EXHIBIT 3
TOTAL ASSET ACCOUNT AGREEMENTS
Account Number 401 036 009 TAA
This Agreement sets forth the terms and conditions governing
the Total Asset Account (the "TAA") financial service to which
the undersigned is applying with X.X. Xxxxxxx & Sons, Inc.
("Xxxxxxx"). The undersigned understands that before the TAA
service is provided it will be necessary for Bank One, Columbus,
N.A., Columbus, Ohio (the "Bank"), to accept the undersigned's
application to open a checking account and a VISA account (a Card-
Check Account) pursuant to which the undersigned may be provided
checks ("Checks") and may be issued one or more VISA cards
("Card") to be used in connection with the TAA service. An
annual fee will be charged by Xxxxxxx for the financial services
provided to the undersigned. The annual fee may be changed at
any time upon ten (10) days' notice to the undersigned. The
undersigned understands that before TAA begins operation, the
undersigned's securities margin account must have at least
$20,000 in any combination of cash or securities for an
individual TAA or $50,000 in any combination of cash or
securities for a business TAA.
In consideration of Xxxxxxx, or any successor thereof,
accepting one or more accounts of the undersigned (whether
designated by name, number or otherwise) for the purchase, sale
or carrying of securities, commodities and options, or contracts
relating thereto, and other property (hereinafter collectively
referred to as "property"), the undersigned agrees as follows:
GENERAL TERMS
1. DESCRIPTION OF TAA FINANCIAL SERVICES. The TAA is a regular
Xxxxxxx securities margin account (the "Securities Account")
which is linked to a no-load money market trust the
undersigned designates as primary herein (the "Fund") and a
Card-Check Account with checking and VISA Card services
maintained by the Bank. The Securities Account and the Card-
Check Account are collectively referred to as the Account.
2. REPRESENTATIONS, ADDITIONAL TERMS AND AMENDMENTS. The
undersigned acknowledges receiving a copy of the Fund
prospectus with the Program Summary Description and the
Truth in Lending Disclosure. These document shall be
referred to in this Agreement as the "Documents." Unless
the context otherwise requires, the term "this Agreement"
shall include the Documents as amended from time to time.
The undersigned agrees that Xxxxxxx may amend this Agreement
by modifying or rescinding any of its existing provisions or
by adding any new provision, at any time by sending notice
of the amendment to the undersigned. The undersigned hereby
appoints Xxxxxxx as its agent in order to effectuate any
such amendment. Any such amendment shall be effective as of
the date established by Xxxxxxx.
Except as herein provided, no provision of this Agreement as
printed shall in any respect be waived, modified, amended or
deleted nor shall acceptance of this Agreement and any
accounts thereunder by Xxxxxxx constitute ratification of
any such changes nor shall such acceptance stop Xxxxxxx from
asserting and enforcing the original provisions of this
Agreement as printed unless such changes are expressly
agreed to in a separate document signed by the Director of
Operations of Xxxxxxx or Xxxxxxx' designee. Receipt and
retention of this Agreement shall constitute acceptance by
Xxxxxxx without signature hereon.
3. LIEN AND SECURITY INTEREST. All monies and property carried
by Xxxxxxx at any time in any account of the undersigned
(held either individually, jointly or otherwise), other than
a Regulated Commodity Account, or which may at any time be
in Xxxxxxx' possession or under Xxxxxxx' control for any
purpose shall be collateral subject to a general lien and
security interest for the discharge of all obligations of
the undersigned to Xxxxxxx, however and whenever arising.
At any time and from time to time, at Xxxxxxx' discretion,
Xxxxxxx may without notice to the undersigned transfer or
apply any monies or property of the undersigned between or
within any accounts of the undersigned (other than from
Regulated Commodity Accounts unless separately agreed to by
the undersigned).
4. XXXXXXX' PLEDGE AND LOAN RIGHTS. Whenever the undersigned
is indebted to Xxxxxxx or has a short position with Xxxxxxx,
any property carried by Xxxxxxx in any account of the
undersigned may from time to time and without notice to the
undersigned be pledged, repledged, hypothecated or
rehypothecated by Xxxxxxx, separately or together with the
property of others, either for more or less than the amount
of the indebtedness of the undersigned to Xxxxxxx, without
Xxxxxxx retaining in Xxxxxxx' possession or under Xxxxxxx'
control for delivery a like amount of similar property.
5. ARBITRATION. The following disclosure is required by
various regulatory bodies but shall not limit the
applicability of the following arbitration provision to any
controversy or claim or issue in any controversy or claim
which may arise between the undersigned and Xxxxxxx.
