Commission and Fee Schedules

Transcription

1 Vanguard Brokerage Services Commission and Fee Schedules As of April 12, 2006 Standard charges apply to clients with up to $250,000 in total Vanguard assets. Discounts and other benefits are available to clients who qualify and are enrolled in Vanguard Voyager Service (for clients with total Vanguard assets of $250,000 up to $1 million) or Vanguard Flagship Service (for clients with total Vanguard assets of $1 million or more, of which $500,000 must be in Vanguard funds). Other discounts and fee waivers may be available. A separate commission is charged for each security bought or sold. This commission and fee schedule is subject to change. For further information about our commission and fee schedule as well as about membership in Voyager and Flagship Service call Vanguard Brokerage Services at any business day from 8 a.m. to 8 p.m., Eastern time. Note: We can t accept written instructions for trades.

2 Commission Schedule for Bonds and CDs Vanguard Brokerage Services may act as an agent, executing your order at cost plus a commission, or Vanguard Brokerage may act as a principal and add markups to purchase prices or subtract markdowns from sales prices. When we act as a principal for a primary market issue, Vanguard Brokerage receives a fee concession from the issuer. If a concession is not available, Vanguard Brokerage reserves the right to charge a commission. Security Type New Issues Existing Issues U.S. Treasury Associate assistance. Standard rate for auction Associate assistance. $1 per $1,000 face amount; orders: $25; Voyager: $15; Flagship: $0. $50 min., $125 max. ($40 for Flagship clients). Online. Standard rate for auction orders: $10; Online. $0.75 per $1,000 face amount; Voyager: $0; Flagship: $0. $40 min., $75 max. ($40 for Flagship clients). U.S. government agency No commission.* See table below. Mortgage-backed securities $50 per transaction; GNMA minimum purchase, $50 per transaction; GNMA minimum purchase, $25,000. $25,000. Corporate bonds No commission.* Unlisted (over-the-counter). See table below. Listed. $25 + $2 per bond. Municipal bonds $50 commission if a fee concession is not See table below. available; minimum purchase varies. Certificates of deposit No commission.* Purchase. See table below. Sale. $35 per transaction. Commercial paper $50 per transaction; minimum purchase, $100,000. NA Unit investment trusts NA Sale only. $35 per transaction. Commission per $1,000 face amount for existing issues, where applicable. $1,000 $49,000 $50 minimum ($5 per $1,000) $50,000 or more $500 maximum ($3 per $1,000) *Minimum purchase $10,000, subject to dealer minimum. Note: Bond and CD prices are available at and are price indications only. Online prices for all secondary market bonds and CDs are before commissions.

3 Commission and Fee Schedule for FundAccess Mutual Funds No-Load Fund Transaction Fees 1 No-transaction-fee Transaction fee None. (NTF) funds Minimum initial investment For most funds, $3,000 for nonretirement accounts and $1,000 for IRAs. Minimum additional investment Redemption fee Dollar-cost-averaging transactions $1,000 for any account type. $50 minimum, or 1% of proceeds up to $250, for shares held less than six months. The six-month holding period begins on the settlement day of the transaction, which is ususally the next business day or three business days after the trade date. (The redemption fee is waived for shares transferred from another brokerage firm or financial institution.) No fee; minimum purchase, $100; minimum, two transactions. Transaction-fee Transaction fee Purchase: $35 per trade regardless of order size. 3 (TF) funds 2 Sale: $35 per trade regardless of order size. 4 Exchange: $35 per trade regardless of order size. 5 Minimum initial and additional investments Dollar-cost-averaging transactions Typically based on amount listed in the fund s prospectus. $3 per transaction; minimum purchase, $100; minimum, two transactions. 1 Individual fund families may impose additional fees or charges for a specific fund or funds. Read the prospectus carefully before investing. 2 Transaction-fee fund trades can be included in the 12 commission-free trades per calendar year available to Flagship clients. No commissions will apply to the first 12 online trades in each calendar year to any combination of stocks (other than stocks priced at less than $1 a share), options, or transactionfee mutual funds. The number of trades is limited to 12 per client, as identified by the primary Social Security number on the account. Vanguard Brokerage reserves the right to terminate the 12 commission-free trades at any time for clients whose account activity can be deemed improper. 3 If you buy $10,000 of a fund, your net total cost will be $10, If you sell $10,000 of a fund, your net total proceeds will be $9, If you exchange all shares of a fund for another fund in the same fund family and share class, the $35 transaction fee will be paid from your money market settlement account. Load Fund Charges and Fees Class A shares Class B shares Class C shares Front-end load (purchase fee): Varies by fund or fund family and may be as high as 5.75%. Review the fund s prospectus carefully before investing. Discounts (breakpoints) may be available if you make a large purchase, already hold other mutual funds offered by the same fund family (individually or combined with a spouse or other qualifying person), or commit to regularly purchasing the fund s shares. Back-end load or contingent deferred sales charge (redemption fee): Decreases to zero over a period of years. Back-end load or contingent deferred sales charge (redemption fee): Smaller than a Class B redemption fee, it decreases to zero after one year. All share classes Sales charges The schedule for a specific load fund may vary, perhaps significantly, from the general description shown here. Check a fund s prospectus for the details. Fees Dollar-cost-averaging transactions Vanguard Brokerage charges no additional fee for a purchase, sale, or exchange of any load fund offered through FundAccess. Vanguard Brokerage does not charge a fee, but sales charges imposed by the fund still apply. Minimum transaction, $100; minimum, two transactions.

4 Commission Schedule for Stocks and Options Client Group Standard 1, 2 Voyager 2 Flagship Stocks Online: $25 or $0.025 per share, $22.50 or $ per First12 trades: no commission. 3 whichever is greater share, whichever is greater Subsequent trades: $8 each. AutoBroker : $40 or $0.05 per share, $36 or $0.045 per share, $30 or $ per share, whichever is greater whichever is greater whichever is greater Associate assistance: $45 + $0.05 per share $ $0.045 per share $ $ per share Stock priced less than $1 a share: Online: $20 + 2% of principal $20 + 2% of principal $20 + 2% of principal Associate assistance and AutoBroker: $30 + 3% of principal $30 + 3% of principal $30 + 3% of principal Options Online: $30 + $1.50 per contract $30 + $1.50 per contract $30 + $1.50 per contract 3 Associate assistance: $30 + $2.50 per contract $30 + $2.50 per contract $30 + $2.50 per contract A separate commission applies for opening, closing, or exercising a position. Note: Option exercise and assignment require associate assistance. Associate-assisted commission rates for stocks apply. 1 A 10% discount from standard rates for stock trades (except for stocks priced at less than $1 per share). Discounts apply to online, AutoBroker, or associate-assisted trades. The first 35 qualifying trades can be made through any combination of online, AutoBroker, or associate-assisted trades during a rolling 12-month period. Qualifying trades include stocks, options, bonds, CDs, and FundAccess funds. 2 A 25% discount from standard rates for 72 or more stock trades (except for stocks priced at less than $1 per share). Discounts apply to online, AutoBroker, or associate-assisted trades. The first 71 qualifying trades can be made through any combination of online, AutoBroker, or associate-assisted trades during a rolling 12-month period. Qualifying trades include stocks, options, bonds, CDs, and FundAccess funds. 3 No commissions will apply to the first 12 online trades in each calendar year to any combination of stocks (other than stocks priced at less than $1 a share), options, or transaction-fee mutual funds. The number of trades is limited to 12 per client, as identified by the primary Social Security number on the account. Vanguard Brokerage reserves the right to terminate the 12 commission-free trades at any time for clients whose account activity can be deemed improper. Brokerage Account Maintenance Fee and Other Fees Annual maintenance fee Foreign securities Limited partnerships (LPs) Wire transfers VIPER Shares VanguardAdvantage Miscellaneous fees Standard: $30, charged annually.voyager and Flagship: no charge. $75 for each execution (not applicable to American Depositary Receipts) plus commission. For private LPs, a $35 annual maintenance fee and, if reregistered, a $50 Vanguard Brokerage fee plus any third-party fees that we incur. For private and public LPs that are held in a brokerage IRA and earn unrelated business taxable income ($1,000 or more), a $200 tax-filing fee. Note: Private LPs are illiquid. Vanguard Brokerage can hold, but not trade, private LPs in IRA accounts. $20 from your brokerage account. $5 from your settlement account (if less than $5,000). Note: Your bank may charge for receiving wires from your brokerage or settlement account. $50 per conversion of conventional Vanguard index fund shares to VIPER Shares. Flagship: no charge. (Fees may vary at other brokerage firms.) Voyager fee: $30. Flagship: no charge. Also: insufficient funds ($20), stop payment ($15), checkbook reorder (Voyager: $9.95; Flagship: no charge), VanguardAdvantage Billpay service (Voyager: $4.95 per month; Flagship: no charge). Possibly, fees at automated teller machines not affiliated with PNC Bank. Other securities transaction fees may apply. Call us for additional information.

