arbitration claim filing guide - finra.org table of contents introduction to dispute resolution 2...

Dispute Resolution January 2017 Edition

Arbitration Claim Filing Guide

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TABLE OF CONTENTS

Introduction to Dispute Resolution 2

PART ONE: Filing the Initial Statement of Claim 4

PART TWO: Filing Statements of Answer 9

PART THREE:Filing Other Claim(s) 10

PART FOUR: General Information 11

Claim Information Sheet 14

FINRA Arbitration Submission Agreement 23

ARBITRATION CLAIM FILING GUIDE

FINRADisputeResolutionOneLibertyPlaza27thFloor165BroadwayNewYork,NewYork10006

www.finra.org/arbitration_mediation

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1 FINRAalsoprovidesdisputeresolutionservicesforseveralnon-FINRAexchangesthroughcontractedagreements.Byagreementwiththeseotherexchanges,theexchangesadoptFINRA’srulesandsubjectthefirmsregisteredwiththeexchangestoFINRADisputeResolution’srulesandprocedures.ThefollowingexchangeshaveagreementswithFINRAfordisputeresolutionservices:BATSExchange,BOXOptionsExchange,LLC(BOX),ChicagoBoardOptionExchange(CBOE),DirectEdge,InternationalSecuritiesExchange(ISE),MIAXOptionsExchange(MIAX),MunicipalSecuritiesRulemakingBoard(MSRB),NASDAQ,NASDAQOMX(includestheformerBostonStockExchangeandPhiladelphiaStockExchange),NewYorkStockExchange,NYSEAmexandNYSEArca.Theagreementswiththeseexchangesofferfirmsandinvestorsconsistencyofproceduresandtheuniformityofasingleforumfortheresolutionofsecuritiesindustryrelateddisputes.ContactFINRADisputeResolutionstafftodeterminewhetherapotentialpartymaybesubjecttomandatoryarbitrationinFINRA’sforumunderoneoftheagreements.

2 TheCode of Arbitration Procedureisseparatedintothreeparts: theCustomer Code, the Industry CodeandtheMediation Code.

Introduction to Dispute Resolution

FINRAsponsorsaforumforsecuritiesdisputeresolution.Ourarbitrationprogramadministersclaimsinvolvingcustomersofbrokeragefirmsanddisputesbetweenbrokeragefirmsandtheiremployees.Wealsoofferafull-scopemediationprogram.

Mediationandarbitrationarenon-judicialmethodsofresolvingdisputesbetweentwoormoreparties.Anytypeofdispute,claimorcontroversyarisingoutofbusinessdealingswithanyFINRAbrokeragefirm1canberesolvedinmediationorarbitration.

Consider Mediation First

Beforeyou,apotentialclaimant,initiatearbitrationorcourtlitigation,considermediatingyourclaimsincethisisanaturalfirststepinthedisputeresolutionprocess.

Mediationisaninformalprocessinwhichamediatorfacilitatesnegotiationsbetweendisputingparties.Themediator’sroleistohelpthepartiesfindamutuallyacceptablesolutiontothedispute.

Inmediation,youandtheotherpartiescontrol:

00 whothemediatorwillbe;

00 whenthemediationwilloccur;and

00 howthedisputewillberesolved.

Partieswhomediateatthisforumresolvefouroutofeveryfivecases.Inaddition,resolutioncanbefasterandlessexpensivethaninarbitrationorlitigation.Ifyouandtheotherpartiesagreetomediate,youwillnotgiveupanyrighttoarbitrateorlitigateifafullsettlementisnotreached.

Formoreinformationonourmediationprogram,pleaseseethepublicationFINRAMediation—AnAlternatePathtoResolvingSecuritiesDisputes,availableonourWebsiteatwww.finra.org/arbitration_mediation.

FINRA Arbitration

Ifallpartiesdonotfullysettletheirclaimsoryoudecidetoarbitrateyourclaimwithoutmediation,youmaysubmityourclaimtoFINRA.Inarbitration,animpartialpersonorpanelhearsthepresentationsoftheparties,evaluatestheevidenceanddecideshowthematterwillberesolved.Whenyouchoosearbitrationtoresolveyourdispute,youforegotheopportunitytohavethesamematterdecidedbyacourtoflawbecauseanarbitrationawardatthisforumisfinalandbinding.

ThisArbitration Claim Filing Guideprovidesinformationforyouandallpartiesinvolvedinarbitrationproceed-ings.TheguideexplainshowtofileaninitialStatementofClaimandotherpleadings.Italsooutlinesthewaypleadingsshouldbeservedupontheotherparties,andprovidesinformationandguidanceonotheraspectsofthearbitrationprocess.

PartiestoFINRAarbitrationsormediationsareboundbyFINRA’srules.TheCode of Arbitration Procedure2containstheformalrulesthatgovernarbitrationsandmediationsadministeredbyFINRA.TheCodeisavailableonourWebsiteatwww.finra.org/arbitration_mediation.TakethetimetoreadandunderstandtheCode.Inaddition,pleasereviewourWebsiteasitcontainsadditionalimportantinformationaboutFINRA’scaseadministrationprocessesandprocedures.

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Ifyouhaveanyquestions,calltheappropriateFINRADisputeResolutionoffice,MondaythroughFriday,between9a.m.and5p.m.

FINRA is not authorized to give you legal advice or to comment on the merits of your case. If you feel that you need legal advice, consult a lawyer.

FINRA DISPUTE RESOLUTION OFFICES

Northeast Region

FINRADisputeResolutionOneLibertyPlaza,27thFloor165BroadwayNewYork,NY10006(212)858-4200Fax:(301)[email protected]

Western Region

FINRADisputeResolution300S.GrandAvenue,Suite1700LosAngeles,CA90071(213)613-2680Fax:(301)[email protected]

Southeast Region

FINRADisputeResolutionBocaCenterTower15200TownCenterCircle,Suite200BocaRaton,FL33486(561)416-0277Fax:(301)[email protected]

Midwest Region

FINRADisputeResolution55WestMonroeStreet,Suite2600Chicago,IL60603-1002(312)899-4440Fax:(312)[email protected]

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PART ONE: Filing the Initial Statement of Claim

3 Seeremarksatfootnote1.

1. Statement of Claim

YoubeginthearbitrationprocessbyfilingaStatementofClaim,whichisawrittennarrativethatsetsforththefactsofthedispute.WhiletheStatementofClaimdoesnothavetobeinaspecialform,itshouldsetforththedetailsofthedispute,includingallrelevantdatesandnames,inaclear,conciseandchronologicalfashion,andshouldconcludebyindicatingwhatrelief(e.g.,theamountofmoneydamages,specificperformance,interest,etc.)isrequested.

