a) Subdivision or Combination of Common Stock. If the Corporation at
any time subdivides (by any stock split, stock dividend, recapitalization or
otherwise) its outstanding shares of Common Stock into a greater number of
shares, the Exercise Price in effect immediately prior to such subdivision will
be proportionately reduced. If the Corporation at any time combines (by reverse
stock split or otherwise) its outstanding shares of Common Stock into a smaller
number of shares, the Exercise Price in effect immediately prior to such
combination will be proportionately increased.
(b) Organic Change. Upon the consummation of a subdivision, combination
or recapitalization of the Common Stock (an "Organic Change") the terms of the
Warrants shall be deemed modified, without payment of any additional
consideration therefor, so as to provide that upon the exercise of the Warrants
following the consummation of such Organic Change the holder of such Warrants
shall have the right to acquire and receive (in lieu of or in addition to the
shares of Common Stock acquirable and receivable prior to the Organic Change)
such shares of stock, securities or assets as such holder would have received if
such holder had exercised its Warrants for Common Stock immediately prior to
such Organic Change, in each case giving effect to any adjustment of the
Exercise Price made after the date of consummation of the Organic Change. All
other terms of the Warrants shall remain in full force and effect following such
an Organic Change. The provisions of this subparagraph shall similarly apply to
successive Organic Changes.
(c) Notices.
(i) Immediately upon any adjustment of the Exercise Price, the
Corporation shall give written notice thereof to all holders of the Warrants
specifying the Exercise Price in effect thereafter.
(ii) The Corporation shall give written notice to all holders of the
Warrants at least twenty (20) days prior to the date on which the Corporation
closes its books or takes a record for determining rights to vote with respect
to any Organic Change. The Corporation shall also give written notice to the
holders of the Warrants at least twenty (20) days prior to the date on which any
Organic Change shall occur.
(d) Adjustment of Number of Warrant Shares. Whenever the Exercise Price
is adjusted as provided herein, the Number of Warrant Shares shall be adjusted
by multiplying the Number of Warrant Shares immediately prior to such adjustment
by a fraction, of which the numerator shall be the Exercise Price immediately
prior to such adjustment, and of which the denominator shall be the Exercise
Price immediately thereafter.
5. Mergers, Consolidations, Sales. In the case of any consolidation or
merger of the Corporation with another entity, or the sale of all or
substantially all of its assets to another entity, or any reorganization or
reclassification of the Common Stock or other equity securities of the
Corporation (except a subdivision or combination of the Common Stock, provision
for which is made in pursuant to Section 4), then, as a condition of such
consolidation, merger, sale, reorganization or reclassification, lawful and
adequate provision shall be made whereby
4
the holders of the Warrants shall thereafter have the right to receive upon the
basis and upon the terms and conditions specified herein and in lieu of the
shares of Common Stock immediately theretofore purchasable hereunder, such
shares of stock, securities or assets as may (by virtue of such consolidation,
merger, sale, reorganization or reclassification) be issued or payable with
respect to or in exchange for a number of outstanding shares of Common Stock
equal to the number of shares of Common Stock immediately theretofore so
purchasable hereunder had such consolidation, merger, sale, reorganization or
reclassification not taken place, and in any such case appropriate provisions
shall be made with respect to the rights and interests of the holders of the
Warrants to the end that the provisions hereof (including, but not limited to,
provisions for adjustment of the Number of Warrant Shares) shall thereafter be
applicable as nearly as may be, in relation to any shares of stock, securities
or assets thereafter deliverable upon exercise of this Warrant. The Corporation
shall not effect any such consolidation, merger or sale, unless prior to or
simultaneously with the consummation thereof, the successor entity (if other
than the Corporation) resulting from such consolidation or merger or the entity
purchasing such assets shall assume by written instrument executed and mailed or
delivered to each holder of the Warrants, the obligation to deliver to such
holder such shares of stock, securities or assets as, in accordance with the
foregoing provisions, such holder may be entitled to receive.
