<PAGE>

                                                                    EXHIBIT 10.1

Confidential treatment has been requested for portions of this exhibit. The
copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as ******. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.


                              CLEARING AGREEMENT


   This agreement, made as of the date indicated on the signature page hereof
(the "Agreement") between Broadcort Capital Corp. (hereinafter referred to as
the "Clearing Firm") and Knight Securities, L.P. (hereinafter referred to as the
"Introducing Firm"),

                               WITNESSETH THAT:

   WHEREAS, the Introducing Firm is desirous of availing itself of clearing,
execution and other services related to the securities business as more fully
set forth herein; and

   WHEREAS, the Clearing Firm desires to extend the foregoing types of services
to the Introducing Firm.

   NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth
and other good and valuable consideration the receipt of which is hereby
acknowledged, the parties hereto hereby covenant and agree as follows:

I.  Services
    --------

    A.    Services to be Performed by the Clearing Firm
          ---------------------------------------------

          1.   The Clearing Firm will execute orders for the Introducing Firm's
               customers whose cash or margin accounts have been accepted by
               Clearing Firm ("Introduced Accounts"), but only insofar as such
               orders are transmitted by the Introducing Firm to the Clearing
               Firm.

          2.   The Clearing Firm will generate, prepare and, to the extent
               mutually agreed upon by the parties hereto, mail confirmations
               respecting each of the Introduced Accounts.  Upon mutual
               agreement of the parties hereto, the Clearing Firm may transmit
               the necessary information via the Sales Support communication
               network in order to effect the printing of confirmations at the
               location of the Introducing Firm.

          3.   The Clearing Firm will prepare and mail the summary monthly
               statements (or quarterly statements if no activity in any
               Introduced Account occurs during any quarter covered by such
               statement) to every Introduced Account.

          4.   The Clearing Firm will settle contracts and transactions in
               securities (including options to buy or sell securities) (i)
               between the Introducing Firm and other brokers and dealers, (ii)
               between the Introducing Firm and the Introduced Accounts, and
               (iii) between the Introducing Firm and persons other than the
               Introduced Accounts or other brokers and dealers.

                                       1
<PAGE>

          5.   The Clearing Firm will engage in all cashiering functions for the
               Introduced Accounts, including the receipt, delivery and transfer
               of securities purchased, sold, borrowed and loaned, receiving and
               distributing payment therefor, holding in custody and safekeeping
               all securities and payments so received, the handling of margin
               accounts, the receipt and distribution of dividends and other
               distributions, and the processing of exchange offers, rights
               offerings, warrants, tender offers and redemptions.  Upon mutual
               agreement of the parties hereto, the cashiering functions with
               respect to the receipt of securities and the making and receiving
               payment therefor may be relinquished to the Introducing Firm.

          6.   The Clearing Firm will construct and maintain prescribed books
               and records of all transactions executed or cleared through it
               and not specifically charged to the Introducing Firm pursuant to
               the terms of this Agreement, including a daily record of required
               margin and other information required by Rule 432(a) of the rules
               of the Board of Directors of the New York Stock Exchange, Inc.
               (the "Rules"), or by the constitution, articles of incorporation,
               by-laws (or comparable instruments) or rules, regulations or
               other instruments corresponding to the foregoing, and the stated
               policies or practices of any other securities exchange (the
               "Standards"), including but not otherwise limited to any national
               securities exchange registered under the Securities Exchange Act
               of 1934, as amended ("National Securities Exchange").

    B.    Services Which Shall Not be Performed by the Clearing Firm
          ----------------------------------------------------------

    Unless otherwise agreed to in a writing executed by the parties hereto, the
Clearing Firm shall not engage in any of the following services on behalf of the
Introducing Firm:

          1.   Accounting, bookkeeping or recordkeeping, cashiering, or any
               other services with respect to commodity transactions, and/or any
               transaction other than securities transactions.

          2.   Preparation of the Introducing Firm's payroll records, financial
               statements or any analysis or review thereof or any
               recommendations relating thereto.

          3.   Preparation or issuance of checks in payment of the Introducing
               Firm's expenses, other than expenses incurred by the Clearing
               Firm on behalf of the Introducing Firm pursuant to this
               Agreement.

          4.   Payment of commissions, salaries or other remuneration to the
               Introducing Firm's salesmen or any other employees of the
               Introducing Firm.

          5.   Preparation and filing of reports (the "Reports") with the
               Securities and Exchange Commission, any state securities
               commission, any National Securities Exchange, or other securities
               exchange or securities association or any other regulatory or
               self-regulatory body or agency with which the

                                       2
<PAGE>

               Introducing Firm is associated and/or by which it is regulated.
               Notwithstanding the foregoing, the Clearing Firm will, at the
               request of the Introducing Firm, furnish the Introducing Firm
               with any necessary information and data contained in books and
               records kept by the Clearing Firm and not otherwise reasonably
               available to the Introducing Firm if such information is required
               in connection with the preparation and filing of Reports by the
               Introducing Firm.

          6.   Making and maintaining reports and records required to be kept by
               the Introducing Firm by the Currency and Foreign Transactions
               Reporting Act of 1970 and the regulations promulgated pursuant
               thereto, or any similar law or regulations enacted or adopted
               hereafter.

          7.   Verification of the address changes of any Introduced Account.

          8.   Obtaining and verifying new account information, and insuring
               that such information meets the requirements of Rule 405(1) of
               the Rules and any other Rules or applicable Standards.

          9.   Maintaining a record of all personal and financial information
               concerning any Introduced Account and all orders received
               therefrom, and maintaining all documents and agreements executed
               by any Introduced Account.

          10.  Holding for safekeeping of the securities of any Introduced
               Account registered in the name of the Introduced Account.

          11.  Accepting deposits from the Introducing Firm in the form of coin
               or currency of the United States or any other country.

II.  Clearing Charges
     ----------------

     See Schedule A attached hereto and incorporated herein by reference.

     In no event shall the fees charged in this Article II for the above
services be in contravention of the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, the Investment Advisers Act of
1940, as amended, and the Employee Retirement Income Security Act of 1974, as
amended, or any rules or regulations thereunder, or any other law, rule or
regulation, Federal, state or local, or any constitution, by-law, rule,
regulation or instrument corresponding to the foregoing, or stated policy or
practice of any National Securities Exchange or other securities exchange or
association or other regulatory or self-regulatory body or agency ("Laws and
Regulations"). In the event that such fees are deemed by the Clearing Firm to be
in contravention of the Laws and Regulations, they shall be replaced with fees
mutually agreed upon by the Clearing Firm and the Introducing Firm.

                                       3
<PAGE>

III. Interest
     --------

     Interest income earned through charges on debit balances in any Introduced
Account shall be proprietary to and fully retained by the Clearing Firm. No
interest shall be paid or credit given for any credit balances which from time
to time may be left on deposit with the Clearing Firm, unless otherwise mutually
agreed upon by the Clearing Firm and the Introducing Firm.

IV.  Notations on Statements, Confirmations and Other Written Material
     -----------------------------------------------------------------

     The Clearing Firm shall carry all Introduced Accounts in the name of the
Introducing Firm's customer, with a notation on its books and records that such
Introduced Accounts were introduced by the Introducing Firm, and all monthly or
quarterly statements, confirmations and notices of funds or securities due
relating to such Introduced Accounts shall also indicate that the Introduced
Accounts were introduced by the Introducing Firm, that the role of the Clearing
Firm is to perform only the clearing functions and related services expressly
set forth herein, and that the Introducing Firm will continue as broker for the
Introduced Accounts.  Inadvertent omission of such notations shall not be deemed
to constitute a breach of this Agreement.  Copies of the forms covering all of
the foregoing shall be furnished by the Clearing Firm to the Introducing Firm.

