<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
ICO, INC.
----------------
(Name of Issuer)
Common Stock, No par value
------------------------------
(Title of Class of Securities)
449294206
--------------
(CUSIP Number)
Shannon Self, Esquire
Self, Giddens & Lees, Inc.
2725 Oklahoma Tower
210 Park Avenue
Oklahoma City, Oklahoma 73102
(405) 232-3001
-----------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
March 14, 1997
-------------------------------------------------------
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box. [ ]
Note: Six (6) copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
CUSIP NO. 449294 20 6
(1) Names of Reporting Persons, Aubrey K. McClendon
S.S. or I.R.S. Identification ###-##-####
Nos. of Above Persons
(2) Check the Appropriate Box if (a) [ ]
a Member of a Group (See (b) [X]
Instructions)
(3) SEC Use Only
(4) Source of Funds (See Instruc- OO,PF
tions)
(5) Check if Disclosure of Legal
Proceedings is Required Pur-
suant to Items 2(d) or 2(e) [ ]
(6) Citizenship or Place of Organi- USA
zation
(7) Sole Voting Power 525,700
Number of Shares (8) Shared Voting Power -
Beneficially
Owned by Each (9) Sole Dispositive 525,700
Reporting Person Power
With:
(10) Shared Dispositive -
Power
(11) Aggregate Amount Beneficially 525,700
Owned by Each Reporting Person
(12) Check if the Aggregate Amount [ ]
in Row (11) Excludes Certain
Shares (See Instructions)
(13) Percent of Class Represented 2.5%
by Amount in Row (11)
(14) Type of Reporting Person (See IN
Instructions)
Page 2 of 9 Pages
<PAGE>
CUSIP NO. 449294 20 6
(1) Names of Reporting Persons, Tom L. Ward
S.S. or I.R.S. Identification ###-##-####
Nos. of Above Persons
(2) Check the Appropriate Box if (a) [ ]
a Member of a Group (See (b) [X]
Instructions)
(3) SEC Use Only
(4) Source of Funds (See Instruc- OO,PF
tions)
(5) Check if Disclosure of Legal
Proceedings is Required Pur-
suant to Items 2(d) or 2(e) [ ]
(6) Citizenship or Place of Organi- USA
zation
(7) Sole Voting Power 525,700
Number of Shares (8) Shared Voting Power -
Beneficially
Owned by Each (9) Sole Dispositive 525,700
Reporting Person Power
With:
(10) Shared Dispositive -
Power
(11) Aggregate Amount Beneficially 525,700
Owned by Each Reporting Person
(12) Check if the Aggregate Amount [X]
in Row (11) Excludes Certain
Shares (See Instructions)
(13) Percent of Class Represented 2.5%
by Amount in Row (11)
(14) Type of Reporting Person (See IN
Instructions)
Page 3 of 9 Pages
<PAGE>
CUSIP NO. 449294 20 6
Preliminary Statement
---------------------
This Schedule 13D is submitted on behalf of Aubrey K. McClendon, an individual,
and Tom L. Ward, an individual. Because certain information set forth in this
Schedule 13D may indicate group status between Mr. McClendon and Mr. Ward, this
Schedule 13D is submitted jointly by such reporting persons. However, McClendon
and Ward each disclaim the presence of any agreement among them to act as a
group for purposes of acquiring , holding or disposing of the securities
reported herein.
Item 1. Security and Issuer.
--------------------
This Schedule 13D relates to the shares of common stock, no par value per
share (the "Common Stock"), of ICO, Inc., a Texas corporation ("ICO"),
which has its principal executive offices at 11490 Westheimer, Suite 1000,
Houston, Texas 77077.
Item 2. Identity and Background.
------------------------
Aubrey K. McClendon
-------------------
(a)-(c) Mr. McClendon is the Chairman of the Board and Chief Executive
Officer of Chesapeake Energy Corporation, an Oklahoma corporation
("Chesapeake Energy"), 6100 North Western Avenue, Oklahoma City, Oklahoma
73118. Chesapeake Energy is engaged in oil and gas exploration and
development.
(d) During the past five (5) years, Mr. McClendon has not been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) During the past five (5) years, Mr. McClendon has not been a
party to a civil proceeding of a judicial or an administrative body of
competent jurisdiction as a result of which Mr. McClendon is, or was,
subject to a judgment, decree or final order enjoining future relations of,
or prohibiting or mandating activity subject to, federal or state
securities laws or finding any violation with respect to such laws.
Page 4 of 9 Pages
<PAGE>
CUSIP NO. 449294 20 6
Tom L. Ward
-----------
(a)-(c) Mr. Ward is the President and Chief Operating Officer of
Chesapeake Energy.
(d) During the past five (5) years, Mr. Ward has not been convicted
in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) During the past five (5) years, Mr. Ward has not been a party
to a civil proceeding of a judicial or an administrative body of competent
jurisdiction as a result of which Mr. Ward is, or was, subject to a
judgment, decree or final order enjoining future relations of, or
prohibiting or mandating activity subject to, federal or state securities
laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
--------------------------------------------------
Aubrey K. McClendon
-------------------
The 525,700 shares of the Common Stock of ICO owned by Mr. McClendon were
purchased in the open market through brokerage transactions. The
investment cost (excluding commissions) of the 133,150 shares acquired by
Mr. McClendon in the past sixty days was $807,111.75. All or substantially
all of the funds utilized to purchase the 525,700 shares consisted of funds
borrowed by Mr. McClendon pursuant to a margin account with Rauscher Pierce
Refsnes, Inc. Such borrowed amounts do not include an adjustment for
subsequent repayments of such borrowings from Mr. McClendon's personal
funds because of the inherent difficulty in tracing the application of such
funds.
Page 5 of 9 Pages
<PAGE>
CUSIP NO. 449294 20 6
Tom L. Ward
-----------
The 525,700 shares of the Common Stock of ICO owned by Mr. Ward were
purchased through brokerage transactions. The investment cost (excluding
commissions) of the 133,150 shares acquired by Mr. Ward in the past sixty
days was $807,111.75. All or substantially all of the funds utilized to
purchase the 525,700 shares consisted of funds borrowed by Mr. Ward
pursuant to a lending arrangement with Rauscher Pierce Refsnes, Inc. Such
borrowed amounts do not include an adjustment for subsequent repayments of
such borrowings from Mr. Ward's personal funds because of the inherent
difficulty in tracing the application of such funds.
Item 4. Purpose of Transaction.
-----------------------
The reporting persons each purchased shares of Common Stock of ICO for
purposes of investment. In the future any one or more of the reporting
persons may decide to (i) purchase additional shares of Common Stock or
(ii) dispose of any or all of the Common Stock of ICO in any manner
permitted by applicable securities laws.
As a part of each reporting person's continuing assessment of the reporting
person's investment in the Common Stock of ICO, one or more of the
reporting persons may communicate with, among others, ICO's management,
ICO's Board of Directors, and other ICO shareholders. In addition, each of
the reporting persons reserves the right to exercise any and all of the
reporting person's rights as a stockholder of ICO in a manner consistent
with the reporting person's equity interest.
Except as set forth above, each of the reporting persons has no present
plans or intentions relating to the transactions described in subparagraphs
(a) through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
-------------------------------------
The aggregate percentage of shares of Common Stock reported as beneficially
owned by each person herein is based upon 20,900,678 shares of Common Stock
outstanding, as reported in ICO's quarterly report on Form 10-Q for the
quarterly period ending December 31, 1996.