IfyourStatementofClaimreferstodocuments,copiesofthedocumentsshouldbeattachedasexhibits.ExhibitsmustbeclearlyidentifiedandacompletesetshouldbeattachedtoeachcopyoftheStatementofClaim.NumbereachpageofyourStatementofClaimtoindicatethepagenumberandthetotalamountofpages.Forexample,ifyourStatementofClaimcontainsfourpages,numberthepagesasfollows:“Page1of4,”“Page2of4,”“Page3of4”and“Page4of4.”

Exceptforarbitrationawards,whicharepubliclyavailable,thedocumentsandinformationinFINRADisputeResolutioncasefilesareconfidential.FINRADisputeResolutionlimitsaccesstopersonalconfidentialinformationtoFINRAstaffmemberswhoneedittoperformtheirjobfunctions,andtoarbitrators,mediatorsorotherindividualsinvolveddirectlyinthearbitrationormediationprocess.Examplesofpersonalconfidentialinformationinclude:

00 SocialSecuritynumbers;

00 Brokerage,bankorotherfinancialaccountnumbers;

00 Taxpayeridentificationnumbers;and

00 Medicalrecords.

Partiesandtheircounselalsoshouldtakestepstoprotecttheirconfidentialinformation.Partiescansafeguardpersonalconfidentialinformationbyredactingsuchinformationfrompleadings,exhibitsandotherdocumentsuponagreementoftheparties.Forexample,thepartiesmayagree:

00 NottouseortoredactSocialSecurity,accountordriverlicensenumbers;and

00 Wheresuchdatamustbereferenced,touseonlythelastfewdigitsofsocialsecurity,bankoraccountnumbers,orsimilarinformation.

Ifyouincludeanemployeeofabroker-dealerasarespondent,theemployee’snameandcurrentbusinessaddressshouldbeprovidedontheenclosedClaimInformationSheet.Ifyoudonotknowtheemployee’scurrentbusinessaddress,FINRAwillattempttoobtainit.Iftherespondentemployeeisnotcurrentlyworkingasabroker,youshouldprovidetheemployee’scurrentresidentialaddressontheenclosedClaimInformationSheet,ifknown.IfFINRAcannotlocateanemployeerespondent,youwillberequiredtoprovideavalidaddressfortherespondent.

Ifyouareaclaimantfirm3andtherespondentisapubliccustomer,youmustinclude,withyourStatementofClaim,acopyofthepredisputeagreementsignedbythecustomertoarbitratethisdisputewithyouatthisforum.Ifyoudonotfileacopyofthecustomerpredisputearbitrationagreement,youwilldelaytheprocessingofyourclaim.

ThetextofyourStatementofClaimshouldcontainanexplanationofhowandwhyeachoftherespondentsisliable.

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QUESTION: Can I file my arbitration claim online?

AnypartymaysubmitanarbitrationclaimthroughtheFINRAOfficeofDisputeResolution’sDRPortal.Onlinefilingisaconvenientwaytofileanarbitrationclaim.FINRAwillmakecopiesofyourdocumentstoserveontherespondentsandforthearbitrators.Claimsaredeemedfiledwhentheclaimantsubmitstheclaimelectronicallythroughtheportal.Filingonlineallowsyouto:

00 completeanonlineClaimInformationForm;

00 submitaStatementofClaim,signedSubmissionAgreementandothersupportingdocumentationelectronically(nohardcopysubmissionsrequired);

00 paythefilingfeesonline;

00 generateaprintablereceiptwithtrackingnumber;and

00 savemultiplepartiallycompletedclaimsandreturntothemlater.

TheDRPortalalsoallowspartiesto:

00 viewcasedocuments;

00 submitdocumentstoFINRAandsenddocumentstootherportalcaseparticipants;

00 schedulehearingdates;

00 viewdetailsofupcominghearings;and

00 rankandstrikearbitratorsduringlistselection.

PartiescanaccesstheDRPortalat:https://drportal.finra.org

TheDRPortalUserGuideandFAQcanbefoundat:http://www.finra.org/arbitration-and-mediation/dispute-resolution-portal-user-guides.

EffectiveJuly20,2015,webeganinvitingallpartiesinallnewcasestousetheportalonavoluntarybasis.Wewillinviteclaimantstousetheportalimmediatelyuponreceiptoftheclaimattheregionalofficeandwillinviterespondentstousetheportalimmediatelyuponreceivinganoticeofappearance,requestforextension,orstatementofanswerfromrespondents’counsel.

QUESTION: What is the dollar amount of your claim?

Ifyourclaimis$50,000 or less,itwillbeclassifiedasa“simplifiedarbitration.”Theprocedureforprocessingasimplifiedarbitrationisasfollows:

00 Onearbitratordecidesasimplifiedarbitration.

00 Thecasewillbedecidedexclusivelyonthefileddocuments(withoutahearing)unlessthecustomerinacustomercaseortheclaimantinanindustrycaserequestsoragreestoahearing.

Ifthetotalamountincontroversyis more than $50,000 and up to $100,000,exclusiveofinterestandexpenses,onearbitratorwillbeselectedtodecidethecaseunlessbothpartiesagreeinwritingtoapanelofthreearbitrators.

Ifthetotalamountincontroversyismore than $100,000 or an unspecified or non-monetaryamount,apanelofthreearbitratorswillbeselectedtodecidethecase.

2. Arbitration List Selection

QUESTION: Can parties in an investor case have a panel of all public arbitrators decide the case?

FINRAwillappointasinglepublicarbitratorincustomercasesdecidedbyonearbitrator.

