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Account Agreement

** IMPORTANT TO READ **

ACCOUNT AGREEMENT

The following TERMS AND CONDITIONS and PRIVACY POLICY constitute the entire Account Agreement that governs opening an account at the KenyaShares LLC. KENYASHARES strongly advises all investors wishing to open an account with KenyaShares to read the entire Account Agreement and to consult with an experienced financial or investment advisor prior to making any transactions or opening an account. This Account Agreement also contains a Pre-dispute Arbitration Clause.

TERMS AND CONDITIONS

1) Definition:
KenyaShares Service is the proprietary investment program offered by KenyaShares, LLC, which allows individual investors to build personal investment portfolios through periodic purchases of publicly traded securities listed in the Nairobi Stock Exchange. KenyaShares is an international agent of African Alliance Kenyan Securities Limited pending its own legal brokerage license to trade directly from the Kenya Capital Market Authority. The program enables investors to select those securities which they feel will grow over time and to invest in dollar increments appropriate to the financial situation of each individual investor.

Transaction Cycle is the programmatic timing selected by each participant for his/her KenyaShares Transactions. This selection is normally based on the week(s) within each month most convenient for the participant to fund his/her KenyaShares Account through an electronic funds transfer or other means. You can place an order to buy or sell a fixed number of shares of most publicly traded securities in the Nairobi Stock Exchange.

Trade Date is the actual day of the week when securities are purchased or sold at the Nairobi Stock Exchange on behalf of its clients by Kenya Shares and its partner – African Alliance Kenyan Securities Limited.

Settlement Date is the Trade Date plus five (5) business days.

Nairobi Stock Exchange listed stocks are approximately 55 stocks which may be purchased or sold through KenyaShares. Only stocks on this list, meeting all trading price and market capitalization criteria, may be purchased and/or sold through KenyaShares. The Securities listed in the Nairobi Stock Exchange are revised regularly at KenyaShares’s sole discretion to add new stocks that meet KenyaShares's criteria and to remove stocks that no longer meet those criteria. You understand and agree that certain stocks which you purchase or which you may wish to purchase in the future may be subsequently removed from the KenyaShares Listed Stocks and, may no longer be available for purchase through KenyaShares. If a stock which you have purchased through KenyaShares is subsequently removed from the list of KenyaShares Listed Stocks, you will continue to be able to sell any positions in that stock acquired through KenyaShares, but you may no longer be able to acquire additional shares through KenyaShares or transfer in additional shares from another non-KenyanShares account.

2) Age Requirement:
You must be 18 years or older to open an account with KenyaShares. A minor may however open an account with KenyaShares through a parent or a legal guardian.

3) Acknowledgement and Representation.
By opening an account at KenyaShares LLC, you acknowledge and represent that you have read and understood the following TERMS AND CONDITIONS and PRIVACY POLICY and that you agree to be bound by such TERMS AND CONDITIONS and PRIVACY POLICY. You understand and agree that clicking on "I Agree" to accept these terms and conditions ("Agreement") has the same legal effect of your hand signature being appended on the Account Agreement indicating your intent to be bound by the terms and Conditions as well as the Privacy Policy of KenyaShares. KenyaShares reserves the right to change, modify or terminate this Agreement with due notice. You agree that your continued use of the service offered by KenyaShares after a change or modification of this Agreement within a period of fifteen (15) calendar days of such change or modification shall be construed to be your representation to accept such change or modification, your actual real or constructive knowledge of such change or modification notwithstanding. A change or modification required by law, however, may take effect immediately pursuant to the requirement of the law.

You acknowledge that you alone are responsible for determining the suitability of your investment choices and investment strategies in light of your particular circumstances and you understand that KenyaShares assumes no responsibility for such choices or determinations. You further acknowledge that all orders are unsolicited, and that the market values of securities may and do fluctuate. You also acknowledge that KenyaShares will not advise you nor give a binding opinion concerning the nature, risk or suitability of any security, transaction or investment strategy. You also acknowledge that KenyaShares will not give legal or tax advice and that you are should consult legal and tax professionals if in need of legal and/or tax consultation.

By opening an account at KenyaShares, you agree to effect all transactions in your KenyaShares Account via the KenyaShares web site, http://www.kenyashares.com.