Page 6 of 9 Pages
<PAGE>
CUSIP NO. 449294 20 6
(a) The following table sets forth the aggregate number and percentage
of the class of Common Stock of the ICO identified pursuant to Item 1
beneficially owned by each person named in Item 2:
<TABLE>
<CAPTION>
Person Amount Percent
- ------ ---------- --------
<S> <C> <C>
Aubrey K. McClendon 525,700 2.5%
Tom L. Ward 525,700(1) 2.5%
</TABLE>
- ---------------------------
(1) This amount does not include 31,800 shares owned of record
and beneficially by the Trustee of the Tom L. Ward Children's Trust (the
"Trust"). The Trustee exercises sole voting and dispositive power over the
shares owned by the Trust, and Mr. Ward disclaims beneficial ownership of
such shares.
(b) The following table sets forth, for each person identified under
paragraph (a), the number of shares of Common Stock of ICO as to which the
person has (1) the sole power to vote or direct the voting, (2) shared
power to vote or direct the voting, (3) the sole power to dispose or to
direct the disposition, or (4) shared power to dispose or to direct the
disposition:
<TABLE>
<CAPTION>
Person Amount Percent
---------- --------
<S> <C> <C>
Aubrey K. McClendon 525,700 2.5%
Tom L. Ward 525,700(1) 2.5%
</TABLE>
- ---------------------------
(1) See footnote (1) under paragraph (a) of Item 5.
(c) During the past sixty (60) days from the date of this Schedule 13D,
the following transactions were effected in the Common Stock on the open
market by a reporting person named in response to Paragraph (a) of this
Item 5:
Page 7 of 9 Pages
<PAGE>
CUSIP NO. 449294 20 6
Aubrey K. McClendon
-------------------
<TABLE>
<CAPTION>
Number Price,
of Shares Excluding
Date Acquired Commission
-------- --------- ----------
<S> <C> <C>
01-15-97 7,500 $ 6.375
01-15-97 2,500 6.375
01-16-97 12,000 6.50
01-17-97 10,000 6.50
01-21-97 5,650 6.3473
01-23-97 10,000 6.375
01-28-97 20,000 6.0625
01-30-97 10,000 5.875
02-04-97 3,500 5.875
02-05-97 10,000 5.875
02-06-97 20,000 5.8125
02-06-97 2,500 5.8125
03-04-97 15,000 5.6333
03-07-97 1,000 5.8125
03-14-97 3,500 5.8125
</TABLE>
Tom L. Ward
-----------
<TABLE>
<CAPTION>
Number Price,
of Shares Excluding
Date Acquired Commission
-------- --------- ----------
<S> <C> <C>
01-15-97 10,000 $ 6.375
01-16-97 12,000 6.50
01-17-97 10,000 6.50
01-21-97 5,650 6.3473
01-23-97 10,000 6.375
01-28-97 20,000 6.0625
01-30-97 10,000 5.875
02-04-97 3,500 5.875
02-05-97 10,000 5.875
02-06-97 17,000 5.8125
02-06-97 5,500 5.8125
03-04-97 15,000 5.6333
03-07-97 1,000 5.8125
03-14-97 3,500 5.8125
</TABLE>
(d) See Item 6, below.
(e) Not applicable.
Page 8 of 9 Pages
<PAGE>
CUSIP NO. 449294 20 6
Item 6. Contracts, Agreements, Underwritings or Relationships With Respect
to Securities of the Issuer.
------------------------------------------------------------------
The Agreement dated February 25, 1994 between Aubrey K. McClendon and
Rauscher Pierce Refsnes, Inc. ("Rauscher") and the Agreement dated October
25, 1991 between Tom L. Ward and Rauscher each contain standard default and
remedial provisions.
Item 7. Materials to be Filed as Exhibits.
---------------------------------
1. Joint Filing Agreement.
2. Agreement between Aubrey K. McClendon and Rauscher Pierce Refsnes, Inc.,
dated February 25, 1994.
3. Agreement between Tom L. Ward and Rauscher Pierce Refsnes, Inc., dated
October 25, 1991.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
DATED: March 14, 1997.
/s/ Aubrey K. McClendon
---------------------------------
Aubrey K. McClendon
/s/ Tom L. Ward
--------------------------------
Tom L. Ward
Page 9 of 9 Pages
<PAGE>
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f) under the Securities Exchange Act of
1934, as amended, the undersigned hereby agree to the joint filing with each
other of the attached statement on Schedule 13D and to all amendments to such
statement and that such statement and all amendments to such statement is made
on behalf of each of them.
IN WITNESS WHEREOF, the undersigned hereby execute this agreement on
March 24, 1997.
/s/ Aubrey K. McClendon
------------------------------------------
Aubrey K. McClendon, an individual
/s/ Tom L. Ward
------------------------------------------
Tom L. Ward, an individual
<PAGE>
MARGIN ACCOUNT APPLICATION AND AGREEMENT
This agreement sets forth the rights and obligations of Rauscher Pierce
Refsnes, Inc. and its affiliate, Regional Operations Group, Inc., by which its
accounts are carried and through which its trades are cleared and settled on a
fully disclosed basis and the undersigned ("Customer," whether one or more) in
connection with a margin account or accounts established for the Customer. If
this account is introduced by Rauscher Pierce Refsnes, Inc. to Regional
Operations Group, Inc., Customer acknowledges having received a notice pursuant
to Rule 382 of the New York Stock Exchange describing the responsibilities with
respect to this account of each of such firms. If this account is introduced to
Regional Operations Group, Inc. by another brokerage firm through the courtesy
of RPR Correspondent Services, a division of Rauscher Pierce Refsnes, Inc.,
Customer acknowledges having received a notice pursuant to such Rule describing
the responsibilities with respect to this account of each of such firms. As
used in this agreement, the term "RPR" shall refer to Rauscher Pierce Refsnes,
Inc., RPR Correspondent Services and/or Regional Operations Group, Inc. as the
context requires and as determined by such entities pursuant to the applicable
clearing agreement entered into by them with the introducing broker. RPR and
Customer agree to the following with respect to any of Customer's accounts with
RPR for the purchase and sale of securities:
1. All transactions in RPR accounts for Customer will be handled in accordance
with and subject to: (a) applicable constitutions, rules, regulations, bylaws,
customs, and usages of the National Association of Securities Dealers, Inc. and
of the exchanges, markets, and clearing corporations, if any, where the
transactions are executed and cleared by RPR; and (b) applicable federal laws
and rules and regulations promulgated under such laws.
2. Customer understands that RPR is not acting for Customer as a trustee or in
any other fiduciary capacity under this agreement and that RPR's responsibility
is expressly limited to acting as a broker or dealer with respect to trades
executed pursuant to Customer's instructions. Confirmation of transactions and
statements of Customer's account will be conclusive as to accuracy and
authorization of RPR to execute the trades indicated on the confirmations or
statements if not objected to in writing by Customer within 10 days after
mailing by RPR to Customer.
3. Any cash balance in Customer's account as of the end of the business day
will be automatically deposited in the RPR Credit Interest Program (CIP) which
will pay Customer interest at rates that will vary with market conditions.
Customer represents to RPR that any deposit of funds into CIP is with the
intention of investing such funds, and not merely for the purpose of receiving
interest. If Customer places a buy or sell order while the account has
insufficient cash or securities, respectively, to settle the transaction, then
customer will deposit promptly (and not later
<PAGE>
than the settlement date) into the account cash or securities to settle the
respective buy or sell order.
4. Customer represents that the undersigned has all required legal capacity and
authorization to enter into this agreement and to place orders to purchase or
sell securities or other assets in the account and otherwise give instructions
to RPR under this agreement. RPR and Customer may have entered into, or may
subsequently enter into, additional written agreements with each other
concerning, for example, trading in options, or establishing additional accounts
which may or may not be joint accounts. This agreement, including the
arbitration provisions, supplements without replacing or being replaced by any
other agreements between RPR and Customer. If any provision of this agreement
is found invalid or unenforceable in any respect, then that finding will not
affect the validity of the remaining provisions of the agreement.
