C.-LIMITED LIABILITY.

Unlimited Selling.

(Alternative Clause)

Each Member may be required to sell the amount of bonds comprising his own participation in the account, or at the termination of the Account may be required to take for his own account and risk any part of that amount then remaining unsold; and except that he shall be liable for his proportion of the joint expenses, he shall assume no other liability hereunder, anything else herein to the contrary notwithstanding. He shall be entitled to the profit or shall bear the loss on his sale of the bonds of his participation at whatever price he may actually sell them which, however, shall always be the Selling Price of the Account at the time the Member makes the sale.

So long as the Account continues, however, any Member who has sold an amount of bonds equal to his participation may continue to sell bonds of the Account, and, as hereinafter provided, call upon the Manager to deliver, or order delivered, to him unsold bonds of the Account. If he sells bonds of the Account in excess of his participation he shall be entitled to the profit on the sale of bonds so sold. In that event he shall share the expense of the Account in proportion to the bonds he actually sells, and other Members shall bear the expenses in proportion to the bonds they sell, and shall be entitled: to the profits only on the sale of the bonds they actually sell.

Sec. 7. PRICE AGREEMENT.

During the existence of the Account no Member shall sell any of the bonds at a price less than the Account price, to be determined by the Supplementary Agreement provided for herein.

Sec. 8-AGREEMENT FOR SUPPLEMENTARY AGREEMENT.

As soon as practicable after the purchase of the bonds, the Members, at the request of the Manager, or, if he fails to request, then at the request of any of the Members, shall enter into a supplementary agreement stipulating the selling price and all other matters necessary or deemed desirable for the conduct of the Account. The vote of a majority in interest of the Members shall be sufficient to determine the stipulations of the supplementary agreement and this vote and any other vote provided for therein or herein may be given orally in person at a meeting of the Members called by the Manager for this purpose, and entered by him on the records, or may be given by letter or telegram. But if the place of business of any member is not in the same city or town as the place where the meeting is called,

then that member may vote by letter or telegram, or in the discretion of the Manager, unless a majority in interest request by letter or telegram to the contrary, any vote may be taken wholly by letter or telegram. Notice, which shall state the purpose of the vote, sufficient in the reasonable discretion of the Manager to enable every member to vote, shall be given by letter or telegram of every vote to be taken. The terms of the supplementary agreement need not all be stipulated at one time but each term of the agreement shall become binding on the account as agreed upon by the majority in interest.

IN WITNESS WHEREOF, the Manager, party of the first part, has subscribed the original hereof, and the Members, parties of the second part, have subscribed the original or counterparts thereof as of the day and year of the date hereof, and have added to their subscription the address to which all communications hereunder are to be directed.

Name

Address

Amount

In response to some demand for a modification of the unlimited liability principle the following suggestions have been made, which if not acceptable exactly as they stand, may serve as the basis of discussion of the matter. They have been inserted out of order because of their special nature.

D. OPTION TO LIMIT LIABILITY.

(Alternative Clause)

When any member shall have sold, or taken up at the Take Down Price to be agreed on in an agreement supplementary hereto, as hereinafter provided, or, in event of divided carrying, declared that he holds for his own account and risk the bonds he is carrying, up to a total amount of bonds equal to the amount of his participation, he may notify the Manager of his withdrawal from the Account. Thereupon he shall be free from further liability to other members of the Account for losses incurred thereafter or bonds unsold as a result of the Account transaction, except for the expenses of the Account theretofore incurred. He shall not, however, be entitled to any profits until all the bonds are sold or the Account closed and unsold bonds distributed, whereupon he shall be entitled to share, in proportion to his participation, any profits that then appear in the account.

PROPORTIONAL LESSENING OF LIABILITY.
(Alternative Clause)

Each member, irrespective of the size of his participation, may and shall continue to sell bonds so long as the account shall continue, and

shall share any profits in proportion to the size of his participation. The selling price shall never be less than the purchase price, but in the event that it is not found possible to dispose of the bonds at the purchase price or better, the account shall be closed, and the unsold bonds shall be distributed as follows:

Each member who has sold bonds in excess of the amount of his participation shall have his proportional amount of the unsold bonds reduced by an amount which shall be the same per cent of the unsold bonds as he has sold of the account in excess of his participation. The total of these reductions shall be added to the amounts of those members who have sold less than their participations in proportion to that percentage of the account by which their sales have fallen short of their participations.