4) Services and Fees
KenyaShares LLC will act as your agent for the purpose of buying and selling securities on your instructions. You are solely responsible for the trades entered, and will not hold KenyaShares or any of its employees liable for those investment decisions. KenyaShares reserves the right to refuse any account and to decline or change any order at its sole discretion. KenyaShares does not discriminate on the basis of gender, race, age, nationality, ethnicity or disability. You agree to pay the applicable commission, fees (including any extraordinary surcharges passed to KenyaShares by certain exchanges), and taxes that may apply at the time services are rendered to your account. For a schedule of standard fees relating to your KenyaShares Account, you should refer to the "Customer Care" link on KenyaShares web site.

The commission and fees shall be deducted as follows: 1) Commission for a particular transaction would be deducted from the principal amount of funds applied to dollar-based purchase orders; 2) in future Commission for real-time trades would be added to the extended amount payable for share purchase orders and deducted from the extended proceeds for share liquidation orders; and 3) All other fees that may be incurred in the course of a given transaction would be debited in your KenyaShares account. KenyaShares reserves the right to change its commission and fees anytime by posting a modified fee schedule on the KenyaShares web site. KenyaShares would issue a notice before any new fees are effective.

KenyaShares processes requests to cancel orders on a best efforts basis and you agree not to hold KenyaShares liable if it is unable to cancel an order.

5) Investing Programs - Basic, Plus and Premier
Kenya Shares offers three types of investments programs, Basic, Plus and Premier. Monthly subscription fees for the premier account are non-refundable once paid, even if you do not take advantage of program benefits during that month, and free automatic investments not used in one month are not rolled forward to future months. Additionally, Investing Program subscriptions are processed immediately and are not pro-rated based on the number of days or weeks remaining in that month. In the event your Subscription fee payment reverses or otherwise fails with respect to your selected payment method, KenyaShares reserves the right to collect the Subscription fee from your account's cash balance in order to continue your selected Investing Program, or revert your Investing Program status back to the program previously in effect. (Basic). Kenya Shares reserves the right to appropriately re-calculate and/or assess transaction commissions applicable under your previous Investing Program if the Subscription fee cannot be collected from your account's cash balance.

5) Governing Laws and Jurisdiction
This Account Agreement with Terms and Conditions shall be governed by and construed in accordance with the laws of the State of Colorado. In addition, you acknowledge that all securities transaction through your KenyaShares account involving securities listed in Kenya are wholly regulated by the laws of the Republic of Kenya. You acknowledge that Kenyan laws and regulations governing public traded securities may restrict the type and the number of securities purchased by a non-Kenyan citizen.


6) KenyaShares makes no representation or warranty regarding its compliance with local laws in foreign jurisdictions, or regarding the appropriateness of the web site's content or its compliance with such local laws. The products and services provided by KenyaShares and its web site are only available to Kenya citizens. You understand that the KenyaShares web site is the only means of accessing your KenyaShares Account and effecting your KenyaShares brokerage transactions. Your inability to access the KenyaShares web site in certain foreign countries could result in your inability to access your brokerage account or to effect transactions. You agree that KenyaShares shall not be liable for any losses or damages you incur as a result of the unavailability of the KenyaShares web site from foreign countries.

7) Accuracy and Notification
You represent and warrant that the information you supplied on your Account Application is true and accurate, and you agree to notify us in writing or by electronic communication of any changes in information contained in your KenyaShares account. You also agree to notify us by the same means if you are or become: a) employed or affiliated with a stock brokerage firm, bank, trust company, insurance company or securities exchange; b) an officer, director, affiliate or 10% shareholder of a publicly traded company. You agree to indemnify and hold KenyaShares and its affiliates harmless from and against any and all damage, cost, judgment, liability, loss, award, settlement, tax, penalty, action, expense or fee (including reasonable attorneys' fees and costs of collection) of any nature, and claims therefore (collectively, "Losses") arising out of or relating to your failure to provide accurate information on your KenyaShares Account Application or to update that information as required. You further represent that no other person has an interest in your Account except those you have disclosed in the KenyaShares Account Application.

