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To: Penson Financial Services, Inc.
1. Applicable Rules and Regulations. All transactions shall be subject
to the constitution, rules, regulations, customs and usages of the exchange
or market and its clearing house, if any, upon which such transactions
are executed, except as otherwise specifically provided in this Agreement.
2. Definitions. “Introducing broker” means any brokerage firm, which introduces
securities transactions on behalf of the undersigned, which transactions
are cleared through you, whether one or more. “Obligations” means all
indebtedness, debit balances, liabilities or other obligations of any
kind of the undersigned to you, whether now existing or hereafter arising.
“Securities and other property” shall include, but shall not be limited
to, money, securities, commodities or other property of every kind and
nature and all contracts and options relating thereto, whether for present
or future delivery. “You” or “your” refers to Penson Financial Services,
Inc. “Undersigned” refers to the customer, or the party signing this agreement
on behalf of the customer.
3. Security Interest. All securities and other property now or hereafter
held, carried or maintained by you in or for any of the accounts of the
undersigned, now or hereafter opened, including any accounts in which
the undersigned may have an interest, shall be subject to a first and
prior lien and security interest for the discharge of all of the obligations
of the undersigned to you, and are to be held by you as security for the
payment of the obligations of the undersigned to you, to the fullest extent
allowed by law. You shall have the right to transfer securities and other
property so held by you from or to any other of the accounts of the undersigned
whenever you so determine.
4. Liquidation. In the event of the death of the undersigned, or in the
event the margin in any account in which the undersigned has an interest
shall in either your or the introducing broker’s discretion become unsatisfactory
to either you or the introducing broker, or be deemed insufficient by
either you or the introducing broker, you are hereby authorized; (a) to
sell any or all securities or other property which you may hold for the
undersigned (either individually or jointly with others); (b) to buy any
or all securities and other property which may be short in such accounts;
and/or © to cancel any open orders and to close any or all outstanding
contracts; all without demand for margin or additional margin, notice
of sale or purchase, or other notice or advertisement, and that any prior
demand or notice shall not be a waiver of your rights provided herein.
You may likewise accept and rely upon instructions which you receive from
the introducing broker to effect any of the aforementioned transactions
(as noted in (a); (b); and (c). You shall have the discretion to determine
which securities and other property are to be sold and which contracts
are to be closed. Any such sales or purchases may be made at your discretion
on any exchange, the over-the-counter market or any other market where
such business is usually transacted, or at public auction or private sale,
and you may be the purchaser for your own account.
5. Cancellation. You are authorized, in your discretion, should you for
any reason whatsoever deem it necessary for your protection, without notice,
to cancel any outstanding order, to close out the accounts of the undersigned,
in whole or in part, or to close out any commitment made on behalf of
the undersigned.
6. Payment of Indebtedness Upon Demand. The undersigned shall at all times
be liable for the payment upon demand of any obligations owing from the
undersigned to you, and the undersigned shall be liable to you for any
deficiency remaining in any such accounts in the event of liquidation
thereof (as contemplated in Paragraph 4 of this Agreement or otherwise),
in whole or in part, by you or by the undersigned; and the undersigned
shall make payment of such obligations upon demand.
7. Liability for Costs of Collection. The costs and expenses of collection
of the debit balance and any unpaid deficiency in the accounts of the
undersigned with you, including but not limited to reasonable attorneys’
fees and expenses, incurred and payable or paid by you shall be payable
to you by the undersigned.
8. Accounts Carried as Clearing Broker. The undersigned understands that
you are carrying the accounts of the undersigned as clearing broker by
arrangement with the undersigned’s introducing broker through whose courtesy
the account of the undersigned has been introduced to you. Until receipt
from the undersigned of written notice to the contrary, you may accept
from and rely upon the undersigned’s introducing broker (a) orders for
the purchase or sale of securities and other property, and (b) any other
instructions concerning the undersigned’s accounts. The undersigned represents
that the undersigned understands that you act only to clear trades introduced
by the undersigned’s introducing broker and to effect other back office
functions for the undersigned’s introducing broker. The undersigned confirms
to you that the undersigned is relying for any advice concerning the undersigned’s
accounts solely on the undersigned’s introducing broker. The undersigned
understands that all representatives, employees and other agents with
whom the undersigned communicates concerning the undersigned’s account
are agents of the introducing broker and not your representatives, employees
or other agents. The undersigned understands that you are not a principal
of or partner with, and do not control in any way, the introducing broker
or its representatives, employees or other agents. The undersigned understands
that you will not review the undersigned’s accounts and will have no responsibility
for trades made in the undersigned’s accounts. You shall not be responsible
or liable for any acts or omissions of the introducing broker or its representatives,
employees or other agents.