(a) ARBITRATION IS FINAL AND BINDING ON THE PARTIES.
(b) THE PARTIES ARE WAIVING THEIR RIGHT TO SEEK REMEDIES IN
COURT, INCLUDING THE RIGHT TO JURY TRIAL.
(c) PRE-ARBITRATION, DISCOVERY IS GENERALLY MORE LIMITED
THAN AND DIFFERENT FROM COURT PROCEEDINGS.
(d) THE ARBITRATORS' AWARD IS NOT REQUIRED TO INCLUDE
FACTUAL FINDINGS OR LEGAL REASONING AND ANY PARTY'S
RIGHT TO APPEAL OR TO SEEK MODIFICATION OF RULINGS BY
THE ARBITRATORS IS STRICTLY LIMITED.
(e) THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A
MINORITY OF ARBITRATORS WHO WERE OR ARE AFFILIATED WITH
THE SECURITIES INDUSTRY.
(f) NO PERSON SHALL BRING A PUTATIVE OR CERTIFIED CLASS
ACTION TO ARBITRATION, NOR SEEK TO ENFORCE ANY
PREDISPUTE 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
DECERTIFIED; 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.
The undersigned agrees and, by carrying any account for the
undersigned, Xxxxxxx agrees that all controversies between
the undersigned and Xxxxxxx or any of Xxxxxxx' present or
former officers, directors, agents or employees that may
arise for any cause whatsoever, shall be determined by
arbitration. Any arbitration under this Agreement shall be
before the National Association of Securities Dealers, Inc.,
or the New York Stock Exchange, Inc. or an arbitration
facility provided by any other securities exchange of which
Xxxxxxx is a member, or the American Arbitration
Association, or the Municipal Securities Rulemaking Board,
and in accordance with the rules obtaining of such
organization. The undersigned may elect in the first
instance whether arbitration shall be before and in
accordance with the rules of one of the aforementioned
arbitration forums by registered letter or telegram
addressed to Xxxxxxx at Xxxxxxx' office in St. Louis,
Missouri. If the undersigned fails to notify Xxxxxxx of
such election as specified within five (5) days after
receipt from Xxxxxxx of a request to make such election,
then Xxxxxxx may make such election.
At least one of the arbitrators appointed to hear any
controversy to be settled by arbitration shall be currently
employed full time by a member organization of the New York
Stock Exchange, Inc., unless otherwise agreed in writing
prior to the time of the arbitration.
This arbitration provision shall apply to any controversy or
claim or issue in any controversy arising from events which
occurred prior, on or subsequent to the execution of this
arbitration agreement. This arbitration provision shall be
interpreted according to federal law and the Federal
Arbitration Act. The award of the arbitrators, or of the
majority of them, shall be final, and judgment on the award
rendered may be entered into any court, state or federal,
having jurisdiction.
6. LIQUIDATION. Should the undersigned fail to make any
payment or deliver any property to Xxxxxxx when due, fail to
maintain in any account of the undersigned with Xxxxxxx
collateral of sufficient value to meet Xxxxxxx' then current
requirements or otherwise fail to discharge any obligation
to Xxxxxxx, or should the undersigned die, or should Xxxxxxx
for any reason whatsoever deem it necessary for its
protection, Xxxxxxx is hereby authorized to sell any
securities, commodities or other property in any account of
the undersigned with Xxxxxxx or buy-in any property in which
any such account may be short, or otherwise effect
settlement, or cancel any outstanding orders. Any such
sale, purchase, settlement or cancellation may be made at
Xxxxxxx' discretion and at its prevailing commission rates
on any exchange or market where such business is transacted
or at public auction or private sale without notice to the
undersigned and without advertisement, tender or demand of
any kind on the undersigned, such notice, advertisement,
tender or demand being hereby expressly waived by the
undersigned. Xxxxxxx may purchase any such property for its
own account or on behalf of anyone else, free from right of
redemption. The undersigned shall remain liable for any
deficiency in any account of the undersigned. The
undersigned shall also be liable for any fines, assessments
or other costs levied against Xxxxxxx by any exchange,
clearinghouse or regulatory authority resulting from the
failure of the undersigned to deliver or otherwise make
available any property sold by Xxxxxxx at the direction of
the undersigned. No tender, demand, call or notice by
Xxxxxxx shall constitute a waiver of any right to take any
other action permitted hereunder at that time or in the
future. The failure of Xxxxxxx to enforce its rights under
this paragraph, this Agreement or any other agreement
between the undersigned and Xxxxxxx shall not act as a
waiver of any such rights nor preclude Xxxxxxx from
exercising those rights thereafter.
