Document:

EMPLOYMENT AGREEMENT

     AGREEMENT made as of the 1st day of January,  2000, by and between  William
J. Kurinsky, residing at 4 Cotswold Circle, Ocean, New Jersey 07712 (hereinafter
referred to as the "Employee") and First Montauk  Financial  Corp., a New Jersey
corporation  with  principal  offices  Parkway 109,  Red Bank,  New Jersey 07701
(hereinafter referred to as the "Company").

                              W I T N E S S E T H :

     WHEREAS,  the Company,  through its wholly owned  subsidiary  First Montauk
Securities  Corp, is engaged in the  investment  banking and general  securities
business as a registered broker-dealer; and

     WHEREAS,  the  Company  desires to employ and secure for the  Company,  the
experience, ability and services of Employee; and

     WHEREAS,  the Employee desires to continue his present  employment with the
Company,  pursuant to the terms and conditions herein set forth, superseding all
prior agreements between the Company,  its subsidiaries  and/or predecessors and
Employee;

                  NOW,  THEREFORE,  it is  mutually  agreed by and  between  the
parties hereto as follows:

                                    ARTICLE I

                                   EMPLOYMENT

                  Subject  to  and  upon  the  terms  and   conditions  of  this
Agreement,  the Company  hereby employs and agrees to continue the employment of
the Employee,  and the Employee hereby accepts such continued  employment in his
capacity  as member of the Board of  Directors,  Vice-President,  Secretary  and
Treasurer. In this capacity, Employee will report to the Board of Directors.

                                   ARTICLE II

                                     DUTIES

     (A) The Employee shall, during the term of his employment with the Company,
perform such services and duties of an executive  nature in connection  with the
business, affairs and operations of the Company, and its subsidiaries, as may be
reasonably  and in good faith  assigned or delegated to him from time to time by
or under  the  authority  of the Board of  Directors  and the  President  of the
Company and consistent with the position of Vice-President.

     (B) The  Employee  agrees  to use his best  efforts  in the  promotion  and
advancement  of the Company and its welfare  and  business.  Employee  agrees to
devote his primary  professional time to the business of the Company as Employee
deems reasonably  necessary;  provided,  however,  that the Company acknowledges
that Employee shall be entitled to pursue unrelated  personal  business ventures
that do not materially conflict with the performance of Employee's duties to the
Company.

     (C)  Employee  shall be based in the Red Bank New  Jersey  area,  and shall
undertake such occasional  travel,  within or without the United States as is or
may be reasonably necessary in the interests of the Company.

                                   ARTICLE III

                                  COMPENSATION

     (A) Commencing with the commencement date hereof,  the Company shall pay to
Employee a salary at the rate of $256,218 per annum and increasing 10% per annum
on each  anniversary  hereof during the period this Agreement shall be in effect
(payable in equal  weekly  installments  or pursuant to such regular pay periods
adopted by the Company) (the "Base Salary").
<PAGE>

     (B) Employee shall be entitled to receive a bonus (the "Bonus") during each
year of this Agreement,  determined as follows: The amount to be paid as a Bonus
shall be  determined as of each June 30 based upon the prior fiscal year end and
shall  consist of a portion  of a bonus  pool which  shall be equal to ten (10%)
percent of the net pre-tax  profit of the Company as determined by the Company's
independent  auditors,  no later than 90 days following the end of the Company's
fiscal year without  giving effect to loss  carryforwards  or non-cash items and
giving  effect to and  including  revenues  received by the  Company  during the
fiscal year and which revenues may have otherwise been excluded in computing net
pre-tax profit by reason of any revenue  recognition rules otherwise utilized in
the application of generally accepted accounting  principles,  and excluding any
expense deduction  attributed to such Bonus paid to Herbert.  Kurinsky (the "Net
Pre-Tax  Profit");  provided  that,  in the event the Net Pre-Tax  Profit of the
Company for any fiscal year is less than $500,000, no bonus shall be paid by the
Company to the Employee pursuant to this  subparagraph (B). Such  determination,
for Bonus purposes  only,  shall be made in accordance  with generally  accepted
accounting principles, as modified by these resolutions.

     (C)  Employee  may receive  such other  additional  compensation  as may be
determined from time to time by the Board of Directors.  Nothing herein shall be
deemed or  construed  to  require  the  Board to award  any bonus or  additional
compensation.

     (D) Employee  shall be eligible to purchase from the Company,  at Employees
sole  discretion,  a portion of a bonus pool which shall consist of up to 20% of
all underwriters and/or placement agent warrants and/or options granted to First
Montauk Securities Corp., upon the same price, terms and conditions  afforded to
First Montauk  Securities Corp. in connection with its service as an underwriter
and/or placement agent for any and all public or private offerings of securities
on behalf of issuers.

     (E) The Company  shall  deduct from  Employee's  compensation  all federal,
state and local taxes which it may now or may hereafter be required to deduct.

     (F) Employee shall also be entitled to receive brokerage  commissions on in
accordance  with the  commission  schedule  in effect  for  other  non-affiliate
brokers employed by the Company.

                                   ARTICLE IV

                                    BENEFITS

                  (A) During the term  hereof,  (i) the  Company  shall  provide
Employee  with health  insurance  benefits  and major  medical  insurance;  (ii)
Employee  shall be reimbursed by the Company upon  presentation  of  appropriate
vouchers  for all  business  expenses  incurred by the Employee on behalf of the
Company;  (iii) the  Company  shall  provide  the  Employee  with an  automobile
suitable for his position,  equipped with a mobile  telephone,  or at Employee's
option, an appropriate automobile allowance, and reimburse reasonable automobile
expenses including repairs,  maintenance,  gasoline charges,  mobile phone, etc.
via receipted expense reports.

         (B) In the event the Company wishes to obtain Key Man life insurance on
the  life of  Employee,  Employee  agrees  to  cooperate  with  the  Company  in
completing  any  applications  necessary to obtain such  insurance  and promptly
submit  to such  physical  examinations  and  furnish  such  information  as any
proposed insurance carrier may request.

          (C) For each year of the term  hereof,  Employee  shall be entitled to
four weeks paid vacation.

<PAGE>

                                  ARTICLE V

                                 NON-DISCLOSURE

         The Employee shall not, at any time during or after the  termination of
his  employment  hereunder  except  when  acting  on  behalf  of  and  with  the
authorization  of  the  Company,   make  use  of  or  disclose  to  any  person,
corporation,  or other entity, for any purpose  whatsoever,  any trade secret or
other  confidential  information  concerning the Company's  business,  finances,
research,  services  or  products,  and  information  relating  to any client or
account  of  the  Company   (collectively   referred  to  as  the   "Proprietary
Information").   For  the  purposes  of  this   Agreement,   trade  secrets  and
confidential  information  shall mean  information  disclosed to the Employee or
known by him as a consequence of his  employment by the Company,  whether or not
pursuant to this Agreement, and not generally known in the industry,  concerning
the business,  finances,  methods,  operations,  clients,  accounts,  service or
product information of the Company. The Employee acknowledges that trade secrets
and other  items of  confidential  information,  as they may exist  from time to
time, are valuable and unique assets of the Company,  and that disclosure of any
such information would cause substantial injury to the Company. The foregoing is
intended to be  confirmatory of the common law of the state of New York relating
to trade secrets and confidential information.

                                   ARTICLE VI

                              RESTRICTIVE COVENANT

                  (A) In the event of the  voluntary  termination  of employment
with the  Company,  except  for Good  Reason  as  defined  in  Article  XIX,  or
Employee's  discharge  for cause,  as defined in Article  VII  hereof,  Employee
agrees  that he will  not (i) for a  period  of one (1)  year  from  the date of
termination, directly or indirectly solicit brokers or employees of the Company,
or any sister or subsidiary of the Company for employment with any other entity,
or (ii)  during  the  term and for a  period  of one (1)  year  from the date of
termination  or  discharge,  solicit  or accept  any  corporate  finance  client
relating to a transaction  involving a public offering,  private  placement,  or
merger and acquisition advisory services,  or research project which was already
pending and in existence at the time of Employee's termination or discharge,  or
which was being negotiated at the time of Employee's termination or discharge.

                  (B)  If  any   court   shall   hold  that  the   duration   of
non-competition  or  any  other  restriction  contained  in  this  paragraph  is
unenforceable, it is our intention that same shall not thereby be terminated but
shall  be  deemed  amended  to  delete   therefrom  such  provision  or  portion
adjudicated to be invalid or unenforceable or in the alternative such judicially
substituted term may be substituted therefor.