Incustomercasesdecidedbythreearbitrators,FINRARule12403allowsanypartytoselectanallpublicpanelofarbitrators.EffectiveforallarbitratorlistsFINRAsendstopartiesonorafterJanuary3,2017,FINRAwillsendthepartiesthreelists–onewith10chair-qualifiedpublicarbitrators,onewith15publicarbitrators,andonewith10non-publicarbitrators.Eachseparatelyrepresentedpartymaystrikeuptofourofthe10arbitratorsonthechair-qualifiedpubliclistforanyreasonbycrossingthroughthenamesofthearbitrators(atleastsixnamesmustremainonthechair-qualifiedpubliclist).Eachseparatelyrepresentedpartymaystrikeuptosixofthe15arbitratorsonthepubliclistforanyreasonbycrossingthroughthenamesofthearbitrators(atleastninenamesmustremainonthepubliclist).Bystrikingallofthearbitratorsonthenon-publiclist,anypartycanensurethatthepanelwillhavethreepublicarbitrators.FINRAwillnotappointanon-publicarbitratortothepanelwhohasnotbeenselectedbytheparties.

https://ews.finra.org/auth/ews_logon.jsp?CTAuthMode=BASIC&login_form_location_basic&aa_param=user

http://www.finra.org/arbitration-and-mediation/dispute-resolution-portal-user-guides

http://www.finra.org/arbitration-and-mediation/dispute-resolution-portal-user-guides

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4 Seeremarksatfootnote1.

QUESTION: As a party in an intra-industry case, which arbitrators will decide my case?

Partiesinintra-industrycasesshouldrefertotheCode of Arbitration Procedure for Industry Disputesforinformationonarbitratorlistselection.

3. Submission Agreement

AnoriginalSubmissionAgreementalsomustaccompanyyourStatementofClaim(seep.23).TheSubmissionAgreementisadocumentthatsignifiesthatyouelecttosubmitaclaimtoFINRAandtoabidebytheselectedarbitrator(s)’decisionontheinitialclaimandonanyotherrelatedclaimthatotherpartiesserveandfile.Therefore,partiesshouldnotalterthelanguageoftheSubmissionAgreement.

OnceyousignandfileaSubmissionAgreementwithFINRA,theproceduresandtimingsetoutintheCodes becomeoperativeandbinding.ASubmissionAgreementforclaimantsisincludedinthisguide.Youmaycopytheformasneeded.

Thearbitrationprocesswillbeginonlywhenallclaimantsortheirproperlyauthorizedrepresentativessign,dateandfiletheSubmissionAgreements.

BysigningtheSubmissionAgreement,youarestatingthatyouareoneofthefollowing:(1)theclaimant;or(2)apersonwithlegalauthoritytobindtheclaimant;or(3)apersonwithfirsthandknowledgeofthefactsandactualorimpliedauthoritytoactonbehalfoftheclaimant;or(4)anattorneywhohasactualorimpliedwrittenorverbalpowerofattorneyfromtheclaimanttosignontheclaimant’sbehalf,andthus,bindtheclaimanttothetermsoftheSubmissionAgreement,asiftheclaimantpersonallysignedtheform.

Youmustcompletethe“Claimant”and“Respondent”portionsonthefrontofaSubmissionAgreement.Intheblankspacesprovidedfortheclaimants’names,youshouldwriteortypethenameofeachclaimantfilingtheStatementofClaim.Publiccustomerclaimantsshouldlistthemselvesthesamewaytheaccountwaslistedwiththebroker-dealer.Forexample,

(1) ifyouraccountwasajointaccountlistedas“TomSmithandMarySmith,JTWROS,”itshouldbewrittenortypedinthismannerundertheclaimantheading.

(2) ifyouhadtwoaccounts,apersonalandanIRA,theyshouldbewrittenortypedas“JohnSmithandJohnSmith,IRA.”

00 ClaimantsmustcompletetherespondentportionoftheSubmissionAgreement.Intheblankspacesprovidedfortherespondents’names,youshouldwriteortypethenameofeachrespondentyoubelieveisliable.

00 Therespondent(s)listedontheSubmissionAgreementmustbeidenticalwiththoseappearinginyourStatementofClaim.Iftheyarenotidentical,youwilldelaytheprocessingofyourclaim.

00 Donotlist“JohnDoe”respondentsintherespondentportionoftheSubmissionAgreement.FINRADisputeResolutionwillnotserveunidentifiedrespondents.Ifyoulist“JohnDoe”respondents,youwilldelaytheprocessingofyourclaim.PleasereviewtheAmendmentstoPleadingssectiononpage10.

4. Respondents – Active Firms

Inacustomercase,therespondentshouldbeeitherafirmand/orsomeoneassociatedwithafirm.4TodeterminewhethertherespondentsyouarenamingareFINRAfirmsorassociatedpersons,youmayconsulttheFINRA’sBrokerCheckprogramontheWebatwww.finra.org/BrokerCheck,orcalltheBrokerCheckHotlineat(800)289-9999MondaythroughFridayfrom8a.m.to8p.m.EasternTime.

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5. Respondents – Terminated Firms

UnderRule12202ofthe Customer Code,aFINRAfirmwhosemembershipisterminated,suspended,canceledorrevoked,orthathasbeenexpelledfromFINRAorarelatedexchange,orthatisotherwisedefunctisprohibitedfromenforcingpredisputearbitrationagreementswithitscustomerstoarbitrateatFINRAunlessthecustomersagreeinwritingtodosoaftertheclaimhasarisen.Ifthecustomerchoosesnottoproceedwiththeclaiminthisforum,andhasnotagreedtoarbitratetheclaiminanotherforum,heorshemaybeabletobringthisclaimincourt.

FINRAwillassumethatthecustomerwantstoproceedwiththeclaiminthisforum,baseduponthesignedSubmissionAgreement.However,FINRAwillnotifythecustomerifthefirm’smembershipstatusisinactiveandofitsintenttoservetheclaim,unlesstheclaimantsubmitswrittennoticewithin30calendardaysthatheorshedoesnotwanttoarbitratetheclaiminthisforum.

Theaboveruledoesnotaffectcustomerclaimsinvolvingafirmthathasbeenacquiredbyanotherfirmthatassumesitsliabilities.Also,itdoesnotaffectclaimsinvolvinganassociatedpersonwhoseregistrationhasbeenbarred,terminated,revokedorsuspended.

Ifthecustomerdecidestoproceedwiththeclaiminthisforum,heorsheshouldbeawarethatarbitrationawardsagainstafirmwhosemembershipstatusisterminated,suspended,canceled,revoked,expelledorotherwisedefunct,haveamuchhigherincidenceofnon-paymentthanthoseagainstactivefirms.TheclaimantshouldalsobeawarethatFINRAhasonlylimiteddisciplinaryauthorityoverinactivefirmsthatfailtosatisfyarbitrationawards.