7. AUTHORITY OF UNDERSIGNED. Each of the parties who execute
this Agreement or who are authorized to act on behalf of the
Account under this Agreement or under a separate agreement,
shall have authority on behalf of the Account, and for the
risk and in the name of the Account, and the undersigned
does hereby appoint the undersigned's agent and attorney in
fact in regard to the Account, to buy, sell (including short
sales) and otherwise deal in stocks, bonds, options and
other securities, listed or unlisted, and commodities for
present or future delivery, on margin or otherwise in
accordance with Xxxxxxx' terms and conditions; to deposit
with, withdraw and receive payment or delivery in regard to
the Account from Xxxxxxx, of money, commodities, stocks,
bonds, contracts for purchase or sale of commodities, and
other negotiable instruments, securities and other property;
to execute checks on behalf of the Card-Check Account; to
make purchases of merchandise and services and receive cash
advances, all of which may be done for the Account or for
the individual use of Account of any one of the undersigned
and all of which will be chargeable to the Securities
Account.
Each of the undersigned indemnifies Xxxxxxx, its agents and
employees, and covenants to hold Xxxxxxx, its agents and
employees, harmless against all obligations, demands, losses
or liabilities (including attorney's fees) by whomsoever
asserted, which are suffered, incurred or paid by Xxxxxxx as
a result of, or in any way arising out of, or following or
consequential to, transactions or actions by any of the
undersigned, either jointly or severally, or by any other
party who is authorized to act on behalf of the Account.
8. INITIAL AND MAINTENANCE MARGIN AND INTEREST. No
arrangements conflicting with Xxxxxxx' usual requirements
for initial or maintenance margin shall be binding upon
Xxxxxxx or have any effect unless expressly agreed to in a
separate document signed by the Director of Operations of
Xxxxxxx or Xxxxxxx' designee. No investment broker, branch
office manager or branch office employee is authorized to
waive or modify Xxxxxxx' margin demands or postpone sell-
outs or buy-ins unless agreed to in writing by the Director
of Operations of Xxxxxxx or Xxxxxxx' designee.
Interest shall be charged on any debit balance in any
account of the undersigned at rates related to Xxxxxxx' then
prevailing broker's call money rate. The undersigned
acknowledges having received from Xxxxxxx and examined a
statement setting forth the details of the conditions under
which interest will be charged, the method of computing such
interest and the conditions under which additional
collateral may be required.
9. INVESTIGATIVE CONSUMER REPORT. Xxxxxxx may request and
procure an Investigative consumer report indicating the
creditworthiness, credit standing, credit capacity,
character, general reputation, personal characteristics or
mode of living of the undersigned. The undersigned has the
right, upon written request made within a reasonable period
of time from the date hereof, to receive from Xxxxxxx a
complete and accurate disclosure of the nature and scope of
the investigation requested.
10. CHOICE OF LAW AND SUCCESSORS IN INTEREST. Except as
specifically stated below, this Agreement, its enforcement
and the interest charged hereunder shall be governed by the
laws of the state of Missouri, shall cover individually and
collectively all accounts that the undersigned may at any
time maintain with Xxxxxxx, shall inure to the benefit of
Xxxxxxx, any successor or assigns, and shall be binding upon
the undersigned, the executors, administrators, successors,
heirs and assigns of the undersigned. Provisions concerning
the Card/Card-Check Account shall be governed by the Laws of
the state of Ohio.
11. REVIEW OF DOCUMENTS. The undersigned will examine all
statements, confirmations and other reports or notices upon
receipt thereof from Xxxxxxx. Xxxxxxx may xxxx such statements,
confirmations, reports or notices to have been accepted by the
undersigned as correct and conclusive if the undersigned does not
notify the Customer Service Department of Xxxxxxx otherwise in
writing within ten (10) days after receipt, except in regard to
transactions in options, commodities and contracts relating
thereto, wherein notice of any discrepancies must be provided
within three (3) days of receipt. Any such notice including
notice of the non-receipt of any such report will be made by the
undersigned via both telephone and telegraph directed to Edward's
office in St. Louis, Missouri. The undersigned acknowledges that
due to the nature of the markets involved, positions confirmed or
deleted in error may result in a substantial loss. Consequently,
the undersigned agrees that if for any reason the undersigned
fails to bring an error or discrepancy to Xxxxxxx' attention
within the periods specified above, any loss will be the
responsibility and liability of the undersigned.
12. DEPOSITS. All Checks from the undersigned to be credited to
the undersigned's account with Xxxxxxx shall be payable to "X.X.