                                   ARTICLE VII

                                      TERM

                  This  Agreement  shall  be for a term  commencing  on the date
first  set  forth  above  and  terminating  December  31,  2002,  unless  sooner
terminated  pursuant to the terms hereof,  and renewable as provided for herein,
for one additional  period of one year. The Company agrees to notify Employee in
writing of its intent to negotiate an  extension  of this  Agreement  six months
prior to the expiration of the original term hereof.  If the Company fails to so
notify  Employee,  or after having timely notified  Employee of its intention to
extend,  fails to reach  agreement with Employee on the terms of such extension,
this  agreement  shall be  renewable,  at the  option  of the  Employee,  for an
additional  period of one year from the expiration of the original term,  except
that the Employee's base salary shall be increased 10% above the prior year, and
Employee  shall be entitled to stock  options  equivalent  to  one-third  of the
options  granted during the initial term of this  agreement on comparable  terms
and conditions.  If the Company elects not to seek to negotiate an extension and
has so timely notified Employee,  then the Company shall pay Employee,  upon the
expiration of the original term of this Agreement,  a severance benefit equal to
the aggregate amount of Employee's then prevailing  annual Base Salary and Bonus
payable in 12 equal monthly  installments  commencing on the original expiration
date of this Agreement.
<PAGE>

                                  ARTICLE VIII

                             DISABILITY DURING TERM

                  In the event that the  Employee  becomes  totally  disabled so
that he is  unable  or  prevented  from  performing  any one or all of his usual
duties  hereunder for a period of four (4) consecutive  months then, and in that
event,  the Company shall  continue to  compensate  him and he shall receive his
Base Salary as provided  under  Article  III of this  Agreement  for a period of
twelve  (12)  months  commencing  from the date of such  total  disability.  The
aforesaid  obligations  of the Company  shall not extend beyond the term of this
Agreement. The obligation of the Company to make the aforesaid payments shall be
modified and reduced and the Company shall  receive a credit for all  disability
insurance  payments  which  Employee  may  receive  or to  which  he may  become
entitled;  and  provided  further that the payments  herein  provided  shall not
extend beyond the term of this Agreement.

                                   ARTICLE IX

                                   TERMINATION

                  The Company may terminate this Agreement:

                  (A) Upon the death of Employee during the term hereof,  except
that the Employee's legal representatives,  successors,  assigns and heirs shall
have  those  rights and  interests  as  otherwise  provided  in this  Agreement,
including the right to receive accrued but unpaid bonus compensation, if any.

                  (B) Subject to the terms of Article VIII herein,  upon written
notice from the Company to the Employee,  if Employee  becomes totally  disabled
and as a result of such total disability,  has been prevented from and unable to
perform all of his duties hereunder for a consecutive period of four (4) months.

                  (C) Upon written  notice from the Company to the Employee,  if
the Employee is convicted of a felony, or the final  adjudication by any federal
or state  judicial or regulatory  authority or any action or proceeding  arising
out of the violation of any material  securities  law, rule or regulation  where
such action by proceeding resulted in Employee being a statutorily  disqualified
person as that term is defined in Section  3(a)(39) of the Security and Exchange
Act of 1934.

                                    ARTICLE X

                         TERMINATION OF PRIOR AGREEMENTS

                  This  Agreement  sets forth the entire  agreement  between the
parties and supersedes all prior agreements between the parties, whether oral or
written, without prejudice to Employee's right to all accrued compensation prior
to the effective date of this Agreement.

                                   ARTICLE XI

                                   ARBITRATION

                  Any  dispute  arising out of the  interpretation,  application
and/or  performance  of this  Agreement  with the sole  exception  of any claim,
breach or  violation  arising  under  Articles  V or VI hereof  shall be settled
through final and binding  arbitration  before a panel arbitrators in accordance
with the rules of the National  Association of Securities  Dealers (the "NASD").
Any judgment upon any arbitration award may be entered in any court,  federal or
state, having competent jurisdiction of the parties.

                                   ARTICLE XII

                                  SEVERABILITY

                  If any provision of this  Agreement  shall be held invalid and
unenforceable,  the remainder of this  Agreement  shall remain in full force and
effect.  If any  provision  is held  invalid or  unenforceable  with  respect to
particular circumstances,  it shall remain in full force and effect in all other
circumstances.
<PAGE>

                                  ARTICLE XIII

                                     NOTICE

                  All  notices  required  to be given  under  the  terms of this
Agreement  shall be in writing  and shall be deemed to have been duly given only
if delivered to the  addressee  in person or mailed by  certified  mail,  return
receipt requested, as follows:

          IF TO THE COMPANY:
                            First Montauk Financial Corp.
                            Parkway 109 Office Center
                            328 Newman Springs Road
                            Red Bank, New Jersey 07701

          IF TO THE EMPLOYEE:
                            William J. Kurinsky
                            4 Cotswold Circle
                            Ocean, New Jersey 07712

or to any such other  address as the party to receive the notice shall advise by
due notice given in accordance with this paragraph.

                                   ARTICLE XIV

                                     BENEFIT

                  This Agreement  shall inure to, and shall be binding upon, the
parties  hereto,  the successors  and assigns of the Company,  and the heirs and
personal representatives of the Employee.

                                  ARTICLE XV

                                     WAIVER

                  The waiver by either  party of any breach or  violation of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach of construction and validity.

                                   ARTICLE XVI

                                  GOVERNING LAW

                  This  Agreement has been  negotiated and executed in the State
of New Jersey, and New Jersey law shall govern its construction and validity.

                                  ARTICLE XVII

                                  JURISDICTION

                  Any or all actions or proceedings  which may be brought by the
Company or Employee under this Agreement  shall be brought before an arbitration
panel, or if otherwise  permissible under the terms of this agreement,  a court,
having a situs within the State of New Jersey,  and Employee  hereby consents to
the jurisdiction of any tribunal or local, state or federal court located within
the State of New Jersey.

                                  ARTICLE XVIII

                                ENTIRE AGREEMENT

                  This  Agreement  contains  the entire  agreement  between  the
parties hereto. No change, addition or amendment shall be made hereto, except by
written agreement signed by the parties hereto.
<PAGE>

                                   ARTICLE XIX

                             SEVERANCE COMPENSATION

         The Company's  Board of Directors has determined that it is appropriate
to reinforce and encourage the continued  attention and dedication of members of
the  Company's  management,  including the Employee,  to their  assigned  duties
without  distraction in potentially  disturbing  circumstances  arising from the
possibility of a change in control of the Company.

         This  Article  XIX sets  forth  the  severance  compensation  which the
Company agrees it will pay to the Employee if the Employee's employment with the
Company  terminates under one of the circumstances  described herein following a
Change in Control of the Company (as defined herein).  The terms of this Article
XIX shall  supersede  any other  provision of this  Agreement  after a Change in
Control as defined  below.  (References  to Sections  refers to Sections in this
Article XIX.)

                  1.  Term.  This  Article  XIX shall  terminate,  except to the
extent that any  obligation of the Company  hereunder  remains unpaid as of such
time, upon the earliest of (i) the  termination of this Agreement  including any
renewal  period,  if a Change in Control of the Company has not occurred  within
such two-year period; (ii) the termination of the Employee's employment with the
Company based on death,  Disability (as defined in Section 3(b)), Retirement (as
defined  in  Section  3(c)) or Cause  (as  defined  in  Section  3(d)) or by the
Employee other than for Good Reason (as defined in Section 3(e));  and (iii) one
year from the date of a Change in Control of the Company if the Employee has not
terminated his employment for Good Reason as of such time.

                  2. Change in Control.  No compensation  shall be payable under
this  Article XIX unless and until (a) there shall have been a Change in Control
of the  Company,  while the Employee is still an employee of the Company and (b)
the Employee's  employment by the Company  thereafter shall have been terminated
in  accordance  with  Section 3. For  purposes  of this  Agreement,  a Change in
Control of the  Company  shall be deemed to have  occurred if (i) there shall be
consummated (x) any  consolidation or merger of the Company in which the Company
is not the  continuing or surviving  corporation  or pursuant to which shares of
the  Company's  Common Stock would be converted  into cash,  securities or other
property,  other  than a merger  of the  Company  in which  the  holders  of the
Company's  Common  Stock   immediately   prior  to  the  merger  have  the  same
proportionate ownership of common stock of the surviving corporation immediately
after the merger,  or (y) any sale,  lease,  exchange or other  transfer (in one
transaction or a series of related  transactions) of all, or substantially  all,
of the assets of the Company,  or (ii) the  stockholders of the Company approved
any plan or proposal for the liquidation or dissolution of the Company, or (iii)
any  person  (as  such  term is used  in  Sections  13(d)  and  13(d)(2)  of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")),  shall become
the  beneficial  owner (within the meaning of Rule 13d-3 under the Exchange Act)
of 20% or more of the Company's  outstanding  Common  Stock,  or (iv) during any
period of two consecutive years, individuals who at the beginning of such period
constitute  the  entire  Board  of  Directors  shall  cease  for any  reason  to
constitute  a  majority  thereof  unless the  election,  or the  nomination  for
election by the Company's  stockholders,  of each new director was approved by a
vote of at least  two-thirds  of the  directors  then  still in office  who were
directors at the beginning of the period.