Tosavetime,beforefilinganarbitrationclaimyou:

00 MayreviewtheFINRAPublicDisclosureProgramtodeterminethefirm’sFINRAmembershipstatus.(CustomersmayaccessFINRA’sBrokerCheckprogramontheWebatwww.finra.org/BrokerCheck,orcalltheBrokerCheckHotlineat(800)289-9999MondaythroughFridayfrom8a.m.to8p.m.EasternTime.)Customersmayalsoreviewthefirm’smembershipstatusattheappropriateexchange.

00 Shoulddeterminewhetheryouwishtoproceedinarbitrationagainstaformerfirmorgotocourt.

Ifyoudeterminethatyouwishtoproceedinarbitration,adviseFINRA,inwriting,thatyouwanttoproceedagainstthefirmwhosemembershipstatuswasterminated,suspended,canceled,revoked,expelledorotherwisedefunct.Failuretoprovidethiswrittenstatementwithyourclaimwilldelaytheprocessingofyourarbitrationcase.

6. Fees

YoumustpayafilingfeeatthetimeyoufileyourStatementofClaim.Theamountofthisfeeisbasedonthetotalamountofyourclaimincludinganypunitiveandtrebledamagesbutexcludinginterestandexpenses.Onecheckforthefilingfeemustbemadepayableto“FINRADisputeResolution.”UsePartsIIIandIVoftheClaimInformationSheettodeterminethecorrectfee.

FINRAwillprocessyourclaimonlyifthecorrectfilingfeeissubmitted.However,youcanobtainatemporarywaiverofthefilingfeeifyoucandemonstrateafinancialhardship.

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QUESTION: How does FINRA credit a filing fee paid by one claimant, by claimants’ representative or by a non-party, in cases with multiple claimants?

00 Ifaclaimincludesmultipleclaimants,theclaimantscollectivelyoweasinglefilingfee.FINRAwillacceptacheckfromanyoftheclaimants,fromthepartyrepresentativeorfromanon-partyonbehalfoftheclaimants.

00 Ifoneclaimantpaysthefilingfee,FINRAwillcreditthepayingclaimanttheamountofthecheck.

00 Ifclaimants’representative,oranon-party,paysthefilingfeeonbehalfoftheclaimants,FINRAwillcredittheamountofthechecktothefirstnamedclaimantintheStatementofClaim.

00 Theseproceduresalsoapplytocounterclaims,crossclaimsandthirdpartyclaimsfiledonbehalfofmultiplerespondents.

QUESTION: How does FINRA use the filing fee paid by one claimant or by claimants’ representative, in cases with multiple claimants?

00 Attheconclusionofthecase,FINRAwillusethefilingfeechecktopayfeesowedbyanyclaimant.

00 FINRAwillevenlydistributethefundstopayeachclaimant’sfees.Ifanyfundsremainforanyoftheclaimants,FINRAwillusethosefundstopaythebalanceoffeesowedbyanyotherclaimants.

00 Theseproceduresalsoapplytocounterclaims,crossclaimsandthird-partyclaimsfiledonbehalfofmultiplerespondents.

QUESTION: How do I request a waiver of the filing fee?

00 Makeawrittenrequestforthewaiverstatingthereason(s)thatwouldmakepaymentofthefilingfeeafinancialhardship.

00 Includewiththewrittenrequestforwaiverthefollowinginsupportoftherequest:acopyofyourmostrecentlyfiledtaxreturn;twoofyourmostrecentpaystubs;anddocumentationofgarnishmentorlien,orotherdocumentsthatevidencehardship.

00 Ifyouareunabletoprovidethisdocumentationinsupportoffinancialhardship,submitanaffidavitattestingtoyourfinancialhardship.

00 Thestaffpersonassignedtoyourcasewillinformyouinwritingofthedecisiontograntordenyyourrequestforawaiveroffees.Intheeventyourrequestisgranted,rememberthewaiveristemporaryinnature.Theselectedarbitrator(s)willmakeafinaldecisionontheassessmentofthesefeesafterconsideringanumberoffactors,includingthedocumentationyousuppliedinsupportofthewaiverrequest.

00 Beawarethatforumfeesaccrueforeachprehearingconferenceandforeachhearingsessionconducted.Ahearingsessionisanymeetingwiththearbitrator(s)thatlastsfourhoursorless.

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PART TWO: Filing Statements of Answer

7. Claim Information Sheet

TheClaimInformationSheet(InformationSheet)(seep.14)isasynopsisoftheinformationcontainedinyourStatementofClaim.FINRArequeststhatyouvoluntarilycompleteandfilewiththeNewYorkDisputeResolutionOfficeallpartsoftheInformationSheetinthispacketbecauseitwillhelptheassignedstafftoquicklyaccessthefactsofyourcase.The Information Sheet is not a substitute for a Statement of Claim.

QUESTION: How do you file your Statement of Claim?

FileyourStatementofClaimwithFINRA’sNewYorkOffice(theaddressisonthecoverofthisguide).Assembleyourdocumentsinthefollowingorder:

1. Checkormoneyorder(DONOTSENDCASH)

2. SubmissionAgreement(s)(withadditionalcopies)

3. ClaimInformationSheet

4. StatementofClaimandExhibits

Uponreceiptofyourfiling,yourcasewillbeassignedtotheappropriateregionalofficeandyouwillbeprovidedwithacasenumber.

FINRAwillnotifyyouofthestaffpersonassignedtoyourcaseduringthisstageoftheprocess.Youmaydirectanyquestionstothatstaffperson.Alwaysreferenceyourcasenumberwhenyouwriteorcallaboutyourcasetoenablethatstaffmembertoassistyouquickly.

QUESTION: Who will serve the Statement of Claim?

FINRAwillserveyourStatementofClaimoneachoftherespondentsthatyoulistandagainstwhomyouassertaclaim.FINRAalsowillnotifytherespondentsandyouoftheanticipatedinitialhearinglocationofthecase.

AftertheinitialStatementofClaimisserved,FINRAisnotobligatedtoserveanypleadings,motionsorcorrespondenceonanyparty.YouandtheotherpartiesmustserveandfiletheseotherdocumentsasdescribedinPartsTwo,ThreeandFourofthisguide.

Ifyouarearespondent,theentityorpersonrespondingtoaclaim,theCodesallowyou45calendardaystoserveandfileanswerstoclaims.