5. CUSTOMER UNDERSTANDS THAT THIS AGREEMENT CONTAINS A PRE-DISPUTE ARBITRATION
CLAUSE IN PARAGRAPH 6 BELOW, AND THAT:
(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; AND
(E) THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF
ARBITRATORS WHO WERE OR ARE AFFILIATED WITH THE SECURITIES INDUSTRY.
6. CUSTOMER AND RPR AGREE THAT ALL CONTROVERSIES THAT MAY ARISE AT ANY TIME
BETWEEN CUSTOMER AND RPR CONCERNING ANY TRANSACTION OR OTHERWISE RELATING,
DIRECTLY OR INDIRECTLY, TO THE CONSTRUCTION, PERFORMANCE, OR ASSERTED BREACH OF
THIS OR ANY OTHER AGREEMENT OR OBLIGATION BETWEEN RPR AND CUSTOMER WHETHER
ENTERED INTO PRIOR, ON, OR SUBSEQUENT TO THE DATE HEREOF, WILL BE DETERMINED BY
ARBITRATION. ANY SUCH ARBITRATION WILL BE GOVERNED BY THE SUBSTANTIVE AND
PROCEDURAL ARBITRATION LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO IT'S
CHOICE OF LAW PROVISIONS. SUCH ARBITRATION WILL BE IN ACCORDANCE WITH THE
ARBITRATION RULES THEN IN EFFECT OF THE NEW YORK STOCK EXCHANGE, INC. OR OF ANY
OTHER EXCHANGE OF WHICH RPR IS A MEMBER, THE NATIONAL ASSOCIATION OF SECURITIES
DEALERS, INC., OR THE MUNICIPAL SECURITIES RULEMAKING BOARD. CUSTOMER
AUTHORIZES RPR TO ELECT AMONG THESE SPONSORING ORGANIZATIONS IF CUSTOMER DOES
NOT MAKE AN ELECTION BY SENDING TO RPR WRITTEN NOTICE OF CUSTOMER'S ELECTION
WITHIN FIFTEEN DAYS AFTER RPR SENDS TO CUSTOMER WRITTEN NOTICE REQUESTING SUCH
ELECTION. THE AWARD OF THE ARBITRATORS, OR A MAJORITY OF THEM, WILL BE FINAL
AND BINDING AND JUDGEMENT ON THE AWARD MAY BE ENTERED IN ANY COURT HAVING
JURISDICTION. FOR PURPOSES OF THIS PARAGRAPH, "RPR"
<PAGE>
INCLUDES ITS DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, AND PARENT, SUBSIDIARY,
AFFILIATED, AND SUCCESSOR COMPANIES.
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; 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;
(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.
THIS AGREEMENT AND THE RIGHTS OF THE PARTIES UNDER IT WILL BE GOVERNED BY
NEW YORK LAW.
7. Customer agrees that all securities and other property which RPR may hold or
control for Customer or which are due to Customer (either individually or
jointly with others), and the proceeds thereof,shall be subject to, and there is
hereby granted, a general lien, security interest and right of setoff to RPR for
the discharge of all Customer's obligations to RPR. RPR may, in its discretion
and without notice to the Customer, deduct any amounts which may become due to
RPR from Customer's account and apply or transfer any of Customer's securities
and other property interchangeably between any of Customer's accounts.
8. Customer agrees to maintain margins for Customer's account as RPR may
require from time to time. Customer agrees to pay interest charges which are
imposed, in accordance with RPR's usual custom, but in no event higher than the
maximum rate allowed by law, with respect to Customer's account and to pay on
demand any debit balance owing with respect to Customer's account. Customer
acknowledges review of the disclosure on the back of this agreement concerning
interest charges to customers. Customer agrees to pay promptly any custody or
other fees which may be imposed by RPR with respect to the account. Customer
will pay agency commissions or dealer charges determined by RPR on transactions
in Customer accounts, transaction fees and costs that RPR incurs in connection
with transactions in Customer accounts, and such charges as RPR may make to
cover RPR's facilities and extra services.
9. Customer agrees to designate all sell orders for securities as either "long"
or "short." The designation of a sale of a security as "long" constitutes a
certification that the securities to be sold are owned by Customer and, if such
securities are not in RPR's possession, the placing of such order shall
constitute a warranty
<PAGE>
by Customer that Customer shall deliver such securities to RPR on or before
settlement date.
10. In the event of default of any obligation to RPR, or if for any reason RPR
may deem it advisable for it's protection, RPR may, without notice or demand to
Customer, and at such time and place as RPR may reasonably determine, sell any
securities or other property which RPR may hold for Customer or which is due to
Customer (either individually or jointly with others) and apply the proceeds to
the discharge of the obligation, or buy in or borrow any securities or other
property sold for Customer's account but undelivered by Customer, and cancel any
outstanding orders and take such other action as RPR deems appropriate.
Customer shall remain liable for any deficiency and shall promptly reimburse RPR
for any loss or expense incurred thereby, including losses sustained by reason
of RPR's inability to borrow any securities or other property sold for
Customer's account. RPR's rights and obligations under this agreement are
assignable by RPR to any company which is affiliated with RPR, with or without
notice by RPR to Customer.
11. Customer agrees that securities and other property in Customer's account
may be carried in RPR's general loans and may be pledged or hypothecated
separately or in common with other securities and any other property for the sum
due to RPR thereon or for a greater sum and without retaining in RPR's
possession and control for delivery a like amount of similar securities or other
property. RPR is further authorized to collect all income and other payments
which may become due on Customer's securities.
12. Customer and RPR agree that the accounts maintained hereunder may be
terminated by RPR or Customer at any time effective upon the giving of notice of
such termination to Customer or to RPR, as the case may be. Upon any such
termination, the provisions or this agreement shall nevertheless remain in
effect with respect to all securities and other property then held in such
account or accounts, all transactions previously executed by RPR hereunder and
all orders from Customer previously given to and accepted by RPR hereunder and
not otherwise canceled pursuant to the terms of this agreement. Customer agrees
that RPR may, in RPR's sole discretion and without prior notice to Customer,
refuse to accept any order from Customer in connection with the purchase or sale
of securities by giving notice of such refusal to Customer as soon as
practicable after RPR is given such order.
THIS IS A BINDING CONTRACT. READ IT CAREFULLY BEFORE SIGNING.
THIS AGREEMENT CONTAINS A PRE-DISPUTE CLAUSE AT PARAGRAPH 5 AND 6.
<PAGE>
LOAN CONSENT
I ACKNOWLEDGE THAT MY SECURITIES WHEN BEING USED AS COLLATERAL FOR A LOAN BY
YOU MAY BE LOANED, SEPARATELY OR TOGETHER WITH THE SECURITIES OF OTHERS, EITHER
TO RAUSCHER PIERCE REFSNES, INC., REGIONAL OPERATIONS GROUP, OR OTHERS.