  If the Introducing Firm does not assume any cashiering function with respect
to any Introduced Accounts, the account statements of the Clearing Firm sent to
Introduced Accounts will contain a provision substantially in the following
form:

         The funds and securities specified in this account statement are under
     the possession or control of Merrill Lynch, Pierce, Fenner & Smith
     Incorporated, and not with the securities firm that introduced this account
     to Broadcort Capital Corp., the clearing firm. If you have any questions
     regarding your account, please contact Customer Services at Broadcort
     Capital Corp., at 212-670-0600, if your Introducing Firm is unable to
     assist you.

V.   Opening of Accounts
     -------------------

     A.  At the time of the opening of each Introduced Account, the Introducing
Firm shall furnish the Clearing Firm with all financial and personal information
concerning such Introduced Accounts as the Clearing Firm may reasonably require.
At the time of the opening of Introduced Accounts that are margin accounts, the
Introducing Firm shall furnish the Clearing Firm with executed customers'
agreements, hypothecation agreements and consents to loans of securities
(collectively, the "margin agreement").  The Clearing Firm shall supply the
Introducing Firm with "new account" and margin agreement forms regarding margin
accounts in sufficient quantities, such forms to be submitted to the Clearing
Firm upon their completion by the Introducing Firm.  If any Introduced Account
may have been opened without the Clearing Firm having previously received the
foregoing information or, in the case of a margin account, without the Clearing
Firm having previously received properly executed margin agreements, failure of
the Clearing Firm to receive such information or margin agreements shall not be
deemed to be a waiver of the information requirements set forth herein.  Upon
the written or oral request of the Clearing Firm, the Introducing Firm shall
furnish the Clearing Firm with any other documents

                                       4
<PAGE>

and agreements executed by the Introduced Account on forms which shall be
supplied by the Clearing Firm in sufficient quantities and which may reasonably
be required by the Clearing Firm in connection with the opening, operating or
maintaining of Introduced Accounts. The Clearing Firm may, at its election, mail
margin agreement or "new account" forms directly to the Introduced Accounts upon
notification by the Introducing Firm, and/or require completion of its own
margin agreement or "new account" forms and, if required, option account
agreements for the Introduced Accounts. The Introducing Firm shall promptly
provide the Clearing Firm with basic data and copies of documents relating to
each of the Introduced Accounts, including, but not otherwise limited to, copies
of records of any receipts of the Introduced Accounts' funds and/or securities
received directly by the Introducing Firm, as shall be necessary for the
Clearing Firm to discharge its service obligations hereunder.

     B. All transactions in any Introduced Account are to be considered cash
transactions until such time as the Clearing Firm has received margin
agreements, duly and validly executed in respect of such Introduced Account.
Nevertheless, it is intended that the Introducing Firm will obtain executed
margin agreements within the time periods set forth in the Clearing Firm's
procedural manuals. In the event credit is inadvertently extended with respect
to such Introduced Accounts, the Introducing Firm shall indemnify and hold the
Clearing Firm harmless from and against all loss, liability, damage, cost and
expense (including but not otherwise limited to fees and expenses of legal
counsel) arising therefrom.

     C.  At the time of the opening of any agency Introduced Account, the
Introducing Firm shall furnish the Clearing Firm with the name of any principal
for whom the Introducing Firm is acting as agent, and written evidence of such
authority.

     D. The Introducing Firm shall have the sole and exclusive responsibility
for compliance with Rule 405(3) of the Rules and shall specifically approve the
opening of any new account before forwarding such account to the Clearing Firm
as a potential Introduced Account. The Clearing Firm, in its reasonable business
judgment, reserves the right to reject any account which the Introducing Firm
may tender to the Clearing Firm as a potential Introduced Account. The Clearing
Firm also reserves the right to terminate any account previously accepted by it
as an Introduced Account.

     E.  Pursuant to written notification received by the Introducing Firm and
forwarded to the Clearing Firm, any account of the Introducing Firm may choose
to reject the services to be performed by the Clearing Firm pursuant to this
Agreement and thus choose not to be serviced as an Introduced Account pursuant
hereto.  Upon notice from another member organization that an Introduced Account
intends to transfer his account thereto, the Clearing Firm shall expedite such
transfer and shall have the sole and exclusive responsibility for compliance
with Rule 412 of the Rules.

     F. It shall be the sole and exclusive responsibility of the Introducing
Firm to make every reasonable effort to ascertain the essential facts relative
to any Introduced Account and any order therefor, in compliance with Rule 405(1)
of the Rules, including but not otherwise limited to ascertaining the authority
of all orders for Introduced Accounts, and the genuineness of all certificates,
papers and signatures provided by each Introduced Account. Any investment advice
furnished to an Introduced Account shall be the sole and exclusive
responsibility of the Introducing Firm.

                                       5
<PAGE>

     G. The Introducing Firm shall be solely and exclusively responsible for the
handling and supervisory review of any Introduced Accounts over which the
Introducing Firm's partners, officers or employees have discretionary authority,
as required by Rule 408 of the Rules and any other applicable Laws and
Regulations. The Introducing Firm shall furnish the Clearing Firm with such
documentation with respect thereto as may be requested by the Clearing Firm. The
Introducing Firm hereby agrees to indemnify and hold the Clearing Firm harmless
against any loss, liability, damage, cost or expense (including but not
otherwise limited to fees and expenses of legal counsel), as incurred, suffered
or incurred by the Clearing Firm directly or indirectly as a result of any
liabilities or claims arising from the exercise by the Introducing Firm, its
partners, officers or employees of discretionary authority over Introduced
Accounts. The Introducing Firm hereby warrants that with regard to any orders or
instructions given by the Introducing Firm with respect to such discretionary
accounts, its partners, officers or employees shall have been fully and properly
authorized relative thereto and that the execution of such orders shall not be
in violation of the Laws and Regulations. Furthermore, the Introducing Firm
hereby agrees to indemnify and hold the Clearing Firm harmless against any loss,
liability, damage, cost or expense (including but not otherwise limited to fees
and expenses of legal counsel), as incurred, suffered or incurred by the
Clearing Firm directly or indirectly as a result of any breach of the
Introducing Firm's said warranty. The Introducing Firm hereby agrees and
warrants that it will maintain appropriate blanket brokers bond insurance
policies covering any and all acts of its employees, agents and partners
adequate to fully protect and indemnify the Clearing Firm against any loss,
liability, damage, cost or expense (including but not otherwise limited to fees
and expenses of legal counsel) which the Clearing Firm may suffer or incur,
directly or indirectly, as a result of any act of the Introducing Firm's
employees, agents or partners.

     H. The Introducing Firm shall have the sole and exclusive responsibility
for the handling and supervisory review of any Introduced Account for an
employee or officer of any member organization, self-regulatory organization,
bank, trust company, insurance company or other organization engaged in the
securities business, and for compliance with Rule 407 of the Rules relating
thereto. The Introducing Firm shall furnish the Clearing Firm with such
documentation with respect thereto as may be requested by the Clearing Firm.