Youranswermustspecifyalldefensesavailabletoeachclaim.

QUESTION: How do you serve and file a Statement of Answer?

Incontrasttotheinitialclaim,whenyouansweraclaimyoumustserveeverypartywithcopiesofyourexecutedSubmissionAgreementandanswer.Partiesincludeallrespondentsandclaimants.

Atthesametime,youmustfileanoriginalexecutedSubmissionAgreementandanswerwiththeFINRADisputeResolutionofficedesignatedintheserviceofclaimletter.

Youshouldestablishproofofservice.Proofofserviceisasignedstatementindicatingthedate,timeandmannerofservice.

QUESTION: Can you obtain an extension of time to serve and file your answer?

Withclaimants’writtenconsent,youmayobtainextensionsoftimetoanswer.

FINRAstaffwillnotgrantyouanextensionoftimetoanswer,exceptuponashowingofgoodcause.

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Withyouranswer,youalsomayserveandfileclaims.Thetypesofclaimsincludethefollowing:

1. counterclaimsthatareassertedagainstclaimants;

2. cross-claims thatareassertedagainstalreadynamedco-respondents;and

3. third-party claimsthatareassertedagainstapartynotnamedinanypreviouspleading.

Ifyouassertcounterclaims,cross-claimsorthird-partyclaims,thefilingfeewillbedeterminedbythehighestclaimamount,excludinginterestandexpenses.Todeterminethecorrectfee,seePartsIIIandIVoftheClaimInformationSheet.Acheckforthefeemustbemadepayableto“FINRADisputeResolution.”

QUESTION: How do you serve and file counterclaims and cross-claims?

Youmustserveeverypartyyoulistandagainstwhomyouassertaclaimwithacopyofyouranswercontainingacounterclaimorcross-claim,andyoushouldestablishproofofservice.

Youalsomustsendonecopyoftheanswercontainingyourclaim(s)andtheexecutedSubmissionAgreementtoallotherpartiesfortheirinformationandreview.

Atthesametime,youmustalsosendacopyoftheanswercontainingyourclaim(s)andtheexecutedSubmissionAgreementtotheregionalofficeadministeringyourclaim.

PART THREE: Filing Other Claim(s)

QUESTION: How do you serve and file third-party claims?

Youmustserveeverynewpartyyoulistandagainstwhomyouassertaclaimwithacopyofyouranswercontainingthird-partyclaim(s),andyoushouldestablishproofofservice.

Youalsomustservethenewrespondentwith:

00 theStatementofClaimandallotherpleadings;and

00 acopyofthisguide.

Youmustsendonecopyoftheanswercontainingyourthird-partyclaim(s)andtheexecutedSubmissionAgreementtoallotherparties.

Atthesametime,youmustalsosendacopyoftheanswercontainingyourclaim(s)andtheexecutedSubmissionAgreementtotheregionalofficeadministeringyourclaim.

1. Amendments to Pleadings

YoumustservedirectlyonallpartiesamendmentstoStatementsofClaimandStatementsofAnswer.IfyoureceiveanamendmentyoumustreviewRule12310oftheCustomer CodeorRule13310oftheIndustry Codetodetermineyourtimetofilearesponsetotheamendment.Ifyouamendyouranswertoincludeacounterclaim,cross-claimorthird-partyclaim,youmustserveitinaccordancewiththeinstructionscontainedinPartsTwoandThreeofthisguide.

Atthesametime,youmustfileacopyofthe

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amendmentwiththedesignatedFINRADisputeResolutionoffice.

IfyouamendaninitialStatementofClaimorifyouamendaStatementofAnswertoaddanewrespondent,youmustservethenewrespondentwith:

00 theamendment;

00 theStatementofClaimandallotherpleadings;and

00 acopyofthisguide.

Ifyouareanewrespondent,youhave45calendardaystoserveandfileananswerandanyrelatedclaiminaccordancewiththeinstructionscontainedinPartsTwoandThreeofthisguide.

Ifyoureceiveanamendedanswercontainingacross-claim,youhave20calendardaysfromthedateyouranswerisdue,orfromreceiptofthecross-claim(whicheverislater)toserveandfileananswerandanyrelatedclaiminaccordancewiththeinstructionscontainedinPartsTwoandThreeofthisguide.

Onceapanelhasbeenappointed,apartymayonlyamendapleadingifthepanelgrantsamotiontoamend.OncetherankedarbitratorlistsareduetotheDirector,nopartymayamendapleadingtoaddanewpartyuntilapanelhasbeenappointedandthepanelgrantsamotiontoaddtheparty.

PART FOUR: General Information

2. Hearing Locations

Afterallpleadings(claims,answers,counterclaims,replies,cross-claimsandthird-partyclaims)areservedandfiled,FINRAwillnotifyyouandtheotherpartiesinwritingofitsfinaldecisionontheinitialhearinglocation.

FINRAconductshearingsinatleastonecityineverystate,aswellasinLondon,EnglandandSanJuan,PuertoRico.

National Hearing Locations

Alabama:Birmingham

Alaska: Anchorage

Arizona:Phoenix

Arkansas:Little Rock

California: Los Angeles, San Diego, San Francisco

Colorado: Denver

Connecticut: Hartford

Delaware: Wilmington

Florida:Boca Raton, Jacksonville, Miami, Orlando, Tampa

Georgia:Atlanta

Hawaii:Honolulu

Idaho:Boise

Illinois:Chicago

Indiana: Indianapolis

Iowa:Des Moines

Kansas: Wichita

Kentucky: Louisville

Louisiana: New Orleans

Maine: Augusta

Maryland: Baltimore

Massachusetts: Boston

Michigan: Detroit

Minnesota: Minneapolis

Mississippi: Jackson

Missouri: Kansas City, St. Louis

Montana: Helena

Nebraska: Omaha

Nevada: Las Vegas, Reno

NewHampshire: Manchester

NewJersey: Newark

NewMexico: Albuquerque

NewYork: Albany, Buffalo, New York, Syracuse

NorthCarolina: Charlotte, Raleigh

NorthDakota: Bismarck

Ohio: Cincinnati, Cleveland, Columbus

Oklahoma: Oklahoma City

Oregon: Portland

Pennsylvania: Philadelphia, Pittsburgh

RhodeIsland: Providence

SouthCarolina: Columbia

SouthDakota: Rapid City

Tennessee: Memphis, Nashville

Texas: Dallas, Houston

Utah: Salt Lake City

Vermont: Montpelier

Virginia: Norfolk, Richmond

Washington,DC

Washington: Seattle

WestVirginia: Charleston

Wisconsin: Milwaukee

Wyoming: Cheyenne

England:London PuertoRico: San Juan

International Hearing Locations

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5 “Withoutprejudice”meanswithoutinterferingwithanyexistingrightyoumayhavetorefilethisclaimatthisoranotherforum.