Xxxxxxx & Sons, Inc." Xxxxxxx may in its discretion refuse to
accept for the undersigned's account Checks payable to any party
other than the undersigned, and, in any event, such Checks, if
accepted, shall be accepted for collection only and shall not be
credited to the undersigned's account until paid.
13. CHOICE OF FORUM. Any suit, arbitration proceeding,
reparation proceeding, claim of action against Xxxxxxx or its
present or past officers, agents or employees shall be brought
and heard in the city where the branch sales office of Edward's
with which the undersigned dealt is or was located. If the
court, arbitration agency or reparations tribunal does not
conduct hearings in that city, then any such action must be
brought and heard in the locale closest to that city in which the
court, arbitration agency or reparations tribunal conducts
hearings. This paragraph shall apply even if the undersigned has
related disputes with other parties that cannot be resolved in
the same locale.
14. TERMINATION OF TAA FINANCIAL SERVICES. The undersigned may
terminate the TAA, upon receipt of written notice of revocation
by the Director of Operations of Xxxxxxx from the undersigned.
Notwithstanding any such revocation, this Agreement shall
continue in effect as to all transactions entered into or an
indebtedness occurred prior to such revocation and all matters
pertaining thereto. The undersigned will remain responsible for
any charges to the undersigned's Securities Account or Card-Check
Account whether arising before or after termination.
Xxxxxxx may terminate the undersigned's TAA, including the
Securities Account at any time. Without limiting Xxxxxxx'
rights in this regard, the undersigned acknowledges that the
deposit of Checks followed by the prompt removal of funds
for the primary purpose of earning dividends on Fund shares
violates this Agreement. If in Xxxxxxx' sole judgment, it
appears that the undersigned is so acting, Xxxxxxx may
terminate the undersigned's TAA.
If subscription to TAA is terminated for any reason, either
by the undersigned or by Xxxxxxx, the undersigned will
promptly return all unused Checks and Cards to Xxxxxxx.
Failure to return such Checks and Cards to Xxxxxxx may
result in a delay in following the undersigned's
instructions as to the disposition of assets in the TAA.
Should the TAA be terminated, Xxxxxxx may and is hereby
authorized to redeem all Fund shares owned by the
undersigned.
15. COSTS OF COLLECTION. Any expense, including attorney's
fees, incurred by Xxxxxxx in the collection of a deficit from the
undersigned in any account of the undersigned shall be borne
solely by the undersigned. The undersigned agrees to pay any and
all such costs and expenses, including attorney's fees, and any
unpaid balances in any such accounts.
16. COMMUNICATIONS. Communications directed to the undersigned
at the address then appearing on the account of the undersigned,
sent by ordinary mail or delivered to such address, shall be
deemed to have been personally delivered to the undersigned
whether or not actually received.
Unless otherwise specified, any notice required by this Agreement
to be given by the undersigned to Xxxxxx shall be addressed to
the Director of Operations at Xxxxxxx' Home Office as Xxx Xxxxx
Xxxxxxxxx, Xx. Xxxxx, Xxxxxxxx 00000, or at such other address as
Xxxxxxx may instruct.
17. GENERAL REPRESENTATIONS. The undersigned, if an individual,
represents that, unless the Director of Operations of Xxxxxxx has
been notified in writing to the contrary, the undersigned has
reached the age of majority; is duly authorized to execute this
Agreement if acting on behalf of another; is not insolvent; is
not an employee of any securities or commodities exchange, or of
any corporation of which any such exchange, or of any corporation
of which any such exchange owns a majority of the capital stock,
or of any member of any such exchange, or of a member firm,
corporation or organization registered with any such exchange, or
of a bank, trust company or insurance company or of any
corporation, firm or individual engaged in the business of
dealing either as a broker or as a principal in securities, bills
of exchange, acceptances or other forms of commercial paper; is
not registered with any securities or commodities exchange,
association or commission; and no one except the undersigned has
an interest in any account of the undersigned with Xxxxxxx. The
undersigned agrees that the undersigned will notify the Director
of Operations of Xxxxxxx promptly of any change in the
undersigned's circumstances affecting the foregoing
representations.
18. SEVERABILITY. In the event any provision or clause of this
Agreement shall be deemed invalid or unenforceable for any
reason, such provision or clause shall be deemed to be
ineffective to the extent of such invalidity or unenforceability
but without affecting the remainder of this Agreement, which
shall continue in full force and effect.
SECURITIES ACCOUNT
19. SETTLEMENT OF TRANSACTIONS. The undersigned will settle
transactions when due and will maintain with Xxxxxxx collateral
in the form of monies or property acceptable to Xxxxxxx of such
value as Xxxxxxx may require and upon demand will immediately
make payment of the entire amount or such part as Xxxxxxx may
demand of the obligations of the undersigned to Xxxxxxx.