5 Vanguard Brokerage Services A Division of Vanguard Marketing Corporation, member of NASD and SIPC P.O. Box 1170 Valley Forge, PA Since 1983, Vanguard Brokerage Services has provided superior service and exceptional value to investors. Our clients enjoy online, automated phone, and associate-assisted access to stocks, exchange-traded funds, bonds, CDs, and options, plus thousands of funds from other mutual fund families. Standard services include cost basis accounting, comprehensive statements, free dividend reinvestment, and many other services designed to maximize investment convenience at a reasonable cost. World Wide Web Vanguard Brokerage Services For more information, visit or call for Vanguard funds and for non-vanguard funds offered through Vanguard Brokerage Services, to obtain a prospectus. Visit our website, call VIPER, or contact your broker to obtain a product description and prospectus for Vanguard VIPER Shares. Investment objectives, risks, charges, expenses, and other important information are contained in these documents; read and consider them carefully before investing The Vanguard Group, Inc. All rights reserved. Vanguard Marketing Corporation, Distributor. CMSCH

6 The VanguardAdvantage Account A flexible and convenient cash management service Vanguard Brokerage Services A Division of Vanguard Marketing Corporation

7 A cash management service with The Vanguard Difference If you re looking for a brokerage account that also offers cash management services, consider the VanguardAdvantage Account. Offered through Vanguard Brokerage Services, this exceptional account offers checkwriting with no minimum dollar amount, a Visa Gold debit card, online bill payment, and overdraft protection through a margin account. You can even simplify your finances by transferring assets you hold elsewhere to your VanguardAdvantage Account. And you can review your account information on one simple statement or online if you prefer. Better yet, accountholders experience The Vanguard Difference. You ll see it in everything we do at Vanguard. We focus only on your needs and on continuing our long record of serving all clients with integrity. We re committed to keeping costs as low as possible, providing a high level of service, and offering a wide range of sound financial products aimed at helping you meet your needs. An investment in a money market fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although a money market fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money by investing in such a fund.

8 The VanguardAdvantage Account puts you in control Our cash management service offers no-minimum checkwriting and easy-to-use features that allow you to better manage your finances. Take advantage of our commitment to provide competitive money market fund returns on cash balances. Access your account anywhere with a Visa Gold debit card. Pay your bills online with the VanguardAdvantage Billpay service. Enjoy low-interest-rate overdraft protection (through an approved margin account that contains eligible securities). Expand your investment possibilities at Vanguard. Hold individual stocks, ETFs, bonds, CDs, options, and even non-vanguard mutual funds through our FundAccess program. Have regular payments deposited directly into your account automatically. Manage your account online 24 hours a day, seven days a week at

9 Take Advantage of these powerful cash management tools The VanguardAdvantage Account is a convenient, flexible product that enhances your ability to monitor and manage your assets. By opening a VanguardAdvantage Account, you ll benefit from the following attractive features: Higher interest. You get your choice of Vanguard s low-cost money market funds, which have consistently delivered strong performance. Over the past ten years, 100% of our money market funds have outperformed the average returns of competitive funds.* Unlimited checkwriting. Write as many checks as you need and for any amount. You can write checks for more than your account balance if you sign up for overdraft protection. Online Billpay service. You can pay bills online using our secure Billpay service. Pay each bill separately or enter several payments at once. You can even schedule payments months in advance for added peace of mind. Overdraft protection. Apply for overdraft protection through a margin loan, secured by eligible stocks, bonds, and mutual fund shares. *For the ten-year period ended March 31, 2005, Vanguard s money market funds with at least a ten-year history (10 of 10 funds) have outperformed their Lipper-group averages; results will vary for other time periods. (Source: Lipper Inc.) Note that the competitive performance data shown represent past performance, which is not a guarantee of future results, and that all investments are subject to risks. For the most recent performance, visit our website at

10 flexibility Direct deposit. You can arrange for direct deposit service into this account for recurring payments, such as salary, Social Security, or pension checks. Call and ask us to mail a direct deposit application to you. Broad investment choices. You can expand your investment opportunities beyond Vanguard funds. Use this account to invest in individual stocks and bonds, options, ETFs, CDs and any of 2,600 mutual funds (including more than 900 no-load funds without transaction fees) from some 300 companies through our FundAccess program. Visa Gold debit card. You can use your VanguardAdvantage Account debit card at any ATM wordwide that displays the Visa or Plus System logo. Vanguard never charges a fee for an ATM transaction, and all transactions from a PNCaffiliated bank are free. (There may be a surcharge at other banks ATMs.) Cost basis accounting. Track the capital gains and losses of your stocks and bonds online so that you can identify possible tax benefits or liabilities. Manage your accounts online. Register at Vanguard.com to manage all of your investments online: Vanguard funds, stocks, bonds, and even other companies mutual funds. Gain control of your finances today. To open a VanguardAdvantage Account, complete the application and return it in the postage-paid envelope enclosed in this kit. If you need help completing the form, call Vanguard Brokerage Services at on business days from 8 a.m. to 8 p.m., Eastern time. Additional information about all of our financial products and services is also available on our website at

11 Vanguard Brokerage Services A Division of Vanguard Marketing Corporation Post Office Box 1170 Valley Forge, PA World Wide Web Vanguard Brokerage Services FundAccess, The Vanguard Group, Vanguard, Vanguard.com, VanguardAdvantage, VanguardAdvantage Billpay, The Vanguard Difference, Vanguard Brokerage Services, and the ship logo are trademarks of The Vanguard Group, Inc. Visa and Plus are trademarks of Visa International Service Association. All other marks are the exclusive property of their respective owners. For more information, visit or call for Vanguard funds and for non-vanguard funds offered through Vanguard Brokerage Services, to obtain a prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing The Vanguard Group, Inc. All rights reserved. Vanguard Marketing Corporation, Distributor. VADAB

12 Vanguard Brokerage Services (VBS ) A Division of Vanguard Marketing Corporation Upgrade Your Vanguard Brokerage Account to a VanguardAdvantage Account VAACF Important: This account is offered only to clients with a valid U.S. street address a post office box is not acceptable. Use this form to upgrade an existing nonretirement account at Vanguard Brokerage Services to a VanguardAdvantage Account. Please print, preferably in capital letters and black ink. If you would like to have a paycheck or other recurring payment deposited automatically in your account, call us to have the direct deposit application mailed to you. An annual account maintenance fee, in addition to any VanguardAdvantage Account fee, may apply. Please see the current Vanguard Brokerage Services Commission and Fee Schedules for details Most forms, as well as booklets that provide details on our services, can be downloaded from our website at Vanguard.com, or you can call us at for assistance. Return this form in the enclosed postage-paid envelope or mail it to Vanguard Brokerage Services, P.O. Box 1170, Valley Forge, PA For overnight or special delivery, mail to Vanguard Brokerage Services, 100 Vanguard Boulevard, Malvern, PA Your Existing Nonretirement Account at Vanguard Brokerage Services (Provide all applicable information.) Vanguard Brokerage Nonretirement Account Number Name of Account Owner, Minor, Trustee, or Organization (first, middle initial, last) OR Social Security Number Employer Identification Number Name of Joint Account Owner, Custodian, Agent, or Co-Trustee (first, middle initial, last) Social Security Number OR 2. Your Investment Profile (Complete all sections.) Employer Identification Number 1. Liquid net worth (cash, securities, etc.): $,, 2. Total net worth (excluding residence): $,, 3. Approximate annual income: $,, (Note to trustee: Indicate annual income of trust and applicable nontrust income.) 4. Indicate the number of dependents excluding account owners: 1

13 3. Cash Management Options VAACF-page 2 of 3 Choose only those features you want. A. VanguardAdvantage Visa Gold Debit Card I would like to receive a VanguardAdvantage Visa Gold debit card. Use of the card is subject to the conditions listed in the VanguardAdvantage Account Services Agreement. B. VanguardAdvantage Billpay I would like to sign up for VanguardAdvantage Billpay, an electronic bill payment service available through our secure website. Use of the Billpay service and fees associated with it is subject to the terms and conditions of the VanguardAdvantage Account Services Agreement. C. Overdraft Protection Through a Margin Account Important: If you have already been approved for margin in the Vanguard Brokerage account you are upgrading, you will automatically receive overdraft protection. Do not complete this section. Overdraft protection for transactions using your VanguardAdvantage checks, Visa Gold debit card, and Billpay is provided through a margin loan secured by eligible securities in your VanguardAdvantage Account. If the market value of the securities in your margin account declines, or the check, debit card, or Billpay transactions in your account result in an overdraft situation, you may be required to deposit more money or securities. If you do not do so, Vanguard Brokerage may be required to sell all or a portion of your assets. I want to apply for overdraft protection and margin privileges. I have knowledge of and understand the risks associated with margin, and I recognize that this option is subject to the terms and conditions of the Margin Account Agreement. I do not want to apply for overdraft protection and margin privileges. D. Cost Basis Accounting Through Vanguard.com You will be automatically enrolled in our Cost Basis Accounting Service when your VanguardAdvantage Account is opened. To view the cost basis of your individual securities, you must be a registered user of Vanguard.com. Choose the method of cost basis accounting you would like to have for your individual securities. (Check one.) First-in, first-out. When you sell stocks or bonds, the securities that you have held the longest will be sold first. Highest-cost. When you sell stocks or bonds, the securities with the highest cost will be sold first. Note: If you do not select a method of accounting, your account will automatically default to the first-in, first-out method for individual securities. The average-cost method automatically applies to all mutual fund investments. This service is made available in association with Pershing LLC, a member of the BNY Securities Group and a subsidiary of The Bank of New York Company, Inc. It is provided for general informational purposes only. You are responsible for maintaining accurate account records for your tax returns. Neither Vanguard nor Pershing will give your information to the IRS, prepare your tax return, or advise you on which accounting method is best for your particular tax situation. For such information, we recommend you consult a qualified tax professional. For Vanguard Brokerage Use Margin Approved By Margin Denied By Date 2