                  3. Termination Following Change in Control.

                  (a) If a Change in Control of the Company  shall have occurred
while the  Employee is still an employee of the Company,  the Employee  shall be
entitled  to  the  compensation  provided  in  Section  4  upon  the  subsequent
termination of the Employee's  employment with the Company by the Employee or by
the Company unless such termination is as a result of (i) the Employee's  death;
(ii) the  Employee's  Disability  (as defined in Section 3(b) below);  (iii) the
Employee's  Retirement  (as defined in Section 3(c) below);  (iv) the Employee's
termination by the Company for Cause (as defined in Section 3(d) below);  or (v)
the Employee's  decision to terminate  employment other than for Good Reason (as
defined in Section 3(e) below).
<PAGE>

                  (b) Disability.  If, as a result of the Employee's  incapacity
due to physical or mental illness,  the Employee shall have been absent from his
duties with the Company on a full-time  basis for four months and within 30 days
after  written  notice of  termination  is  thereafter  given by the Company the
Employee shall not have returned to the full-time  performance of the Employee's
duties, the Company may terminate this Agreement for "Disability."

                  (c) Retirement.  The term "Retirement" as used in this Article
XIX shall mean  termination  by the Company or the  Employee  of the  Employee's
employment  based on the  Employee's  having reached age 65 or such other age as
shall have been fixed in any arrangement established with the Employee's consent
with respect to the Executive.

                  (d) Cause. The Company may terminate the Employee's employment
for Cause.  For purposes of this Agreement  only, the Company shall have "Cause"
to terminate the  Employee's  employment  hereunder  only on the basis of fraud,
misappropriation  or embezzlement  on the part of the Employee.  Notwithstanding
the  foregoing,  the Employee  shall not be deemed to have been  terminated  for
Cause unless and until there shall have been delivered to the Employee a copy of
a  resolution   duly  adopted  by  the   affirmative   vote  of  not  less  than
three-quarters of the entire membership of the Company's Board of Directors at a
meeting of the Board called and held for the purpose (after reasonable notice to
the Employee and an opportunity  for the Employee,  together with the Employee's
counsel,  to be heard before the Board),  finding that in the good faith opinion
of the Board the Employee was guilty of conduct set forth in the second sentence
of this Section 3(d) and specifying the particulars thereof in detail.

                  (e) Good Reason.  The Employee may  terminate  the  Employee's
employment  for Good Reason at any time during the term of this  Agreement.  For
purposes  of this  Agreement  "Good  Reason"  shall  mean  any of the  following
(without the Employee's express written consent):

     (i) the  assignment  to the Employee by the Company of duties  inconsistent
with the  Employee's  position,  duties,  responsibilities  and status  with the
Company  immediately prior to a Change in Control of the Company, or a change in
the Employee's  titles or offices as in effect  immediately prior to a Change in
Control of the Company,  or any removal of the  Employee  from or any failure to
reelect the  Employee to any of such  position,  except in  connection  with the
termination of his employment for Disability, Retirement or Cause or as a result
of the Employee's death or by the Employee other than for Good Reason;

     (ii) a reduction by the Company in the Employee's  base salary as in effect
on the date hereof or as the same may be increased  from time to time during the
term of this Agreement or the Company's failure to increase (within 12 months of
the Employee's  last increase in base salary) the Employee's base salary after a
Change in  Control  of the  Company  in an amount  which at least  equals,  on a
percentage  basis,  the  average  percentage  increase  in base  salary  for all
officers of the Company effected in the preceding 12 months;

     (iii) any failure by the Company to continue in effect any benefit  plan or
arrangement  (including,  without  limitation,  the Company's life insurance and
medical,  dental,  accident  and  disability  plans)  in which the  Employee  is
participating  at the time of a Change in Control of the  Company  (or any other
plans providing the Employee with substantially  similar benefits)  (hereinafter
referred  to as  "Benefit  Plans"),  or the taking of any action by the  Company
which would  adversely  affect the  Employee's  participation  in or  materially
reduce the  Employee's  benefits  under any such  Benefit  Plan or  deprive  the
Employee of any material fringe benefit enjoyed by the Employee at the time of a
Change in Control of the Company;

     (iv) any failure by the Company to continue in effect any incentive plan or
arrangement   (including,   without  limitation,   bonus  and  contingent  bonus
arrangements and credits and the right to receive performance awards and similar
incentive  compensation  benefits) in which the Employee is participating at the
time of a Change in Control of the Company  (or any other plans or  arrangements
providing him with substantially  similar benefits)  (hereinafter referred to as
"Incentive  Plans")  or the  taking of any  action by the  Company  which  would
adversely  affect the  Employee's  participation  in any such  Incentive Plan or
reduce the Employee's  benefits under any such  Incentive  Plan,  expressed as a
percentage of his base salary,  by more than 10 percentage  points in any fiscal
year as compared to the immediately preceding fiscal year;
<PAGE>

     (v)  any  failure  by the  Company  to  continue  in  effect  any  plan  or
arrangement to receive securities of the Company (including, without limitation,
the Company's  Incentive  Stock Option Plan and any other plan or arrangement to
receive and exercise stock options, stock appreciation rights,  restricted stock
or grants  thereof)  in which the  Employee  is  participating  at the time of a
Change in Control of the Company (or plans or  arrangements  providing  him with
substantially similar benefits)  (hereinafter referred to as "Securities Plans")
or the taking of any action by the  Company  which  would  adversely  affect the
Employee's  participation in or materially reduce the Employee's  benefits under
any such Securities Plan;

     (vi) a  relocation  of  the  Company's  principal  executive  offices  to a
location outside of Monmouth County, New Jersey, or the Employee's relocation to
any place other than the location at which the Employee performed the Employee's
duties prior to a Change in Control of the Company,  except for required  travel
by the Employee on the Company's business to an extent substantially  consistent
with the  Employee's  business  travel  obligations  at the time of a Change  in
Control of the Company;

     (vii) any failure by the Company to provide the Employee with the number of
paid  vacation days to which the Employee is entitled at the time of a Change in
Control of the Company;

     (viii)  any  material  breach  by the  Company  of any  provision  of  this
Agreement;

     (ix) any failure by the Company to obtain the  assumption of this Agreement
by any successor or assign of the Company; or

     (x) any purported  termination  of the Employee's  employment  which is not
effected  pursuant to a Notice of  Termination  satisfying the  requirements  of
Section 3(f), and for purposes of this Agreement,  no such purported termination
shall be effective.

                  (f) Notice of  Termination.  Any  termination  by the  Company
pursuant  to Section  3(b),  3(c) or 3(d) shall be  communicated  by a Notice of
Termination.  For purposes of this Agreement,  a "Notice of  Termination"  shall
mean a written notice which shall indicate those specific termination provisions
in this  Agreement  relied  upon and which sets forth in  reasonable  detail the
facts and  circumstances  claimed  to  provide a basis  for  termination  of the
Employee's  employment  under the provision so  indicated.  For purposes of this
Agreement,  no such  purported  termination  by the Company  shall be  effective
without such Notice of Termination.

                  (g) Date of Termination.  "Date of Termination" shall mean (a)
if this  Agreement is  terminated by the Company for  Disability,  30 days after
Notice of Termination is given to the Employee (provided that the Employee shall
not have returned to the  performance  of the  Employee's  duties on a full-time
basis  during  such  30-day  period)  or  (b) if the  Employee's  employment  is
terminated  by the Company for any other  reason,  the date on which a Notice of
Termination  is  given;  provided  that if within  30 days  after any  Notice of
Termination  is given to the Employee by the Company the  Employee  notifies the
Company  that  a  dispute  exists  concerning  the  termination,   the  Date  of
Termination  shall be the date the  dispute  is finally  determined,  whether by
mutual  agreement  by the parties or upon final  judgment,  order or decree of a
court of competent  jurisdiction  (the time for appeal  therefrom having expired
and no appeal having been perfected).

                  4.  Severance Compensation upon Termination of Employment.

                  If the Company shall terminate the Employee's employment other
than pursuant to Section 3(b),  3(c) or 3(d) or if the Employee shall  terminate
his employment for Good Reason, then the Company shall:

     (i) pay to the  Employee as  severance  pay in a lump sum, in cash,  on the
fifth day following the Date of Termination,  an amount equal to three times the
aggregate  annual  compensation  paid to the Employee  during the calendar  year
preceding  the change in control of the  Company by the  Company  and any of its
subsidiaries subject to United States income taxes;  provided,  however, that if
the lump sum  severance  payment  under this Section 4, either alone or together

<PAGE>

with  other  payments  which  the  Employee  has the right to  receive  from the
Company,  would constitute a "parachute  payment" (as defined in Section 280G of
the Internal  Revenue  Code of 1954,  as amended  (the  "Code")),  such lump sum
severance  payment  shall be reduced to the largest  amount as will result in no
portion of the lump sum severance  payment under this Section 4 being subject to
the excise tax imposed by Section  4999 of the Code.  The  determination  of any
reduction in the lump sum severance payment under this Section 4 pursuant to the
foregoing  proviso  shall  be  made by the  Employee  in good  faith,  and  such
determination shall be conclusive and binding on the Company; and

     (ii) within ten days  following  the Date of  Termination,  shall cause the
Employee  to  be  relieved  of  any  and  all  personal  guarantees  of  Company
obligations,  and fully pay all outstanding  loans and other  obligations of the
Company to the Executive.  If, for any reason,  the Company fails to comply with
its obligations under this subparagraph,  the Employee shall have the option, at
his sole  discretion,  to  convert up to the  principal  amount of such Notes to
shares of the  Company's  Common Stock at the rate of $.50 per share;  provided,
that the conversion of all or a portion of any outstanding loans by the Employee
shall not  relieve  the  Company of any of its  obligations  arising  under this
subparagraph  including  the  obligations  to repay  any  unconverted  loans and
relieve the Employee of any personal guarantees.