- --------------------------------------------- Dated: 2/25/94
Name of account if other than Customer Name(s)
<TABLE>
<S> <C> <C>
6104 N. Western \s\ Aubrey K. McClendon
- -------------------------- -------------------------------- -------------------------------
Street Address Signature of Customer (or Signature of Customer #2 (or
authorized person, if applicable) authorized person, if applicable)
if a joint account
Oklahoma City, OK 73118 Aubrey K. McClendon
- -------------------------- -------------------------------- -------------------------------
Printed Name of Customer Printed Name of Customer #2 (or
authorized person, if applicable)
if a joint account
- -------------------------- -------------------------------- -------------------------------
City, State & Zip Code Title, if applicable (e.g.: Title, if applicable (e.g.:
President, Partner, Trustee, President, Partner, Trustee,
Custodian) Custodian)
- --------------------------
Telephone Number, including Area Code
</TABLE>
For Office Use Only
- ------------------------- ------------------------------ -----------------------
Account Executive Signature Branch Manager Approval
MARGIN ACCOUNT DISCLOSURE STATEMENT
Rule 10b-16 of the Securities and Exchange Commission requires disclosure
of the elements of interest cost which will be incurred by a customer through
his or her use of credit from broker-dealers in margin transactions. Such
borrowings through margin account transactions are charged interest at variable
rates and these rates may be adjusted upward at any time without notice to the
borrower. Therefore, to comply with rule 10b-16 and to further explain the
agreement a customer must sign to maintain a margin account, set out below are
the specific elements of the costs of a margin transaction. Please read these
elements carefully to see that they are acceptable to you since all margin
transactions will be governed by them. (1.) An interest charge is made on a
customer's debit balance (amount borrowed.) This debit balance is reduced by
any credit balance other than a short account (type 6) credit. (2.) The annual
rate of interest charged the customer on his or her debit balance will not
exceed 5% above the applicable rate which a bank would charge RPR to borrow to
finance customer's margin purchases (brokers call money rate). The rate of
interest charged to you will depend upon factors such as, but not limited to,
the size of your net debit balance, our evaluation of the commission income
generated in your accounts, the service required for the account, etc. Your
rate of interest will also vary without notice in accordance with changes in the
broker's call money rate. As that rate is raised or lowered by the banks, your
interest rate may
<PAGE>
be raised or lowered correspondingly without notice to you; however, in no event
shall the interest rate charged pursuant hereto be in excess of the interest
allowed by applicable law. When your interest rate is to be increased for any
reason other than as stated above, at least thirty (30) days prior written
notice will be given. (3.) Interest computation on net debit balances is on a
daily basis. Both the debit balance and the daily interest at the aforesaid
rates are computed each day. Tour daily interest charge for any day would be
computed by multiplying your debit balance by the annual rate of interest
described above and dividing by 360. (4.) No credit charges are charges other
than interest as herein explained. (5.) According to the rules of the New York
Stock Exchange, a customer must maintain minimum maintenance cash value
requirements in his or her margin account. The minimum requirements, expressed
in terms of percentages, vary from time to time, and certain types of securities
have greater maintenance percentages than others. Although the New York Stock
Exchange has minimum standards, each New York Stock Exchange member firm may set
its maintenance requirements higher than the New York Stock Exchange, and in
some cases RPR may thus have a higher minimum. Subject to the minimum set by
the New York Stock Exchange, the setting of minimum maintenance requirements for
customer's accounts is within the sole discretion of RPR. It must be noted that
these minimum maintenance requirements may change without prior notice and, if
raised, it is the customer's obligation to add to his or her equity; conversely,
if lowered, the customer will have available more credit potential. (6.) A lien
is placed on securities held in both the customer's margin and cash accounts
whereby RPR may sell said securities if minimum margin maintenance levels are
not complied with. Such liens are described more fully in the agreement which a
customer must sign when opening a margin account. Please refer to the agreement
for reference. Defined terms used herein have the same meanings ascribed to them
under the agreement. (7.) Margin (type 2), interest is calculated daily based
on the debit balance plus the market value of any short security in a type 6
account. For example, if an account had a settlement date debit balance in the
type 2 account of $9,900, and a short common stock position with a market value
of $15,000, we would adjust the settlement date balance for interest calculation
only by adding the $15,000 market value to the $9,900 debit balance. The
resulting balance of $24,900 would be used for that day to compute the interest
charge.
<PAGE>
AGREEMENT
Introduction. This Agreement contains the terms governing my RPR Plus Account,
including my relationship with you as brokers or dealers in the purchase or sale
of securities and other property in my RPR Plus Account. I will read and keep
this Agreement because my signature below binds me to its terms.
In this Agreement, "I," "me," or "my" means each person who signs below,
and the successors and assigns of such person. "You," "your," or "RPR" means
Rauscher Pierce Refsnes, Inc. and its directors, officers, employees,
affiliates, agents and successors. "Bank" means Investors Fiduciary Trust
Company of Kansas City, Missouri. "Checks" means those "payable through
drafts" by which I may withdraw funds from my RPR Plus Account. "INVESTORS
MONEYCARDsm Account" means the account(s) established for me at the Bank. "Card
means the one or more VISA GOLD Cards issued to me by the Bank for use with my
INVESTORS MONEYCARDsm Account with the Bank. For purposes of this Agreement,
"securities and other property" means, but is not limited to, money, securities,
and financial instruments of every kind and nature (expect for commodities
transacted in a separate commodities account maintained by you for me),
including but not limited to stocks, bonds, notes, options, and government
obligations.
Description of RPR Plus Account
1. RPR Plus Account. The RPR Plus Account consists of (1) my Securities
Account with RPR, which will include a cash account, as well as a margin account
if I wish to engage in margin transactions and/or desire the Credit Reserve
Feature described below, (2) an INVESTORS MONEYCARDsm Account with the Bank, (3)
the Automatic Cash Investment Fund chosen by me as explained below, and (4) at
my election, a Credit Reserve Feature which, as a margin arrangement, provides
for advances of funds to me, under certain conditions, to cover checks or Card
charges in excess of the cash position in my account. My RPR Plus Account is
described further, and is subject to the terms and conditions (including certain
fees) listed below.
2. RPR Securities Account Margin Checks. My Securities Account will include a
margin account unless I specifically reject the Credit Reserve Feature at the
end of this agreement. You will act as broker or dealer for me to purchase or
sell securities in my Securities Account. My Securities Account is further
governed and described in the rest of this Agreement.
I may withdraw funds from my RPR Plus Account by means of checklike
instruments technically known as "payable through drafts" (the "Checks"). The
Checks are drawn on RPR, but are payable through Norwest Bank St. Paul, National
Association ("Norwest"). This means that, even though I do not have an account
at Norwest, Norwest will process my Checks. The Checks will be paid by RPR, but
only if my Authorized Limit, as defined in Section 9 below, on the day each
Check is presented to RPR exceeds the amount of the
<PAGE>
Check. With the exception of certain restrictions listed in "Check and Card
Use" below, the Checks may otherwise be used in the same manner and are subject
to normal procedures, rules, and regulations applicable to drafts payable
through Norwest. I agree that any information I provide to RPR in connection
with my RPR Plus account may be disclosed in whole or in part to Bank or its
agents for use in administration of the INVESTORS MONEYCARDsm Account or to
Norwest and its agents for use in processing of Checks.
3. Bank Account: Visa Card. Upon acceptance of my application by the Bank,
the Bank will issue me one or more VISA GOLD Card(s) (the "Card"). All Card
transactions are offered solely by and through the Bank, as a feature of its
INVESTORS MONEYCARDsm Account. I may use the Card(s) issued by the Bank to make
purchases of merchandise and services and to receive cash advances. All Card
transactions will be processed by First Data Resources, Omaha, Nebraska
("FDR"). My INVESTORS MONEYCARDsm Account is further governed by my INVESTORS
MONEYCARDsm Agreement.