     I. The Introducing Firm shall have the sole and exclusive responsibility to
insure that those of its customers who become Introduced Accounts hereunder
shall not be minors or subject to those prohibitions existing under the Laws and
Regulations generally relating to the incapacity of any Introduced Account or
any conflict of interest relating to such Introduced Account.

     J. The Introducing Firm shall be solely and exclusively responsible for any
loss, liability, damage, cost or expense (including but not otherwise limited to
fees and expenses of legal counsel) sustained or incurred by either the
Introducing Firm or the Clearing Firm, arising out of or resulting from any
orders the Introducing Firm has taken from Introduced Accounts residing or being
domiciled in jurisdictions in which the Introducing Firm has not been or is no
longer authorized to do business.

     K.  It shall be the sole and exclusive responsibility of the Introducing
Firm to comply with any and all prospectus delivery requirements in connection
with Introduced Accounts which are option accounts.

                                       6
<PAGE>

     L.  For purposes of the Securities Investors Protection Act and the
financial responsibility rules promulgated by the Securities and Exchange
Commission, the Introduced Accounts shall be deemed customers of the Clearing
Firm. For all other purposes, the responsibilities of the Clearing Firm and the
Introducing Firm with respect to the Introduced Accounts shall be as specified
herein, including with respect to the Introducing Firm's supervisory
responsibility specified herein.

VI.  Transactions and Margin
     -----------------------

     A. It is understood that with respect to Introduced Accounts which are
margin accounts the Clearing Firm is responsible for compliance with Regulation
T, 12 C.F.R. Part 220, the federal margin regulation promulgated by the Board of
Governors of the Federal Reserve System (the "Board"), and any interpretive
ruling issued by the Board, and letter rulings of the Federal Reserve Bank of
New York, Rules and interpretations of the New York Stock Exchange, Inc. and any
other applicable margin and margin maintenance requirements of the Laws and
Regulations. The Introducing Firm is responsible to the Clearing Firm for the
collection of the margin required to support each transaction for, and to
maintain margin in, each Introduced Account, in conformity with the above margin
and margin maintenance requirements. After such initial margin on each
transaction has been received, maintenance margin calls shall be generated by
the Clearing Firm and made by the Clearing Firm or by the Introducing Firm at
the instructions of the Clearing Firm. The Clearing Firm shall have the right to
modify, in its sole discretion, the margin requirements of any Introduced
Account from time to time so that the Clearing Firm may call for additional
margin. Therefore, the Clearing Firm shall be the sole judge as to the amount of
margin to be required of and maintained by Introduced Accounts, which may be
imposed by security or specific Introduced Account and need not be of general
application.

     B. On all transactions, the Introducing Firm shall be solely and
exclusively responsible to the Clearing Firm for any loss, liability, damage,
cost or expense (including but not otherwise limited to fees and expenses of
legal counsel), as incurred, incurred or sustained by the Introducing Firm or
the Clearing Firm as a result of the failure of any Introduced Account to make
timely payment for the securities purchased by it or timely and good delivery of
securities sold for it, or timely compliance by it with margin or margin
maintenance calls (provided that the Clearing Firm has timely issued such call
and given notice thereof to the Introducing Firm), whether or not any margin
extensions have been granted by the Clearing Firm pursuant to the request of the
Introducing Firm, except that no interest will be charged by the Clearing Firm
for cash shorts in Introduced Accounts. The Introducing Firm agrees to be solely
and exclusively responsible to the Clearing Firm for any loss or liability
whatsoever should any check or draft given to the Clearing Firm by any of the
Introduced Accounts be returned to the Clearing Firm unpaid. The Introducing
Firm furthermore agrees to be solely and exclusively responsible for the payment
and delivery of all "when issued" or "when distributed" transactions which the
Clearing Firm may accept, forward or execute for Introduced Accounts.

     C.  On all over-the-counter transactions for Introduced Accounts, the
Introducing Firm shall furnish the Clearing Firm with the names of the
respective purchasing and selling broker-dealers (except as otherwise provided
in Section D of this Article VI, as set forth below),

                                       7
<PAGE>

the names of the purchasing and selling customers, and the wholesale and retail
purchase and sale prices.

     D.  Should the Introducing Firm give an order in an over-the-counter
security to the Clearing Firm and the counterparty is left to the Clearing
Firm's discretion, the Clearing Firm will assume the responsibility of paying
the Introducing Firm that which the counterparty has failed to pay pursuant to
the over-the-counter transaction ("del credere risk"). In case the Introducing
Firm executes its own over-the-counter order or designates the counterparty, it
shall be understood that in the event the over-the-counter dealer with whom the
Introducing Firm dealt or whom it designated fails to live up to its part of the
transaction, the Introducing Firm will assume the del credere risk and reimburse
the Clearing Firm for any loss sustained thereby.

     E.  The Introducing Firm shall be solely and exclusively responsible for
approving all orders for the Introduced Accounts and for establishing procedures
to insure that such approved  orders are transmitted properly to the Clearing
Firm for execution.  The Clearing Firm, in its reasonable business judgment,
reserves the right to reject any order which the Introducing Firm may transmit
to the Clearing Firm for execution.

     F. The Introducing Firm shall be solely and exclusively responsible for the
supervisory review of all orders for the Introduced Accounts and shall insure
that any orders and instructions given by it or any of its employees to the
Clearing Firm pursuant to the terms of this Agreement shall have been properly
authorized in advance.

     G. The Introducing Firm shall be solely and exclusively responsible for
sales and purchases for the Introduced Accounts that may create or result in a
violation of any of the Laws and Regulations.

     H. All transactions pursuant to the terms of this Agreement shall be
subject to the constitution, rules, by-laws, regulations, stated policies,
practices, and customs and any modifications thereof of any National Securities
Exchange or other securities exchange or market and its clearing house, if any,
where executed, and the Laws and Regulations. It is understood that the
Introducing Firm assumes sole and exclusive responsibility for compliance with
the Laws and Regulations in the same manner and to the same degree as if the
Introducing Firm were performing the services for the Introduced Accounts that
have been assumed by the Clearing Firm pursuant to this Agreement, except
insofar as the Clearing Firm may, pursuant to Section D of this Article VI, as
set forth above, select the counterparty to a particular transaction.

     I. All transactions heretofore between the Introducing Firm and the
Clearing Firm with respect to orders given by or for the Introduced Accounts and
cleared through the Clearing Firm shall be subject to the provisions of this
Agreement.

                                       8
<PAGE>

VII. Supervisory Responsibility
     --------------------------

      A. The Introducing Firm shall have the sole and exclusive responsibility
for the review of all Introduced Accounts and for compliance with any
supervisory responsibility under Rule 405(2) of the Rules, including but not
otherwise limited to matters involving the investment objectives of the
Introduced Accounts, the suitability of the investments made by the Introduced
Accounts, the reasonable bases for recommendations made to Introduced Accounts,
and the frequency of trading in the Introduced Accounts, whether or not such
transactions are instituted by the Introducing Firm, its partners, officers,
employees or any registered investment advisor.

      B. The Introducing Firm and the Clearing Firm shall each be responsible
for compliance with any supervisory procedures under Rule 342 of the Rules and,
to the extent applicable, any other provisions of the Laws and Regulations,
including but not otherwise limited to supervising the activities and training
of their respective registered representatives, as well as all of their other
respective employees in the performance of functions specifically allocated to
them pursuant to the terms of this Agreement.