14 4. Signature of All Account Owners YOU MUST SIGN BELOW VAACF-page 3 of 3 VanguardAdvantage Account Services Agreement I consent and agree to be bound by all terms and conditions of the VanguardAdvantage Account Services Agreement in the Disclosures Booklet, and I acknowledge receipt of a copy of such agreement. I acknowledge that Vanguard reserves the right to revoke checkwriting and debit card privileges at any time without prior notice. Note: I have read and accept the most recent Vanguard Brokerage Services Commission and Fee Schedules, which I agree may be amended by Vanguard Brokerage from time to time. VanguardAdvantage Checkwriting Privileges I acknowledge that the VanguardAdvantage Account allows me to write checks (subject to the conditions listed in the VanguardAdvantage Account Services Agreement) to redeem any amount of my available balance. I further acknowledge that my name and address will appear on my checks exactly as they appear on my VanguardAdvantage Account registration, and that my check range will begin with number 101. Important: Any existing checks for my money market settlement account should be destroyed when I receive my VanguardAdvantage checkbook. DO NOT DETACH VanguardAdvantage Checkwriting Signature Form Please sign here. Important: All those listed as owners, custodians, trustees, or organization representatives except minors must sign below exactly as the account is registered. Attach an additional sheet if necessary. All registered account owners must sign this application exactly as the checks will be signed. Note: Only one signature is required on the checks, even if your VanguardAdvantage Account is set up to require more than one signature. See Section 5 of the VanguardAdvantage Account Services Agreement for details. Margin Agreement Important: This applies to account owners who have applied for overdraft protection through margin on their accounts. I acknowledge receiving a copy of the Margin Account Agreement ( Agreement ) in the Disclosures Booklet. This Agreement contains a predispute arbitration clause highlighted in paragraphs 22 and 23 on pages 30 and 31 of the Disclosures Booklet. By signing this application, I agree to be bound by the terms of the Agreement. S I G N A T U R E (owner, custodian, trustee, or organization representative) Date (month, day, year) S I G N A T U R E (joint owner, agent, co-trustee, or organization representative) Date (month, day, year) For Vanguard Brokerage Use Brokerage Account Number Checking Account Number VAACF

15 Vanguard, The Vanguard Group, VBS, VanguardAdvantage, VanguardAdvantage Billpay, Vanguard.com, Vanguard Brokerage Services, and the ship logo are trademarks of The Vanguard Group, Inc. Visa is a trademark of Visa International Service Association. All other marks are the exclusive property of their respective owners The Vanguard Group, Inc. All rights reserved. VAACF

16 A caution about deposits to your money market fund settlement account Recently purchased shares of your linked money market fund may not be immediately available to pay for transactions in your Vanguard Brokerage Services account. Effective May 1, 2005, Vanguard Brokerage Services may restrict your ability to trade in your brokerage account until the linked money market fund collects payment for recent purchases into that fund. It may take up to ten calendar days for funds from money market shares purchased by check or electronic bank transfer to become available for securities transactions. Wiring funds to purchase shares of the linked money market fund may reduce the ten-calendar-day period for availability. A Vanguard Brokerage associate will be happy to answer any questions you may have. Call Vanguard Brokerage Services at on business days from 8 a.m. to 8 p.m., Eastern time. Vanguard Brokerage Services is a division of Vanguard Marketing Corporation, member of NASD and SIPC The Vanguard Group, Inc. All rights reserved. Vanguard Marketing Corporation, Distributor. UNCLFD

17 VanguardAdvantage Account Disclosures Booklet VanguardAdvantage Account Services Agreement Margin Account Agreement Cost Basis Accounting Service Keep this copy for your records.

18 VanguardAdvantage Account Services Agreement Checkwriting, Debit Card, ACH, and Related Services This agreement (the Agreement ) sets forth the definitive terms and conditions of the VanguardAdvantage Account Checkwriting, Visa Gold Debit Card, Billpay, ACH, and related services (the Services ) that are available through your VanguardAdvantage Account. This Agreement is made by and among Vanguard Brokerage Services (Vanguard Brokerage); PNC Bank, Delaware; and you. By your enrollment in and use of your VanguardAdvantage Account, you agree to be bound by the terms of this Agreement that are applicable to the Services that you use. 1. Definitions. Unless the context otherwise requires, the capitalized terms used in this Agreement have the meanings specified below: Account means your VanguardAdvantage Account, which consists of (a) your Brokerage Account, (b) your linked money market settlement account, and (c) any securities or other property or obligation from time to time included in your VanguardAdvantage Account by Vanguard Brokerage. ACH means Automated Clearing House. ACH Transaction means any transfer of funds processed through the ACH system. ATM means automated teller machine. ATM Withdrawal means a Card Transaction in which you receive money from an ATM. Authorization means a Card Transaction in which you authorize others to place a hold on your Available Balance to ensure future payment. Available Balance means the available cash and sweep fund balances in your Account, as well as any available secured credit if you have a margin account,* but excluding those balances that are subject to Vanguard Brokerage s ten-business-day hold or that have otherwise been placed on hold to ensure payment of previously authorized Transactions. Bank means PNC Bank, Delaware, a Delaware bank, or, as the context requires, PFPC Trust Company, a subsidiary of The PNC Financial Services Group, Inc., which is responsible for administration of the banking services provided hereunder. *If the market value of the securities in your margin account declines, or the Transactions in your account result in an overdraft situation, you may be required to deposit more money or securities. If you are unable to do so, Vanguard Brokerage may be required to sell all or a portion of your pledged assets. You will also be subject to margin interest as disclosed in your margin agreement. Margin trading involves greater risk than paying cash up front for your investment, is not suitable for all investors, and is subject to approval by Vanguard Brokerage. 1

19 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT Banking Day has different meanings for ATM Withdrawals and for Cash Advances, Purchases, and Authorizations. A Banking Day may, as applicable, exclude bank or brokerage holidays. (1) For ATM Withdrawals, we consider there to be seven Banking Days each week for purposes of imposing security limits on the number and amount of withdrawals you can perform at an ATM. For these purposes, Banking Days begin at 12 a.m., Eastern time. (2) For Cash Advances, Purchases, and Authorizations: (a) We consider there to be five Banking Days each week for purposes of imposing security limits on the amount of Cash Advances, Purchases, and Authorizations you can perform. For these purposes, Banking Days begin at 6 a.m., Eastern time. (b) We consider there to be six Banking Days each week for purposes of imposing security limits on the number of Cash Advances, Purchases, and Authorizations you can perform. For these purposes, Banking Days begin at 6 p.m., Eastern time. The period from Friday at 6 p.m. to Sunday at 6 p.m., Eastern time, is counted as one Banking Day. Billpay Service means the electronic bill payment service offered by Vanguard Brokerage, which is accessed exclusively by means of Vanguard Brokerage s secure website. Billpay Transaction means any transaction in which you use the Billpay Service to effect payment to a payee. Brokerage Account means the cash and/or margin account opened in your name with Vanguard Brokerage. Business Day means Monday through Friday, excluding federal holidays. Although Vanguard Brokerage s or the Bank s offices may be open on certain federal holidays, these days are not considered Business Days for purposes relating to the transfer of funds. Card means the VanguardAdvantage Account Visa Gold Card issued on your Account. Card Transaction means any transaction in which you use the Card, the Card number, and/or your PIN to obtain cash through a Cash Advance transaction, to obtain cash from an ATM, or in payment to a merchant for goods or services. Cash Advance means a Card Transaction in which you receive money back from a merchant or financial institution. Cash Advances do not include ATM Withdrawals. Check, Checks, Checking refer to checks drawn on the Bank. 2

20 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT Check Transaction means any Transaction in which you use a Check to make a payment. Due Date is the date reflected on your payee statement for which the payment is due. It is not the late date or grace period. Electronic Funds Transfer means any transfer of funds initiated or authorized by you through an electronic payment system such as the ACH network. Payee is the person or entity to which you wish a bill payment to be directed or is the person or entity from which you receive electronic bills. Payment Account is your VanguardAdvantage Account, from which all payments and Billpay Service fees will be automatically debited. Payment Instructions is the information provided by you to Vanguard Brokerage for a bill payment to be made to the Payee (such as, but not limited to, Payee name, Payee account number, and Scheduled Payment Date). PIN means your personal identification number that is associated with your Card. Purchase means a Card Transaction in which you purchase goods or services. Regulation E means Regulation E (12 C.F.R. part 205) of the Board of Governors of the Federal Reserve System. Scheduled Payment is a payment that has been scheduled through the Billpay Service but has not begun processing.. Scheduled Payment Date is the day you want your Payee to receive your bill payment and is also the day your Payment Account will be debited, unless the Scheduled Payment Date falls on a non-business Day, in which case it will be considered to be the previous Business Day. Services means Checkwriting, Card, Billpay, ACH, and related services. Transaction means any Check, Card, Billpay, or ACH Transaction. Unauthorized Transaction means a Transaction made by someone without your authorization and from which you received no benefit. An Unauthorized Transaction does not include (a) a Transaction by a person to whom you furnished your Card, Card number, or PIN unless you have notified Vanguard Brokerage that Transactions by such persons are no longer authorized and Vanguard Brokerage has had a reasonable opportunity to act on such notice, (b) a Transaction made or authorized by you with the intent to defraud, or (c) a Transaction made in error by us. Vanguard Brokerage means Vanguard Brokerage Services, a division of Vanguard Marketing Corporation, member of NASD and SIPC. 3