Hearing Location

InaccordancewithRule12213oftheCustomer Codeifanarbitrationdisputeinvolvesapublic customer,FINRAwillgenerallyselectthehearinglocationclosesttothecustomer’sresidenceatthetimethedisputearose,unlessthecustomerrequestsinhis/herinitialfilingahearinglocationinthecustomer’sstateofresidenceatthetimethedisputearose.

Forexample,ifaKansasresidentlivesonlyfivemilesfromKansasCity,Missouri(anddidsoatthetimethedisputearose),butspecifiesWichita,Kansasashisrequestedhearinglocation—alocationmorethanfivemilesfromhisresidence—FINRAwouldselectWichitaasthehearinglocation.

InaccordancewithRule13213oftheIndustry Code,ifanarbitrationinvolvesanemployment disputebetweenafirmandanassociatedperson,FINRAgenerallywillselectthehearinglocationthatisclosesttothelocationwheretheassociatedpersonwasemployedatthetimethedisputearose,unlesstheassociatedpersonrequestsinhis/herinitialfilingahearinglocationintheassociatedperson’sstateofemploymentatthetimethedisputearose.

PerRule13213,inindustrydisputesinvolvingFINRAfirmsonly,unlessthefirmsarelocatedinthesamecity,FINRAwillconsideranumberoffactorswhendecidingthehearinglocation.Theseincludethefollowing:

00 signedagreementstoarbitrate;

00 whoinitiatedthetransactionsorbusinessatissue;and

00 locationofessentialwitnessesanddocuments.

Ifallpartiesinanyarbitrationagreetoahearinglocation,FINRAordinarilywillselectthathearinglocation.

3. Correspondence with Parties and FINRA

YoumustserveallpartiesandfilewithFINRAanycorrespondencesenttoparties—inadditiontopleadingsandamendments.

4. Settlement of a Claim

Claimant(s)mustwritedirectlytotheassignedstaffifanyclaimsettles.FINRAwillnotclosethecasewithoutreceivingwrittennoticefromtheclaimant.FailuretoadviseFINRAtimelyofasettlementofaclaimmayaffectclaimant’sentitlementtoareturnoftherefundableportionofthefilingfee.

5. Withdrawal of a Claim

Rule12702oftheCustomer Code andRule13702oftheIndustry Code provideforwithdrawalofaclaim:

00 Ifyouwishtowithdrawyourclaimaftertheclaimhasbeenservedandfiled,butbeforetherespondenthasservedandfiledtheanswer,youmaywithdrawtheclaimwithoutprejudice5byinformingtherespondentinwritingandcopyingthedesignatedFINRADisputeResolutionofficeandallotherparties.

00 Ifyouwishtowithdrawyourclaimaftertheclaimhasbeenservedandfiled,andaftertheanswerhasbeenservedandfiled,bytherespondent,youmaynotwithdrawtheclaimwithoutprejudice,unlesstherespondentagreestoawithdrawalwithoutprejudiceorwiththearbitrator(s)’consent.

13

6. Payment of Fees

Anytimeafeeisassessedtoyouduringthecase,youwillreceiveaninvoicethatreflectsthefeeassessed.Attheconclusionofthecase,youwillreceiveaStatementofAccountthatreflectsthefeesassessedandanyoutstandingbalanceorrefunddue.FeesaredueandpayabletoFINRADisputeResolutionuponreceiptofaninvoiceandshouldberemittedtotheaddressspecifiedontheinvoice.

Allquestionsregardingassessmentoffeesshouldbedirectedtotheregionalofficeadministeringyourcase.AllquestionsregardingpaymentoffeesandrefundsshouldbedirectedtoFINRAFinanceat(240)386-5910.

7. Representation of Parties

Rule12208oftheCustomer CodeandRule13208oftheIndustry Codepermitpartiestoanarbitrationormediationtorepresentthemselvesortoberepresentedbyanattorneyadmittedtopracticeandingoodstandinginanyjurisdiction,unlessstatelawprohibitssuchrepresentation.Inaddition,anon-attorneymayrepresentparties,unlessstatelawprohibitssuchrepresentation,thepersoniscurrentlysuspendedorbarredfromthesecuritiesindustryinanycapacity,orthepersoniscurrentlysuspendedfromthepracticeoflawordisbarred.

FINRAmaintainsalistoflawschoolsecuritiesarbitrationclinics,whichproviderepresentationtoinvestorsatreducedornocost.Forhelpfindinganattorneyoralawschoolsecuritiesarbitrationclinic,pleasevisitourwebsiteathttp://www.finra.org/arbitrationandmediation/finradisputeresolution/optionsforinvestors/findanattorney/.

14

If needed, copy this page to list additional claimants.

CLAIM INFORMATION SHEET

I. PARTIES

CLAIMANT(S):(Providethisinformationevenifyouarerepresentedbycounsel.)

Name

Address

City State ZipCode

DaytimeTelephone Fax# EmailAddress

Residenceduringthetimeofthedispute(ifdifferentfromabove):

Name

Address

City State ZipCode

Claimantisa:Publiccustomer Broker-dealer Personassociatedwithabroker-dealer

Ifyouchecked“Broker-dealer”or“Personassociatedwithabroker-dealer,”itisimportantthatyouprovidethecorrectBD/CRDnumber.TodeterminewhetherapartyisaFINRAfirmorassociatedperson,youmayconsultFINRA’sBrokerCheckprogramontheWebatwww.finra.org/BrokerCheck.

BD# CRD#

Claimant’s Counsel/Representative (if applicable):(Note:FINRArequiresthatpersonsrepresentingFloridainvestorsinarbitrationproceedingsconductedinoroutsideoftheStateofFloridaaffirmeitherthattheyarelicensedtopracticelawandprovideabaridentificationnumber,orthattheyarenotreceivingcompensationinconnectionwithrepresentingthepartyinthearbitrationproceeding.)