VIII.Information to be Provided by the Introducing Firm
     --------------------------------------------------

      A. The Introducing Firm shall provide the Clearing Firm with copies of all
financial information and reports filed by the Introducing Firm with the New
York Stock Exchange, Inc. (if a member), the National Association of Securities
Dealers, Inc., the Securities and Exchange Commission, and any other National
Securities Exchange (where a member) (including but not otherwise limited to
monthly and quarterly Financial and Operational Combined Uniform Single Reports,
i.e., "FOCUS" Reports) simultaneous with the filing therewith.

      B. The Introducing Firm shall submit to the Clearing Firm on a monthly
basis or, if so requested by the Clearing Firm, at more frequent intervals,
information and reports relating to the Introducing Firm's financial integrity,
including but not otherwise limited to information regarding the Introducing
Firm's aggregate indebtedness ratio and net capital.

      C. The Introducing Firm shall provide the Clearing Firm with all
appropriate data in its possession pertinent to the proper performance and
supervision of any function or responsibility specifically allocated to the
Clearing Firm pursuant to the terms of this Agreement.

      D. The Introducing Firm shall provide the Clearing Firm with any amendment
or supplement to the Form BD of the Introducing Firm.

IX.  Information to be Provided by the Clearing Firm
     -----------------------------------------------

      The Clearing Firm shall provide the Introducing Firm with all appropriate
data in its possession pertinent to the proper performance and supervision of
any function specifically allocated to the Introducing Firm pursuant to the
terms of this Agreement. The Introducing Firm shall be responsible for and shall
promptly reimburse the Clearing Firm for all costs incurred by the Clearing Firm
in connection with the preparation and mailing of such information.

                                       9
<PAGE>

X.   Customer Notification and Correspondence
     ----------------------------------------

      A. The Introducing Firm shall be solely and exclusively responsible for
informing its customers in a written correspondence, the form and substance of
which will be mutually agreed upon, prior to the effective date of this
Agreement, as to the general nature of the services to be provided by the
Clearing Firm pursuant to this Agreement and the right of such customers to
reject the services provided herein.  Any new customers of the Introducing Firm
shall also be informed as provided herein, prior to such customers becoming
Introduced Accounts.  The Introducing Firm shall be solely and exclusively
responsible for the payment of all costs incurred in connection with the
preparation and mailing of such customer correspondence.

      B. The Introducing Firm shall inform its customers pursuant to such
written correspondence that all inquiries and correspondence should be directed
to the Introducing Firm. All customer correspondence shall be reviewed and
responded to by the party responsible for the specific area to which the inquiry
or complaint relates pursuant to the terms of this Agreement. In the event such
correspondence is not directed to such party originally, the Introducing Firm or
Clearing Firm shall expeditiously forward such correspondence to the appropriate
party.

XI.  Errors, Controversies and Indemnities
     -------------------------------------

      A. Errors, misunderstandings or controversies, except those specifically
otherwise covered in this Agreement, between the Introduced Accounts and the
Introducing Firm or any of its employees, which shall arise out of acts or
omissions of the Introducing Firm or any of its employees (including, without
limiting the foregoing, the failure of the Introducing Firm to deliver promptly
to the Clearing Firm any instructions received by the Introducing Firm from an
Introduced Account with respect to the voting, tender or exchange of shares held
in such Introduced Account), shall be the sole and exclusive responsibility and
liability of the Introducing Firm.  In the event, however, that by reason of
such error, misunderstanding or controversy, the Introducing Firm in its
discretion deems it advisable to commence an action or proceeding against an
Introduced Account, the Introducing Firm shall indemnify and hold the Clearing
Firm harmless from any loss, liability, damage, cost or expense (including but
not otherwise limited to fees and expenses of legal counsel), as incurred, which
the Clearing Firm may incur or sustain in connection therewith or under any
settlement thereof.  If such error, misunderstanding or controversy shall result
in the bringing of an action or proceeding against the Clearing Firm, the
Introducing Firm shall indemnify and hold the Clearing Firm harmless from any
loss, liability, damage, cost or expense (including but not otherwise limited to
fees and expenses of legal counsel), as incurred, which the Clearing Firm may
incur or sustain in connection therewith or under any settlement thereof.

      B. Errors, misunderstandings or controversies, except those specifically
otherwise covered in this Agreement, between the Introduced Accounts and the
Introducing Firm or any of its employees, which shall arise out of acts or
omissions of the Clearing Firm or any of its employees, shall be the sole and
exclusive responsibility and liability of the Clearing Firm.  In the event,
however, that by reason of such error, misunderstanding or controversy, the
Clearing Firm in its discretion deems it advisable to commence an action or
proceeding against an Introduced Account, the Clearing Firm shall indemnify and
hold the Introducing Firm harmless from any loss, liability, damage, cost or
expense (including but not otherwise limited to fees and

                                       10
<PAGE>

expenses of legal counsel), as incurred, which the Introducing Firm may incur or
sustain in connection therewith or under any settlement thereof. If such error,
misunderstanding or controversy shall result in the bringing of an action or
proceeding against the Introducing Firm, the Clearing Firm shall indemnify and
hold the Introducing Firm harmless from any loss, liability, damage, cost or
expense (including but not otherwise limited to fees and expenses of legal
counsel), as incurred, which the Introducing Firm may incur or sustain in
connection therewith or under any settlement thereof.

      C. The Clearing Firm and the Introducing Firm both agree to indemnify the
other and hold the other harmless from and against any loss, liability, damage,
cost or expense (including but not otherwise limited to fees and expenses of
legal counsel), as incurred, arising out of or resulting from any failure by the
indemnifying party or any of its employees to carry out fully the duties and
responsibilities assigned to the indemnifying party herein (including, without
limitation, the indemnification obligations contained in this Agreement) or any
breach of any representation or warranty herein by the indemnifying party under
this Agreement.  The Introducing Firm hereby agrees to indemnify and hold the
Clearing Firm harmless from and against any loss, liability, damage, cost or
expense (including but not otherwise limited to fees and expenses of legal
counsel), as incurred, sustained or incurred in connection herewith in the event
any Introduced Account fails to meet any initial margin call or maintenance
call, in conformity with Article VI hereof.

      D. The indemnification provisions in this Agreement shall remain operative
and in full force and effect, regardless of the termination of this Agreement,
and shall survive any such termination.

      E. The Introducing Firm agrees to maintain, and to provide evidence
thereof to the Clearing Firm, at least $500,000 blanket brokers indemnity bond
insurance covering any and all acts of its employees, agents and partners, with
an insurance company reasonably acceptable to the Clearing Firm, listing the
Clearing Firm as an insured party and permitting the Clearing Firm to assume the
policy in the event of the Introducing Firm ceasing operations.

XII. Representations, Warranties and Covenants
     -----------------------------------------

      A.  The Introducing Firm represents, warrants and covenants as follows:

             1.   The Introducing Firm will (a) maintain at all times a net
                  capital computed in accordance with Rule 15c3-1 of at least
                  (i) $100,000 in excess of the minimum net capital required by
                  such rule if the Introducing Firm is a market maker (as that
                  term is defined under Rule 15c3-1) and (ii) $50,000 in excess
                  of the minimum net capital required by such rule if the
                  Introducing Firm is not a market maker, and (b) immediately
                  notify the Clearing Firm when (i) its net capital is less than
                  the applicable amount set forth in (a) above, (ii) its
                  Aggregate Indebtedness Ratio reaches or exceeds 10 to 1 or
                  (iii) if the Introducing Firm has elected to operate under
                  Rule l5c3-1(a)(1)(ii) of the Securities Exchange Act of 1934,
                  as amended, when its net capital is less than 5% of aggregate
                  debit items computed in accordance with Rule l5c3-3.