             5. No  Obligation  to  Mitigate  Damages;  No Effect  on Other
                Contractual Rights.

     (a) The Employee shall not be required to mitigate damages or the amount of
any payment  provided for under this Article XIX by seeking other  employment or
otherwise,  nor shall the amount of any payment  provided for under this Article
XIX be  reduced  by any  compensation  earned by the  Employee  as the result of
employment by another employer after the Date of Termination, or otherwise.

     (b) The  provisions  of this  Article  XIX,  and any payment  provided  for
hereunder,  shall  not  reduce  any  amounts  otherwise  payable,  or in any way
diminish the Employee's  existing rights, or rights which would accrue solely as
a result of the  passage of time,  under any  Benefit  Plan,  Incentive  Plan or
Securities Plan, employment agreement or other contract, plan or arrangement.

                  6. Successor to the Company.  (a) The Company will require any
successor  or  assign  (whether  direct  or  indirect,   by  purchase,   merger,
consolidation or otherwise) to all or  substantially  all of the business and/or
assets of the Company,  by agreement in form and substance  satisfactory  to the
Executive,  expressly,  absolutely  and  unconditionally  to assume and agree to
perform  this  Agreement  in the same  manner  and to the same  extent  that the
Company would be required to perform it if no such  succession or assignment had
taken place.  Any failure of the Company to obtain such  agreement  prior to the
effectiveness of any such succession or assignment shall be a material breach of
this  Agreement  and shall  entitle the  Employee to  terminate  the  Employee's
employment for Good Reason. As used in this Agreement,  "Company" shall mean the
Company as  hereinbefore  defined and any  successor  or assign to its  business
and/or assets as aforesaid  which  executes and delivers the agreement  provided
for in this  Section  6 or which  otherwise  becomes  bound by all the terms and
provisions of this Agreement by operation of law. If at any time during the term
of this Agreement the Employee is employed by any  corporation a majority of the
voting  securities  of which is then owned by the Company,  "Company" as used in
Sections 3 and 4 hereof shall in addition include such employer.  In such event,
the Company  agrees  that it shall pay or shall  cause such  employer to pay any
amounts owed to the Employee pursuant to Section 4 hereof.

     (b) This Agreement  shall inure to the benefit of and be enforceable by the
Employee's  personal  and  legal  representatives,   executors,  administrators,
successors,  heirs, distributees,  devisees and legatees. If the Employee should
die while any  amounts are still  payable to him  hereunder,  all such  amounts,
unless otherwise provided herein,  shall be paid in accordance with the terms of
this  Agreement to the  Employee's  devisee,  legatee,  or other designee or, if
there be no such designee, to the Employee's estate.

     7.  Legal  Fees and  Expenses.  The  Company  shall pay all legal  fees and
expenses  which the Employee may incur as a result of the  Company's  contesting
the  validity,   enforceability   or  the  Employee's   interpretation   of,  or
determinations under, this Article XIX.

                  IN WITNESS  WHEREOF,  the parties  hereto have  executed  this
Agreement  and  affixed  their  hands  and seals  the day and year  first  above
written.

(Corporate Seal)                            FIRST MONTAUK FINANCIAL CORP.

                                            By:---------------------------------
                                                Herbert Kurinsky

-------------------------------
William J. Kurinsky (Employee)CLEARING AGREEMENT

     This  Agreement  is made as of this 8th day of May,  2000,  between  Fiserv
Securities,  Inc.  (hereinafter  referred to as the "Clearing  Agent") and First
Montauk Securities Corp. (hereinafter referred to as the "Introducing Firm").

     In consideration  of the mutual  covenants  hereinafter set forth and other
good and valuable  consideration,  the receipt of which is hereby  acknowledged,
and intending to be legally bound,  the parties hereto hereby covenant and agree
as follows:

     1.  Services  to be  Performed  by the  Clearing  Agent;  Covenants  of the
Clearing Agent.

     a.  Execution.  The Clearing Agent will execute orders for the  Introducing
Firm's  proprietary  accounts and customers  whose cash or margin  accounts have
been  accepted by the Clearing  Agent  (hereinafter  referred to as  "Introduced
Accounts")  . The  Clearing  Agent  will  execute  only  those  orders  that are
transmitted by the Introducing Firm to the Clearing Agent.

     b.   Confirmations.   The   Clearing   Agent  will   generate  and  prepare
confirmations  of each  purchase  or sale for each of the  Introduced  Accounts.
Information  will be  transmitted  by the Clearing  Agent via its  communication
network in order to effect the printing of  confirmations at the location of the
Introducing  Firm.  Unless the Clearing Agent is notified by Introducing Firm to
the contrary in accordance to the notice provision 13(g) of this Agreement,  the
Introducing Firm shall mail such confirmations to the Introduced Accounts.

     c. Statements. The Clearing Agent will prepare and mail the summary monthly
statements  (or quarterly  statements if no activity in any  Introduced  Account
occurs during any month covered by such statement) to every Introduced  Account.
No  statements  will be  prepared  by the  Clearing  Agent  with  respect  to an
Introduced Account in which there is no cash balance or security position and in
which there has been no other activity since the date of the last statement. The
Introducing Firm may mail or arrange for the mailing of such statements with the
concurrence of the Clearing  Agent pursuant to terms of a separate  agreement as
incorporated in Exhibit F.

     d.  Clearance  Settlements.  The Clearing  Agent 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. For the purposes of the Agreement the term "securities"  includes,  but
is not limited to, stocks,  bonds, notes,  listed options,  commercial paper and
such other instruments as the Introducing Firm may designate with the consent of
the Clearing Agent and excludes commodities.

     e. Cashiering.  The Clearing Agent 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 cash 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.  Only where the Clearing
Agent receives dividends in its nominee name and then distributes such dividends
to  Introduced  Accounts  will  the  Clearing  Agent  backup  withhold  on those
Introduced  Accounts which do not have a taxpayer  identification  number.  Upon
written agreement of the Clearing Agent and the Introducing  Firm,  incorporated
in Exhibit F, the cashiering functions with respect to the receipt of securities
and the making and  receiving  of payment  therefor may be  relinquished  to the
Introducing Firm.

     f. Books and Records.  The Clearing  Agent will  construct and maintain all
prescribed books and records of all transactions executed or cleared through it,
in accordance with Section 17 of the Securities  Exchange Act of 1934 as amended
("the  Exchange  Act"),  including a daily  record of required  margin and other
information required by rules,  regulations and the stated policies or practices
of any  securities  exchange  of which  the  Clearing  Agent  is a  member  (the
"Standards").
<PAGE>

     g. Lost  Securities  - Notice.  The  Clearing  Agent when  notified  by the
Introducing  Firm will  notify  either  orally  or in  writing,  the  Securities
Information Center ("SIC") located in Massachusetts,  regarding any lost, stolen
or missing  securities.  Any written notice will be made on forms  prescribed by
the SIC by the Clearing Agent.

     h. Tax Reporting. The Clearing Agent will prepare required annual dividend,
interest and distribution information on appropriate IRS Form 1099 and any other
information  required to be reported by Federal,  state or local tax laws, rules
or  regulations  solely  with  respect to activity  in the  Introduced  Accounts
occurring  subsequent to the effective  date of this  Agreement and prior to the
termination  hereof.  Such  reports  shall be mailed at the  Introducing  Firm's
expense by the Clearing Agent to the Introduced Accounts.

     i.  Account  Transfer.  Pursuant  to written  notification  received by the
Introducing  Firm and  forwarded  to the  Clearing  Agent,  any  account  of the
Introducing  Firm may  choose to reject  the  services  to be  performed  by the
Clearing  Agent 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
or therefrom, the Clearing Agent shall expedite such transfer and shall have the
sole and exclusive  responsibility  for compliance with Rule 412 of the Rules of
the Board of Governors of the New York Stock Exchange, Inc. (the "Rules").

     j. Supervisory  Data. The Clearing Agent shall provide the Introducing Firm
with  all  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 Agent for all costs
incurred by the Clearing Agent in connection with the preparation and mailing of
such information.

     k. Option  Prospectus.  The Clearing  Agent will deliver to the  Introduced
Account  a  current  prospectus  or other  disclosure  document  of the  Options
Clearing  Corporation  together  with  any  effective   supplements  thereto  in
accordance with all applicable laws and/or regulations.

     l.  Compliance  with Laws,  Rules or  Regulations.  The Clearing Agent will
remain  duly  licensed  and  in  good  standing  as a  broker/dealer  under  all
applicable  laws,  rules and  regulations  and will  comply with the capital and
financial  reporting  requirements  of every  securities  exchange or securities
association of which it is a member, the Securities and Exchange Commission, and
each state in which it is registered as a broker/ dealer.

