Responsibilities of Cales
Cales has general responsibility for servicing and supervising your securities account through its own personnel in accordance with its own policies and applicable laws and regulations.
Cales is responsible for approving the opening of your account and obtaining necessary account documentation.
Cales is responsible for the acceptance and, in certain instances, execution of securities orders.
Cales is responsible for knowing the facts about any orders for the purchase or sale of securities for your account.
If Cales obtains possession of any cash or securities intended for your account, it is responsible for correctly identifying and promptly forwarding the same to Southwest.
Cales is responsible for supervising the activities of the individual (if any) who services your account, for resolving any complaints regarding the handling of your account, and, in general, for the ongoing relationship that it has with you.
In all of the above matters relating to the servicing of your account, Southwest has no involvement and assumes no responsibility.
Responsibilities of Southwest
In general, Southwest is only responsible for those services provided at the request or direction of Cales as stipulated by the Clearing Agreement.
Southwest will create computer-based account records on your behalf in such name(s) and with such address(es) as Cales directs.
Southwest will process orders for the purchase, sale, or transfer of securities for your account as Cales directs. Southwest is not obligated to accept orders for securities transactions for Cales directly from you and will do so only in exceptional circumstances.
Southwest will receive and deliver cash and securities for your account and will record such receipts and deliveries according to information provided either by Cales or directly, in writing, by you.
Southwest will hold in custody securities and cash received for your account, and will collect and disburse dividends and interest and process reorganization and voting instructions with respect to securities held in custody. Southwest is responsible for the custody of your cash and securities only after it comes into Southwest's physical possession or control.
Southwest will prepare and transmit to you the transmission of confirmations of trades. Southwest will prepare and transmit periodic account statements summarizing transactions processed for your account to you.
If Cales opens a margin account for you Southwest will loan you money for the purpose of purchasing or holding securities subject to the terms of Southwest's written Margin Agreement and Southwest margin policies and applicable margin regulations. Cales is responsible for obtaining the initial margin as required by Regulation T. Thereafter, Southwest will calculate the amount of maintenance margin required. Southwest will advise you of those requirements, usually through Cales. Southwest will also calculate the interest charged on your debit balance, if any.
In connection with all of the functions which Southwest performs, Southwest maintains the books and records required by law and by business practice.
Southwest will provide Cales with written reports of all transactions processed for your account to enable it to carry out its responsibilities under the Clearing Agreement.
Southwest will assist you and Cales with any discrepancies or errors that may occur in the processing of transactions for your account.
SOUTHWEST DOES NOT CONTROL, AUDIT, OR OTHERWISE SUPERVISE THE ACTIVITIES OF CALES OR ITS EMPLOYEES. SOUTHWEST DOES NOT VERIFY INFORMATION PROVIDED BY CALES REGARDING YOUR ACCOUNT OR TRANSACTIONS PROCESSED FOR YOUR ACCOUNT NOR UNDERTAKE RESPONSIBILITY FOR REVIEWING THE APPROPRIATENESS OF TRANSACTIONS ENTERED BY CALES ON YOUR BEHALF.
The Clearing Agreement does not encompass transactions in commodities futures contracts or investments other than marketable securities which Southwest normally processes on recognized exchanges and over-the-counter markets. In furnishing its services under the Clearing Agreement, Southwest may use and rely upon the services of clearing agencies, automatic data processing vendors, proxy processing, transfer agents, securities pricing services, and other similar organizations. This discussion addresses the basic allocation of functions regarding the handling of your account. It is not meant as a definite enumeration of every possible circumstance, but only as a general disclosure.
Copyright 1998-2001 Cales Investments Inc.,
Denver, Colorado, U.S.A.
All rights reserved.