                                       11
<PAGE>

             2.   The Introducing Firm is a member in good standing of the
                  National Association of Securities Dealers, Inc. The
                  Introducing Firm will promptly notify the Clearing Firm of any
                  additional exchange memberships or affiliations. The
                  Introducing Firm shall also comply with whatever non-member
                  access rules have been promulgated by any National Securities
                  Exchange or any other securities exchange of which it is not a
                  member.

             3.   The Introducing Firm is and during the term of this Agreement
                  will remain duly registered or licensed and in good standing
                  as a broker/dealer under all applicable Laws and Regulations.

             4.   The Introducing Firm has all the requisite authority in
                  conformity with all applicable Laws and Regulations to enter
                  into this Agreement and to retain the services of the Clearing
                  Firm in accordance with the terms hereof.

             5.   The Introducing Firm is in compliance, and during the term of
                  this Agreement will remain in compliance with (i) the capital
                  and financial reporting requirements of every National
                  Securities Exchange or other securities exchange and/or
                  securities association of which the Introducing Firm is a
                  member, (ii) the capital requirements of the Securities and
                  Exchange Commission, and (iii) the capital requirements of
                  every state in which the Introducing Firm is licensed as a
                  broker/dealer.

             6.   The Introducing Firm shall not generate and/or prepare any
                  statements, billings or confirmations respecting any
                  Introduced Account unless expressly so instructed in writing
                  by the Clearing Firm.

             7.   The Introducing Firm shall keep confidential any information
                  it may acquire as a result of this Agreement regarding the
                  business and affairs of the Clearing Firm, which requirement
                  shall survive the life of this Agreement.

      B.  The Clearing Firm represents, warrants and covenants as follows:

             1.   The Clearing Firm is a member in good standing of the National
                  Association of Securities Dealers, Inc. and the New York Stock
                  Exchange, Inc.

             2.   The Clearing Firm is and during the term of this Agreement
                  will remain duly licensed and in good standing as a
                  broker/dealer under all applicable Laws and Regulations.

             3.   The Clearing Firm has all the requisite authority, in
                  conformity with all applicable Laws and Regulations, to enter
                  into and perform this Agreement.

                                       12
<PAGE>

             4.   The Clearing Firm is in compliance, and during the term of
                  this Agreement will remain in compliance with (i) the capital
                  and financial reporting requirements of every National
                  Securities Exchange and/or other securities exchange or
                  association of which it is a member, (ii) the capital
                  requirements of the Securities and Exchange Commission, and
                  (iii) the capital requirements of every state in which it is
                  licensed as a broker/dealer.

             5.   The Clearing Firm represents and warrants that the names and
                  addresses of the Introducing Firm's customers which have or
                  which may come to its attention in connection with the
                  clearing and related functions it has assumed under this
                  Agreement are confidential and shall not be utilized by the
                  Clearing Firm except in connection with the functions
                  performed by the Clearing Firm pursuant to this Agreement.
                  Notwithstanding the foregoing, should an Introduced Account
                  request, on an unsolicited basis, that the Clearing Firm or an
                  organization affiliated with the Clearing Firm become its
                  broker, acceptance of such Introduced Account by the Clearing
                  Firm or such affiliated organization shall in no way violate
                  this representation and warranty, nor result in a breach of
                  this Agreement.

             6.   The Clearing Firm shall keep confidential any information it
                  may acquire as a result of this Agreement regarding the
                  business and affairs of the Introducing Firm, which
                  requirement shall survive the life of this Agreement.

XIII.  Termination - Event of Default
       ------------------------------

       Notwithstanding any provision in this Agreement, the following events or
occurrences shall constitute an Event of Default under this Agreement:

            (i)   either the Clearing Firm or the Introducing Firm shall fail to
                  perform or observe any term, covenant or condition to be
                  performed or observed by it hereunder and such failure shall
                  continue to be unremedied for a period of 60 days (30 days in
                  the case of a failure of the Introducing Firm to maintain the
                  net capital ratios set forth in Section A(i)(a) of Article
                  XII) after written notice from the non-defaulting party to the
                  defaulting party specifying the failure and demanding that the
                  same be remedied; or

            (ii)  any representation or warranty made by either the Clearing
                  Firm or the Introducing Firm herein shall prove to be
                  incorrect at any time in any material respect; or

            (iii) a receiver, liquidator or trustee of either the Clearing Firm
                  or the Introducing Firm, or of its property, held by either
                  party, is appointed by court order and such order remains in
                  effect for more than 30 days; or either the Clearing Firm or
                  the Introducing Firm is adjudicated bankrupt or


                                       13
<PAGE>

                  insolvent; or any of its property is sequestered by court
                  order and such order remains in effect for more than 30 days;
                  or a petition is filed against either the Clearing Firm or the
                  Introducing Firm under any bankruptcy, reorganization,
                  arrangement, insolvency, readjustment of debt, dissolution or
                  liquidation law of any jurisdiction, whether now or hereafter
                  in effect, and is not dismissed within 30 days after such
                  filing; or

            (iv)  either the Clearing Firm or the Introducing Firm files a
                  petition in voluntary bankruptcy or seeking relief under any
                  provision of any bankruptcy, reorganization, arrangement,
                  insolvency, readjustment of debt, dissolution or liquidation
                  law of any jurisdiction, whether now or hereafter in effect,
                  or consents to the filing of any petition against it under any
                  such law; or

            (v)   either the Clearing Firm or the Introducing Firm makes an
                  assignment for the benefit of its creditors, or admits in
                  writing its inability to pay its debts generally as they
                  become due, or consents to the appointment of a receiver,
                  trustee or liquidator of either the Clearing Firm or the
                  Introducing Firm, or of any property held by either party.

Upon the occurrence of any such Event of Default, the non-defaulting party may,
at its option, by notice to the defaulting party declare that this Agreement
shall be thereby terminated and such termination shall be effective as of the
date such notice has been sent or communicated to the defaulting party.

XIV. Remedies Cumulative
     -------------------

      The enumeration herein of specific remedies shall not be exclusive of any
other remedies.  Any delay or failure by any party to this Agreement to exercise
any right, power, remedy or privilege herein contained, or now or hereafter
existing under any applicable statute or law, shall not be construed to be a
waiver of such right, power, remedy or privilege or to limit the exercise of
such right, power, remedy or privilege.  No single, partial or other exercise of
any such right, power, remedy or privilege shall preclude the further exercise
thereof or the exercise of any other right, power, remedy or privilege.

XV.  Year 2000
     ---------

      The Introducing Firm agrees that, in the event the Introducing Firm
desires to establish an electronic link with the Clearing Firm or any of its
affiliates, the Introducing Firm shall be required to make a representation with
respect to the Year 2000 compliance of any of its systems that may interface
with the Clearing Firm's systems (or those of any affiliate), and the Clearing
Firm shall, in its sole discretion, determine whether to permit the electronic
interface to exist (or to discontinue any link after being established). The
Clearing Firm may require that evidence of compliance be provided.