     m.  Confidentiality.  The Clearing Agent shall keep  confidential the names
and addresses of the Introducing Firm's customers,  affiliates and clients which
have or which may come to the attention of the Clearing Agent in connection with
the clearing and related functions it has assumed under this Agreement and shall
not use such  names  and  addresses  except  in  connection  with the  functions
performed by the Clearing Agent pursuant to this  Agreement.  The Clearing Agent
shall send no written  information  without the express  written  consent of the
Introducing  Firm to  such  customers  and  affiliates  other  than  monthly  or
quarterly  account  statements,  trade  confirmations,  bills or notices or such
information  as may  be  required  or  advisable  under  any  applicable  law or
regulation in connection with its role as a Clearing Agent.

     n. Accounts.  The Clearing Agent shall carry all Introduced Accounts in the
name of the  Introducing  Firm's  customer  with the notation on its new account
applications,  monthly or quarterly  statements and/or  confirmations  that such
Introduced Accounts are carried by the Clearing Agent and were introduced by the
Introducing  Firm and will contain the Introducing  Firm's address and telephone
number  of the main  office  to the  extent  that  Introducing  Firm  elects  to
incorporate them as part of the statement logo and that such meets the necessary
parameters.  Inadvertent  omission  of such  notations  shall  not be  deemed to
constitute  a breach of this  Agreement.  Copies of  sample or  suggested  forms
covering all of the  foregoing  shall be furnished by the Clearing  Agent to the
Introducing Firm in advance of use.
<PAGE>

     For purposes of the  Securities  Investor  Protection Act and the financial
responsibility  rules  of the  U.S.  Securities  and  Exchange  Commission,  the
Introduced  Accounts are  Introduced  Accounts of the Clearing Agent and not the
Introducing Firm.

     o.  Advertising.  Without the prior consent of the  Introducing  Firm,  the
Clearing Agent will not place any advertisement in any newspaper, publication or
other media which makes reference to the Introducing Firm and the services to be
provided to the Introducing Firm in this Agreement.

     p. Proxy  Statements.  The Clearing  Agent shall send, or shall cause to be
sent,  directly to an Introduced  Account,  proxy  statements  received by or on
behalf of the Clearing Agent relating to securities  beneficially  owned by such
Introduced Account but held of record by the Clearing Agent or its nominee.  The
Clearing Agent shall be solely  responsible for its failure to send, or to cause
to be sent by any election  service in the business of mailing proxy  statements
to shareholders, such proxy statements to Introduced Accounts.

     q. Class Action  Notices.  The Clearing Agent shall send, or shall cause to
be sent by a third  party,  directly  to an  Introduced  Account,  class  action
notices  received  by or on  the  behalf  of  the  Clearing  Agent  relating  to
securities  beneficially  owned by such Introduced Account but held of record by
the Clearing Agent or its nominee.

     r.  Prospectus.  It shall be the sole and exclusive  responsibility  of the
Clearing  Agent to  comply  with any and all  prospectus  delivery  requirements
relating to  prospectuses to be provided to Introduced  Accounts,  including any
new issues that the Introducing Firm acts as the managing  underwriter  provided
that such is made  available  for that purpose  within a reasonable  time to the
Clearing Agent by the Introducing Firm.

     s.  Reorganization  Notices.  The Clearing Agent shall send, or cause to be
sent by a third party, notice concerning voluntary  reorganizations  directly to
the Introduced Accounts.

     t.  Compliance  with Law. The  Clearing  Agent  assumes sole and  exclusive
responsibility   for  compliance   with  the   constitution,   by-laws,   rules,
regulations,  stated  policies,  practices  and  customs  and any  modifications
thereof of any securities  exchange of which it is a member or other  securities
exchange or market and its clearing house if any, where executed,  and any other
applicable  laws and  regulations  for the service it performs  pursuant to this
Agreement.

     u. Reports to Regulators.  The Clearing Agent shall provide the Introducing
Firm with copies of all financial  information and reports filed by the Clearing
Agent with all stock exchanges of which it is a member, the National Association
of  Securities  Dealers  Regulation,   Inc.  and  the  Securities  and  Exchange
Commission  (including  but not  otherwise  limited to quarterly  Financial  and
Operational Combined Uniform Single Reports, i.e., "FOCUS" Reports) simultaneous
with the filing therewith Copies of such financial  information and reports will
be provided in a manner mutually agreed by Clearing Agent and Introduced Firm.

     v.  Competition.  Throughout the term of this Agreement and for a period of
one year following the termination of this Agreement the Clearing Agent will not
knowingly solicit the brokerage or any other business of any Introduced Account,
and at no time  during  or after the  termination  of this  Agreement  shall the
Clearing  Agent use the  customer  list of the  Introducing  Firm to solicit the
Introducing  Firm's  customers  or allow the  affiliates  and/or  clients of the
Clearing Agent to obtain or have access to the  affiliated  customer list of the
Introducing Broker.

     w.  Confidentiality.   The  Clearing  Agent  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
termination  of this  Agreement;  provided  further that this covenant shall not
apply to information which is, or becomes, in the public domain through no fault
of the Clearing Agent.

     x. Hiring Introducing Firm's Employees.  The Clearing Agent will not engage
in negotiations  with a view to hiring or hire personnel of the Introducing Firm
without the  Introducing  Firm's prior written  consent which  obligation  shall
survive the termination of this Agreement for a period of one year.
<PAGE>

     y. Customer  Complaints.  In order for the Clearing  Agent to carry out its
functions and  responsibilities  under this  Agreement,  the Clearing Agent will
promptly  forward  any  written  customer   complaint   received  regarding  the
Introducing Firm or its associated persons including those relating to functions
and  responsibilities  allocated to the Introducing Firm under this Agreement to
(i) the Introducing Firm, attention:  Legal and Compliance Department;  and (ii)
the Introducing Firm's designated examining  authority.  The Clearing Agent will
also  notify the  customer  who sent the written  complaint  that a copy of such
complaint was furnished to both the Introducing Firm and the Introducing  Firm's
designated examining authority.

     z.  Clearing  Agent  Inspection.  Upon  reasonable  prior  written  notice,
Clearing Agent may make visits to Introducing Firm's principal place of business
to inspect  Customer  Account  documentation,  provided  that such visits do not
interfere with the conduct of Introducing  Firm's normal  business.  Introducing
Firm shall, at all times during  reasonable  business hours,  make such Customer
Account documentation readily available for inspection by Clearing Agent.

     aa. Disaster Recovery. The Clearing Agent will maintain sufficient disaster
recovery and back up system  capabilities  to enable  Clearing  Agent to provide
reasonably alternative clearing and related services to Introducing Firm.

     bb. Secondary  Clearing  Arrangements.  Clearing Agent may provide clearing
services for the benefit of third  parties  introduced  through the  Introducing
Firm subject to a separate  agreement related to that third party to be included
as part of Exhibit F hereto and which shall, upon execution,  be incorporated by
reference herein.

     2.  Services  Which Will Not be  Performed by the  Clearing  Agent.  Unless
otherwise  agreed to in a writing  executed by the parties hereto,  the Clearing
Agent  will  not  engage  in any of the  following  services  on  behalf  of the
Introducing Firm:

     a. Books and Records. Accounting, bookkeeping or recordkeeping, cashiering,
or  any  other  services  with  respect  to  commodity   transactions,   or  any
transactions not involving cash or securities.

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

     c.  Disbursements.  Preparation  or  issuance  of checks in  payment of the
Introducing Firm's expenses,  other than expenses incurred by the Clearing Agent
on behalf of the  Introducing  Firm  pursuant to this  Agreement or any attached
schedules incorporated by reference herein.

     d. Compensation. Payment of commissions, salaries or other remunerations to
the Introducing  Firm's  salespersons,  or any other independent  contractors or
employees of the Introducing  Firm or payment of other  obligations  incurred by
the Introducing Firm.

     e. Other Records. Preparation and maintenance of any records required to be
prepared and maintained by the Introducing Firm.

     f.  Reports.  Preparation  and filing of reports (the  "Reports")  with the
Securities  and  Exchange  Commission,   and  state  securities  commission,  or
securities  exchange  or  securities  association  or any  other  regulatory  of
self-regulatory  body or agency with which the  Introducing  Firm is  associated
and/or by which it is regulated.  Notwithstanding  the  foregoing,  the Clearing
Agent  will,  at the request of the  Introducing  Firm to the  Customer  Service
Department or any other department  directed by the Clearing Agent,  furnish the
Introducing Firm with any necessary  information and data contained in books and
records kept by the Clearing Agent 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.

     g. Account information. Verification of tax identification numbers, changes
of address or any other information with respect to Introduced Accounts.

     h.  New  Account   Information.   Obtaining   and   verifying  new  account
information,  and ensuring that such information  meets the requirements of Rule
405(1) of the Rules and any other Rules or applicable Standards.

     i. Custody of Certain  Securities.  Holding for safekeeping  (other than in
connection  with its execution of an order to sell securities or securities that
are  classified  as Rule 144 stock or restricted  stock ) the  securities of any
Introduced  Account  registered  in the name of anyone other than the nominee of
the Clearing Agent.

     j. Investment Advice. Clearing Agent shall not furnish investment advice to
any Introduced Account.
<PAGE>