6. Fractional Shares. Fractional shares shall not be issued upon the
exercise of this Warrant but in any case where the holder hereof would, except
for the provisions of this paragraph, be entitled under the terms hereof to
receive a fractional share upon the complete exercise of this Warrant, the
Corporation shall, upon the exercise of this Warrant for the largest number of
whole shares then called for, pay a sum in cash equal to the excess of the value
of such fractional share (determined in such reasonable manner as may be
prescribed in good faith by the Board of Directors of the Corporation) over the
proportional part of the Exercise Price represented by such fractional share.
7. Fully Paid Stock; Taxes. The Corporation covenants and agrees that
the shares of stock represented by each and every certificate for its Common
Stock to be delivered on the exercise of the conversion rights herein provided
for shall, at the time of such delivery, be validly issued and outstanding and
be fully paid and nonassessable. The Corporation further covenants and agrees
that it shall pay when due and payable any and all federal and state taxes
(other than income taxes) which may be payable in respect of the Warrants or any
Common Stock or certificates therefor upon the exercise of the conversion rights
herein provided for pursuant to the provisions hereof.
8. Closing of Transfer Books. The stock transfer books of the
Corporation for its Common Stock shall not be closed in any manner which
interferes with the exercise of any Warrant.
9. Restrictions on Transferability of Warrants and Common Stock;
Compliance with Laws. This Warrant and the Common Stock issued upon the exercise
hereof shall not be transferable except upon the conditions hereinafter
specified, which conditions are intended to insure compliance with the
provisions of the Securities Act of 1933 (or any similar federal
5
statute at the time in effect) in respect of the transfer of any Warrant or any
such Common Stock.
A. Certain Definitions. As used in this Section 9, the following
terms shall have the following respective meanings:
"Commission" shall mean the Securities and Exchange Commission,
or any other federal agency at the time administering the Securities Act.
"Restricted Stock" shall mean the shares of Common Stock issued
upon the exercise of the Warrants and evidenced by a certificate required
to bear the legend specified in subparagraph B hereof.
"Securities Act" shall mean the Securities Act of 1933, or any
successor federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
B. Restrictive Legends. Each Warrant shall bear on the face thereof
a legend substantially in the form of the notice endorsed on the first page
of this Warrant.
Each certificate for shares of Common Stock initially issued upon
the exercise of any Warrant and each certificate for shares of Common Stock
issued to a subsequent transferee of such certificate shall, unless
otherwise permitted by the provisions of this subparagraph B, bear on the
face thereof a legend reading substantially as follows:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and may not
be offered, sold or transferred in the absence of such registration or
an exemption therefrom under said Act, and are transferable only upon
the conditions specified in the Warrant pursuant to which such shares
were issued."
In the event that the Corporation shall receive an opinion of
counsel that, in the opinion of such counsel, such legend is not, or is no
longer, necessary or required (including, but not limited to, because of
the availability of the exemption afforded by Rule 144 of the General Rules
and Regulations of the Commission), the Corporation shall, or shall
instruct its transfer agents and registrars to, remove such legend from the
certificates evidencing the Restricted Stock or issue new certificates
without such legend in lieu thereof. All fees and expenses of counsel in
connection with the rendition of the opinion provided for in this
subparagraph shall be paid by the Warrant holder.
C. Notice of Proposed Transfer; Registration Not Required. Promptly
after receiving written notice of intention to transfer the Warrant, the
Corporation shall
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present copies thereof to counsel for the Corporation and to counsel
designated by the holder of each Warrant or any Restricted Stock. If in the
opinion of each such counsel the proposed transfer may be effected without
registration or qualification under any federal or state law, the
Corporation, as promptly as practicable, shall notify the holder of such
opinion and of the terms and conditions, if any, to be observed, whereupon
the holder shall be entitled to transfer the Warrant or Warrant Shares or
the Restricted Stock, all in accordance with the terms of the notice
delivered to the holder by the Corporation. If either of such counsel is
unable to render such an opinion (in which case such counsel shall set
forth in writing the basis for the legal conclusions in this regard) the
proposed transfer described in the written notice given pursuant to this
subparagraph may not be effected without the registration or qualification
or without compliance with the conditions of an exemptive regulation of the
Commission, and the Corporation shall promptly so notify the holder and
thereafter the holder shall not be entitled to effect such transfer until
receipt of a subsequent notice from the Corporation pursuant to the
immediately preceding sentence or until the registration or qualification,
filing or compliance has become effective.