21 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT We, Us, Our mean, as the context requires, Vanguard Brokerage and/or the Bank. You, Your, Accountholder mean each person or entity who is a registered owner of the Account. 2. How to Contact Us About Your Account. 2.1 Loss or Theft of Card, or Unauthorized Transactions. You must tell Vanguard Brokerage at once if you believe your Card or Checks have been lost or stolen or if you believe an unauthorized person may know your PIN or your Billpay Service website password. Similarly, tell Vanguard Brokerage if you believe any Unauthorized Transactions have been made to your Account, or if you believe that someone may attempt to use the Services without your consent or has transferred money without your permission. See Section 7 for more information about your rights and obligations with respect to Electronic Funds Transfers. 2.2 Errors or Questions About Your Account. Tell Vanguard Brokerage immediately if you think your Account statement or a Transaction record is wrong or if you need more information about your Account or any Transaction listed on the Account statement or Transaction record. 2.3 Contact Information. Call Vanguard Brokerage at Business Days from 8 a.m. to 8 p.m., Eastern time (limited services are available at other times). Or write to Vanguard Brokerage at: Vanguard Brokerage Services P.O. Box 1170 Valley Forge, PA General Features of the Services. 3.1 Available Balance Your Available Balance may fluctuate from day to day because it is dependent upon changes in the balance in your Account. The Available Balance is reduced shortly after the Bank is notified of a Transaction, not when a sales draft or Cash Advance draft is paid You promise not to make a Transaction (such as issuing a Check, making a Card Transaction, or requesting a Billpay Transaction) that exceeds your Available Balance. If you make a Transaction that exceeds your Available Balance, you will incur the insufficient funds fee listed in the Vanguard Brokerage Services Commission and Fee Schedules. If you attempt to make a Transaction that will exceed your Available Balance, the Transaction will normally be declined. 4

22 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 3.2 Payment for Transactions On a daily basis, the Bank will notify Vanguard Brokerage of the Transactions on your Account that the Bank receives. Vanguard Brokerage will make payments to the Bank on your behalf on each Business Day that Vanguard Brokerage receives notice of the Transactions. Vanguard Brokerage will make payments for the charges in the following order of priority: free credit in your Vanguard Brokerage account, cash available in your Vanguard Brokerage linked money market account, margin cash available You authorize Vanguard Brokerage to charge your Brokerage Account in order to pay for Transactions. Each Transaction shall be considered to be your direction to us to charge or reduce your Available Balance. When you use your Card, the reduction to your Available Balance occurs immediately, and you understand that you have no right to stop payment on any Card Transaction. You understand that Authorizations will reduce your Available Balance by the amount of the Authorization even if the Authorization does not result in a Transaction. Note that an Authorization will reduce your Available Balance until the earlier of the completion of the Transaction in whole or in part or the expiration of a time period specified by us If there is more than one person who is authorized to sign on the Account, you authorize us to pay Card drafts or Checks on the authority of any one of the signatures of the individuals identified on the appropriate account documentation even if you have signed documentation on file with us that states you require more than one signature to act on your Account. You also acknowledge that the Billpay Service may be established and any Billpay Transaction may be requested at any time upon the authorization of any one account owner or authorized signer. See Section 10 for more information about joint accounts Unauthorized Use. You promise not to let any unauthorized person make a Transaction, and you agree not to give or make available your PIN, password, or other means to access your Account or the Services to any unauthorized individuals. You are responsible for all payments you authorize using the Services. If you permit an unauthorized person to make a Transaction, or use any means to access your Account, even if the amount of actual use exceeds the amount you authorized, you will be responsible for the full amount of all Transactions that result. 5

23 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 3.3 Insufficient Funds; Overdraft Protection If the available cash and sweep fund balances in your Account are insufficient to cover a Transaction, and you have not established overdraft protection for your Account, Vanguard Brokerage may instruct the Bank to return the item, if a Check or Billpay Transaction, or decline the item, if a Card Transaction. In each case, the insufficient funds fee listed in the Vanguard Brokerage Services Commission and Fee Schedules will be debited from your Account. If a Transaction results in an overdraft situation and you have established overdraft protection by means of a margin account, you may be required to deposit more money or securities. If you are unable to do so, or if the Transaction exceeds your margin cash available, Vanguard Brokerage may be required to sell all or a portion of your pledged assets. You will also be subject to margin interest as disclosed in your margin agreement. 3.4 Account Statements Vanguard Brokerage will send you an Account statement for every month in which you make a Transaction. In any event, you will receive an Account statement at least quarterly. Your Account statement will include the following information: For Card Transactions. The amount, location, Transaction date, posting date, reference number, and merchant name (when available). For Check Transactions. The Check number, amount, and date of payment. For ACH Transactions. The reference number, a Transaction description, amount, and date of payment. For Billpay Transactions. Billpay Transactions will be reflected as either Check Transactions or ACH Transactions, depending upon the form in which the payment is made to the Payee. Billpay Transactions paid by check will not include a Check number. 3.5 Foreign Transactions Foreign Transactions. These transactions are completed outside the United States through your Account. All debits to your Account will be posted in U.S. dollars. Payments to Payees outside the United States or its territories through the Billpay Service are prohibited. See Section 4.4 for more information about Card Transactions made in a foreign currency. 6

24 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT Foreign Transaction Fee. For each Foreign Transaction, Visa charges a Foreign Transaction fee (currently 1% of the Transaction amount), which will be included in the amount charged to your Account. This Visa charge applies whether or not there is a currency conversion. 3.6 Fees. See the fees and charges associated with the Services that are listed in the Vanguard Brokerage Services Commission and Fee Schedules. Not included are fees that may be charged by third parties. Any applicable fees will be charged regardless of whether you use the service during any billing cycle. You agree to pay such charges and authorize us to deduct the calculated amount from your Account. Any other fees associated with your Account will continue to apply. You are responsible for any and all telephone access fees and/or Internet service fees that may be assessed by your telephone and/or Internet service provider. 4. Card Transactions. 4.1 Conveniences ATM Withdrawals. You can use your Card to receive cash at ATMs displaying the Plus System name and logo or at ATMs displaying the Visa name and logo Cash Advances. You can use your Card to receive money (Cash Advances) from your Account through financial institutions that honor Cards bearing the Visa logo Purchases/Authorizations. You can use your Card to buy goods and services (Purchases) from merchants honoring Visa. You can also use your Card to authorize others to place a hold on your Available Balance to ensure future payment and to make balance inquiries. 4.2 Out-of-Network Surcharges. An out-of-network surcharge may be imposed for ATM Transactions and balance inquiries. 4.3 Cancellation of Card. The Card can be canceled by the Bank or Vanguard Brokerage at any time without prior notice and will remain the property of the Bank. Without limiting the foregoing, your Card will be canceled effective with the closing of your Account. 7

25 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 4.4 Foreign Currency. Card Transactions made in a foreign currency are converted into U.S. dollar amounts by Visa, using its then current currency conversion procedure and rate. At this time, the currency conversion rate is generally either a wholesale market rate or a government-mandated rate in effect the day before the Transaction processing date. The currency conversion rate used on the processing date may differ from the rate in effect on the Transaction date or periodic statement posting date. 4.5 Restrictions on Certain Transactions You may not use the Checks, the Card, or the Billpay Service to purchase securities You may not use the Card for Internet gambling Use of the Card for illegal activities is prohibited. 5. Check Transactions. Important: If more than one person is authorized to sign on the Account, you authorize us to pay Card drafts or Checks on the authority of any one of the signatures of the individuals identified on the appropriate account documentation even if you have signed documentation on file with us that states you require more than one signature to act on your Account. 5.1 Request for Check Copies. Your original Checks will not be returned to you. However, the Bank retains a record of all Checks paid for at least three months following their cancellation in original form, and it retains copies for at least seven years. At your request, we can provide a copy of a Check to you. A Check copy fee as listed in the Vanguard Brokerage Services Commission and Fee Schedules will be debited from your Account. 5.2 Insufficient Funds. If your Available Balance is insufficient to cover a Check, Vanguard Brokerage may instruct the Bank to return the item. An insufficient funds fee as listed in the Vanguard Brokerage Services Commission and Fee Schedules will be debited from your Account. 5.3 Stop Payment Orders You can place a stop payment order on Checks as long as they have not yet been paid. A stop payment order fee as listed in the Vanguard Brokerage Services Commission and Fee Schedules will be debited from your Account. In order to effect a stop payment, you must notify Vanguard Brokerage at of the Check number, exact amount of the Check, payee of the Check, date of the Check, and your Account number. 8

26 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT Neither Vanguard Brokerage nor the Bank will be responsible if it is not possible to stop payment on Checks because the required stop payment information is not correct or is not entered on a timely basis, or if you fail to comply with a request for any other reasonable information about the Check If the Bank fails to stop payment on a Check for whatever reason, Vanguard Brokerage may, without liability, delay recrediting your Account while the rights of the parties involved are determined, including the rights of the Bank. Generally, stop payment orders become effective one Business Day after Vanguard Brokerage notifies the Bank. An oral stop payment order is effective for 14 days. If an oral stop payment order is promptly confirmed in writing, the stop payment order will remain in effect for 180 days For instructions on how to make stop payment orders on preauthorized ACH payments, see Section Billpay Service. Important: If more than one person is authorized to sign on the Account, you authorize us to establish the Billpay Service and process any Billpay Transaction at any time upon the authorization of any one account owner or authorized signer identified on the appropriate account documentation even if you have signed documentation on file with us that states you require more than one signature to act on your Account. 6.1 Bill Payment Scheduling. Billpay Transactions begin processing four Business Days prior to your Scheduled Payment Date. Therefore, Vanguard Brokerage will not permit you to select a Scheduled Payment Date less than four Business Days from the current date. When scheduling payments, you must select a Scheduled Payment Date that is no later than the actual Due Date reflected on your Payee statement unless the Due Date falls on a non-business Day. If the actual Due Date falls on a non-business Day, you must select a Scheduled Payment Date that is at least one Business Day before the actual Due Date. Scheduled Payment Dates should be prior to any late date or grace period. 6.2 Billpay Service Guarantee. Due to circumstances beyond the control of Vanguard Brokerage and/or the Bank, particularly delays in handling and posting payments by Payees or financial institutions, some transactions may take longer to be credited to your Account. We will bear responsibility for any late-payment-related charges up to $50 should a payment post after its Due Date as long as the payment was scheduled in accordance with the guidelines described in Section 6.1 above. 9