3.       Opening of Accounts.

         The following procedures are to be followed in opening accounts:

a.   Account Forms.  The Clearing Agent shall supply the  Introducing  Firm with
     the format for "new  account"  forms  (including  Cash  Account  and Option
     Account  Agreements) and Margin  Agreements to be submitted to the Clearing
     Agent upon their  completion by the  Introducing  Firm.  The Clearing Agent
     will mail to each margin Introduced Account a written statement at the time
     of opening of a margin  account in  accordance  with Rule 10b-16  under the
     Securities  Exchange Act of 1934, as amended (the "Exchange Act") from time
     to time.

b.   Cash Account Agreements.At the time of opening the Introduced Accounts that
     are cash  accounts,  the  Introduced  Firm shall furnish the Clearing Agent
     with executed customers'  agreements and any other documents required under
     applicable rules or regulations.

c.   Margin Account Agreements. At the time of opening Introduced Accounts which
     are margin accounts,  the Introducing Firm shall furnish the Clearing Agent
     with executed customers' agreements,  hypothecation agreements and consents
     to loan of securities  (hereinafter referred to collectively as the "Margin
     Agreements") and any other documents required under the applicable rules or
     regulations.

d.   Option Account Agreements. At the time of opening Introduced Accounts which
     trade options,  the Introducing  Firm shall furnish the Clearing Agent with
     executed  customers'  option  agreements and any other  documents  required
     under applicable rules or regulations.

e.   Account  Information.  At the time of opening each Introduced Account,  the
     Introducing  Firm shall  furnish the Clearing  Agent with all financial and
     personal  information  concerning such Introduced  Accounts as the Clearing
     Agent may reasonably require.

f.   Waiver of Agreements.  If an Introduced Account has been opened without the
     Clearing Agent having previously received the foregoing  information or, in
     the case of a margin account,  without the Clearing Agent having previously
     received properly executed Margin Agreements, failure of the Clearing Agent
     to receive such information or Margin  Agreements shall not be deemed to be
     a waiver of the information requirements set forth herein.

g.   Additional  Account  Agreements.  Upon the  written or oral  request of the
     Clearing Agent,  the Introducing Firm shall furnish the Clearing Agent with
     any other  documents and agreements  executed by the Introduced  Account as
     shall be necessary for the Clearing Agent to discharge its service.

h.   Account Agreements - Customer Contact.  The Clearing Agent may upon written
     request by the Introducing  Firm,  mail Margin  Agreements or "new account"
     forms directly to the Introduced Accounts, and/or require completion of its
     own margin agreements or "new account" forms for the Introduced Accounts.

i.   Account  Information to Clearing Agent. The Introducing Firm shall promptly
     provide the Clearing Agent 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 Agent to discharge its services hereunder.

j.   Cash  Transactions.  All  transactions in any Introduced  Account are to be
     considered  cash  transactions  until such time as the  Clearing  Agent has
     received  Margin  Agreements  duly and validly  executed in respect of such
     Introduced Account.

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

l.   Rule  405(3).  The  Introducing  Firm  shall  have the  sole and  exclusive
     responsibility for substantial 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 Agent as a potential  Introduced Account.  The
     Clearing Agent, in its reasonable  business judgment,  shall have the right
     to reject any account which the Introducing Firm may tender to the Clearing
     Agent as a potential Introduced Account and promptly notify the Introducing
     Firm of such  rejection.  The  Clearing  Agent shall also have the right to
     terminate any account  previously  accepted by it as an Introduced  Account
     and promptly notify the Introducing  Firm of such  termination.  Failure of
     the Clearing Agent to so notify the Introducing  Firm,  however,  shall not
     affect the effectiveness of such termination or rejection.
<PAGE>

m.   Tax Identification Numbers. The Introducing Firm will verify and furnish to
     the Clearing Agent tax  identification  numbers,  signatures and such other
     information  as are  requested  by the  Clearing  Agent for the opening and
     carrying of  Introduced  Accounts  on such forms as may have been  approved
     from time to time by the  Clearing  Agent  and the  Introducing  Firm.  The
     Introducing Firm shall be responsible for any penalty or fine assessed as a
     result  of  its  failure  to  provide  tax  identification  numbers  or its
     providing incorrect tax identification numbers.

n.   Account Restriction for Lack of Proper Documentation.  If, after reasonable
     requests therefor,  the documents necessary to enable the Clearing Agent to
     comply with account  documentation  requirements of any applicable laws and
     regulations  have not been  received by the  Clearing  Agent,  the Clearing
     Agent may  notify  the  Introducing  Firm that no  further  orders  will be
     accepted  for  the  Introduced   Accounts  involved.   In  the  event  that
     inadvertent  orders  are  placed for such  accounts  after  such  notice is
     received,  all  commissions  collected from such orders will be retained by
     the Clearing Agent. On receipt of the necessary documents, this restriction
     will be lifted  with  respect to future  commissions,  and any  commissions
     collected by the Clearing Agent prior to its receipt of such documents will
     be paid to the Introducing Firm.

o.   Rule  405(1).  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
     substantial  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 by the  Introducing  Firm to an  Introduced  Account shall be the
     sole and exclusive responsibility of the Introducing Firm.

p.   Customer Incapacity. The Introducing Firm shall have the sole and exclusive
     responsibility  to ensure that those of its customers who become Introduced
     Accounts  hereunder  shall not be minors or subject  to those  prohibitions
     existing  under  any  laws  and  regulations   generally  relating  to  the
     incapacity of any Introduced Account.

4.   Additional  Responsibilities,  Warranties and Covenants of the  Introducing
     Firm.

a.   Exclusive  Arrangement.  The  Introducing  Firm covenants that the Clearing
     Agent shall be the exclusive  provider of clearing and settlement  services
     for the Introducing Firm and Introducing Firm's  affiliates,  subsidiaries,
     agents and assigns  subject to section 4(p) of this Agreement and except as
     otherwise  mutually  agreed upon in writing by the parties as  necessary to
     facilitate temporary dual clearing  arrangements related to acquisitions by
     Introducing Firm.

b.   Restricted  and Control  Stock.  The  Introducing  Firm shall be solely and
     exclusively  responsible  for  determining  if any  securities  held in any
     Introduced  Account are  "restricted  securities"  or  "control  stock" and
     ensuring that orders  executed for such  securities are in compliance  with
     applicable laws, rules and regulations.

c.   Addresses and Tax  Information.  The  Introducing  Firm shall be solely and
     exclusively  responsible  for  maintaining  proper  addresses,  correct tax
     identification numbers and other information required by the Tax Equity and
     Fiscal Responsibility Act, for each Introduced Account.

d.   Rule 408. 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  Agent  with such  documentation  with  respect  thereto as may be
     requested by the Clearing Agent.

e.   Rule  407.  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 and any other  applicable  laws and  regulations
     relating  thereto.  The  Introducing  Firm shall furnish the Clearing Agent
     with such  documentation  with  respect  thereto as may be requested by the
     Clearing Agent.

<PAGE>

f.   Blue Sky Requirements. 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 Agent,  arising out
     of or  resulting  from any  orders  the  Introducing  Firm has  taken  from
     Introduced  Accounts  residing or domiciled in  jurisdictions  in which the
     Introducing Firm was not, is not or is no longer permitted to do so.

g.   Payment  Responsibility.  In all cash accounts and with respect to all cash
     transactions,  as between the Introducing  Firm and the Clearing Agent, the
     Introducing Firm shall be responsible for purchases for Introduced Accounts
     until final payment  therefor has been received by the Clearing Agent.  The
     Introducing  Firm  shall be  responsible  for all  sales  until  acceptable
     deliveries to the Clearing  Agent, or to a national  clearing  organization
     mutually agreed upon by the Clearing Agent and the Introducing Firm, of the
     securities  have been  made.  The  Introducing  Firm  shall be  solely  and
     exclusively  responsible  to the  Clearing  Agent for any loss or liability
     whatsoever  in the event any check or draft given to the Clearing  Agent by
     any of the  Introduced  Accounts is returned to the Clearing  Agent unpaid.
     The Introducing  Firm shall also be solely and exclusively  responsible for
     the  payment  and  delivery  of all  "when  issued"  or "when  distributed"
     transactions  which the Clearing  Agent may accept,  forward or execute for
     Introduced Accounts.

h.   Order  Approval  or  Rejection.  The  Introducing  Firm shall be solely and
     exclusively  responsible  for  approving  all  orders  for  the  Introduced
     Accounts  and for  establishing  procedures  to ensure  that such  approved
     orders are  transmitted  properly to the Clearing Agent for execution.  The
     Clearing Agent, in its reasonable business judgment,  reserves the right to
     reject any order which the  Introducing  Firm may  transmit to the Clearing
     Agent  for  execution  and to  promptly  notify  such  agent or  registered
     representative of the Introducing Firm of such rejection.

i.   Order  Review.  The  Introducing  Firm  shall  be  solely  and  exclusively
     responsible  for the  supervisory  review of all orders for the  Introduced
     Accounts and shall ensure that any orders and  instructions  given by it or
     any of its  employees to the Clearing  Agent  pursuant to the terms of this
     Agreement shall have been properly  authorized in advance and do not create
     or result in a violation of any applicable laws and regulations.