RULES OF THE ACCOUNT (SUPPLEMENTARY AGREEMENT)

1. SELLING PRICE.

MUST PROVIDE FOR

2. BROKER'S COMMISSION.

3. MEMBER'S SELLING COMMISSION.

Shall there be any at all?

If a commission, shall it begin at once?

Or only after the member has sold his proportion?

4. DURATION OF ACCOUNT.

To continue until securities disposed of unless earlier terminated by agreement of Members.

To continue for a definite period and to be terminated at the end of that period unless members then agreed to extend.

5. TAKE DOWN PRICE.

Selling Price.

Or Selling Price less Member's Commission.

Purchase Price less any pro rata already paid by Members
Selling Price less any pro rata already paid by Members.
Selling Price less Commission and any pro rata already paid
by Members.

6. DELIVERY.

Only on Manager's order.

Without Manager's order.

7. TERRITORY.

Unrestricted.

Restricted.

8. ADVERTISING.

By Manager in name of all at expense of account.

Or by each in the name of all and at his individual expense.
Or by each in his own name and at his own expense.

RULES OF THE ACCOUNT (SUPPLEMENTARY AGREEMENT). An agreement made the ..... day of ........ 19...., in accordance with an agreement, herein called the First Agreement, entered into the ..... day of ......... 19...., creating a joint account, therein and hereinafter called the "Account," for the purchase and sale of $........ of the bonds of .....

..

... by

and between the parties thereto, who are also the parties thereto, namely:

....

Joint Account Manager herein called the "Manager," party of the first part, and...

party of the second part, herein with the Manager called the Members, and each of whom is herein termed the Member, hereby enter into this Supplementary Agreement, which becomes a part of the said First Agreement and together with it forms one agreement, the terms whereof are agreed upon by the vote of a majority in interest in the Account created by the said First Agreement, and as therein stipulated.

Section 1.-SELLING PRICE.

No Member shall offer or sell any of the said bonds at a price less than and interest (or in lots of ... and interest.)

This shall

at a price less than be, and is called herein, the Selling Price. If voted by a majority in interest of the Members the Manager shall change the Selling Price to the price so voted. The Manager shall notify all the Members of the Selling Price and any change thereof.

Sec. 2-BROKER'S COMMISSION.

A Member may allow a commission of .... per cent of the par value of ten bonds to brokers, and to them only, under an agreement with the broker, which may be oral, that the broker will not split the commission or sell the bonds at a price less than the Selling Price hereinabove set forth. In the settlement of the Account this commission shall be deducted from the Member's selling commission, if any is stipulated for herein. If voted by a majority in interest of the Members the Manager shall change the Broker's Commission to the commission so voted and shall notify all the Members of the change.

Sec. 3-SELLER'S COMMISSION.

On all sales made by a Member (or-alternative-beyond the amount of his participation) the Member shall be allowed a seller's commission of ..... per cent, of the par value of the bonds, which in the settlement of the Account shall be added to his share in the profits, or allowed him in deduction from his proportion of the losses. Expenses of a member for purposes of the account shall be deducted from the amount allowed him as commissions. Or (alternative) Expenses of a member for purposes of the account shall not be deducted from the amount allowed him as commissions.

Sec. 4-DELIVERY.

A. (DELIVERY ONLY ON THE MANAGER'S ORDER.)

A Member shall deliver bonds he is carrying for the Account only on the order of the Manager, and a Member shall at any time deliver such bonds to the Manager's order on receiving the purchase price therefor. When a Member reports a sale to the Manager, if the Manager instructs the Member to make the delivery from bonds of the Account the Member is carrying, the Member shall so make the delivery; otherwise the Member shall remit to the Manager for the bonds the Take Down Price agreed on herein, and on receiving it the Manager shall deliver or cause to be delivered to the Member the bonds required.

B.-DELIVERY WITHOUT THE MANAGER'S ORDER-DIVIDED CARRYING. (Alternative Clause)

A Member shall at any time deliver bonds he is carrying of the Account to the Manager's order on receiving the purchase price therefor. But so long as a Member is carrying bonds which the Manager has not instructed him to deliver otherwise, a Member shall make deliveries on his own sales from bonds of the Account he is carrying. If a Member has no bonds of the Account to deliver on his own