                                       14
<PAGE>

XVI. PAIB Requirements
     -----------------

      The Clearing Firm and Introducing Firm agree to comply with the SEC No-
Action Letter, dated November 3, 1998 ("No-Action Letter") relating to the
capital treatment of assets in the proprietary account of an introducing broker
("PAIB") and to permit Introducing Firm to use PAIB assets in its net capital
computations.

      A. Introducing Firm shall identify to Clearing Firm in writing all
accounts that are, or from time to time may be, its proprietary accounts. The
Clearing Firm shall perform a computation for Introducing Firm's PAIB assets
("PAIB Reserve Computation") in accordance with the customer reserve computation
set forth in Rule 15c3-3 ("customer reserve formula") with the following
modifications:

             1.  Any credit (including a credit applied to reduce a debit) that
                 is included in the customer reserve formula may not be included
                 as a credit in the PAIB reserve computation;

             2.  Note E(3) to Rule 15c3-3a which reduces debit balances by 1%
                 under the basic method and subparagraph (a)(1)(ii)(A) of the
                 net capital rule which reduces debit balances by 3% under the
                 alternative method shall not apply; and

             3.  Neither Note E(1) to Rule 15c3-3a nor NYSE Interpretation /04
                 to Item 10 of Rule 15c3-3a regarding securities concentration
                 charges shall be applicable to the PAIB reserve computation.

      B. The PAIB reserve computation shall include all proprietary accounts
belonging to Introducing Firm.  All PAIB assets shall be kept separate and
distinct from customer assets under the customer reserve formula in Rule 15c3-3.

      C. The PAIB reserve computation shall be prepared within the same time
frames as those prescribed by Rule 15c3-3 for the customer reserve formula.

      D. The Clearing Firm shall establish and maintain a separate "Special
Reserve Account for the Exclusive Benefit of Customers" with a bank in
conformity with the standards of paragraph (f) of Rule 15c3-3 ("PAIB Reserve
Account").  Cash and/or qualified securities as defined in the customer reserve
formula shall be maintained in the PAIB Reserve Account in an amount equal to
the PAIB reserve requirement.

      E. If the PAIB reserve computation results in a deposit requirement, the
requirement may be satisfied to the extent of any excess debit in the customer
reserve formula of the same date.  However, a deposit requirement resulting from
the customer reserve formula shall not be satisfied with excess debits from the
PAIB reserve computation.

      F. Introducing Firm's commissions receivable and other receivables from
the Clearing Firm (excluding clearing deposits) that are otherwise allowable
assets under the net capital rule

                                       15
<PAGE>

shall be excluded from the PAIB reserve computation if the amounts have been
clearly identified as receivables on Introducing Firm's books and records of and
as payables on the books of the Clearing Firm.

      G. Introducing Firm represents that it is not a guaranteed subsidiary of a
clearing broker and that it is not a guarantor of a clearing broker.
Introducing Firm also represents that it will immediately notify the Clearing
Firm in the event that either of the foregoing representations becomes
inaccurate.

      H. Upon discovery that any deposit made to the PAIB Reserve Account did
not satisfy its deposit requirement, the Clearing Firm shall by facsimile or
telegram immediately notify its designated examining authority and the
Securities and Exchange Commission ("Commission"). Unless a corrective plan is
found acceptable by the Commission and the designated examining authority, the
Clearing Firm shall provide written notification to Introducing Firm within 5
business days of the date of discovery that PAIB assets held by the Clearing
Firm shall not be deemed allowable assets for net capital purposes. The
notification shall also state that if Introducing Firm wishes to continue to
count its PAIB assets as allowable, it has until the last business day of the
month following the month in which the notification was made to transfer all
PAIB assets to another clearing broker. However, if the deposit deficiency is
remedied before the time at which Introducing Firm must transfer its PAIB assets
to another clearing broker, Introducing Firm may choose to keep its assets at
the Clearing Firm.

      I. The parties shall adhere to the terms of the No-Action Letter,
including the Interpretations set forth therein, in all respects.

XVII. Customer Complaints, Exception Reports and Check Writing Authority
      ------------------------------------------------------------------

      A. Customer Complaints. Introducing Firm authorizes the Clearing Firm, and
         -------------------
the Clearing Firm agrees to (i) furnish promptly any written customer complaint
received by the Clearing Firm regarding any of its customers or its associated
persons relating to functions and responsibilities allocated to Introducing Firm
pursuant to this Agreement, directly to Introducing Firm and its designated
examining authority; and (ii) notify its customer in writing that the Clearing
Firm has received the complaint, and that the complaint has been furnished to
Introducing Firm and to its designated examining authority.

      B. Exception Reports.  The Clearing Firm agrees to furnish a list of all
         -----------------
reports that it offers to Introducing Firm to assist Introducing Firm to
supervise and monitor its accounts in order for Introducing Firm to carry out
its functions and responsibilities pursuant to this Agreement.  The Clearing
Firm agrees to notify Introducing Firm promptly, in writing, of those specific
reports offered by the Clearing Firm that Introducing Firm requires to supervise
and monitor its customer accounts. The Clearing Firm may provide data or data
software to Introducing Firm that enables it to prepare its own reports provided
the Clearing Firm can recreate the report or furnish the data and the data
software used to prepare the report upon the request of the designated examining
authority.  The Clearing Firm must comply with the notification requirement by
informing Introducing Firm of the data and data software that is available.  The
Clearing Firm agrees to retain and preserve as part of its records copies of the

                                       16
<PAGE>

specific reports requested by and/or supplied to Introducing Firm or
alternatively, where reports are supplied through data and data software, retain
and preserve such items from which the reports are prepared. The Clearing Firm
agrees to provide a written notice to Introducing Firm's chief executive and
compliance officers within 30 days of July 1 of each year indicating the list of
reports offered to Introducing Firm and specify the reports that were actually
requested by and/or supplied to Introducing Firm. A copy of the notice will be
sent to Introducing Firm's designated examining authority.


      C. Check Writing Authority. In connection with the services that are to be
         -----------------------
performed by the Clearing Firm under this Agreement, the Clearing Firm will not
establish a checking account on Introducing Firm's behalf or on behalf of
Introducing Firm's customers.

XVIII.Order Audit Trail System (OATS)
      ------------------------------

      A. In compliance with NASDR requirements, the Clearing Firm implemented an
Order Audit Trail System ("OATS").  For all NASDAQ transactions executed by the
Clearing Firm, the Clearing Firm agrees to perform OATS reporting for all data
commencing at the time an order is received by the Clearing Firm.

      B. The Clearing Firm will not report any data (i) covering time periods
before an order is received, (ii) on transactions that were settled and/or
cleared but not executed by the Clearing Firm, (iii) for transactions that were
cleared through another clearing broker.

      C. Introducing Firm is required to file a "new order report" detailing the
time the order was entered by Introducing Firm and a "route report" indicating
the time the order was sent to Clearing Firm in order to satisfy Introducing
Firm's OATS requirements.

XIX.  Miscellaneous
       -------------

      A. As of the effective date of this Agreement the Clearing Firm will not
convert to its records as Introduced Accounts customer accounts of the
Introducing Firm that are partially or totally unsecured, securities in the name
of the Introducing Firm's customers, or legal transfer securities (securities in
the name of estates, trust, joint ownership, foreign ownership and such).