Name BarID#(ifapplicable)

Address

City State ZipCode

BusinessTelephone Fax# EmailAddress

15


RESPONDENT(S)

Respondent #1:

Name

Address(ifknown)

City State ZipCode

BusinessTelephone Fax EmailAddress

Respondent#1isa:Publiccustomer Broker-dealer Personassociatedwithabroker-dealer


BD# CRD#

Respondent #2:

Name

Address(ifknown)

City State ZipCode

BusinessTelephone Fax# EmailAddress

Respondent#2isa:Publiccustomer Broker-dealer Personassociatedwithabroker-dealer


BD# CRD#

If needed, copy this page to list additional respondents.

16


II. CLAIMS

Accounts:Ifthedisputeorclaiminvolvesactivitywithrespecttoanaccountoraccounts,pleaselisteachaccountandindicatethetypeofaccountitis(e.g.,jointaccount,custodialaccount,etc.)

1.

Name(exactlyasitappearsontheaccount) TypeofAccount

NameofFirmandBranchOffice DateAccountOpened

NameofRegisteredRepresentative

2.




3.




If needed, copy this page to list additional accounts.

17


Type of Dispute: (Check where applicable)

a. Account Related

BreachofContract Exchanges Transfer

Collection FailuretoSupervise Other

Dividends MarginCalls

Errors/Charges Negligence

b. Executions

ExecutionPrice IncorrectQuantity Other

FailuretoExecute LimitVersusMarketOrder

c. Account Activity

BreachofFiduciaryDuty Manipulations Suitability

Churning Misrepresentations UnauthorizedTrading

Fraud OmissionofFacts Other

d. Employment

BreachofContract DiscriminationNationalOrigin Partnerships

Commissions DiscriminationRace PromissoryNotes

Compensation DiscriminationReligion SexualHarassment

DiscriminationAge DiscriminationSexualPreference TrainingContracts

DiscriminationDisability LibelorSlander WrongfulTermination

DiscriminationGender LibelorSlanderonFormU-5 Other

e. Trading Dispute

Buy-In Markups Transfers

D.K.s SellOuts Other

Manipulation StockLoan

f. Other

ClearingDispute Indemnification Underwriting

Defamation RaidingDisputes

18

Annuities

VariableAnnuities

Auction-RateSecurities

CertificatesofDeposit

CollateralizedDebtObligations(CDOs)

CollateralizedMortgageObligations(CMOs)

Commodities(OtherthanFutures)

CommonStock

CorporateBonds

Exchange-TradedFunds

“FannieMaes”

“FreddieMacs”

Futures

“GinnieMaes”

GovernmentSecurities

HedgeFunds

LimitedPartnerships

MunicipalBonds

MunicipalBondFunds

MutualFunds

Options

PreferredStock

PrivateEquities

RealEstateInvestmentTrust

RepurchaseAgreements

ReverseConvertibles

ReverseRepurchaseAgreements

StockIndexFutures

StructuredProducts

Warrants/Rights

g. Type of Security(ies), Financial Instrument(s), and/or Investment(s) involved in the Dispute:

Other:

19


III. RELIEF REQUESTED

1. Damages

ActualDamages Requested $ 1.(monetarysumrequiredtocompensateapartyfor

hisorherlossexcludinginterestsandexpenses)

PunitiveDamages Requested 2.(monetaryamountintendedtopunishthewrongdoer)

* AMOUNTINDISPUTE: 3.

* UsethisamounttocalculatethecorrectfilingfeeandhearingsessiondepositinPartIV.Thisamountmustmatchtheamountstatedinyourclaim.

Interest(includecalculations,ifpossible)

2. Other Type of Relief RequestedSpecificPerformance(Specifythetypeofspecificperformancesought)(specificperformancerequirespartiestotakeanaction,suchasturningoverownershipofstocks)

InjunctiveRelief(Specifythetypeofinjunctivereliefsought)(injunctionsrequirepartiestorefrainfromcertainactions)

3. Costs

(Providespecificamounts,ifknown.Ifnotknown,pleasemarkan“X”toindicatethecostsyouarerequesting)

ForumFees WitnessandProductionFees

Attorney’sFees OtherCase-RelatedCosts

4. Claims Requesting Expungement

AsofJanuary1,2016,FINRAwillaskpartiesrequestingexpungementto:(1)ProvideFINRAwiththeCRDoccurrencenumber(s)whichisthesubjectoftheexpungementrequest;(2)Providethecasenameanddocketnumberthatgaverisetothedisclosure,ifapplicable;(3)StatewhethertheyhavepreviouslyrequestedexpungementofthesamedisclosureinCRD,andifso,explaintheoutcomeofthatrequest;and(4)StatewhethertheyarecurrentlyorpreviouslyregisteredinCRDandprovidetheirCRDnumber.

PartiesshouldincludeallsubjectCRDoccurrencenumbersonthefirstpageoftheirexpungementrequest.Providingthisinformationwillensuretheaccurateandtimelyprocessingofallexpungementrequests.

Failing to provide this information may unnecessarily delay the proceedings.

IndividualswithCRDnumberscaninstantaneouslyaccesstheirregistrationandlicensinginformationbyrequestinganIndividualSnapshotReportat:Individual Snapshot Report.

http://www.finra.org/industry/web-crd/snapshot-reports#

20


Customer or Associated Person Claimant

IV. FEES

TO DETERMINE THE CORRECT FEE, USE THE “AMOUNT IN DISPUTE” FIGURE ON LINE 3, PAGE 19.

IfyouareaCUSTOMER OR ASSOCIATED PERSON CLAIMANTusethistable(Rule12900ofthe Customer CodeorRule13900oftheIndustry Code)todeterminethefilingfeethatMUSTaccompanyaStatementofClaimwhenitisfiledwithFINRA.IfyourclaimdoesNOTdiscloseorspecifyamonetaryclaim,thefilingfeeis$1,575.

Findtheamountofyourdisputeonthechart,thenfindtheapplicableclaimfilingfee.