j.   Compliance  with Law.  The  Introducing  Firm  assumes  sole and  exclusive
     responsibility  for  compliance  with the  constitution,  by-laws,  rules,,
     regulations,  stated  policies,  practices,  and customs and any amendments
     thereof  of any  securities  exchange  of  which  it is a  member  or other
     securities  exchange  or  market  and its  clearing  house,  if any,  where
     executed, and any other applicable laws and regulations for the services it
     performs pursuant to this Agreement.

k.   Rule  405(2).  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 and any
     other  applicable  rules and laws,  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.

l.   Rule  342.  The  Introducing  Firm  shall be  responsible  for  substantial
     compliance with any supervisory procedures under Rule 342 of the Rules and,
     to the extent  applicable,  any other provisions of any applicable laws and
     regulations,  including  but  not  otherwise  limited  to  supervising  the
     activities and training of its registered  representatives,  as well as all
     of  its  other  employees  in the  performance  of  functions  specifically
     allocated to it pursuant to the terms of this Agreement.
<PAGE>

m.   Customer  Notification  of  Relationship.  In accordance with Rule 382, the
     Introducing   Firm  shall  be  solely  and   exclusively   responsible  for
     determining  the extent to which it will inform its customers,  in writing,
     of its  relationship  with the Clearing  Agent,  the form and  substance of
     which will be mutually  agreed upon.  Any new customers of the  Introducing
     Firm shall also be so informed 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.

n.   Equipment. The Introducing Firm shall be solely and exclusively responsible
     for all rental and other fees  relating  to any  equipment  obtained by the
     Introducing  Firm in addition to that supplied by the Clearing Agent.  Upon
     the closing of an office of the Introducing  Firm, the Clearing Agent shall
     use its best efforts to locate  promptly a new  installation  site for such
     equipment.

o.   Discretionary  Accounts. The Introducing Firm covenants that with regard to
     any orders or instructions  given by the  Introducing  Firm with respect to
     discretionary accounts, its officers,  registered agents or employees shall
     have been  fully and  properly  authorized  relative  thereto  and that the
     execution of such orders shall not be in violation of any  applicable  laws
     and regulations.

p.   Over-the-Counter  Trades  by  Introducing  Firm.  On  all  over-the-counter
     transactions  executed for Introduced Accounts by the Introducing Firm, the
     Introducing  Firm shall  furnish the  Clearing  Agent with the names of the
     respective  purchasing  and  selling  broker-dealers,   the  names  of  the
     purchasing and selling customers, and the wholesale and retail purchase and
     sale prices.  Clearing  Agent  reserves the right,  at any time, to place a
     limit  (of  either  dollars  or  numbers  of  securities)  on the  size  of
     transactions  that Clearing  Agent in these  circumstances  will accept for
     clearance.   If,  after  Introducing  Firm  has  received  notice  of  such
     limitation,  it  executes  an order in excess of the limit  established  by
     Clearing  Agent,  Clearing  Agent  shall have the right to notify the other
     parties  and other  broker  that it will not  accept  the  transaction  for
     clearance and  settlement.  In the event that Clearing Agent  exercises the
     right to not accept a particular  transaction for clearance and settlement,
     and only in such event,  Introducing Firm may pursue  alternative  means of
     clearing that  transaction.  Such  exercise by the Clearing  Agent and such
     alternatively  cleared  transaction by the Introducing Firm shall in no way
     alter or be construed to alter Introducing Firm's  obligations  pursuant to
     Section 4(a) of this  Agreement or constitute  an event of default.  In the
     event any claim is  asserted  against  Clearing  Agent by the other  broker
     because  of such  action by  Clearing  Agent,  Introducing  Firm  agrees to
     indemnify  and hold  Clearing  Agent  harmless  from any  loss,  liability,
     damage,  cost, or expense  arising  directly or indirectly  therefrom.  The
     Clearing Agent may impose on the Introducing  Firm  additional  charges for
     any such trades or may at its discretion  decline to handle such introduced
     trades in the normal course of business.

q.   Reports to  Regulators.  The  Introducing  Firm shall  provide the Clearing
     Agent with copies of all  financial  information  and reports  filed by the
     Introducing  Firm with all  stock  exchanges  of which it is a member,  the
     National  Association of Securities  Dealers,  Inc., and the Securities and
     Exchange  Commission  (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.

r.   Data on Performance of Function.  The Introducing  Firm shall submit to the
     Clearing  Agent  upon  reasonable  request  all  appropriate  data  in  its
     possession  pertinent  to the proper  performance  and  supervision  of any
     function or responsibility  specifically  allocated to the Introducing Firm
     pursuant to the terms of the Agreement.

s.   Compliance with Financial Regulations.  The Introducing Firm will remain in
     substantial   compliance   with  the   capital  and   financial   reporting
     requirements  of each  securities  exchange and  securities  association of
     which it is a member,  the  Securities  and Exchange  Commission,  and each
     state in which the Introducing Firm is registered as a  broker/dealer.  The
     Introducing Firm will  immediately  notify the Clearing Agent when: (i) its
     Aggregate  Indebtedness  Ratio (as defined in Rule  15c3-3 of The  Exchange
     Act) reaches or exceeds 10 to 1; or (ii) the  Introducing  Firm has elected
     to operate  under  paragraph  (f) of Rule  15c3-1 of The  Exchange  Act, as
     amended,  when its net  capital is less than 5% of  aggregate  debit  items
     computed in accordance with Rule 15c3-3.

t.   Customer  Correspondence.  The Introducing  Firm shall inform its customers
     that all inquiries  and  correspondence  relating to the services  provided
     pursuant to this Agreement 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  correspondence
     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 Agent shall  expeditiously  forward such correspondence to
     the appropriate party.
<PAGE>

u.   Membership on Exchanges and Compliance.  The  Introducing  Firm will remain
     duly licensed and in good standing as a broker/dealer  under all applicable
     laws and  regulations.  The  Introducing  Firm  will  promptly  notify  the
     Clearing Agent in accordance  with 13(q) of the Agreement of its becoming a
     member or affiliate of any  exchange in addition to those  memberships  and
     affiliations  existing on the date of this Agreement.  The Introducing Firm
     shall  also  comply  with  whatever   non-member  access  rules  have  been
     promulgated by any securities exchange of which it is a member or any other
     securities exchange of which it is not a member.

v.   Security  Deposit.  The  Introducing  Firm shall  deposit with the Clearing
     Agent,  within  10 days  after  its  execution  of this  Agreement,  a cash
     security  deposit in the amount of $50,000.00.  Should the security deposit
     at any time during the term of this  Agreement fall below  $50,000.00,  the
     Introducing  Firm will be notified as to the deficient amount and within 10
     days of said notice,  the Introducing  Firm will deposit  additional  funds
     sufficient to reach the required minimum of $50,000.00.  The Clearing Agent
     will pay the Introducing Firm interest monthly on such deposit based on the
     13 week  T-bill rate in effect on the first  trading  day of the  brokerage
     month.  Such deposit shall be returned to the  Introducing  Firm within ten
     days  after  termination  of this  Agreement,  and shall be  subject to the
     Clearing Agent's right from time to time to offset sums due to the Clearing
     Agent by the Introducing Firm pursuant to the terms of the Agreement.

w.   Preparation of  Statements,  etc. The  Introducing  Firm shall not generate
     and/or prepare any statements, billings or confirmation with respect to any
     Introduced  Account  unless agreed to in writing by the Clearing  Agent and
     the Introducing Firm.

x.   Confidentiality.   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 Agent, which requirement shall survive
     the termination of this Agreement;  provided,  however,  that this covenant
     shall not apply to information  which is, or becomes,  in the public domain
     through no fault of the Introducing  Firm or which the Introducing  firm is
     legally   required   to  provide  to  any  court,   regulatory   agency  or
     self-regulatory organization.

y.   Summary of Material Litigation/Arbitration.  Introducing Firm shall provide
     the Legal  Department  of the  Clearing  Agent,  on an annual basis or upon
     reasonable  notice,  with  summaries of any pending  litigation/arbitration
     material to Introduced  Accounts or  Introducing  Firm's ability to perform
     its obligations under this Agreement.

z.   Cash and  Securities  of  Customers.  The  Introducing  Firm will turn over
     promptly to the Clearing Agent any and all cash  remittances and securities
     which the Introducing Firm receives from its customers.  Concurrently  with
     the  delivery  of such  funds or  securities  to the  Clearing  Agent,  the
     Introducing  Firm shall furnish the Clearing Agent with such information as
     may be  relevant  or  necessary  to  enable  the  Clearing  Agent to record
     promptly  and  properly  such  cash   remittances  and  securities  in  the
     respective Introduced Accounts.

aa.  Advertisements.  The Introducing  Firm shall not, without the prior written
     approval of the Clearing Agent,  place or agree to place any  advertisement
     for use in any  newspaper,  publication,  periodical  or any other media if
     such advertisement in any manner makes reference to the Clearing Agent; 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 Agent;  and the clearing  arrangements  and/or any of the
     services embodied in this Agreement.