      B. The Clearing Firm shall have the power to place open orders as
instructed by the Introducing Firm as of the effective date of this Agreement,
and appropriate adjustments shall be made by the Clearing Firm to reflect that
the Clearing Firm has acted as broker on the open orders with specialists on any
National Securities Exchange or other securities exchange.

      C. The Clearing Firm shall have the power to effect appropriate
adjustments with respect to pending dividends and other distributions from the
effective date of this Agreement through the last payable date of such pending
dividends.

      D. The Introducing Firm shall be responsible for providing annual dividend
and distribution information as contained in IRS Form 1087 and any other
information required to be reported by Federal, state, or local tax laws, rules
or regulations, to its customers until the

                                       17
<PAGE>

effective date of this Agreement, whereupon the Clearing Firm shall assume this
function as to Introduced Accounts.

      E. The Clearing Firm shall have the power to allocate and make appropriate
adjustments for fails, reorganization accounts, other work in process accounts,
and coverages relating to accounts of the customers of the Introducing Firm that
have become Introduced Accounts pursuant to the terms of this Agreement.

      F. The Introducing Firm shall assume all liabilities in connection with
uncompared principal trades.  The Introducing Firm shall also assume all
liabilities in connection with the bad debts of all Introduced Accounts.  The
Introducing Firm has the responsibility to collect from its customers unsecured
and partially secured debits in the Introduced Accounts and to transmit such
collections to the Clearing Firm within the appropriate time periods as
established in procedural manuals of the Clearing Firm.  If any debit balances
remain outstanding for a time period longer than the established period, the
Clearing Firm is authorized to apply, as payment of such debit balances,
commission fees owed to the Introducing Firm in connection with transactions
pursuant to this Agreement.

     G.  Transfers of securities relating to Introduced Accounts shall be frozen
ten business days prior to the effective date of this Agreement.

     H.  The Clearing Firm shall limit its services pursuant to the terms of
this Agreement to that of clearing functions and the related services expressly
set forth herein and the Introducing Firm shall not hold itself out as an agent
of the Clearing Firm or any of the subsidiaries or companies controlled directly
or indirectly by or affiliated with the Clearing Firm. Should the Introducing
Firm in any way attempt to hold itself out as, advertise or in any way represent
that it is the agent of the Clearing Firm, the Clearing Firm shall have the
power, at its option, to terminate this Agreement and the Introducing Firm shall
be liable for any loss, liability, damage, cost or expense (including but not
otherwise limited to fees and expenses of legal counsel) sustained or incurred
by the Clearing Firm as a result of such a representation of agency or apparent
authority to act as an agent of the Clearing Firm or agency by estoppel.

     I.  This Agreement supersedes any previous agreement and may be modified
only by a writing signed by both parties to this Agreement. Such modification
shall not be deemed as a cancellation of this Agreement.

     J.  This Agreement shall be submitted to and/or approved by any National
Securities Exchange, or other regulatory and self-regulatory bodies vested with
the authority to review and/or approve this Agreement or any amendment or
modifications hereto.  In the event of any such disapproval, the parties hereto
agree to bargain in good faith to achieve the requisite approval.

     K.  This Agreement may be cancelled by either of the parties hereto upon
sixty (60) days' written notice; provided, however, that this Agreement may be
cancelled by either party upon thirty (30) days' written notice if (i) the net
capital ratio of the other party exceeds 10 to 1 or (ii) if the other party has
elected to operate under Rule l5c3-1(a)(1)(ii) of the Securities Exchange Act of
1934, as amended, when its net capital is less than 3% of aggregate debit items
computed

                                       18
<PAGE>

in accordance with Rule l5c3-3, and provided, further, that this Agreement may
be cancelled by the Clearing Firm at any time between the date on which this
Agreement is executed and the effective date of this Agreement if there is a
material change in the control or management of the Introducing Firm.

     L.  ANY DISPUTE OR CONTROVERSY BETWEEN THE INTRODUCING FIRM AND THE
CLEARING FIRM RELATING TO OR ARISING OUT OF THIS AGREEMENT SHALL BE SETTLED BY
ARBITRATION BEFORE AND UNDER THE RULES OF THE ARBITRATION COMMITTEE OF THE
NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC., UNLESS THE TRANSACTION WHICH
GAVE RISE TO SUCH DISPUTE OR CONTROVERSY WAS EFFECTED IN ANOTHER EXCHANGE OR
MARKET WHICH PROVIDES ARBITRATION FACILITIES, IN WHICH CASE IT SHALL BE SETTLED
BY ARBITRATION UNDER SUCH FACILITIES. THE DECISION OF THE ARBITERS MAY BE
ENTERED AS A FINAL JUDGMENT IN ANY COURT OF COMPETENT JURISDICTION.

     M.  The Clearing Firm will not be bound to make any investigation into the
facts surrounding any transaction that it may have with the Introducing Firm on
a principal or agency basis or that the Introducing Firm may have with its
customers or other persons, nor will the Clearing Firm be under any
responsibility for compliance by the Introducing Firm with any Laws or
Regulations which may be applicable to the Introducing Firm.

     N.  To facilitate the keeping of records by the Clearing Firm, the
Introducing Firm will turn over promptly to the Clearing Firm any and all
payments and securities which the Introducing Firm receives from its customers.
Concurrently with the delivery of such payments or securities to the Introducing
Firm, it shall furnish the Clearing Firm with such information as may be
relevant or necessary to enable the Clearing Firm to record promptly and
properly such payments and securities in the respective Introduced Accounts.

     O.  This Agreement shall be binding upon all successors, assigns or
transferees of both parties hereto, irrespective of any change with regard to
the name of or the personnel of the Introducing Firm or the Clearing Firm.  Any
assignment of this Agreement shall be subject to the requisite review and/or
approval of any regulatory or self-regulatory agency or body whose review and/or
approval must be obtained prior to the effectiveness and validity of such
assignment.  No assignment of this Agreement by the Introducing Firm shall be
valid unless the Clearing Firm consents to such an assignment in writing.  Any
assignment by the Clearing Firm to any subsidiary that it may create or to a
company affiliated with or controlled directly or indirectly by it will be
deemed valid and enforceable in the absence of any consent from the Introducing
Firm.  Neither this Agreement nor any operation hereunder is intended to be,
shall not be deemed to be, and shall not be treated as a general or limited
partnership, association or joint venture or agency relationship between the
Introducing Firm and the Clearing Firm.

     P.  Notwithstanding the provisions of Section L of Article XIX that any
dispute or controversy between the parties relating to or arising out of this
Agreement shall be referred to and settled by arbitration, in connection with
any breach by the Introducing Firm of Section H, the Clearing Firm may, at any
time prior to the initial arbitration hearing pertaining to such dispute or
controversy, by application to the United States District Court for the Southern
District

                                       19
<PAGE>

of New York or the Supreme Court of the State of New York for the County of New
York seek any such temporary or provisional relief or remedy ("provisional
remedy") provided for by the laws of the United States of America or the laws of
the State of New York as would be available in an action based upon such dispute
or controversy in the absence of an agreement to arbitrate. The parties
acknowledge and agree that it is their intention to have any such application
for a provisional remedy decided by the court to which it is made and that such
application shall not be referred to or settled by arbitration. No such
application to either said court for a provisional remedy, nor any act or
conduct by either party in furtherance of or in opposition to such application,
shall constitute a relinquishment or waiver of any right to have the underlying
dispute or controversy with respect to which such application is made settled by
arbitration in accordance with Section L above.