4. Automatic Cash Investment Fund. Any available cash balance in my Securities
Account as of the end of the business day will automatically be invested or
deposited the next business day through the Automatic Cash Investment Fund that
I have designated. I may choose from the following three Carnegie Funds Group
Money Market Funds (which are further described in the Prospectus given me):
(1) Liquid Capital Income Trust; (2) Carnegie Government Securities Trust (money
market series); (3) Carnegie Tax Free Income Trust; or I may choose (4) the RPR
Credit Interest Program ("CIP"). If I fail to designate one of these funds as
my "Automatic Cash Investment Fund", I understand and agree that RPR may select
CIP as my Automatic Cash Investment Fund until such time as I select one of the
other funds by written notice to RPR, and I represent to RPR that any deposit of
funds into CIP is with the intention of ultimately investing such funds and not
for the purpose of receiving interest, and that CIP has not caused me to refrain
from depositing these funds in a bank or from purchasing from a bank any debt
instrument.
Credit Reserve Feature:
Margin Agreements
5. Margin Agreements. I understand that unless I reject this Credit Reserve
Feature, my Securities Account will include a margin account, I may trade
securities on a margin basis as permitted by RPR and applicable law, and under
my Authorized Limit for Car and Check transactions I will automatically be
permitted to borrow against the value of securities in my account. I
acknowledge that I have given you a security interest in property of mine as set
out below, and that you will have all the rights described below, including the
right to liquidate my account in accordance with the terms of this Agreement.
I agree that with respect to all margin accounts you now or hereafter establish
for me, or otherwise with respect to all
<PAGE>
advances of credit or money made to me by you, the following terms and
conditions shall apply, in addition to all other applicable terms and conditions
set forth in this agreement, in the Margin Account and Interest Disclosure
Statement, a copy of which I have received and which is incorporated herein by
reference, and in other agreements between you and me:
(a) I agree that I will repay to you on demand all advances of credit or money
made to me by you heretofore, now, or hereafter, in whole or in such part as you
shall demand, strictly in accordance with your directions; and
(b) I agree that I will at all times maintain with you collateral acceptable to
you of such value as you shall in your sole discretion, consistent with
applicable federal regulations, determine and require, and that I will comply
strictly with your initial and maintenance margin requirements; I acknowledge
that no registered representative, branch office manager, or any other person
claiming to act on your behalf is authorized to waive or modify your initial
margin requirements or to postpone sell-outs or buy-ins.
6. Pledges. Whenever I am indebted to you or have a short position in my
account, any property held by you in any account of mine may from time to time
and without notice to me be pledged, repledged, hypothecated or re-hypothecated
by you, separate or together with the property of others, either for more or
less than the amount of my indebtedness to you, without your retaining in your
possession or under your control for delivery a like amount of similar property.
Future RPR Amendments
7. Modifications. I further agree that you shall have the right to amend this
Agreement, by modifying, supplementing, or rescinding any of its existing
provisions at any time by sending me written notice of such amendments. Any
such amendments shall be effective as of the date established by you, subject to
applicable law. My use of the Card or Checks after receiving such written
notice shall constitute my agreement to any such amendments, modifications,
supplements, or recission.
Check and Card Use;
Credit Terms
8. Restrictions; Purpose of Credit. Neither my Card(s) nor any Check can be
used, either directly or indirectly, to purchase securities or any other
products or services available from or through RPR, its affiliates or
corespondents. Although this account is not intended to be used as a household
checking account, I may write Checks in any amount which, when aggregated with
my outstanding Card charges, are within my Authorized Limit. My Checks may not
be certified, and the proceeds of my Checks will not be mailed or wired in
accordance with my or the Check payee's
<PAGE>
instructions or made available to me or the Check payee until after 2:00 p.m. on
the business day following the date on which the Check is presented to RPR by
Norwest. An excessive number of Checks or Card transactions during any month is
inconsistent with the investment purposes of the RPR Plus Program, and RPR may
terminate my participation in the RPR Plus Program if, in RPR's sole judgment,
it appears that the number of Checks and Card transactions under the RPR Plus
Program is excessive.
9. Authorized Limit. The aggregate amount available at any time for Card and
Check transactions (the "Authorized Limit") shall be the total from time to time
of the uninvested free credit cash balance of my RPR Plus Account held pending
investment plus the net asst value of my shares or interest in my Automatic Cash
Investment Fund and, if I elect the Credit Reserve Feature, the available margin
loan value of the marginable securities held in my RPR Plus Account, reduced by
the amount of all charges against my INVESTORS MONEYCARDsm Account that have
been reported to RPR by Bank, for which Bank has not been reimbursed, and the
amount of all Checks paid by RPR but for which RPR has not yet reimbursed itself
from my RPR Plus Account. Because my Authorized Limit is dependent upon the
status of transactions in my RPR Plus Account INVESTORS MONEYCARDsm Account, my
Authorized Limit will fluctuate from day to day.
10. Debits and Charges. Unlike standard credit card account procedures which
are rendered monthly, Bank and Norwest will notify RPR as to the amount of any
charges against my INVESTORS MONEYCARDsm Account presented for payment to and
paid by Bank or FDR, and any Checks presented to Norwest. RPR will reimburse
Bank (i) daily for the amount of cash advances pursuant to my Card paid by Bank
or its agents and (ii) once each month for all other charges against my
INVESTORS MONEYCARDsm Account on my behalf by Bank or its agents. RPR will
reimburse itself daily for the amount of all Checks paid by RPR or its agents.
RPR will make such reimbursement payments, however, only to the extent of my
Authorized Limit on the day RPR is notified of such Checks, cash advances or
charges, and RPR will not reimburse Bank for any cash advances or charges to the
extent they exceed my Authorized Limit on that day. RPR will make all
reimbursement payments to Bank in federal funds, or RPR will reimburse itself,
on the day it receives notification from Bank or Norwest of the payment of the
Check or a cash advance pursuant to my Card, and once each month for all other
Card charges. RPR will further reimburse itself daily for any amounts I owe RPR
for securities purchases I make or order, and other debits to my RPR Plus
Account on such dates, at such times as it makes such reimbursements.
RPR will reimburse itself and/or Bank without any specific instructions
from me. I instruct RPR to reimburse itself first, from the free credit cash
balance, if any, held in my RPR Plus Account pending investment. If this
balance is insufficient, RPR is then authorized and instructed by me to sell or
redeem enough of my shares or interests in my Automatic Cash Investment Fund at
<PAGE>
their net asset value to cover the amount due and to apply the proceeds to
reimburse itself. Finally, should such sources prove insufficient and provided
I have elected the Credit Reserve Feature, RPR will advance such monies, to the
extent possible within the available margin loan value of the securities in my
RPR Plus Account, to Bank or RPR for my account. If RPR makes such advances,
the amount thereof will be a loan from RPR to me and will be collateralized by
the securities in my margin account pursuant to the terms of this agreement.
Each payment by RPR to Bank or RPR reduces my Authorized Limit by the
amount of the payment. I agree to maintain sufficient cash and assets in my RPR
Plus Account to ensure my Authorized Limit is sufficient to cover all Checks I
write and all charges under my Card, both on the date that I write the Check or
use the Card and on the date for payment of such charges. Neither Bank nor RPR
has committed to lend me any amounts, except insofar as I have elected the
Credit Reserve Feature and there are securities with an available margin loan
value in my RPR Plus Account.
11. Overdraft. Should my applicable Authorized Limit at any time prove to be
insufficient to satisfy all charges against my INVESTORS MONEYCARDsm Account
that Bank or its agents have paid, so that RPR does not reimburse Bank for the
amount of those charges, I will owe Bank the amount of those charges. Bank may
then treat my INVESTORS MONEYCARDsm Account as being in default and impose a
default charge for the time such account is in default in the manner and at the
rate set out in my separate INVESTORS MONEYCARDsm Account Agreement with Bank.