20. SPECIFIC AUTHORIZATION OF TRANSACTIONS. NO EMPLOYEE OF
XXXXXXX IS AUTHORIZED TO ENTER TRADES FOR THE UNDERSIGNED WITHOUT
THE UNDERSIGNED'S EXPRESS PRIOR APPROVAL UNLESS EXPRESSLY AGREED
TO IN A SEPARATE DOCUMENT SIGNED BY THE DIRECTOR OF OPERATIONS OF
XXXXXXX OR XXXXXXX' DESIGNEE; THE UNDERSIGNED AGREES TO
IMMEDIATELY BRING ANY SUCH ACTIVITY TO THE ATTENTION OF XXXXXXX.
Acceptance by the undersigned of any such transaction or position
in any account of the undersigned that was undertaken by an
employee of Xxxxxxx on behalf of the undersigned but which was
not expressly authorized by the undersigned prior to its entry
and not immediately objected to by the undersigned after its
entry, renders such employee the agent of the undersigned and
precludes the undersigned from thereafter denying that the
employee was given authority to enter other orders for
transactions to positions in the account of the undersigned at
the employee's discretion.
21. SELECTION OF EXCHANGE AND AGENT. Unless otherwise specified
by the undersigned, Xxxxxxx is authorized to enter orders for the
undersigned in its name on any exchange or other market or place
where such business may be transacted for the undersigned's
account and risk. The undersigned hereby authorizes Xxxxxxx to
employ agents on behalf of the undersigned. The identity of any
such agent so employed by Xxxxxxx on behalf of the undersigned
shall be disclosed to the undersigned upon request. Xxxxxxx
shall have no liability to the undersigned for the errors and
omission of such agents who are independent contractors;
provided, however, in any controversy between the undersigned and
such agent, Xxxxxxx shall provide to the undersigned, without
expense to the undersigned, such records and testimony of the
transaction as Xxxxxxx has in its possession.
22. LIMITATION OR NON-EXECUTION OF ORDERS. Xxxxxxx shall not be
liable to the undersigned for any default by a market (Exchange)
on which the undersigned may have acquired a position. The
undersigned understands that Exchanges may change terms, rules
and procedures which may affect markets adversely; an Exchange
may also default on a duty to pay its obligations or may be
unable to take or make delivery of positions traded thereon.
Xxxxxxx may limit the number of securities, options and
commodities, or contracts related thereto, it will place or
hold for the Account of the undersigned and reserves the
right to cease accepting orders for additional securities,
options and commodities, or contracts related thereto, from
the undersigned at any time.
23. RECOMMENDATIONS AND ADVICE. Xxxxxxx' recommendations are
recognized by the undersigned as opinions since such suggestions
deal with future developments that cannot be predicted with
certainty. Xxxxxxx is under no obligation to keep the
undersigned abreast of developments in the market concerning
securities, options and commodities, or contracts related
thereto, and the undersigned shall be responsible for remaining
informed of those securities, options, commodities and contracts
related thereto.
Xxxxxxx may from time to time make recommendations
concerning the advisability of buying, selling or holding
securities, options and commodities, or contracts relating
thereto, or employing a trading method or program. The
undersigned is aware that Xxxxxxx is in the business of
generating brokerage commissions, and, as such is the case,
the more trades the undersigned makes, the higher will be
the amount of commissions generated. Trading programs may
result in a higher number of trades being generated and
commissions charged.
Transactions in securities, options and commodities, or
contracts related thereto, and the market activities of
Xxxxxx or any of its officers, employees or shareholders may
be inconsistent with the recommendations of Xxxxxxx to the
undersigned.
24. RATIFICATION. All transactions and dealings with Xxxxxxx
prior to the execution of this Agreement are hereby ratified by
the undersigned and the undersigned hereby agrees that all such
transactions and dealings are subject to all terms and provisions
of this Agreement as if they had been subsequent to the execution
hereof.
CHECKING/VISA ACCOUNT
The undersigned hereby applies to the Bank for a Card-Check
Account and requests that Checks be provided and that one or
more VISA Cards be issued for use with the undersigned's
Card-Check Account (limited to a maximum of two VISA cards
for a business TAA). It is understood that this application
for a Card-Check Account is accepted by the Bank when Checks
are provided and, as appropriate, a Card is issued to the
undersigned. The undersigned agrees that by signing, using,
or permitting another to use the Checks or Card, the
undersigned will be bound by the following terms and
conditions.