27 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 6.3 Payment Authorization and Payment Remittance By providing us with names and account information of Payees to whom you wish to direct payments, you authorize us to follow the Payment Instructions that we receive through the Billpay Service. In order to process payments more efficiently and effectively, we may edit or alter payment data or data formats in accordance with Payee directives When we receive a Payment Instruction, you authorize us to debit your Payment Account and remit funds on your behalf so that the funds arrive as close as reasonably possible to the Scheduled Payment Date designated by you. You also authorize us to credit your Payment Account for payments returned to us by the United States Post Office or Payee, or payments remitted to you on behalf of another authorized user of the Billpay Service We will use our best efforts to make all your payments properly. However, we shall incur no liability and the Billpay Service Guarantee shall be void if we are unable to complete any payments initiated by you because of the existence of any one or more of the following circumstances: If, through no fault of ours, your Payment Account does not contain sufficient funds to complete the Billpay Transaction or the Billpay Transaction would exceed the credit limit of your overdraft protection through a margin account, if any; The Billpay Service website is not working properly and you know or have been advised by us about the malfunction before you execute the Billpay Transaction; You have not provided us with the correct Payment Account information, or the correct name, address, phone number, or account information for the Payee; and/or Circumstances beyond our control (such as, but not limited to, fire, flood, or interference from an outside force) prevent the proper execution of the Billpay Transaction and we have taken reasonable precautions to avoid those circumstances. Provided none of the foregoing exceptions are applicable, if we cause an incorrect amount of funds to be removed from your Payment Account or cause funds from your Payment Account to be directed to a Payee that does not comply with your Payment 10

28 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT Instructions, we shall be responsible for returning the improperly transferred funds to your Payment Account, and for directing to the proper Payee any previously misdirected Billpay Transactions, and, if applicable, for any late-payment related charges. 6.4 Payment Methods. We reserve the right to select the method in which to remit funds on your behalf to your Payee. These payment methods may include, but may not be limited to, an electronic payment, an electronicto-check payment, or a laser draft payment. 6.5 Payment Cancellation Requests. You may cancel or edit any Scheduled Payment (including recurring payments) by following the directions at the Billpay Service website. There is no charge for canceling or editing a Scheduled Payment. Once we have begun processing a payment it cannot be cancelled or edited; accordingly, a stop payment request must be submitted. 6.6 Stop Payment Requests. Our ability to process a stop payment request will depend on the payment method and whether or not a check has cleared. We also may not have a reasonable opportunity to act on any stop payment request after a payment has been processed. If you desire to stop any payment that has already been processed, you must contact Vanguard Brokerage at Although we will make every effort to accommodate your request, we will have no liability for failing to do so. We may also require you to present your request in writing within 14 days. The charge for each stop payment request will be the current charge for such service as in the Vanguard Brokerage Services Commission and Fee Schedules. 6.7 Prohibited Payments. Payments to Payees outside of the United States or its territories through the Billpay Service are prohibited. 6.8 Exception Payments. Tax payments and court-ordered payments may be scheduled through the Billpay Service; however, such payments are discouraged and must be scheduled at your own risk. In no event shall we be liable for any claims or damages resulting from your scheduling of these types of payments. The Billpay Service Guarantee as it applies to any latepayment related charges is void when these types of payments are scheduled and/or processed by us. We have no obligation to research or resolve any claim resulting from an exception payment. All research and resolution for any misapplied, misposted, or misdirected payments will be your sole responsibility. 11

29 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 6.9 Failed or Returned Transactions; Overdraft Protection. In using the Billpay Service, you are requesting us to make payments for you from your Payment Account. If we are unable to complete a requested Billpay Transaction for any reason associated with your Payment Account (for example, your Available Balance is insufficient to cover the Billpay Transaction), the Billpay Transaction may not be completed. In some instances, you will receive a return notice from us. In such case, you agree that: (a) You will reimburse us immediately upon demand the Billpay Transaction amount indicated in the return notice; (b) For any amount not reimbursed to us within 15 days of the initial notification, you will pay us a late charge equal to 1.5% monthly interest or the legal maximum, whichever rate is lower; and (c) We are authorized to report the facts concerning the return to a credit-reporting agency. If a Billpay Transaction results in an overdraft situation and you have established overdraft protection by means of a margin account, you may be required to deposit more money or securities in your Payment Account. If you are unable to do so, or if the Billpay Transaction exceeds your margin cash available, Vanguard Brokerage may be required to sell all or a portion of your pledged assets. You will also be subject to margin interest as disclosed in your margin agreement Address or Payment Account Changes. It is your sole responsibility to ensure that the contact information maintained in your user profile on the Billpay Service website is current and accurate. This includes, but is not limited to, name, address, phone number(s), and address(es). Changes can be made either through the Billpay Service website or by contacting Vanguard Brokerage at Any changes in your Payment Account should also be made in accordance with the procedures outlined in the Service website s Help area. All changes made are effective immediately for scheduled and future payments paid from the updated Payment Account information. We are not responsible for any payment processing errors or fees incurred if you do not provide accurate Payment Account or contact information. 12

30 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 6.11 Billpay Service Termination, Cancellation, or Suspension. In the event you wish to cancel the Billpay Service, you may have the ability to do so through the Billpay Service website, or you may contact Vanguard Brokerage via one of the following Telephone us at Business Days from 8 a.m. to 8 p.m., Eastern time; or Write to us at: Vanguard Brokerage Services P.O. Box 1170 Valley Forge, PA Any payment(s) we have already processed before the requested cancellation date will be completed by us. All Scheduled Payments including recurring payments will not be processed once the Billpay Service is cancelled. We may terminate or suspend service to you at any time. Neither termination nor suspension shall affect your liability or obligations under this Agreement Payee Limitation. We reserve the right to refuse to pay any Payee to whom you may direct a payment. We will notify you promptly if we decide to refuse to pay a Payee designated by you. This notification is not required if you attempt to make a prohibited payment or an exception payment under this Agreement Returned Payments. In using the Billpay Service, you understand that Payees and/or the United States Post Office may return payments to us for various reasons, including, but not limited to, Payee s forwarding address expired, Payee account number not valid, Payee unable to locate account, or Payee account paid in full. We will use our best efforts to research and correct the returned payment and return it to your Payee, or void the payment and credit your Payment Account. You may receive notification from us in these events Information Authorization. Your enrollment in the Billpay Service may not be fulfilled if we cannot verify your identity or other necessary information, or based upon a review of historical records relating to your account. In addition, you agree that we reserve the right to obtain financial information regarding your account from a Payee (for example, to resolve payment posting problems or for verification). 13

31 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 6.15 Bill Delivery and Presentment. This feature is for the presentment of electronic bills only, and it is your sole responsibility to contact your Payees directly if you do not receive your bills or account statements. In addition, if you elect to activate one of the Billpay Service s electronic bill options, you also agree to the following: Information provided to the Payee. We are unable to update or change your personal information, including, but not limited to, name, address, phone number(s), and address(es), with the electronic Payee. Any changes will need to be made by your contacting the Payee directly. Additionally, it is your responsibility to maintain all usernames and passwords for all electronic Payee sites. You also agree not to use someone else s information to gain unauthorized access to another person s bill Activation. Upon your activation of the electronic bill delivery and presentment feature, we may notify the Payee of your request to receive electronic billing information. The timing of presentment of your first electronic bill may vary from Payee to Payee and may take up to 60 days, depending on the billing cycle of each Payee. Additionally, your ability to obtain a paper copy of your statement(s) is at the sole discretion of the Payee. While your electronic bill delivery and presentment feature is being activated, it is your responsibility to keep your accounts current. Each electronic Payee reserves the right to accept or deny your request to receive electronic bills Notification. We will use our best efforts to present all of your electronic bills promptly. In addition to our posting the bills on the Billpay Service website, the Payee may send an notification to the address you provide. It is your sole responsibility to ensure that this information is accurate. In the event you do not receive notification, it is your responsibility to periodically log on to the Billpay Service and check on the delivery of new electronic bills. The time for notification may vary from Payee to Payee. You are responsible for ensuring timely payment of all bills. 14

32 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT Cancellation of electronic bill notification. Each electronic Payee reserves the right to cancel the presentment of electronic bills at any time. You may cancel electronic bill presentment at any time. The time frame for cancellation of your electronic bill presentment may vary from Payee to Payee, and may take up to 60 days, depending on the billing cycle of each Payee. We will notify your electronic Payee(s) as to the change in status of your account, but it is your sole responsibility to make arrangements for an alternative form of bill delivery. We will not be responsible for presenting any electronic bills that are already in process at the time of cancellation Nondelivery of electronic bill(s). You agree to hold us harmless should the Payee fail to deliver your bill(s) or statement(s). You are responsible for ensuring timely payment of all bills. Copies of previously delivered bills must be requested from the Payee directly Accuracy and dispute of electronic bill. We are not responsible for the accuracy of your electronic bill(s). We are only responsible for presenting the information we receive from the Payee. Any discrepancies or disputes regarding the accuracy of your electronic bill summary or detail must be addressed with the Payee directly. This Agreement does not alter any liability or obligations that currently exist between you and your Payees Exclusions of Warranties; Limitation of Liability The Billpay Service website and related documentation are provided as is without warranty of any kind, either express or implied, including, but not limited to, the implied warranties of merchantability and fitness for a particular purpose This Section 6 constitutes our entire liability and your exclusive remedy with respect to the Billpay Service. In no event will we be liable for any direct, indirect, special, incidental, consequential, or exemplary damages, including lost profits (even if advised of the possibility thereof ) arising in any way out of the installation, use, or maintenance of the Billpay Service website. 7. Automated Clearing House Transfers and Other Funds Transfers. 7.1 Money can be credited to, or debited from, your Account because of ACH entries or because of other money transfer entries. These credits and debits are normally subject to additional rules of the money transfer system that processes them, such as the rules of the National Automated Clearing House Association and local ACH operating rules. 15