8) Joint Accounts
Any joint holder may individually, without notice to other joint holders, authorize KenyaShares to buy, sell, tender, or exchange securities in the account and to receive any monies or securities into the account. However, separate written instructions and signed by all joint holders to the account in the presence of a notary public, are required to disperse or transfer any assets out of the account in a form or to an account not bearing registration identical to the subject KenyaShares Account. You acknowledge and agree that any verbal or written notice issued to one account holder in a joint account will be considered to have been issued to all joint account holders. Upon the death of an account holder to a joint account, the surviving account holder(s) must give reasonable notice to KenyaShares. The surviving account holder(s) will be the owner(s) of the account and continue to be subject to the terms of this Account Agreement. Each account holder is jointly and severally liable to KenyaShares, LLC, for any transaction, obligation or liability arising in connection with the account activities. If KenyaShares becomes aware of a dispute between or among Account holders involving their joint account, KenyaShares reserves the right, but is not obligated, to place restrictions on the subject Account and/or related Accounts and to maintain such restrictions until KenyaShares is satisfied in its own discretion that the dispute has been resolved following receipt of satisfactory documentation from a relevant court of law of competent jurisdiction or a notarized instruction signed jointly and contemporaneously by all joint Account holders. KenyaShares may also, at the expense of the Account holders, seek legal redress or join a legal action to defend its action or position, where a dispute among joint account holders is brought to court and an issue implicating an interest KenyaShares is raised.

9) Obligations by Fiduciaries
KenyaShares does not review any action or inaction of a Fiduciary with respect to any KenyaShares Account and disclaims responsibility for determining whether a Fiduciary's conduct satisfies applicable standards of care, as well as for determining the validity of a person's or entity's status or capacity to serve as a Fiduciary. Any Fiduciary using the KenyaShares Service agrees to indemnify and hold KenyaShares and its affiliates harmless from and against any Losses arising out of or relating to any act, error, commission or omission of the Fiduciary.

10) Right of Offset and Liquidation
You acknowledge and agree that all the assets held in any account, now or in the future, shall be subject to a general lien for discharge of any indebtedness you have to KenyaShares. These assets shall be held by KenyaShares as security for payment of any liability you may have with the company. In the event you do not fully meet a settlement obligation, KenyaShares may, without further notice, take action, including but not limited to: liquidating or canceling the transaction, transferring securities or money from any other of your KenyaShares Accounts, liquidating securities from any such KenyaShares Accounts and applying the proceeds from such sales to your debt or liability to KenyaShares, purchasing or borrowing securities to make delivery. In case of any such action to settle a liability owed to KenyaShares, account holder would be responsible for all costs and losses arising from these actions.

11) Settlement
All transactions are on a "cash only" basis. You agree that prior to placing a purchase order for securities, you will provide a valid and sufficient authorization to KenyaShares for electronic funds transfers from another financial institution(s) and/or you will otherwise deposit sufficient funds with KenyaShares on or before trade date. You also agree that prior to placing a selling an order, you will present securities in "good delivery form" for deposit with KenyaShares as necessary.

12) Non-Sufficient Funds Policies
KenyaShares reserves the right to cancel or cover any transaction which is the subject of a returned check or electronic funds transfer reclamation. A service fee will be charged for such instances. Securities held in an account at KenyaShares may be liquidated to cover any such indebtedness to KenyaShares. KenyaShares also reserves the right to restrict your ability to withdraw funds until such time as it is reasonably assured that all deposits or other items in your account have cleared.

13) Fraud
In cases of fraud or theft by you, acting alone or in concert with others, involving, among other things, use of counterfeit checks, checks drawn on closed or non-existent accounts, checks stolen from third parties, unauthorized electronic funds transfers from bank accounts belonging to others, attempted electronic transfers from non-existent accounts or similar illegal or improper conduct involving account funding or withdrawals, KenyaShares shall assess against you, in addition to all other fees, damages and penalties to which it may be entitled, a $500 fee per forged, faked, fictitious, stolen or otherwise unauthorized item or transfer. This fee shall constitute liquidated damages to compensate KenyaShares for the time and effort expended for rectifying the said conduct.

14) Priority of Balance
KenyaShares Transactions will only be executed if the particular account contains an available balance on the morning of the scheduled transaction to cover all specified purchases. For example, if a participant has established a program to buy three separate securities on a given transaction cycle and there are sufficient funds to cover only two purchases, then no transactions will take place. Requests for withdrawal of funds or an order to buy a security via a standard Real-time Trade will have priority over scheduled KenyaShares Transactions provided the withdrawal request or the Real-time Trade order is received sufficiently in advance of a scheduled KenyaShares Transaction. Any unexecuted Real-time Trade purchase entered as a limit order will be deemed to have been executed for the purpose of calculating your available balance.


In the event you have an unsecured debit balance in an account, KenyaShares may, at its option and without further notice, inactivate a standing instruction to reinvest cash dividends in the account or any other of your accounts, in order to cover the debit. It is your responsibility to ensure that the reinvest dividend instruction is reset for all affected accounts after the debit is covered.