Any amount in default, including default charges, will be billed directly to me
by Bank and will be due and payable from me to Bank immediately. Should my
applicable Authorized Limit at any time prove to be insufficient to satisfy all
Checks paid by RPR, so that RPR is not able to reimburse itself for the amount
of those Checks, such amounts will be due and payable from me to RPR
immediately.
12. Fees and Interest Charges. RPR will charge me an annual fee, which RPR may
change at any time, for my participation in RPR Plus, and RPR will also charge
me for Check reorders, stop payment orders, and Checks returned unpaid because
my then-applicable Authorized Limit is not sufficient to cover the Checks, as
well as for any fees Norwest charges RPR for my Checks. RPR will deduct such
fees from my RPR Plus Account upon the opening thereof and as they are incurred
thereafter. In addition, I will be charged a $1.00 fee for each cash advance
made through a Card at an automatic teller machine, and an additional fee for
Card(s) issued in replacement of a Card that is lost or stolen or in addition to
(2) Cards per account. RPR will reimburse Bank for these amounts as they become
due, to the extent possible within the Authorized Limit in my RPR Plus Account.
I agree to pay interest to you on any debit or delinquent balances (in any
account of mine governed by this Agreement, whether margin, cash, or other) at
your customary rate but in no event in excess of the maximum lawful rate, if
any, all as further disclosed to me in the Margin Account and Interest
<PAGE>
Disclosure Statement, a copy of which is included on the back of this agreement
and incorporated herein by reference. I agree to pay agency commissions or
dealer charges determined by you on transactions in my accounts, transaction
fees and costs that you incur in connection with transactions in my account, and
such charges as you may make to cover your facilities and extra services.
13. Periodic Reports Customer Representation. For each month in which there is
activity in my RPR Plus Account, INVESTORS MONEYCARDsm Account, or both, I will
receive an account statement from RPR which will set out the activity in my
account, including but not limited to securities bought or sold in my RPR Plus
Account, whether on margin or otherwise, all margin loans against securities in
my RPR Plus Account, margin interest charges, all purchases of cash advances
made with my Card, all Checks that were drawn on RPR by me, and any other
charges or fees charged against my RPR Plus Account during that month. My
cancelled receipts for transactions with my card will not be returned to me.
Once a year, the amount of the annual fee charged by RPR for making RPR Plus
available to me will be indicated on a monthly statement, and charged against my
RPR Plus Account. I agree that I will review each account statement that you
send to me and that if I do not object to the account statement by written
notice to you within ten days after receipt of the account statement, you are
entitled to consider my failure to make such an objection as a representation by
me that the account statement is accurate, that all of the transactions reported
in the account statement were made with authority by me, and that I waive any
objections whatsoever to the execution of those transactions. In addition, I
understand that I will receive a written confirmation of each securities
transaction in my Securities Account. I agree that I will review each
confirmation of a transaction that you send to me and that if I do not object by
written notice to you within three days after receipt of the confirmation you
are entitled to consider my failure to object as a representation by me that the
confirmation is accurate, that the trade was executed with authorization by me,
and that I waive any obligations whatsoever in the execution of the trade. I
acknowledge that confirmations and account statements sent to me by you may not
be changed or corrected in any way by a verbal or written communication with any
registered representative, branch office manager, or other employee or officer
purporting to act for you. I agree that I will immediately give you written
notice of any failure by you to send to me timely a confirmation of account
statement and you may consider that I have received each account statement and
confirmation timely if I fail to give you such notice. Any objections or
questions that I may have regarding statements of my INVESTORS MONEYCARDsm
Account shall be made in accordance with my separate INVESTORS MONEYCARDsm
Account Agreement with Bank.
14. Termination of Accounts. I may terminate my participation in RPR Plus,
including my RPR Plus Account, at any time upon written notice to RPR. RPR may
terminate my participation in RPR Plus,
<PAGE>
including my RPR Plus Account, at any time at RPR's discretion. I agree that I
will remain responsible for any charges to my RPR Plus Account and any
outstanding Card or Check transactions, whether arising before or after
termination, and that the provisions of this Agreement will apply to any
transactions or events in or related to this RPR Plus Account despite any
termination of my participation in RPR Plus by RPR or me. In the event of any
termination, RPR may withhold from assets then in my RPR Plus Account such
amount as it may reasonably believe necessary to pay any amounts to RPR or Bank,
and apply such amounts first to pay RPR and second to pay Bank. If my
participation in the RPR Plus Program is terminated, either by me or RPR, I will
promptly return my Card(s) and all unused Checks to Rauscher Pierce Refsnes,
Inc., RPR Plus Department, 2500 RPR Tower, Plaza of the Americas, Dallas, Texas,
75201. Failure to return such Card(s) and Checks to RPR may result in a delay
in complying with the instructions as to the disposition of assets in my RPR
Plus Account.
Arbitration
15. ARBITRATION. I UNDERSTAND THAT THIS AGREEMENT CONTAINS A PRE-DISPUTE
ARBITRATION CLAUSE AND THAT:
(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; AND
(E) THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF ARBITRATORS
WHO WERE OR ARE AFFILIATED WITH THE SECURITIES INDUSTRY.
I AGREE, AND BY CARRYING AN ACCOUNT FOR ME YOU AGREE, THAT ALL CONTROVERSIES
THAT MAY ARISE AT ANY TIME BETWEEN ME AND YOU CONCERNING ANY TRANSACTION OR
OTHERWISE RELATING DIRECTLY OR INDIRECTLY, TO THE CONSTRUCTION, PERFORMANCE, OR
ASSERTED BREACH OF THIS OR ANY OTHER AGREEMENT OR OBLIGATION BETWEEN ME AND YOU
WHETHER ENTERED INTO PRIOR, ON, OR SUBSEQUENT TO THE DATE HEREOF, SHALL BE
DETERMINED BY ARBITRATION. SUCH ARBITRATION SHALL BE IN ACCORDANCE WITH THE
RULES THEN IN EFFECT OF THE NEW YORK STOCK EXCHANGE, INC. OR OF ANY OTHER
EXCHANGE OF WHICH YOU ARE A MEMBER, THE NATIONAL ASSOCIATION OF SECURITIES
DEALERS, INC., OR THE MUNICIPAL SECURITIES RULEMAKING BOARD. I AUTHORIZE YOU TO
ELECT AMONG THESE SPONSORING ORGANIZATIONS IF I DO NOT MAKE AN ELECTION BY
SENDING TO YOU WRITTEN NOTICE OF MY ELECTION WITHIN 15 DAYS AFTER YOU SEND TO ME
WRITTEN NOTICE REQUESTING SUCH ELECTION. THE
<PAGE>
AWARD OF THE ARBITRATORS, OR A MAJORITY OF THEM, SHALL BE FINAL AND BINDING AND
JUDGMENT ON THE AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION.
Other Terms and Conditions
16. Regulations. All transactions in accounts established by you for me shall
be handled in accordance with and subject to the applicable constitutions,
rules, regulations, by-laws, customs, and usages of the National Association of
Securities Dealers, Inc. and of the exchanges and markets and the clearing
corporations, if any, where the transactions are executed by you, and applicable
federal laws and applicable rules and regulations promulgated under such laws.
I agree to indemnify you and to hold you harmless from all claims, losses,
damages, liability, and expenses, including attorney's fees and costs, that you
may incur as a result of your handling of transactions in accordance with such
requirements.
17. Security Interest. I grant to you a security interest in and to all
securities, commodities, or other property of any kind in which I now or
hereafter have rights of any kind and that are now or hereafter held by you in
any account of mine or otherwise in your possession for any purpose, including
safekeeping, or in the possession of a clearing corporation and deemed to be in
your possession by applicable law, to secure the performance of any and all
obligations I now or hereafter have to you under this agreement or any other
agreement, including but not limited to my obligation to repay you for all
advances made, or credit otherwise extended, to me heretofore, now, or hereafter
in any margin account or otherwise.