33 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 7.2 In the case of an ACH credit entry to your Account, the credit is provisional until the Bank receives final settlement through a Federal Reserve Bank or otherwise receives payment as provided in Section 403(a) of Article 4A of the Uniform Commercial Code. The Bank is entitled to a refund of the credit entry if it does not receive final settlement or payment. In that case, the person who originally sent the credit entry will be considered to have not paid you. 7.3 In addition, unless required by applicable law, Vanguard Brokerage will generally not give you notice of the receipt of an entry by the Bank. Entries will, however, be included on your Account statement. 7.4 For instructions on how to make stop payment orders on preauthorized ACH payments, see Section Additional Terms and Conditions of Electronic Funds Transfers. Some of your Transactions may be Electronic Funds Transfers (for example, Card and ACH Transactions). These additional terms and conditions apply only to Electronic Funds Transfers and only to the extent that Regulation E requires. 8.1 Limits on Dollar Amount of Transactions. The ATM you use may have limits on the amount of cash that can be obtained at that machine. These limits may include transactional and daily limits. Separately, there is a $500 (or your Available Balance, if less) maximum ATM Withdrawal limit per Banking Day. Sometimes a temporary $100 limit per Banking Day may be imposed for security purposes or when the Transaction volume in your Account exceeds normal conditions. There may be other limitations stated in this Agreement or in other agreements between you and Vanguard Brokerage Unless a higher limit is authorized, there is a limit of $10,000 (or your Available Balance, if less) per Banking Day on your Card Transactions. ATM Withdrawals, Cash Advances, Purchases, and Authorizations all count against this spending limit. 8.2 Limits on Frequency of Transactions. In addition to the dollar amount limits, we reserve the right to impose a limit on the number of Card Transactions you can make on any Banking Day. For the purpose of maintaining security, we will not disclose that limit, except that you will be allowed to make at least five Card Transactions on any Banking Day under normal conditions. 16

34 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 8.3 Retention of the Card. Your Card may be retained by any ATM, merchant, or participating financial institution if any of the following conditions is met: The PIN is wrong after three attempts (certain ATMs may limit you to fewer attempts). You exceed the limits on dollar amounts and/or frequency of Transactions. Your Card was reported lost or stolen. Your Account has been closed. Your Card has expired or was replaced. The machine is not operating properly. There are other legitimate business reasons. 8.4 Card Transaction Receipts. You will be given a receipt at the time you make Card Transactions, except for Card Transactions you make by telephone or mail. Receipts may not be provided for Card Transactions performed outside the United States. Card Transactions will also be reflected on your Account statement. See Section for information on what to do if you believe a Transaction record is wrong Merchants generally maintain receipts of Card Transactions (excluding PIN-based transactions) for 12 months. If you call Vanguard Brokerage, we will attempt to obtain copies of the receipts. If we are able to, there may be a third-party charge for providing the copies. 8.5 Stop Payment Orders of Preauthorized ACH Payments (other than Billpay Transactions). If you have told Vanguard Brokerage to make regular ACH payments out of your Account, you can stop these payments at any time. Simply call or write Vanguard Brokerage in time for us to receive your request three Business Days or more before the payment is scheduled to be made (our phone number and address are provided in Section 8.6.4). If you call, we may also require you to put your request in writing and get it to us within 14 days after your call. See Section 6.6 for information on stop payment requests for Billpay Transactions Liability for Failure to Stop Payment of Preauthorized ACH Transfers. If you order Vanguard Brokerage to stop one of these ACH payments three Business Days or more before the transfer is scheduled and we do not do so, we will be liable for your losses or damages. 17

35 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 8.6 Problem Prevention and Resolution Taking a few simple steps can help prevent many problems. To protect your Account and limit your liability, we recommend that you: Do not provide anyone with your PIN or Billpay password. Do not write your PIN on your Card. Do not carry your PIN and Card together in your wallet. Do not tell anyone your PIN or Billpay password not even someone from the Bank or Vanguard Brokerage Loss or Theft of Card, or Unauthorized Transactions. You must tell Vanguard Brokerage at once if you believe your Card has been lost or stolen or if you believe an unauthorized person may know your PIN or Billpay Service website password. Calling Vanguard Brokerage immediately is the best way to keep your possible losses down. You could lose all the funds in your Account (plus your maximum overdraft line of credit). If you tell Vanguard Brokerage within two Business Days after you learn of the loss or theft of your Card, PIN, or password, you can lose no more than $50 if someone used your Card, PIN, or password without your permission. If you do not tell Vanguard Brokerage within two Business Days after you learn of the loss or theft of your Card, PIN, or password, and Vanguard Brokerage can prove it could have stopped someone from using your Card, PIN, or password without your permission if you had told us, you could lose as much as $ Inaccurate Account Statement. If you think your Account statement or Transaction record is wrong, if they show Transactions you did not make, or if you need more information about your Account or any statement, let Vanguard Brokerage know at once. If you do not notify Vanguard Brokerage within 60 days after the Account statement was mailed to you, you may not get back any money you lose after 60 days if Vanguard Brokerage can prove that it could have stopped someone from taking the money had you notified us in a timely manner. If there was a good reason (such as a long trip or a hospital stay) that kept you from telling us, we will extend the time period. 18

36 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT Notification Methods Calling Vanguard Brokerage is the quickest way to alert us to a problem. You can reach us at Business Days from 8 a.m. to 8 p.m., Eastern time (limited services are available at other times) We may, however, request that you also notify us of your complaint or question in writing within ten Business Days. Our mailing address is: Vanguard Brokerage Services P.O. Box 1170 Valley Forge, PA Vanguard Brokerage will need all of the following information: Your name, your Account number, your address, and the date of the Transaction. A description of the error or Transaction in question, explaining as clearly as possible why you believe it is an error or why you need more information. The dollar amount of the Transaction and, if different, the amount of the suspected error Timing of the Error Resolution Process. Except as otherwise stated in this Agreement, we will determine within ten Business Days after Vanguard Brokerage hears from you whether an error occurred and will correct any error promptly. If we need more time, however, we may take up to 45 calendar days to investigate your complaint or question. In this event, Vanguard Brokerage will generally recredit your account within ten Business Days for the amount you think is in error so that you will have the use of the money during the time it takes us to complete our investigation. If Vanguard Brokerage asks you to put your complaint or question in writing and does not receive it within ten Business Days, we need not recredit your account or may reverse any credit previously made to your Account For Foreign Transactions. For Transactions initiated outside the United States, the applicable time period for investigations is 90 calendar days instead of 45 calendar days. 19

37 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT For Point-of-Sale Transactions. For Point-of-Sale Transactions (that is, Purchases and Cash Advances), the applicable time period for investigations is 90 calendar days instead of 45 calendar days For New Accounts. For Accounts that have been open for 30 calendar days or less, the applicable time periods for actions stated in Section are 20 Business Days instead of 10 Business Days and 90 calendar days instead of 45 calendar days For Notification of the Findings. In any case, Vanguard Brokerage will tell you the results within three Business Days after we complete our investigation. If Vanguard Brokerage decides that there was no error, we will reverse the applicable credit and send you a written explanation. You may ask us for copies of the documents that we used in the investigation. 8.7 The Bank s and Vanguard Brokerage s Liability for Failure to Complete Transactions If we do not complete an Electronic Funds Transfer to or from your Account on time or in the correct amount according to this Agreement, we will be liable for your losses or damages. However, there are some exceptions. Neither the Bank nor Vanguard Brokerage will be liable if any of the following apply: Through no fault of ours, you do not have a sufficient Available Balance to make the Transaction. Any ATM, other device, Card, Billpay Service website, or computer system was not working properly and you knew about the breakdown when you started the Transaction. The ATM or other device you are using for the Transaction does not have enough cash. Your Account is frozen (for example, because of a court order or other similar reason), and we are not permitted to make the Transaction. Circumstances beyond our control (such as a fire or flood) prevent the Transaction, despite the reasonable precautions that we have taken. 20

38 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT You fail to enter your correct PIN after the maximum number of attempts permitted. You fail to use the ATM, other device, Card, Billpay Service website, or computer system in accordance with instructions. We have limited or have refused to complete Card, ACH, or Billpay Transactions for security reasons. We have reason to believe that the requested Transaction is unauthorized There may be additional exceptions that are stated elsewhere in this Agreement or in your other agreements with Vanguard Brokerage or that you are otherwise notified of by the Bank or Vanguard Brokerage. Neither the Bank nor Vanguard Brokerage will be responsible for any person s actions in refusing to honor or accept your Card or in taking possession of your Card. In any case, we will be liable only for actual proven damages if the failure to make the Transaction results from a bona fide error by us despite our procedures to avoid such errors. 8.8 Preauthorized Credits. If you have arranged to have direct deposits made to your Account at least once every 60 days from the same person or company, the person or company making the deposit should notify you every time they send us the money. 9. Confidentiality. 9.1 Vanguard Brokerage and the Bank will not reveal any information to third parties (other than each other) about your Account and your Transactions except (1) where it is necessary for completing your Transaction or providing any related card benefits to you, (2) to verify the existence and condition of your Account for a third party, such as a credit bureau, merchant, or Payee, (3) to comply with laws or with orders of subpoenas of government agencies or courts, (4) if you give us written permission, (5) to other persons and entities in order to resolve disputes arising from Transactions, or (6) in the circumstances covered by Vanguard s Privacy Policy, included in this Disclosures Booklet and as updated or amended from time to time. 21