15) Cash/Credit Balances
All credit balances in KenyaShares customer accounts, including cash dividends, monies received prior to any purchase settlement date, and net proceeds from liquidations, are automatically transferred to a customer escrow account . This account is registered in the name of KenyaShares and holds monies in aggregate for the exclusive benefit of its customers. Also, sufficient monies to cover purchases in KenyaShares customer accounts are automatically "swept" back from the escrow account on settlement date. Dividends paid by the escrow account if any are calculated monthly and posted to individual KenyaShares Accounts monthly. Proportionate customer balances in the escrow account are reported in individual KenyaShares Account balances and statements. In order to protect itself and its customers from fraudulent activity, KenyaShares reserves the right to temporarily hold credit balances and to delay requested disbursements, regardless of whether the credit resulted from a cash deposit or a selling transaction. Such holding period will generally be the customary time required to verify clearance of the originating deposit, depending upon the nature of the funds' transmittal (e.g. check, electronic transfer, wire, etc.). As circumstances dictate, KenyaShares may also extend such hold in order to confirm the identity of the requestor or to take other steps it deems reasonable to prevent fraudulent activity.

16) Securities Transaction
Securities transaction through KenyaShares shall be subject to a net commission of 5% (including regulatory commission). However, orders originating from Kenya shall be subject to a CMA mandated commission on secondary trading as per the following schedule:

2. FOR SECONDARY TRADING

Consideration (Transaction Value) Net Brokerage Commission Transaction Fee   Investor Compensation Fund Fee   Total
Ksh KenyaShares NSE CMA NSE CMA Total
Up to Ksh 100,000 1.80% 0.14% 0.14% 0.01% 0.01% 2.10%
Ksh 100,000 and Above 1.50% 0.14% 0.14% 0.01% 0.01% 1.80%

 

17) Standing Instructions for Balance and Positions
Shares acquired through KenyaShares will be held in street name. Shares will not be registered or transferred unless specifically requested by the customer. KenyaShares may charge a separate fee to register and or deliver securities. Participants understand that KenyaShares cannot transfer or deliver fractional shares of any security. Cash dividends paid by any individual company will be reinvested automatically, unless directed otherwise, which will increase the customer's share position in that company. Cash balances held at KenyaShares whether resulting from a deposit, bank transfer, and dividend or securities sale will be held by KenyaShares unless specifically requested by the customer.

18) Market Data, News and Other Information
You agree that the market data, news, and other information available to you through the KenyaShares web site are for your personal use and that you will not retransmit or republish this information in any form. You acknowledge that the information provided to you is obtained from sources believed to be reliable and is presented solely on a best efforts basis, and that no accuracy or completeness of the information is guaranteed. You also acknowledge that the provision of such information does not constitute a recommendation by KenyaShares to purchase or sell any security.

19) Extraordinary Events
You agree that KenyaShares will not be liable to you or to third parties for losses incurred directly or indirectly by causes reasonably beyond its control, including but not limited to, government restrictions, natural disasters, severe weather conditions, wars, strikes, terrorist attacks, exchange or market rulings, interruptions of data processing services or communications, disruptions in orderly trading on any market or exchange, unauthorized access or operator errors.

20) Access to Services and Market Volatility
Access to KenyaShares's electronic services, and hence, your KenyaShares account, may be limited or unavailable during periods of market volatility, peak demand, system upgrades or maintenance or for other reasons. You agree that KenyaShares will not be liable to you or to third parties for any losses or damages incurred by you or third parties (including lost profits, trading losses and similar damages) resulting from such access limitations or unavailability.

Additionally, you understand that the KenyaShares web site is generally the only means of processing your KenyaShares transactions and that, in the event of an interruption of communications systems or other hardware or software malfunction, access to view and to transact in your brokerage account may be delayed. In the event of a significant outage, KenyaShares would undertake best efforts to process transactions over the telephone through its Customer Care Department, but would not be liable for any losses or damages you might suffer as a result of such delays or inability to access your account or effect transactions.

You acknowledge that when you place a market order, you will receive the price at which your order is executed in the marketplace. During periods of high volume, illiquidity, fast movement or volatility in the stock markets, the execution price received may differ from the quote provided on entry of an order, and you may receive partial executions of any order at different prices. You also understand that orders for larger numbers of shares are relatively more likely to receive executions at prices that vary from a given quote. You agree to pay or receive the prevailing market price at the time your market order is executed. You understand that limit orders may not be executed at any particular time, or at all, if there is not sufficient trading at or better than the limit price you specify.