18. Transaction Orders. I agree that when I give to you any buy order for any
cash account of mine, if funds sufficient for the purpose are not already held
in that account by you, I will promptly make full cash payment on or before the
settlement date for the securities to be brought by you. I understand that if I
sell the securities before I have paid for them must still make full payment
with funds exclusive of the sale proceeds. I agree that when I give a sell
order to you for any cash account of mine, if the securities to be sold by you
are not held in that account, my order will constitute a representation that I
own the items and will promptly deliver them to you for my account in good
delivery form on or before the settlement date. Certain securities certificates
may require additional documentation to be in good delivery form, and I
therefore agree to ascertain from you whether my certificates are in good
delivery form. I agree to make full cash payment promptly to you for any
amounts which may become due in order to meet necessary requests for additional
deposits or marked to market with respect to any unissued security purchased or
sold by me in a cash account of mine. I also agree that I will promptly pay or
deliver in good delivery form to you and dividend, interest, or distribution
whether in cash, stock, rights, or other property, received by me after a sale
by me made on a date before the security sold becomes ex-dividend, ex-interest,
ex-rights or
<PAGE>
ex-distribution pursuant to the rules and practices of the exchange or market
where the sale is made. If I fail to deliver to RPR any securities or
commodities which have been sold pursuant to my order, RPR is authorized to
borrow the securities or commodities necessary to make delivery thereof, and in
the event of RPR's inability to borrow or otherwise obtain the commodities or
securities, I shall be responsible for any loss sustained thereby. RPR shall
have a reasonable time after payment to deliver to me any securities or
commodities which have been purchased for my account. I understand and agree
that when I place with you any sell order for short account I will designate it
as such and I authorize you to mark such order as being "short", and that when I
place with you any order for long account, I will designate it as such and will
authorize you to mark such order as being "long." I agree that when I designate
a sell order as "long" that designation shall be a certification within the
meaning of the "Short Sales" rules under (S) 10 of the Securities Exchange Act
of 1934 that the security is owned by me and either that it has been forwarded
to my account or that it has been impractical to deliver it, but that I will
deliver it to the account as soon as possible without undue inconvenience or
expense. I understand that if i designate a sell order as "long" but do not
have the securities in my account, the securities may be bought in after
settlement date without notice to me.
19. Indemnify. I agree to indemnify you and to hold you harmless from all
claims, losses, damages, liability, and expenses, including attorney's fees and
costs, that you may incur as a result of following my instructions, as broker or
principal, to buy, sell, transfer, deliver, or pledge securities or other
property. I acknowledge that any such instructions made by me, whether in
writing or orally (by telephone or otherwise), shall be binding upon me until
revoked. I agree to be personally liable for any and all RPR Plus transactions
(including but not limited to brokerage transactions, Card transactions, Check
transactions and all other RPR Plus transactions) effected by any persons whom I
give authority to use my INVESTORS MONEYCARDsm Account Card(s) or Checks.
20. RPR Status. In all transactions between you and me, I understand that you
are acting as my broker except when you disclose to me in writing at or before
the completion of a particular transaction that you are acting, with respect to
such transaction, as dealers for your won account or as brokers for some other
person. I understand that you are not acting for me as trustee or similar
fiduciary.
21. Deposit Securities. Foreign securities may be held for my account abroad
in such places and by such banks and other firms and places as you may
determine. You are authorized to deposit securities owned by me beneficially or
otherwise to the custody of any clearing corporation or other subsidiary
organization of either a national securities exchange or registered national
securities exchange or registered national securities association, or of a
<PAGE>
custodian bank in accordance with any system established by such exchange or
association for the central handling of securities.
22. Transfers. You may, in your sole discretion, without notice to me, apply
or transfer any securities or other property owned by me between or among any
and all of my accounts with you (other than from regulated commodity accounts).
23. Market Changes. I agree that you will not be liable to me for any default
by a market or exchange on which I have acquired a position. I understand that
markets and exchanges may change terms, rules, or procedures which may affect
markets adversity: a market or exchange may also default on a duty to pay its
obligations or may be unable to take or make delivery of positions created
thereon.
24. Lost Securities. I agree that if any securities owned by me are lost,
destroyed, or stolen while in your possession or in transit from a seller or to
a purchaser. I will promptly upon notice by you or otherwise of such occurrence
make claim upon the issuer to issue new securities in place of the original
securities and will undertake all commitments and obligations to the issuer that
may be required by law to secure issuance of the new securities.
25. Bankruptcy Setoffs. I agree and understand that in the event that I
commence a bankruptcy case under the laws of the United States, or an
adjudicated bankrupt in an involuntary bankruptcy case brought under the laws of
the United States, this agreement shall remain in full force and effect and you
shall continue to have the right (as you otherwise have under this agreement) to
set off any mutual debt and claim under or in connection with securities
contracts that constitute the set off of a claim against me for a margin payment
or settlement payment against cash, securities, or other property held by or due
from you to margin, guarantee, secure or settle securities contracts, all as
provided for in 11 U.S.C. (S) 362(b)(6) or any amendatory or successor provision
thereto.
26. Refusal of Orders. I agree that you may limit the number of securities or
other property you hold for any and all of my accounts and that you have the
right at any time to cease accepting orders for additional securities or other
property from me.
27. RPR Remedies. If I die, or I do not pay for any securities purchased by me
on or before the settlement date or deliver to you any securities sold by you
when due, or I fail to comply strictly with any initial or maintenance margin
calls in any margin account of mine or I otherwise fail to perform any
obligation I owe to you under this agreement or any other agreement, or should
you for any reason whatsoever deem it necessary for your protection, you are
authorized to take any or all of the following actions: (a) sell any securities
or other property in any account of mine or otherwise in your possession, or (b)
buy in any securities or other
<PAGE>
property for which any account of mine may be short or as required to make
delivery pursuant to an order entered in any account of mine, or (c) cancel any
unexecuted orders in order to close out any account of mine in whole or in part
or in order to close out any commitment made in my behalf. Any sale, purchase,
or cancellation made in my behalf. Any sale, purchase, or cancellation made by
you as authorized in this paragraph may be made. In your sole discretion, on
the exchange or other market where such business is usually transacted, or as
public auction or at private sale, without advertising the same and without
prior notice, tender, or demand to me. You may purchase any securities or other
property sold pursuant to this paragraph free of any right of redemption by me.
I agree that I will be liable for any deficiency resulting from any sale of
securities made by you pursuant to this paragraph and that I will be liable for,
and indemnify you from, any deficiency, claim, or loss resulting from your
buying in any securities or other property in my account pursuant to this
paragraph. I acknowledge that the securities or other property that you are
authorized pursuant to this paragraph to sell out or to buy in, or with respect
to which you are authorized to cancel orders, may change speedily in value
unless you are authorized to take action immediately without prior notice,
tender, or demand to me. I also acknowledge that your making of any prior
notice, tender, or demand to me on any occasion shall not be considered a waiver
of your rights under this paragraph to act without prior notice, tender or
demand.
28. Choice of Law. THE INTERPRETATION, PERFORMANCE, AND ENFORCEMENT OF THIS
AGREEMENT AND ALL TRANSACTIONS AND PROCEEDINGS CONTEMPLATED OR REQUIRED THEREBY
SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, EXCEPT THAT THE FEDERAL
ARBITRATION ACT SHALL GOVERN WITH RESPECT TO THE PROVISIONS IN THE SECTION
HEADED "ARBITRATION" ABOVE TO THE EXTENT THAT THE LAWS OF THE STATE OF NEW YORK
CONFLICT WITH SUCH ACT.