25. OWNERSHIP. The Card remains the property of the Bank and
may be canceled by the Bank at any time without prior
notice. The undersigned agrees to surrender any unused
Checks and Card and to discontinue use of the Card-Check
Account immediately upon the request of the Bank or Xxxxxxx.
26. ACCOUNT PROCEDURES. It is understood that the Bank will
open the undersigned's Card-Check Account in the name
supplied to the Bank by Xxxxxxx, that information concerning
transactions in the undersigned's Card-Check Account or the
status of such account will be furnished to the undersigned
by Xxxxxxx, and that billing error disputes or inquires are
to be directed to the Bank through Xxxxxxx. It is also
understood that Checks provided with the undersigned's Card-
Check Account will not be returned to the undersigned after
presentation to the Bank for payment.
27. LIABILITY. The undersigned agrees to assume liability for
all transactions made by the undersigned, or by an
authorized person, through the use of the Checks or Card in
connection with the undersigned's Card-Check Account. The
undersigned also agrees to pay the reasonable costs and
expenses of collection of any unpaid balance due on the
undersigned's Card-Check Account, including, but not limited
to, attorney's fees.
28. AUTHORIZATION LIMIT ("XXXXX.XXX"[REGISTERED]). Neither the
undersigned not any person authorized to act on behalf of
the undersigned will incur any charge by use of the Checks
or Card in excess of the amount authorized for the
undersigned's Card-Check Account Xxxxx.xxx, as established
by the Bank based upon information furnished to the Bank by
Xxxxxxx. It is understood that the Xxxxx.xxx established
for the undersigned's Card-Check Account will be the
aggregate amount of any uninvested free credit cash balance
in the undersigned's Securities Account with Xxxxxxx, the
net asset value of the undersigned's money market trust
shares, and the amount of cash reserve from the available
margin loan value of the securities in the undersigned's
Securities Account with Xxxxxxx as mutually agreed between
Xxxxxxx and the undersigned; provided, however, that if the
undersigned's Securities Account with Xxxxxxx is not a
margin account, then the undersigned's Xxxxx.xxx will not
include such cash reserve amount of available margin loan
value of such securities. All Card-Check Account
transactions within the undersigned's Xxxxx.xxx will be paid
to the Bank by Xxxxxxx from and through the undersigned's
TAA, as provided by this Agreement.
29. UNSATISFIED TRANSACTIONS. In the event Xxxxxxx does not pay
the Bank for Card-Check Account transactions, due to the
transactions exceeding the Xxxxx.xxx, the Bank may accept
such transactions as an overdraft on the undersigned's Card-
Check Account, which is immediately due and payable to the
Bank, plus FINANCE CHARGES thereon. It is understood that
FINANCE CHARGES will be incurred on the Average Daily
Balance of such overdraft at periodic rate of .068384% per
day (25% ANNUAL PERCENTAGE RATE) from the date the
undersigned's Card-Check Account is overdrawn until paid in
full. The Average Daily Balance is calculated by dividing
the total of the outstanding daily balances of overdrafts by
the number of days the Card-Check Account is overdrawn.
Payments will be applied, as of the date of receipt by the
Bank, first to previously billed and unpaid FINANCE CHARGES
and then to the balance of overdrafts. FINANCE CHARGES that
accrue after the statement date will appear on the following
periodic billing statement.
The Ohio laws against discrimination require that all
creditors make credit equally available to all creditworthy
customers, and that credit reporting agencies maintain
separate credit histories on each individual upon request.
The Ohio Civil Rights Commission administers compliance with
this law.
30. TERMINATION OF CARD-CHECK ACCOUNT. In the event of (i)
cancellation of the undersigned's Card-Check Account, (ii)
the insolvency, death or termination of the existence of the
undersigned, (iii) the institution of attachment or
garnishment proceedings against the undersigned, (iv) any
breach or default of this Agreement by the undersigned or
any person authorized to act on behalf of the undersigned,
or (v) upon the termination by Xxxxxxx of the TAA service of
the undersigned, the Card-Check Account will automatically
terminate without notice to the undersigned or to any
representative of the undersigned.
By signing this Agreement, the undersigned acknowledges that:
(a) the undersigned has received a duplicate of this Agreement;
(b) the undersigned's securities may be loaned to Xxxxxxx or
loaned out to others (refer to item 4 of GENERAL TERMS);
(c) the undersigned has received the prospectus/summary
description;
(d) this Agreement contains a binding and enforceable
arbitration provision on this page.
THIS IS A BINDING CONTRACT. READ BOTH SIDES CAREFULLY BEFORE SIGNING.