9. Communications. You may send communications to the undersigned at the
address of the undersigned or at such other address as the undersigned
may hereafter give you in writing, and all communications so sent, whether
by mail, telegraph, messenger or otherwise, shall be deemed given to the
undersigned personally, whether actually received or not. Reports of execution
of orders and statements of accounts of the undersigned shall be conclusive
if not objected to in writing to you, the former within five (5) days
and the latter within ten (10) days, after forwarding by you to the undersigned
by mail or otherwise.
BY SIGNING BELOW, THE UNDERSIGNED AGREES TO ALL TERMS OF THE MARGIN AND
SHORT ACCOUNT AGREEMENT PRINTED ON THIS SIDE AND THE REVERSE SIDE OF THIS
DOCUMENT. THE REVERSE SIDE OF THIS AGREEMENT CONTAINS A PRE-DISPUTE ARBITRATION
CLAUSE IN PARAGRAPH 10. The undersigned acknowledges that the undersigned’s
margin account securities may be borrowed by you or loaned to others.
The undersigned also acknowledges receipt of a copy of this Agreement
and a copy of the Margin Risk Disclosure Statement.
Customer's signature X_______________________ Dated:______________________
Joint signature X_______________________
Dated:______________________
Correspondent Approval_________________________
Date________
THE FOLLOWING ARBITRATION AGREEMENT SHOULD BE READ IN CONJUNCTION WITH
THESE DISCLOSURES:
a. ALL PARTIES TO THIS AGREEMENT ARE GIVING UP THE RIGHT TO SUE EACH OTHER
IN COURT, INCLUDING THE RIGHT TO A TRIAL BY JURY EXCEPT AS PROVIDED BY
THE RULES OF THE ARBITRATION FORM IN WHICH A CLAIM IS FILED;
b. ARBITRATION AWARDS ARE GENERALLY FINAL AND BINDING; A PARTY’S ABILITY
TO HAVE A COURT REVERSE OR MODIFY AN ARBITRATION AWARD IS VERY LIMITED.
c. THE ABILITY OF THE PARTIES TO OBTAIN DOCUMENTS, WITNESS STATEMENTS
AND OTHER DISCOVERY IS GENERALLY MORE LIMITED IN ARBITRATION THAN IN COURT
PROCEEDINGS;
d. THE ARBITRATORS DO NOT HAVE TO EXPLAIN THE REASON(S) FOR THEIR AWARD.
e. THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF ARBITRATORS
WHO WERE OR ARE AFFILIATED WITH THE SECURITIES INDUSTRY.
f. THE RULES OF SOME ARBITRATION FORUMS MAY IMPOSE TIME LIMITS FOR BRINGING
A CLAIM IN ARBITRATION. IN SOME CASES, A CLAIM THAT IS INELIGIBLE FOR
ARBITRATION MAY BE BROUGHT IN COURT.
g. THE RULES OF THE ARBITRATION FORUM IN WHICH THE CLAIM IS FILED, AND
ANY AMENDMENTS THERETO, SHALL BE INCORPORATED INTO THIS AGREEMENT.