21) Communications Between KenyaShares and the Customer
By opening an account at KenyaShares and agreeing to these Terms and Conditions, you agree to receive all communications from KenyaShares via the World Wide Web or e-mail [see special NOTE below]. This will include, but not necessarily be limited to, confirmations of transactions, account statements, financial statements and reports of portfolio holdings, reorganization notices, proxy materials, tax documents, notices of modifications to KenyaShares's Privacy Policy and Terms and Conditions, as well as annual and semiannual audited and unaudited reports for KenyaShares and other basic communications. Communications sent to your e-mail address or provided through the web site must be retrieved and read promptly. All communications sent by KenyaShares by any means will be deemed to have been received by you. You agree to advise us promptly of any changes to your e-mail and/or mailing address. You agree to advise KenyaShares promptly of any errors or omissions in any transaction or in the handling of your account. Failure to provide prompt notice of any errors will be deemed to constitute acceptance of the accuracy of all information sent to you.

NOTE: KenyaShares does not send e-mail messages to mobile devices. You understand that any e-mail address provided cannot be a mobile electronic mail address.

22) Complaints
Customer complaints should be directed to KenyaShares's Customer Care Department by e-mail at info@kenyshares.com or by calling -167-669-7839

23) Recording
KenyaShares may record telephone calls to monitor the quality of service you receive or for other purposes KenyaShares deems appropriate for its protection or for the protection of its customers.

24) Security and Confidentiality
You agree that you will be fully responsible for the confidentiality of your user name and password. You further agree that you will be fully and solely responsible for all activities, including brokerage transactions that arise from the use of your user name and password. You will immediately notify us in writing or by e-mail of any loss, theft or unauthorized use of your user name, password and/or account number(s).

25) PREDISPUTE ARBITRATION CLAUSE DISCLOSURES
Subject to the limited exception described below, you agree that a dispute arising between you and, KenyaShares and/or any of KenyaShares officers, directors, employees or agents relating to your account(s), shall, initially, be subject to arbitration. You further agree to submit to a relevant arbitration tribunal. Decision and finding of an arbitrator may be final and such judgment may be affirmed by a court of competent jurisdiction.

Exception: KenyaShares reserves the right to pursue legal action in the event KenyaShares determines that you have committed fraud or other criminal activity against KenyaShares and/or third parties involving the funding of, transactions in, or withdrawals from your account(s) with KenyaShares.

26) PRIVACY POLICY
KenyaShares endeavors to maintain the privacy of your account information, except where the law would mandate disclosure of account information for enforcement purposes.

27) Severability
These TERMS AND CONDITIONS constitute the entire agreement with respect to your access to and use of the KenyaShares web site. If any provision of these TERMS AND CONDITIONS is rendered contrary to the law of a relevant jurisdiction, void or unenforceable, then that provision only shall be deemed severable from the remaining provisions and shall not affect the remaining provisions’ validity and enforceability.

28) Successors
This Agreement will inure to the benefit of KenyaShares's successors, assigns and agents. KenyaShares may assign its rights and duties under this Account Agreement to any of its successors, subsidiaries or affiliates without giving you notice, or to any other entity on prior written notice to you. In addition, you agree that this Agreement and all terms hereof, will be binding on your heirs, executors, administrators or personal representatives and any assigns permitted by KenyaShares.

29) Power of Attorney
You agree and hereby irrevocably appoint KenyaShares with full power as your true and lawful attorney-in-fact, to the full extent permitted by law, for the purpose of carrying out the provisions of this Account Agreement and taking any action and executing any instrument that KenyaShares deems necessary or advisable to accomplish the purposes of this Agreement.

 

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© 2006 KENYASHARESTM. KENYASHARESTM is a registered trademark of KENYASHARESTM, LLC. All information provided herein is for informational purposes only and is not intended to be considered financial or investment advice provided by KENYASHARES or any of its agents. By participating on this site, you specifically understand and agree that KENYASHARES does not provide financial or investment advice. You further understand and agree that financial and investment transactions carry a certain amount of risk which may adversely affect your portfolio value. KENYASHARES makes no express or implied warranties of any kind concerning the companies or entities listed on this site. KENYASHARES strongly advises that you consult with an experienced financial or investment advisor prior to making any transactions.