Dated: /s/ Xxxxxxx X. Xxxxxxxx I HAVE READ THIS AGREEMENT
--------- ----------------------------------------------------
(Signature)
/s/ Xxxxxxx Xxxxxxxx I HAVE READ THIS AGREEMENT
----------------------------------------------------
(Signature)
KEEP CUSTOMER COPY OF THIS CONTRACT FOR YOUR RECORDS.
PLEASE ALSO COMPLETE CUSTOMER APPLICATION THAT FOLLOWS.
EXHIBIT 4
AGREEMENT AS TO BOARD MEMBERSHIP
THIS AGREEMENT AS TO BOARD MEMBERSHIP (this
"Agreement"), dated as of August 7, 1997, is entered into by and
among Incomnet, Inc. (the "Company"), Xxxxxxx X. Xxxxxxxxx
("Xxxxxxxxx"), Xxxxx Xxxxxxxx ("Xxxxxxxx") and Xxxxxxx X.
Xxxxxxxx ("Xxxxxxxx", and together with Xxxxxxxxx, Wilstein and
the Company, the "Parties").
RECITALS
--------
A. On May 5, 1997, Wilstein, Xxxxxxxx and Messrs. Xxxxxxx
Xxxxxxxx and Xxxx Xxxxxxx filed a Schedule 13D with the
Securities Exchange Commission ("SEC") stating that they may be
deemed to be a group pursuant to SEC Rule 13d-5(b)(1) promulgated
under Sections 13(d) and 13(g) of the Securities Exchange Act of
1934 (the "Act").
X. Xxxxxxxxx, Wilstein, Xxxxxxxx have expressed a desire to
serve the Company as members of the Board of Directors of the
Company (the "Board").
C. The Company desires Xxxxxxxxx, Wilstein and Xxxxxxxx to join
the Board as directors.
NOW, THEREFORE, in consideration of the mutual
agreements, covenants, representations and warranties herein
contained, the parties hereby agree as follows:
1. Certain Definitions.
-------------------
"FFHSJ Memorandum" shall mean that certain
memorandum dated June 23, 1997 by Xxxxx Xxxxxxx and Xxxxx Xxxx of
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx of Los Angeles,
California, with regard to the ambiguity in the charter documents
of the Company as to the appropriate number of directors to serve
on the Company's Board.
"Group" shall mean a group as referenced in SEC
Rule 13d-5 promulgated pursuant to Sections 13(d) and 13(g) of
the Act.
2. Board Composition. As of the date hereof, for so long as
each of the individuals named herein shall agree to serve and
until such time as any successor directors shall be duly elected
in accordance with the Company's Bylaws, the Board of the Company
shall consist of Xx. Xxxxxx Xxxxxxxx, Xx. Xxxxx Xxxxxx, Mr.
Xxxxxx Xxxxxxxxx, Xx. Xxxxxx Xxxxxxx, Xx. Xxxxx Xxxxxxxx, Xx.
Xxxxxxx X. Xxxxxxxx and Xx. Xxxxxxx X. Xxxxxxxxx.
3. Lack of Assurances. The Parties acknowledge the issues
raised by the FFHSJ Memorandum. The Parties agree that any
issues raised by the FFHSJ Memorandum are merely of a technical
nature and the Parties agree to clarify the Company's Articles of
Incorporation at the next meeting of the Company's shareholders
so as to resolve any existing uncertainty. Notwithstanding
anything in this Paragraph 3 to the contrary, the Parties
acknowledge and agree that no Party has made any representation
to any other Party with respect to the issues raised in the FFHSJ
Memorandum as the same may relate to the service of any person on
the Board, and that all persons serving on the Board do so at
their own risk with respect to any liability in connection with
the issues raised in the FFHSJ Memorandum.
4. Indemnification. Notwithstanding anything in this Agreement
to the contrary, the Company agrees to hold harmless and
indemnify all of the persons named as directors in Paragraph 2
hereof, to the maximum extent permitted by the General
Corporation Law of California, against any expenses, judgments,
fines, settlements and other amounts actually and reasonably
incurred in connection with any causes of actions, suits or
proceedings arising by reason of the fact any such person is or
was a director of the Company.
5. D&O Insurance. The Company hereby agrees to use best
efforts to raise its Directors and Officers Insurance from
$1,000,000 to $5,000,000.
6. Disclaim Group Membership. Wilstein and Xxxxxxxx hereby
agree that (i) they will not assert that any other director of
the Company should be deemed to be a member of the Group
referenced in the Schedule 13D filed on May 5, 1997 by Wilstein,
Xxxxxxxx and the individuals referenced in Recital A hereof
solely by virtue of the execution and performance of this
Agreement by the parties hereto and (ii) the Company shall not be
considered to have endorsed the Group referenced in the Schedule
13D solely by virtue of the execution and performance of this
Agreement by the parties hereto.