39 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 10. Joint Accounts If this is a joint Account, unless you notify Vanguard Brokerage otherwise and provide such documentation as Vanguard Brokerage requires, your Account shall be held by you jointly with rights of survivorship. Each joint tenant irrevocably appoints the other as attorney-in-fact to take all action on his or her behalf and to represent him or her in all respects in connection with this Agreement. We shall be fully protected in acting upon the instructions of either of you; in sending confirmation advice, notices, or other communications to either of you; or in otherwise dealing with either of you. Each of you shall be liable, jointly and individually, for any amounts due to us pursuant to this Agreement, whether incurred by either or both of you If you shall consist of more than one individual, the obligations of all such persons under this Agreement shall be joint and several. Each joint Accountholder has authority, acting individually and without notice to the other Accountholder, to deal with us as fully and completely as if each is the sole Accountholder. We are authorized to follow the instructions of any joint Accountholder. We are not responsible for determining the purpose or propriety of an instruction we receive from any Accountholder or for the disposition of payments or deliveries among joint Accountholders. Any notice we send to one Accountholder will be deemed notice to all Accountholders. 11. Miscellaneous Scope and Transferability. This Agreement shall cover all aspects of your Account described herein and shall inure to the benefit of our successors whether by merger, consolidation, or otherwise, and assigns, and we may transfer your Account to our respective successors and assigns, and this Agreement shall be binding upon your heirs, executors, administrators, successors, and assigns Extraordinary Events. To the fullest extent allowable under law, we are not responsible, and you agree not to hold us liable, for losses caused directly or indirectly by conditions beyond our control, including, but not limited to: war, natural disaster, terrorism, government restriction, exchange or market rulings, strikes, interruptions of communications or data processing services, news or analysts reports, market volatility, or disruptions in orderly trading on any exchange or market. 22

40 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 11.3 Nature of Obligations. The obligations of Vanguard Brokerage and the Bank are set forth in this Agreement. Neither the Bank nor Vanguard Brokerage is liable for the obligations of the other Waiver, Assignment, and Notices. Neither our failure to insist at any time upon strict compliance with this Agreement or with any of the terms hereof nor any continued course of such conduct on our part shall constitute or be considered a waiver by us of any of our rights or privileges hereunder. Any assignment of your rights and obligations hereunder or your interest in any property held by or through Vanguard Brokerage without obtaining the prior written consent of an authorized representative of Vanguard Brokerage shall be null and void. Notices and other communications (including, without limitation, margin calls) delivered, faxed, sent by express delivery service, or mailed to the address provided by you shall, until Vanguard Brokerage has received notice in writing of a different address, be deemed to have been personally delivered to you Separability. If and to the extent any term or provision herein is or should become invalid or unenforceable, then (1) the remaining terms and provisions hereof shall be unimpaired and remain in full force and effect, and (2) the invalid or unenforceable provision or term shall be replaced by a term or provision that is valid and enforceable and that comes closest to expressing the intention of such invalid or unenforceable term or provision Headings. The headings of the provisions hereof are for ease of reference only and shall not affect the interpretation or application of this Agreement or in any way modify or qualify any of the rights or obligations provided for hereunder Recording Conversations and Monitoring Electronic Communications. For our mutual protection, you understand, agree, and expressly consent to our electronic recordation of any of your telephone conversations with us and to our monitoring of your electronic communications with us, including but not limited to and facsimile transmission Termination of Account/Agreement. Vanguard Brokerage, the Bank, or you may terminate this Agreement, including the use of Checks, Cards, or other Services, if applicable, at any time. You shall remain responsible for authorized charges that arise before or after termination. In the event of termination for whatever reason, you shall promptly destroy all Cards and unused Checks. Failure to do so may result in a delay in Vanguard Brokerage complying with your instructions regarding the disposition of assets. 23

41 VANGUARDADVANTAGE ACCOUNT SERVICES AGREEMENT 11.9 Representations and Amendments. You agree that we shall have the right to amend this Agreement at any time by sending notice of the amendment to you. An amendment shall be effective as of the date we establish. If we make any changes to this Agreement that will affect you adversely (by increasing costs or liability to you, or limiting access to your Account), we will notify you prior to the change as required by law. The change will automatically become effective unless, prior to the effective date, you notify us of your intention to terminate your Account privileges. We reserve the right to make emergency changes for security reasons, without prior written notice to you. You understand that additional restrictions may apply to the Services and that additional documentation may be required by applicable law or our policies and procedures. You agree to promptly comply with any such restrictions and requests for additional documents Governing Law. This Agreement shall be governed by the laws of the Commonwealth of Pennsylvania, except that all Transactions shall be governed by and construed under the laws of the State of Delaware, without regard to principles of conflicts of law Priority of Agreements. In the event of any conflict between this Agreement and any other agreement you have with Vanguard Brokerage Services with respect to your Account, including the VanguardAdvantage Account Application and the Terms and Conditions of the Billpay Service website, this Agreement will control. Notwithstanding the foregoing, in the event of any conflict between this Agreement and the Vanguard Margin Account Agreement, the Margin Account Agreement will control as to matters covered by such agreement. 24

42 Margin Account Agreement To: Pershing LLC ( you or Pershing ) In consideration of your accepting and carrying for the undersigned one or more accounts introduced to you by Vanguard Brokerage Services (VBS ), a division of Vanguard Marketing Corporation, which is intended to have the benefit and is a third-party beneficiary of this Agreement, the undersigned agrees as follows: 1. Role of Pershing You are carrying the accounts of the undersigned as Clearing Broker pursuant to a clearing agreement with VBS. Until receipt from the undersigned of written notice to the contrary, you may accept from VBS, without inquiry or investigation, (i) orders for the purchase or sale of securities and other property on margin or otherwise, and (ii) any other instructions concerning said accounts. Notices to the undersigned concerning margin requirements or other matters related to the undersigned s accounts usually will go through VBS, although direct notice to the undersigned with duplicate notice to VBS may occur if market conditions, time constraints, or other circumstances require it. You shall not be responsible or liable for any acts or omissions of VBS or its employees. The undersigned understands that you provide no investment advice, nor do you give advice or offer any opinion with respect to the suitability of any transaction or order. The undersigned understands that VBS is not acting as the agent of Pershing, and the undersigned agrees that the undersigned will in no way hold Pershing; its other divisions or affiliates; or their officers, directors, and agents liable for any trading losses incurred by the undersigned. 2. Applicable Rules and Regulations All transactions for the undersigned shall be subject to the constitution, rules, regulations, customs, and usages of the exchange or market and its clearing house, if any, where executed by you or your agents, including your subsidiaries and affiliates. 3. Definitions For purposes of the agreement, securities, commodities, and other property as used herein shall include, but not be limited to, money, securities, and commodities of every kind and nature, and all contracts and options relating thereto, whether for present or future delivery. 25

43 MARGIN ACCOUNT AGREEMENT 4. Lien All securities, commodities, and other property of the undersigned that you may at any time be carrying for the undersigned, or that may at any time be in your possession or under your control, shall be subject to a general lien and security interest in your favor for the discharge of all the undersigned s indebtedness and other obligations to you, without regard to your having made any advances in connection with such securities and other property and without regard to the number of accounts the undersigned may have with you. In enforcing your lien, you shall have the discretion to determine which securities and property are to be sold and which contracts are to be closed. 5. Liquidation If, in your discretion, you consider it necessary for your protection to require additional collateral, or in the event that a petition in bankruptcy or for appointment of a receiver is filed by or against the undersigned, or an attachment is levied against the accounts of the undersigned, or in the event of death of the undersigned, you shall have the right to sell any or all securities, commodities, and other property in the accounts of the undersigned with you, whether carried individually or jointly with others; to buy any or all securities, commodities, and other property that may be short in such accounts; to cancel any open orders; and to close any or all outstanding contracts, all without demand for margin or additional margin, notice of sale or purchase, or other notice or advertisement. Any such sales or purchases may be made at your discretion on any exchange or other market where such business is usually transacted, or at public auction or private sale, and you may be the purchasers for your own account. It being understood that a prior demand, or call, or prior notice of the time and place of such sale or purchase shall not be considered a waiver of your right to sell or buy without demand or notice. 6. Payment of Indebtedness Upon Demand and Liability for Costs of Collection The undersigned shall at all times be liable for the payment upon demand of any debit balance or other obligations owing in any of the accounts of the undersigned with you. The undersigned shall be liable to you for any deficiency remaining in any such accounts in the event of the liquidation thereof, in whole or in part, by you or by the undersigned. The undersigned shall make payments of such obligations and indebtedness upon demand. The undersigned will pay the reasonable costs and expense of collection of the debit balance, recovery of securities, and any unpaid deficiency in the accounts of the undersigned with you, including, but not limited to, attorneys fees incurred and payable or paid by you. 26