10. ARBITRATION AGREEMENT. ANY AND ALL CONTROVERSIES, DISPUTES OR CLAIMS
BETWEEN THE UNDERSIGNED AND YOU, OR THE INTRODUCING BROKER, OR YOUR AGENTS,
REPRESENTATIVES, EMPLOYEES, DIRECTORS, OFFICERS OR CONTROL PERSONS OR
THE AGENTS, REPRESENTATIVES, EMPLOYEES, DIRECTORS, OFFICERS OR CONTROL
PERSONS OF THE INTRODUCING BROKER, ARISING OUT OF, IN CONNECTION WITH,
FROM OR WITH RESPECT TO (a) ANY PROVISIONS OF OR THE VALIDITY OF THIS
AGREEMENT OR ANY RELATED AGREEMENTS, (b) THE RELATIONSHIP OF THE PARTIES
HERETO, OR (c) ANY CONTROVERSY ARISING OUT OF YOUR BUSINESS, THE INTRODUCING
BROKER’S BUSINESS OR THE UNDERSIGNED’S ACCOUNTS, SHALL BE CONDUCTED PURSUANT
TO THE CODE OF ARBITRATION PROCEDURE OF THE NASD. ARBITRATION MUST BE
COMMENCED BY SERVICE OF A WRITTEN DEMAND FOR ARBITRATION OR A WRITTEN
NOTICE OF INTENTION TO ARBITRATE. THE DECISION AND AWARD OF THE ARBITRATOR(S)
SHALL BE CONCLUSIVE AND BINDING UPON ALL PARTIES, AND ANY JUDGMENT UPON
ANY AWARD RENDERED MAY BE ENTERED IN A COURT HAVING JURISDICTION THEREOF,
AND NEITHER PARTY SHALL OPPOSE SUCH ENTRY.
No person shall bring a putative or certified class action to arbitration,
nor seek to enforce any pre-dispute arbitration agreement against any
person who has initiated in court a putative class action; or who is a
member of a putative class who has not opted out of the class with respect
to any claims encompassed by the putative class action until: (i) the
class certification is denied; or (ii) the class is de-certified; or (iii)
the customer is excluded from the class by the court. Such forbearance
to enforce an agreement to arbitrate shall not constitute a waiver of
any rights under this agreement except to the extent stated herein.
11. Hypothecation. Within the limitations imposed by applicable laws,
rules and regulations, all securities now or hereafter held by you, or
carried by you in any account for the undersigned (either individually
or jointly with others), or deposited to secure same, may from time to
time, without any notice, be carried in your general loans and may be
pledged, repledged, hypothecated or re-hypothecated, separately or in
common with other securities for the sum due to you thereon or for a greater
sum and without retaining in your possession or control for delivery a
like amount of similar securities. The IRS requires Broker Dealers to
treat dividend payments on loaned securities positions as in-lieu dividends
for 1099 tax reporting purposes. Taxation of substitute dividend payments
may be greater than ordinary on qualified dividends. It is understood,
however, that you agree to deliver to the undersigned upon demand and
upon payment of the full amount due thereon, all securities in such accounts,
but without obligation to deliver the same certificates or securities
deposited by the undersigned originally. Any securities in the undersigned’s
margin or short account may be borrowed by you, or lent to others.
12. Interest. Debit balances in all the accounts of the undersigned shall
be charged with interest in accordance with your established custom, as
disclosed to the undersigned in the Customer Information Brochure pursuant
to the provisions of Rule 10b-16 of the Securities Exchange Act.
13. Margin. The undersigned agrees to maintain in all accounts with you
such positions and margins as required by all applicable statutes, rules,
regulations, procedures and custom, or as you deem necessary or advisable.
The undersigned agrees to promptly satisfy all margin and maintenance
calls.
14. Sales. The undersigned agrees to specifically designate any order
to sell a security, which the undersigned does not own as a short sale,
and understands that you will mark such order as a short sale. The undersigned
agrees that any order which is not specifically designated as a short
sale is a sale of securities owned by the undersigned, and that the undersigned
will deliver the securities on or before settlement date, if not already
in the account. If the undersigned should fail to make such delivery in
the time required, you are authorized to borrow such securities as necessary
to make delivery for the undersigned’s sale, and the undersigned agrees
to be responsible for any loss you may thereby sustain, or which you may
sustain as a result of your inability to borrow such securities.