7. Derivative Suits. The parties agree that it shall be the
policy of the Board that, in view of the current condition of the
Company and the cost and expense of indemnifying officers and
directors, the presumption will be that the Board will not
support (after a review of all the then relevant facts and
circumstances) any derivative action unless such action pleads
with particularity facts that give rise to a strong inference
that a director or directors acted in violation of his, her or
their duty of loyalty or duty of care to the Company, which
policy is not applicable to the extent that the exercise of a
director's fiduciary duties under applicable law, in light of the
then relevant facts and circumstances, requires a different
standard for evaluating a specific matter then before the Board.
8. Shareholder Meeting: Articles Amendment The parties hereto
agree (i) to use their best efforts to cause the next annual
meeting of the shareholders of the Company to take place on
September 22, 1997; (ii) to approve, and recommend that the
shareholders of the Company approve, clarifying amendments to the
Company's Articles of Incorporation and Bylaws, as recommended to
the Board by the Company's counsel and reasonably approved by
counsel to Wilstein and Xxxxxxxx, stating that the Board shall be
comprised of seven (7) members; and (iii) that each director will
either (A) support the election, at such meeting of shareholders,
of a slate of directors nominated by majority vote of the Board
(which slate shall include Wilstein, Xxxxxxxx and Xxxxxxxxx to
the extent each of Wilstein, Xxxxxxxx and Xxxxxxxxx shall have
not resigned from the Board pursuant to Clause (B) hereof); or
(B) resign from the Board and subsequently nominate and support
any slate of directors that such persons may choose, provided,
however, that, in any case, no party shall be entitled (x) to
take any action that would cause the annual meeting to take place
subsequent to September 22, 1997 (other than an assertion in an
appropriate forum that an party has violated the California
General Corporation Law or the federal securities laws in
connection with such meeting, provided, however, that no
assertion shall be made in any forum in opposition to the
clarifying amendments described in clause (ii) above) or (y) to
solicit proxies in opposition to clarifying amendments described
in clause (ii) above. In the event that a director should resign
from the Board pursuant to this Section or should be unable or
unwilling to continue to serve on the Board, the Board shall then
be entitled to fill such vacancy and/or to nominate and support
the election to the Board of such other person as the Board
shall, in its discretion, determine is appropriate.
9. Choice of Law. The parties agree that this Agreement shall
be governed by and construed in accordance with the laws of the
State of California, excluding any laws which would direct
application of another jurisdiction.
10. Miscellaneous.
-------------
(a) This Agreement may not be amended or modified except by
written instrument signed by the Company, Xxxxxxxxx, Xxxxxxxx and
Xxxxxxxx.
(b) This Agreement constitutes the entire agreement and
understanding among the Parties and supersedes all other prior
agreements and undertakings, both written and oral, among the
Parties, or any of them, with respect to the subject matter
hereof.
(c) If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable under any applicable law, then
such contravention or invalidity shall not invalidate the entire
Agreement. Such provision shall be deemed to be modified to the
extent necessary to render it legal, valid and enforceable, and
if no such modification shall render it legal, valid and
enforceable, then this Agreement shall be construed as if not
containing the provision held to be invalid, and the rights and
obligations of the Parties shall be construed and enforced
accordingly.
(d) This Agreement may not be assigned.
(e) The Headings of the Sections of this Agreement have been
inserted for convenience of reference only and do not constitute
a part of this Agreement.
(f) This Agreement may be executed in any number of counterparts
and by the Parties in separate counterparts, with the same effect
as if all Parties had signed the same document. All such
counterparts shall be deemed an original, shall be construed
together and shall constitute one and the same instrument.
(g) When the context requires, the gender of all words used
herein shall include the masculine, feminine and neuter and the
number of all words shall include the singular and plural.
IN WITNESS WHEREOF, the Company, Xxxxxxxxx, Wilstein
and Xxxxxxxx have caused this Agreement to be executed as of the
date first written above.
INCOMNET, INC.
/s/ Xxxxxx Xxxxxxx
-------------------------
Xxxxxx Xxxxxxx
President and Chief
Executive Officer
/s/ Xxxxxxx X. Xxxxxxxxx
-------------------------
Xxxxxxx X. Xxxxxxxxx
/s/ Xxxxx Xxxxxxxx
-------------------------
Xxxxx Xxxxxxxx
/s/ Xxxxxxx X. Xxxxxxxx
-------------------------
Xxxxxxx X. Xxxxxxxx