     Q.  The Introducing Firm shall not, without having obtained the prior
written approval of the Clearing Firm, agree to place or place any advertisement
in any newspaper, publication, periodical or any other media or communicate with
any customer or the public in any manner whatsoever if such advertisement or
communication in any manner makes reference to the Clearing Firm, to any person
or entity that directly, or indirectly through one or more intermediaries,
controls or is controlled by, or is under common control, with the Clearing Firm
and to the clearing arrangements and/or any of the services embodied in this
Agreement.

     R.  The Laws and Regulations require that the Clearing Firm must have
proper documentation to support any account opened on its books, including
Introduced Accounts. If, after reasonable requests therefor, the necessary
documents so as to enable the Clearing Firm to comply with such account
documentation requirements of the Laws and Regulations have not been received by
the Clearing Firm, the Introducing Firm shall receive notification that no
further orders will be accepted for the Introduced Accounts involved. Should it
happen that inadvertent orders are placed for such accounts after this notice is
received, no commission credit will be granted from such orders. On receipt of
the necessary documents, this restriction will be lifted on future commissions,
but any commissions withheld will not be credited or paid. This Agreement is not
in any way intended to limit the responsibility of the Clearing Firm under the
Laws and Regulations with respect to Introduced Accounts.

     S.  THE CONSTRUCTION AND EFFECT OF EVERY PROVISION OF THIS AGREEMENT, THE
RIGHTS OF THE PARTIES HEREUNDER AND ANY QUESTIONS ARISING OUT OF THE AGREEMENT,
SHALL BE SUBJECT TO THE STATUTORY AND COMMON LAW OF THE STATE OF NEW YORK
(INCLUDING SECTION 5-1501 OF THE GENERAL OBLIGATION LAW) WITHOUT REGARD TO
CONFLICT OF LAW PRINCIPLES.

     T.  The headings preceding the text, articles and sections hereof have been
inserted for convenience and reference only and shall not be construed to affect
the meaning, construction or effect of this Agreement.

     U.  This Agreement shall cover only the types of services set forth herein
and is in no way intended nor shall it be construed to bestow upon the
Introducing Firm any special treatment regarding any other arrangements,
agreements or understandings which presently exist between the Introducing Firm
and the Clearing Firm or which may hereafter exist. The Introducing Firm

                                       20
<PAGE>

shall be under no obligation whatsoever to deal with the Clearing Firm or any of
its subsidiaries or any companies controlled directly or indirectly by or
affiliated with the Clearing Firm, in any capacity other than as set forth in
this Agreement. Likewise, the Clearing Firm shall be under no obligation
whatsoever to deal with the Introducing Firm or any of its affiliates in any
capacity other than as set forth in this Agreement.

     V.  If any provision or condition of this Agreement shall be held to be
invalid or unenforceable by any court, or regulatory or self-regulatory agency
or body, such invalidity or unenforceability shall attach only to such provision
or condition.  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.

     W.  For the purposes of any and all notices, consents, directions,
approvals, restrictions, requests or other communications required or permitted
to be delivered hereunder, the Clearing Firm's address shall be 222 Broadway,
6th Floor, New York, New York 10038, with a copy to the General Counsel at the
same address, and the Introducing Firm's address shall be as specified on the
signature page hereof and either party may change its address for notice
purposes by giving written notice pursuant to registered mail of the new address
to the other party.

     X.  This Agreement shall become effective on or about the date specified on
the signature page hereof as the effective date or such other date mutually
agreed upon by the parties hereto.

     Y.  The Clearing Firm shall not be liable for any loss caused, directly or
indirectly, by government restrictions, exchange or market rulings, suspension
of trading, war, strikes or other conditions beyond the control of the Clearing
Firm.  In the event that any communications network or computer system used by
the Clearing Firm, whether or not owned by the Clearing Firm, is rendered
inoperable, the Clearing Firm shall not be liable to the Introducing Firm for
any loss, liability, claim, damage or expense resulting, either directly or
indirectly, therefrom.

     Z.  The Clearing Firm shall have the right to investigate, or arrange for
an appropriate party to investigate, the Introducing Firm's credit; provided,
however, that the Introducing Firm may make a written request for disclosure of
the nature of such investigation within a reasonable time. Nothing in this
paragraph shall be construed to relieve the Introducing Firm of its obligation
to oversee its financial integrity.

                                       21
<PAGE>

Made and executed at New York, New York on the date specified below.



                                       KNIGHT SECURITIES, L.P.

                                       By: /s/ William Karsh
                                          ------------------------------------
                                       Title: SVP
                                             ---------------------------------



BROADCORT CAPITAL CORP.

By: /s/ James Smyth
   ----------------------------------
Title: Managing Director
      -------------------------------



Date of Clearing Agreement:  September 28, 1999
Effective Date of this Clearing Agreement:  October 14, 1999



Introducing Firm's Address:
Newport Tower
525 Washington Boulevard
29th Floor
Jersey City, New Jersey 07310

                                       22
<PAGE>

SCHEDULE A

                               CLEARING CHARGES


(A)  CLEARING ONLY RATES
     -------------------

     O.T.C. Equities (CNS)            $****** per transaction (post compression)
     O.T.C. Equities (Excleared)      $****** per transaction
     O.T.C. (D.V.P.)                  $****** per transaction

(B)  INTERNATIONAL
     -------------

     Foreign Equities - ORD's           $****** per transaction
     ADR to ORD Conversions             $****** per transaction plus fees*
     Euroclear, CEDEL & CREST           $****** per transaction

     *Fees
         $****** per share for Sponsored issuance and cancellation
         $****** per share for Unsponsored cancellations
         Fees are defined as costs that are incurred from the ADR agent.

(C)  OPTIONS
     -------

     [INTENTIONALLY LEFT BLANK]

(D)  MISCELLANEOUS SECURITIES
     ------------------------

     Clearance charges not set forth within the above schedule will be by mutual
     agreement between the parties hereto.

GENERAL
-------

(A)  RETURNED DELIVERIES
     -------------------

     In the event that any Introduced account or its agent (including but not
     otherwise limited to its custodian bank) rejects a valid "delivery against
     payment" (as this phrase is customarily used in the securities industry)
     made by the Clearing Firm, the Clearing Firm will charge the Introducing
     Firm ****** from the date of such rejection until such time as such valid
     delivery is accepted and payment is received.

                                       23
<PAGE>

                                                                    EXHIBIT 10.2

(B)  EXTENSIONS
     ----------

     The Introducing Firm will be charged ****** for each extension granted by
     the Clearing Firm.


(C)  REGISTER AND SHIP TRANSFERS
     ---------------------------

     The Introducing Firm will be charged ****** for each transfer requested of
     the Clearing Firm.

(D)  FED FUND WIRE
     -------------

     The Introducing Firm will be charged ****** for each Fed Fund Money wire
     requested of the Clearing Firm.

(E)  CHARGES AND FEES
     ----------------

     The foregoing charges and fees are based upon the type and level of
     securities business represented as of the date of this agreement by the
     Introducing Firm to the Clearing Firm.  All such charges may be subject to
     renegotiation and change upon the mutual consent of both parties.

(F)  INTEREST RATES
     --------------

     The following percentage and rates will be used to calculate the money owed
     to the Introducing Firm by the Clearing Firm or money owed to the Clearing
     Firm by the Introducing Firm on the following balances:

         Free Credit Balances            ******

         Debit Balances                  ******

         Short                           ******




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