Stephens Inc. ("Stephens") is furnishing this document to you to
provide some basic facts about purchasing securities on margin, and
to alert you to the risks involved with trading securities in a
margin account. Before trading stocks in a margin account, you
should carefully review the margin agreement provided by Stephens.
Contact your financial consultant regarding any questions or
concerns you may have with your margin account(s).
When you purchase securities, you may pay for the securities in
full or you may borrow part of the purchase price from Stephens. If
you choose to borrow funds, you will open a margin account with
Stephens. The securities purchased are Stephens' collateral for the
loan to you. If the securities in your account decline in value, so
does the value of the collateral supporting your loan, and, as a
result, Stephens can take action, such as issue a margin call
and/or sell securities or other assets in any of your accounts held
with Stephens, in order to maintain the required equity in the
It is important that you fully understand the risks involved in
trading securities on margin. These risks include the
1. You can lose more funds than you
deposit in the margin account. A decline in the value of
securities that are purchased on margin may require you to provide
additional funds to Stephens to avoid the forced sale of those
securities or other securities or assets in your account(s).
2. Stephens can force the sale of
securities or other assets in your account(s). If the
equity in your account falls below the maintenance margin
requirements or Stephens' higher "house" requirements, Stephens can
sell the securities or other assets in any of your accounts held at
Stephens to cover the margin deficiency. You also will be
responsible for any short fall in the account after such sale.
3. Stephens can sell your securities
or other assets without contacting you. Some investors
mistakenly believe that Stephens must contact them for a margin
call to be valid, and that Stephens cannot liquidate securities or
other assets in their accounts to meet the call unless Stephens has
contacted them first. This is not the case. Stephens will attempt
to notify its customers of margin calls, but we are not required to
do so. However, even if Stephens has contacted a customer and
provided a specific date by which the customer can meet a margin
call, Stephens can still take necessary steps to protect its
financial interests, including immediately selling the securities
without notice to the customer.
4. You are not entitled to choose
which securities or other assets in your account(s) are liquidated
or sold to meet a margin call. Because the securities are
collateral for the margin loan, Stephens has the right to decide
which security to sell in order to protect its interests.
5. Stephens can increase its "house"
maintenance margin requirements at any time and is not required to
provide you advance written notice. These changes in
Stephens' policy often take effect immediately and may result in
the issuance of a maintenance margin call. Your failure to satisfy
the call may cause Stephens to liquidate or sell securities in your
6. You are not entitled to an
extension of time on a margin call. While an extension of
time to meet margin requirements may be available to customers
under certain conditions, a customer does not have a right to the