10. Partial Exercise and Partial Assignment. If this Warrant is exercised
in part only, the holder hereof shall be entitled to receive a new Warrant
covering the number of shares in respect of which this Warrant shall not have
been exercised as provided in paragraph 2 hereof. If this Warrant is partially
assigned, this Warrant shall be surrendered at the principal office of the
Corporation, and thereupon a new Warrant shall be issued to the holder hereof
covering the number of shares not assigned. The assignee of such partial
assignment of this Warrant shall also be entitled to receive a new Warrant
covering the number of shares so assigned.
11. Warrant Denominations. Warrants are issuable or transferable in such
denomination as the holder may request, and the Warrants of each denomination
are interchangeable upon surrender thereof at the office of the Corporation for
Warrants of other denominations, but aggregating the same number of shares as
the Warrants so surrendered. All Warrants will be dated the same date as this
Warrant.
12. Lost, Stolen, Destroyed or Mutilated Warrants. In case any Warrant
shall be mutilated, lost, stolen or destroyed, the Corporation shall issue a new
Warrant of like date, tenor and denomination and deliver the same in exchange
and substitution for and upon surrender and cancellation of any mutilated
Warrant, or in lieu of any Warrant lost, stolen or destroyed, upon receipt of
evidence satisfactory to the Corporation of the loss, theft or destruction of
such Warrant, and upon receipt of indemnity satisfactory to the Corporation
(provided that in the case of an institutional investor, its own agreement shall
be deemed satisfactory to the Corporation).
13. Warrant Holder Not Stockholder. This Warrant does not confer upon the
holder hereof any right to vote or to consent as a stockholder of the
Corporation, as such, in respect of any matters whatsoever, or any other rights
or liabilities as a stockholder, prior to the exercise hereof as hereinbefore
provided.
7
14. Severability. Should any part of this Warrant for any reason be
declared invalid, such decision shall not affect the validity of any remaining
portion, which remaining portion shall remain in full force and effect as if
this Warrant had been executed with the invalid portion thereof eliminated, and
it is hereby declared the intention of the Parties hereto that they would have
executed and accepted the remaining portion of this Warrant without including
therein any such part, parts or portion which may, for any reason, be hereafter
declared invalid.
15. Governing Law. This Warrant shall be governed by the laws of the
State of Delaware (without regard to principles of conflicts of law).
8
IN WITNESS WHEREOF, WEB STREET, INC. has caused this Warrant to be signed
by its President or one of its Vice Presidents and this Warrant to be dated as
of October 13, 1999.
WEB STREET, INC.
By: /s/ Xxxxxx X. Xxxx
------------------------
Its: Executive Vice President
------------------------
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SUBSCRIPTION
WEB STREET, INC.
The undersigned, _________________________________ pursuant to the
provisions of the within Warrant, hereby elects to purchase ____________________
shares of Common Stock of WEB STREET, INC. covered by the within Warrant, and
tenders herewith payment of the Exercise Price in full in the form of certified
or bank cashier's check or wire transfer.
Please issue a certificate or certificates for such shares of Common Stock
in the following name or names and denominations:
If said number of shares are not all the shares of Common Stock issuable
upon exercise of the attached Warrant, a new Warrant is to be issued in the name
of the undersigned for the balance remaining of such shares less any fraction of
a share paid in cash.
Signature______________________
Address_______________________
Dated:_____________________
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ASSIGNMENT
(To be executed upon assignment of Warrant)
For value received, ___________________________________________________
hereby sells, assigns and transfers unto ______________________________________
the attached Warrant, together with all rights, title and interest therein, and
does hereby irrevocably constitute and appoint _______________________________
attorney to transfer said Warrant on the books of Web Street, Inc., with full
power of substitution in the premises.
________________________________
Note: The above signature should
correspond exactly with the name
on the face of the attached
Warrant.
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