15. Representations. The undersigned represents that the undersigned is
of majority age, that the undersigned is not an employee of any exchange,
or of any corporation of which any exchange owns a majority of the capital
stock, or of a member of any exchange, or of a member firm or a member
corporation registered on any exchange or of a bank, trust company, insurance
company or of any corporation, firm or individual engaged in the business
dealing either as broker or as principal in securities, bills of exchange,
acceptances or other forms of commercial paper. If the undersigned is
a corporation, partnership, trust or other entity, the undersigned represents
that its governing instruments permit this Agreement, that all applicable
persons have authorized this Agreement and that the undersigned signatory
is authorized to bind the undersigned. The undersigned represents that
the undersigned shall comply with all applicable laws, rules and regulations
in connection with the undersigned’s account. The undersigned further
represents that no one except the undersigned has an interest in the account
or accounts of the undersigned with you.
16. Joint Account. If the undersigned shall consist of more than one person,
the undersigned’s obligations under this Agreement shall be joint and
several. References to the “undersigned” shall include each of the undersigned.
You may rely on transfer or other instructions from any one of the undersigned
in a joint account, and such instructions shall be binding on each of
the undersigned. You may deliver securities or other property to, and
send confirmations, notices, statements and communications of every kind,
to any one of us, and such action shall be binding on each of us. Notwithstanding
the foregoing, you are authorized in your discretion to require joint
action by the joint tenants with respect to any matter concerning the
joint account, including but not limited to the giving or cancellation
of orders and the withdrawal or money, securities, futures or commodities.
17. Other Agreements. The undersigned agrees to be bound by the terms
of your Customer Account Agreement. If the undersigned trades any options,
the undersigned agrees to be bound by the terms of your Customer Option
Agreement. The undersigned understands that copies of these agreements
are available from you and, to the extent applicable, are incorporated
by reference herein. The terms of these other agreements are in addition
to the provisions of this Agreement and any other written agreements between
you and the undersigned.
18. Data Not Guaranteed. The undersigned expressly agrees that any data
or online reports is provided to the undersigned without warranties of
any kind, express or implied, including but not limited to, the implied
warranties of merchantability, fitness of a particular purpose or non-infringement.
The undersigned acknowledges that the information contained in any reports
provided by you is obtained from sources believed to be reliable but is
not guaranteed as to its accuracy of completeness. Such information could
include technical or other inaccuracies, errors or omissions. In no event
shall you or any of your affiliates be liable to the undersigned or any
third party for the accuracy, timeliness, or completeness of any information
made available to the undersigned or for any decision made or taken by
the undersigned in reliance upon such information. In no event shall you
or your affiliated entities be liable for any special incidental, indirect
or consequential damages whatsoever, including, without limitation, those
resulting from loss of use, data or profits, whether or not advised of
the possibility of damages, and on any theory of liability, arising out
of or in connection with the use of any reports provided by you or with
the delay or inability to use such reports.
19. Credit Check. You are authorized, in your discretion, should you for
any reason deem it necessary for your protection to request and obtain
a consumer credit report for the undersigned.
20. Miscellaneous If any provision of this Agreement is held to be unenforceable;
it shall not affect any other provision of this Agreement. The headings
of each section of this Agreement are descriptive only and do not modify
or qualify any provision of this Agreement. This Agreement and its enforcement
shall be governed by the laws of the state of Texas and shall cover individually
and collectively all accounts which the undersigned has previously opened,
now has open or may reopen with you, or any introducing broker, and any
and all previous, current and future transactions in such accounts. Except
as provided in this Agreement, no provision of this Agreement may be altered,
modified or amended unless in writing signed by your authorized representative.
This Agreement and all provisions shall inure to the benefit of your successors,
whether by merger, consolidation or otherwise, your assigns, the undersigned’s
introducing broker, and all other persons specified in Paragraph 10. You
shall not be liable for losses caused directly or indirectly by any events
beyond your reasonable control, including without limitation, government
restrictions, exchange or market rulings, suspension of trading or unusually
heavy trading in securities, a general change in economic, political or
financial conditions, war or strikes. You may transfer the accounts of
the undersigned to your successors and assigns. This Agreement shall be
binding upon the heirs, executors, administrators, successors and assigns
of the undersigned.
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