29. Attorneys Fees. If you are required to make any efforts to collect any
obligations owed by me to you under this agreement or otherwise, including but
not limited to the commencement of any proceeding, I agree that I will pay to
you all expenses incurred in your collection efforts, including attorney fees
and costs, unless I receive a final and binding award or judgment that I did not
have any liability to you as claimed.
30. Severability. In the event that any one or more of the provisions
contained in this agreement shall for any reason be held to be invalid, illegal,
or unenforceable in any respect, such finding or holding shall only affect the
provision or provisions involved and the remainder of this agreement and the
application of all other provisions shall not be affected and shall continue in
full force and effect.
31. Interest Limitation. Any provision herein, or any other document executed
in connection herewith or in any other agreement to the contrary,
notwithstanding, you shall not in any event be
<PAGE>
entitled to receive or collect any amounts, and you shall not be entitled to
credit any amounts received by you, as a result of which you are paid as
interest a sum greater than the maximum amount, if any, permitted by applicable
law to be charged to me. If any construction of this agreement or of any and
all other documents in connection herewith or of other agreements indicates a
different right given to you to ask for, demand or receive any larger sum as
interest, such is a mistake in calculation or wording, which this clause shall
override and control, it being the intention of the parties that this agreement
and all related documents shall in all things comply with applicable law, and
proper adjustment shall automatically be made accordingly. In the event you
ever receive, collect or apply as interest any sum in excess of the maximum
legal rate, if any, such excess amount shall be applied to the reduction of the
debit balance of any and all of my accounts, and if I do not have a debit
balance any remaining excess shall be paid to me. In determining whether or not
the interest paid or payable under any specific contingency exceeds the highest
lawful rate, if any, you and I shall, to the maximum extent permitted under
applicable law, characterize any nonprincipal payment as an expense, commission,
fee, or premium rather than as interest and shall "spread" the total amount of
interest throughout the entire time that you have maintained any margin account,
or any cash or other account with a debit balance, for me so that the interest
rate is uniform throughout such time, provided that if the interest received for
the actual period of such accounts exceeds the maximum lawful rate, if any, you
shall refund to me the amount of such excess or credit the amount against any
debit balance still owing at the time in question.
32. No Waiver. Under no circumstances shall the exercise by you of any rights
under this agreement, or the failure by you to exercise any rights under this
agreement, be construed in any way as a waiver or relinquishment of any rights
you have under this agreement or under any other agreement.
33. Notice. I agree that, except as otherwise provided herein, I will give you
any written notice required or permitted under this agreement by hand-delivery
or first class mail, postage prepaid, at the address indicated in paragraph 14
above, or at such other address as you may instruct, and that such notice by
mail shall be deemed effective as of the date sent by me. I also agree that any
written notice sent by you to me shall be deemed to be effective as of the date
sent by you by first class mail, postage prepaid, at my address given below, or
at such other address of which I give you written notice.
34. Integration. This agreement constitutes the entire agreement between us
and supersedes all prior or contemporaneous written or oral agreements between
us concerning the account (except with respect to any written options,
commodities, joint account, or other agreement on your approved forms, or signed
by an authorized officer in your administrative or executive officers, the terms
of which supplement this agreement). This agreement cannot be
<PAGE>
amended, modified, supplemented, or altered in any way other than as provided
for expressly herein in the section headed "Future RPR Amendments" or by written
agreement between me and you on your approved form or by an authorized officer
in your administrative or executive offices. Further, I confirm and represent
that no person has made any verbal or written representation to me concerning
this agreement or any term hereof which is not included herein.
35. Authorization to Change Service Providers:
Termination of Services. RPR may select persons other than Bank or Norwest
to provide any of the services described as provided by Bank or Norwest in this
Agreement. RPR may also decide at any time to terminate the linkage of RPR Plus
with the INVESTORS MONEYCARDsm or any replacement Card, or to terminate my
ability to write Checks, and I agree to surrender all Card(s) or unused Checks
to RPR immediately upon being informed of such termination.
Customer Representations
36. Customer Representations. I represent that I have reached the age of
majority, that neither I nor my spouse is the employee of any exchange or of any
corporation of which any exchange owns the majority of the capital stock, or of
a member of any exchange or member firm or 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 of dealing either as broker or as
principal, in securities, bills of exchange, acceptances or other forms of
commercial paper. I agree that I will notify you in writing if I or my spouse
become so employed during the term of this Agreement. I further represent that
no one except me has an interest in any accounts of mine with you, other than in
accounts you hold in my name jointly with others named on the account.
I further represent that I have received a copy of the Prospectus, relating to
the Automatic Cash Investment Fund, and the INVESTORS MONEYCARDsm Agreement.
I agree to promptly comply with any request for additional documents you may
make in order to comply with applicable law or the policies and procedures of
RPR and/or the Bank.
THIS IS A BINDING CONTRACT. READ IT BEFORE SIGNING. PLEASE RETAIN A COPY FOR
YOUR RECORDS.
By my signature below, I acknowledge receipt of a copy of this RPR Plus
Account Agreement and consent to all of the terms and conditions contained
herein. Should you modify this Agreement in whole or part, my use of the
Card(s) or Checks after you have notified me of the amendments shall constitute
my agreement to the modifications.
<PAGE>
Acct No. __________ Date: 10/25/91
Name(s): Tom L. Ward
Address: P.O. Box 54525
City/State/Zip: Oklahoma City, OK 73154
Phone No.: ____________
__ Check here if you want a phone number to appear on checks
Notice to Customer. You must cross out item (2) in this box if you have been
notified by the IRS that you are subject to backup withholding because of
underreporting interest or dividends on your tax return. However, if after
being notified by the IRS that you were subject to backup withholding you
received another notice from the IRS that you are no longer subject to backup
withholding, do not cross out item (2).
Under the penalties of perjury I certify:
(1) that the number below is my correct taxpayer identification number and (2)
that I am not subject to backup withholding either because I have not been
notified that I am subject to backup withholding as a result of a failure to
report all interest or dividends, or the Internal Revenue Service has notified
me that I am not longer subject to back up withholding.
Social Security/Tax I.D. Number: ###-##-####
ACCOUNT DISCLOSURE
Unless otherwise indicated below, I understand that RPR will release my name,
address, and security positions to any corporation requesting this information
about my account.
___ I DO NOT want RPR to release the above information.
___ I DO NOT want a VISA GOLD Card.
FUND ELECTION
I elect the following Fund as my Automatic Cash Investment Fund:
___ Carnegie Liquid Income Trust
___ Carnegie Government Securities Trust
___ Carnegie Tax Free Income Trust
___ Credit Interest Program (C.I.P.)
If I fail to choose one of these choices, you are to deposit such funds in the
RPR Credit Interest Program ("CIP") for me.
CUSTOMER:
I ACKNOWLEDGE THAT MY SECURITIES WHEN BEING USED AS COLLATERAL FOR A LOAN BY YOU
MAY BE LOANED, SEPARATELY OR TOGETHER WITH THE SECURITIES OF OTHERS, EITHER TO
RAUSCHER PIERCE REFSNES, INC., OR OTHERS. THIS AGREEMENT CONTAINS A PRE-DISPUTE
ARBITRATION CLAUSE.
<PAGE>
Tom Ward
- --------------------------------------
(Print Name)
\s\ Tom L. Ward
- --------------------------------------
(Individual Signature)
- --------------------------------------
(Joint Account Signature)
If signing as agent for a corporation, partnership, or other entity, state
agency status (e.g., President, Partner, etc.)