Filing Fees for Claims Filed by Customers, Associated Persons and Other Non-Members

Amount of Claim (exclusiveofinterestandexpenses) Filing Fee

$.01to$1,000 $50

$1,000.01to$2,500 $75

$2,500.01to$5,000 $175

$5,000.01to$10,000 $325

$10,000.01to$25,000 $425

$25,000.01to$50,000 $600

$50,000.01to$100,000 $975

$100,000.01to$500,000 $1,425

$500,000.01to$1,000,000 $1,725

$1,000,000.01to$5,000,000 $2,000

Over$5,000,000 $2,250

Non-Monetary/NotSpecified $1,575

Onceyouhavedeterminedthecorrectfilingfee,submititwithyourStatementofClaim.Forexample,ifyouareacustomerorassociated personclaimantandtheamountofyourclaimis$40,000,theclaimfilingfeeis$600.MailthecheckwithyourStatementofClaim,ClaimInformationSheetandproperlyexecutedSubmissionAgreement.

21


Firm Claimant

TO DETERMINE THE CORRECT FEE, USE THE “AMOUNT IN DISPUTE” FIGURE ON LINE 3, PAGE 19.

IfyouareaFIRM CLAIMANTusethistable(Rule12900ofthe Customer CodeorRule13900oftheIndustry Code)todeterminethefilingfeethatMUSTaccompanyaStatementofClaimwhenitisfiledwithFINRA.IfyourclaimdoesNOTdiscloseorspecifyamonetaryclaim,thefilingfeeis$1,700.

Findtheamountofyourdisputeonthechart,thenfindtheapplicableclaimfilingfee.

Member Claimant

Amount of Claim (exclusiveofinterestandexpenses) Filing Fee

$.01to$1,000 $225

$1,000.01to$2,500 $350

$2,500.01to$5,000 $525

$5,000.01to$10,000 $750

$10,000.01to$25,000 $1,050

$25,000.01to$50,000 $1,450

$50,000.01to$100,000 $1,750

$100,000.01to$500,000 $2,125

$500,000.01to$1,000,000 $2,550

$1,000,000.01to$5,000,000 $3,400

Over$5,000,000 $4,000


Onceyouhavedeterminedthecorrectfilingfee,youshouldcalculatetheappropriatemembersurchargeoutlinedonpage22andsubmitthetotalwithyourStatementofClaim.Forexample,ifyouareafirmclaimantandtheamountofyourclaimis$40,000,theclaimfilingfeeis$1,450,andthemembersurchargeis$750.Therefore,youshouldsendonecheckpayable to FINRA Dispute Resolutionintheamountof$2,200.MailthecheckwithyourStatementofClaim,ClaimInformationSheetandproperlyexecutedSubmissionAgreement.

22


Member Surcharge & Process Fees

Rules12901and12903oftheCustomer Code,andRules13901and13903oftheIndustry Coderequirefirmstopayanon-refundablesurchargeandnon-refundableprocessfeesifthefirmorpersonassociatedwiththefirmisaclaimantorrespondentinanarbitrationatthisforum.FINRAwillsendinvoicesforprocessfeestofirmsatappropriatestagesofthearbitrationprocess.

TO DETERMINE THE CORRECT SURCHARGE, USE THE “AMOUNT IN DISPUTE” FIGURE ON LINE 3, PAGE 19.

IfyouareaFIRMCLAIMANT,usethistable(Rules12901or13901)todeterminetheappropriatemembersurchargethatMUSTaccompanyyourStatementofClaimwhenitisfiledwithFINRA.IfyourclaimdoesNOTdiscloseorspecifyamonetaryclaim,thenon-refundablesurchargeis$1,900.

Member Surcharge

Amount in Dispute (exclusive of interest and expenses) Surcharge

Upto$2,500 $150

$2,500.01–$5,000 $150

$5,000.01–$10,000 $325

$10,000.01–$25,000 $450

$25,000.01–$30,000 $750

$30,000.01–$50,000 $750

$50,000.01–$100,000 $1,100

$100,000.01–$250,000 $1,700

$250,000.01–$500,000 $1,900

$500,000.01–$1,000,000 $2,475

$1,000,000.01–$5,000,000 $3,025

$5,000,000.01–$10,000,000 $3,600

Over$10,000,000 $4,025


V. HEARING INFORMATION

Forclaimsof$50,000orlessunderRules12800(simplifiedcustomer/investor)and13800(simplifiedindustry):(check one)

Iamrequestingahearinginthismatter Iamnotrequestingahearinginthismatter

23

FINRA ARBITRATION Submission Agreement

Claimant(s)

In the Matter of the Arbitration Between

Name(s)ofClaimant(s)

and

Name(s)ofRespondent(s)

1. Theundersignedparties(“parties”)herebysubmitthepresentmatterincontroversy,assetforthintheattachedstatementof

claim,answers,andallrelatedcrossclaims,counterclaimsand/orthird-partyclaimswhichmaybeasserted,toarbitrationin

accordancewiththeFINRABy-Laws,Rules,andCode of Arbitration Procedure.

2. Thepartiesherebystatethattheyortheirrepresentative(s)havereadtheproceduresandrulesofFINRArelatingtoarbitration,

andthepartiesagreetobeboundbytheseproceduresandrules.

3. Thepartiesagreethatintheeventahearingisnecessary,suchhearingshallbeheldatatimeandplaceasmaybedesignated

bytheDirectorofArbitrationorthearbitrator(s).Thepartiesfurtheragreeandunderstandthatthearbitrationwillbe

conductedinaccordancewiththeFINRACode of Arbitration Procedure.

4. Thepartiesagreetoabidebyandperformanyaward(s)renderedpursuanttothisSubmissionAgreement.Thepartiesfurther

agreethatajudgmentandanyinterestduethereon,maybeentereduponsuchaward(s)and,forthesepurposes,theparties

herebyvoluntarilyconsenttosubmittothejurisdictionofanycourtofcompetentjurisdictionwhichmayproperlyentersuch

judgment.

5. ThepartiesheretohavesignedandacknowledgedtheforegoingSubmissionAgreement.

ClaimantName(pleaseprint)

Claimant’sSignature DateStatecapacityifotherthanindividual(e.g.,executor,trusteeorcorporateofficer)

ClaimantName(pleaseprint)

Claimant’sSignature DateStatecapacityifotherthanindividual(e.g.,executor,trusteeorcorporateofficer)

If needed, copy this page.

FINRA www.finra.orgOne Liberty Plaza © 2016 FINRA. All rights reserved. 165 Broadway FINRA and other trademarks of theNew York, NY 10006 Financial Industry Regulatory Authority, Inc. may not be used without permission. 16_0442.1–1/17

Investor protection. Market integrity.

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