44 MARGIN ACCOUNT AGREEMENT 7. Pledge of Securities All securities, commodities, and other property now or hereafter held, carried, or maintained by you in your possession in any of the accounts of the undersigned may be pledged and repledged by you from time to time, without notice to the undersigned, either separately or in common with other such securities, commodities, and other property for any amount due in the accounts of the undersigned, or for any greater amount, and you may do so without retaining to your possession or control for delivery a like amount of similar securities, commodities, or other property. 8. Margin Requirements, Credit Charges, and Credit Investigation The undersigned will at all times maintain such securities, commodities, and other property in the accounts of the undersigned for margin purposes as you shall require from time to time, and the monthly debit balances or adjusted balances in the accounts of the undersigned with you shall be charged, in accordance with your practice, with interest at a rate permitted by the laws of the state of New York. It is understood that the interest charge made to the undersigned s account at the close of a charge period will be added to the opening balance for the next charge period unless paid. The undersigned acknowledges receipt from VBS of the disclosure statement, which explains the conditions under which interest can be charged to the accounts of the undersigned, the annual rate of interest, how debit balances are determined, and the methods of computing interest. You may exchange credit information about the undersigned with others. You may request a credit report on the undersigned, and, upon request, you will state the name and address of the consumer reporting agency that furnished it. If you extend, update, or renew the undersigned s credit, you may request a new credit report without telling the undersigned. 9. Communications Communications may be sent to the undersigned at the current address of the undersigned, which is on file at your office, or at such other address as the undersigned may hereafter give you in writing or through VBS. All communications so sent, whether by mail, telegraph, messenger, or otherwise, shall be deemed given to the undersigned personally, whether actually received or not. 27

45 MARGIN ACCOUNT AGREEMENTT 10. Scope and Transferability This Agreement shall cover individually and collectively all accounts that the undersigned may open or reopen with you, and shall inure to the benefit of your successors, whether by merger, consolidation, or otherwise and assigns, and you may transfer the accounts of the undersigned to your successors and assigns. This Agreement shall be binding upon the heirs, executors, administrators, successors, and assigns of the undersigned. 11. No Non-Investment Advice The undersigned acknowledges that you will not provide the undersigned with any legal, tax, or accounting advice, that your employees are not authorized to give any such advice, and that the undersigned will not solicit or rely upon any such advice from you or your employees whether in connection with transactions in or for any of the accounts of the undersigned or otherwise. In making legal, tax, or accounting decisions with respect to transactions in or for the accounts of the undersigned or any other matter, the undersigned will consult with and rely upon its own advisors and not you, and you shall have no liability therefor. 12. Extraordinary Events You shall not be liable for loss caused directly or indirectly by government restrictions, exchange or market rulings, suspension of trading, war, strikes, or other conditions beyond your control. 13. Representations as to Capacity to Enter Into Agreement The undersigned, if an individual, represents that the undersigned is of full age and that unless otherwise disclosed to you in writing, the undersigned is not an employee of any exchange; or of any corporation of which any exchange owns a majority of the capital stock; or of a member firm or member corporation registered on any exchange; or of a bank, trust company, or insurance company; or of any corporation, firm, or individual engaged in the business of dealing either as a broker or as a principal in securities, bills of exchange, acceptances, or other forms of commercial paper. The undersigned further represents that no one except the undersigned has an interest in the account or accounts of the undersigned with you. 28

46 MARGIN ACCOUNT AGREEMENT 14. Joint and Several Liability Jointly Owned Accounts If the undersigned shall consist of more than one individual, their obligations under this Agreement shall be joint and several. The undersigned have executed the Joint Account Agreement and made the election required therein. Pursuant to that Agreement, you may, but are not required to, accept instructions from any joint party. 15. Options Transactions If at any time the undersigned shall enter into any transaction for the purchase or sale of an option contract, the undersigned hereby agrees to abide by the rules of any national securities association, registered securities exchange, or clearing organization applicable to the trading of option contracts and, acting alone or in concert, will not violate the position or exercise limitation rules of any such association or exchange or of the Options Clearing Corporation or other clearing organization. 16. Severability If any provision or condition of this Agreement shall be held to be invalid or unenforceable by any court, or by any regulatory or self-regulatory agency or body, such invalidity or unenforceability shall attach only to such provision or conditions. The validity of the remaining provisions and conditions shall not be affected thereby, and this Agreement shall be carried out as if any such invalid or unenforceable provision or condition were not contained herein. 17. Headings Are Descriptive The heading of each provision hereof is for descriptive purposes only and shall not be deemed to modify or qualify any of the rights or obligations set forth in each such provision. 18. Non-Individual Certification If this is an agreement for a trust, other fiduciary account, or other non-individual account, the undersigned hereby certifies and represents that the use of a margin account and specifically the borrowing, lending, or pledging of assets as described herein is in accordance with and authorized by the provisions of the trust instrument or applicable law governing the trust or entity. 29

47 MARGIN ACCOUNT AGREEMENT 19. Liability You shall not be responsible to provide the undersigned at any time with information concerning cash or stock dividends, stock splits, corporate actions, or any other information, advice, guidance, or recommendation with respect to an order by the undersigned to purchase or sell securities. 20. Assignment of Pershing s Rights Under This Agreement to VBS The undersigned agrees that any rights that Pershing has under this Agreement, including but not limited to the right to collect any debit balance or other obligations owing in any of the accounts of the undersigned, may be assigned to VBS so that VBS may collect from the undersigned independently or jointly with Pershing or enforce any other rights granted to Pershing under this Agreement. 21. Modification of Agreement VBS or Pershing may at any time modify these terms and conditions, and other agreements affecting the use of the account of the undersigned, and the undersigned agrees to be bound by the versions of such documents as modified. 22. Arbitration Disclosures This Agreement contains a predispute arbitration clause. By signing an arbitration agreement the parties agree as follows: All parties to this Agreement are giving up the right to sue each other in court, including the right to a trial by jury, except as provided by the rules of the arbitration forum in which a claim is filed. Arbitration awards are generally final and binding; a party s ability to have a court reverse or modify an arbitration award is very limited. The ability of the parties to obtain documents, witness statements and other discovery is generally more limited in arbitration than in court proceedings. The arbitrators do not have to explain the reason(s) for their award. The panel of arbitrators will typically include a minority of arbitrators who were or are affiliated with the securities industry. The rules of some arbitration forums may impose time limits for bringing a claim in arbitration. In some cases, a claim that is ineligible for arbitration may be brought in court. The rules of the arbitration forum in which the claim is filed, and any amendments thereto, shall be incorporated into this Agreement. 30

48 MARGIN ACCOUNT AGREEMENT 23. Agreement to Arbitrate Controversies It is agreed that any controversy between or among the undersigned, Pershing, and VBS, or any of them, arising out of Pershing s or VBS s business or this Agreement, shall be submitted to arbitration before the New York Stock Exchange, Inc., or, if the transaction took place on another exchange, then to that exchange or the NASD Regulation, Inc., as the undersigned may elect and in accordance with the rules obtaining of the selected organization. Arbitration must be commenced by service upon the other party of a written demand for arbitration or a written notice of intention to arbitrate, therein electing the arbitration tribunal. In the event the undersigned does not make such election within five (5) days of such demand or notice, then the undersigned authorizes Pershing or VBS to do so on behalf of the undersigned. No person shall bring a putative or certified class action to arbitration, nor seek to enforce any predispute arbitration agreement against any person who has initiated in court a putative class action; or 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. 24. The Laws of the State of New York Shall Govern This Agreement and its enforcement shall be governed by the laws of the State of New York without giving effect to its conflict of laws provisions. 25. Loan Consent By signing this Agreement, the undersigned acknowledges that securities not fully paid for by the undersigned may be loaned to you or loaned out to others and that while such securities are loaned, the undersigned may be waiving rights to vote such shares. 26. Shareholder Vote of Loaned Securities In the event the undersigned s securities have been loaned by Pershing on the record date of a shareholder vote involving those securities, the undersigned agrees that the undersigned s vote may be reduced to reflect the total amount of the undersigned s securities loaned by Pershing. 31

49 Cost Basis Accounting Service You will be automatically enrolled in our Cost Basis Accounting Service when your VanguardAdvantage Account is opened. As a part of this service, the cost basis for any corporate actions (such as stock splits and mergers) that affect the securities you own will be tracked and updated on an ongoing basis. To view the cost basis of your individual securities, you must be a registered user of our website, Vanguard.com.Once you log on at will be able to view your gains and losses. You can use this service for securities already in your account and for securities you transfer to Vanguard from another firm, but you will have to enter the cost basis information yourself. You have a choice of cost basis accounting methods for your individual securities: First-in, first-out. When you sell stocks or bonds, the securities that you have held the longest will be sold first. Highest-cost. When you sell stocks or bonds, the securities having the highest cost will be sold first. If you do not select a cost basis accounting method, we will use our default method first-in, first-out when you sell individual securities from your account. We use the average cost single category method for the sale of all mutual fund investments. Note the following: This service is made available in association with Pershing LLC. The service is provided for general information purposes only. You are responsible for maintaining accurate account records for your tax returns. Neither Vanguard nor Pershing will give your information to the IRS, prepare your tax return, or advise you on which accounting method is best for your particular tax situation. For help in these matters, we recommend that you consult a qualified tax professional. 32

50 Vanguard Brokerage Services A Division of Vanguard Marketing Corporation, Member of NASD and SIPC Post Office Box 1170 Valley Forge, PA Since 1983, Vanguard Brokerage Services has provided superior service and exceptional value to investors. Our clients enjoy online, automated phone, and associate-assisted access to stocks, exchange-traded funds, bonds, CDs, and options, plus thousands of funds from other mutual fund families. Standard services include cost basis accounting, comprehensive statements, free dividend reinvestment, and many other services designed to maximize investment convenience at a reasonable cost. World Wide Web Toll-Free Information Text Telephone for the Hearing Impaired The Vanguard Group, Vanguard, Vanguard Brokerage Services, VanguardAdvantage, Vanguard.com, VBS, and the ship logo are trademarks of The Vanguard Group. Visa and Plus are trademarks of Visa International Service Association. All other marks are the exclusive property of their respective owners. For more information, visit or call for Vanguard funds and for non-vanguard funds offered through Vanguard Brokerage Services, to obtain a prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing The Vanguard Group, Inc. All rights reserved. Vanguard Marketing Corporation, Distributor. VAADBD