bb.  Examination of Statements and Reports.  Introducing Firm shall examine in a
     reasonable manner all monthly statements of Accounts, monthly statements of
     clearing services,  customer  confirmations,  margin status reports,  money
     line,  daily  reports,  and other  reports  provided  on a timely  basis to
     Introducing Firm by Clearing Agent. Introducing Firm shall, within the time
     specified below,  notify Clearing Agent of any error claimed by Introducing
     Firm in any Accounts in connection  with (1) any  transaction  prior to the
     settlement date of such  transaction;  (2)  information  appearing on daily
     reports  within  thirty  (30) days of  Introducing  Firm's  receipt of such
     report; and (3) information appearing on monthly or quarterly statements or
     reports  within  thirty  (30) days of  Introducing  Firm's  receipt  of any
     monthly or  quarterly  statement  or report.  Any notice of error  shall be
     accompanied  by  such  documentation  as may be  reasonably  necessary  and
     available to Introducing  Firm to  substantiate  Introducing  Firm's claim.
     Introducing  Firm  shall  provide,   upon  Clearing  Agent's  request,  any
     additional  documentation  in  Introducing  Firm's  possession,  under  its
     control  or  otherwise  readily  available  to  it,  which  Clearing  Agent
     reasonably  believes is necessary or desirable to establish and correct any
     such error.  Unless  Introducing  Firm  notifies  Clearing  Agent  within a
     reasonable  time of any mistakes or  discrepancies  in the  above-described
     reports and  information,  Clearing Agent shall, as between  Clearing Agent
     and Introducing Firm and to the extent Clearing Agent suffers monetary loss
     arising from any such delay,  be entitled to consider  all the  information
     supplied to Introducing Firm as correct.
<PAGE>

cc.  Hiring Clearing Agent's Employees.  The Introducing Firm will not engage in
     negotiations  with a view to hiring or hire personnel of the Clearing Agent
     without the Clearing  Agent's prior written consent which  obligation shall
     survive the termination of this Agreement for a period of one year.

5.       Margin Transactions.

a.   Regulation  T.  With  respect  to  Introduced  Accounts  which  are  margin
     accounts,  the Clearing Agent 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
     interpretive  rulings  issued by the Board,  letter  rulings of the Federal
     Reserve  Bank of New York,  Rules,  interpretations  of the New York  Stock
     Exchange,  Inc.  and any other  applicable  margin and  margin  maintenance
     requirements. The Introducing Firm is responsible to the Clearing Agent for
     the collection of the margin required to support each  transaction for, and
     to maintain a position in, each Introduced  Account, in conformity with the
     above margin and margin  maintenance  requirements.  After  initial  margin
     relating to each  transaction has been received,  maintenance  margin calls
     shall be generated by the Clearing Agent or by the Introducing  Firm at the
     instruction of the Clearing Agent.  The Clearing Agent shall have the right
     to  modify,  in  its  sole  discretion,  the  margin  requirements  of  any
     Introduced Account from time to time. All margin Introduced  Accounts shall
     be subject to the Clearing Agent's "house margin  requirements" which shall
     be delivered to the Introducing Firm on the Introducing Firm's request. The
     Clearing Agent will not mark up any fees or charges imposed directly by any
     regulatory body with regard to Regulation T call extensions  granted by the
     Clearing  Agent  pursuant  to  written  requests  from a  principal  of the
     Introducing Firm.

b.   Payment Responsibility.  On all transactions, the Introducing Firm shall be
     responsible to the Clearing Agent for any loss, liability,  damage, cost or
     expense  (including but not otherwise limited to fees and expenses of legal
     counsel)  incurred or  sustained  by the  Introducing  Firm or the Clearing
     Agent as a result of the failure of any  Introduced  Account to make timely
     payment for the securities  purchased by it or timely compliance by it with
     margin or margin  maintenance  calls  (provided that the Clearing Agent has
     timely issued such call and given notice thereof to the Introducing  Firm),
     whether or not any margin  extension has been granted by the Clearing Agent
     pursuant to the request of the  Introducing  Firm,  except that no interest
     will be charged by the Clearing Agent for securities sold in cash accounts,
     also referred to as cash shorts, in Introduced Accounts.

6.       Self-Directed Individual Retirement Accounts Program

a.   Services  Performed.   The  Self-Directed  Individual  Retirement  Accounts
     Program  (the "SDIRA  Program")  includes  without  limitation  a brokerage
     account by Clearing Agent and one or more liquid asset investment  options.
     Clearing Agent provides the various  processing  services described in this
     section on behalf of the  Introducing  Firm, in connection  with such SDIRA
     program. Unless otherwise agreed to in writing, Clearing Agent will not act
     a custodian of the SDIRA.

b.   Responsibilities of the Parties.

i.   The parties will develop the application form and other forms to be used by
     Introduced  Accounts  who  participate  in the  SDIRA  Program  (the  SDIRA
     Introduced Account").

ii.  Introducing  Firm and Clearing Agent will be responsible for processing the
     application  forms with  regard to  approving  a SDIRA  Introduced  Account
     application  and shall approve,  deny or otherwise  handle the  application
     forms in accordance  with  applicable  law,  including  without  limitation
     receipt,  evaluation  and  retention  of the  application  form  and  legal
     documentation  required to open an Account.  Introducing Firm will retain a
     copy of the application form and related documentation and materials as may
     be required by applicable law.

iii. The following  responsibilities  will be  undertaken by the Clearing  Agent
     regarding the SDIRA program:

a.   Clearing Agent will perform all required tax reporting.

b.   Clearing Agent will identify receipts into the SDIRA Introduced Account and
     disbursements from the SDIRA Introduced Account by transaction type and tax
     year.  Clearing Agent will store this  transaction  information and produce
     the proper tax reporting, on Forms 5498 and 1099R.

b.   The  maintenance  of the annual fee billing  system which  includes (i) the
     generation  and  mailing of fee due  notices;  (ii)  support of various fee
     incentive  or waiver  programs;  and (iii) the  ability  to debit the SDIRA
     Introduced Account for the required fee amount.
<PAGE>

c.   Forms Approval and Inventory.  Introducing Firm will provide,  at its cost,
     all  forms  necessary  to  opening,  operate  and  close  SDIRA  Introduced
     Accounts.  The use of such forms and all revisions  thereto will be subject
     to the prior approval of Clearing  Agent,  but Clearing  Agent's review and
     approval shall not be unreasonably withheld.

     If any reprinting is required by a change in law applicable to the parties,
or any party hereto,  or the SDIRA Program services offered by Introducing Firm,
the  cost  of  reprinting  and  distributing  revised  forms  will be  borne  by
Introducing  Firm. If a change  requiring forms  reprinting is requested,  other
than as required by a change in law  applicable to the parties  hereto or to the
SDIRA Program services offered by Introducing Firm, then all creative, printing,
inventory,  distribution and other costs incurred as a result of such reprinting
shall be borne solely by the party requesting such change.  Clearing Agent shall
have no responsibility  for any creative,  inventory,  distribution or any other
costs incurred as a result of replacing an inventory of forms  maintained by, or
for,  Introducing Firm that exceeds the supply reasonably expected to be used in
a three-month  period unless Clearing Agent shall have  previously  consented in
writing to the printing and  distribution of more than a three month's supply of
such forms.

d.   No Third Party Beneficiaries.  The parties agree that there are no intended
     or  incidental  third party  beneficiaries  of the SDIRA Program other than
     those customers who are SDIRA Introduced Accounts.

e.   Fees.  Introducing  Firm  agrees to pay  Clearing  Agent all fees for those
     services relating to the SDIRA Program, and for supplies and other services
     as set forth in Exhibit A in the section titled RETIRMENT PLANS as the same
     may be amended from time to time by the Clearing  Agent on thirty (30) days
     prior written  notice or from time to time by agreement of the  Introducing
     Firm and the Clearing Agent.

     Clearing  Agent will  invoice  Introducing  Firm in January for all charges
associated with the SDIRA Program. Such invoices shall be payable in full within
ten (10) days of receipt by Introducing Firm. Past-due accounts shall be subject
to a service  charge of 1% per month  calculated  on the past-due  balance.  All
other charges, or out- of-pocket cost will be expensed as incurred and reflected
on the month-end settlement statement.

f.   Reference  to Each Other.  Each party  agrees,  with respect to any and all
     SDIRA Program  forms,  notices,  agreements,  advertising  and  promotional
     materials to be used in  connection  with the SDIRA  Program and which make
     reference to any other party  and/or  mention any other  party's  products,
     service or  benefits,  that it will submit the same to such other party for
     review and comment  relating to the  reference  or mention and that no such
     form,  notice,  agreement,  advertising  or  promotional  materials will be
     mailed to customers or  distributed to the public by that party without the
     prior  consent of such other party or parties,  which  consent  will not be
     unreasonably withheld.

7.   Additional  Services.   Mutual  Fund  and  registered  investment  advisory
     services shall be performed pursuant to a separate agreement as attached in
     Exhibit F which shall, upon execution, be included by reference herein.

8.   Representations, Warranties and  Covenants.

a.   Introducing  Firm's  Representations.   The  Introducing  Firm  represents,
     warrants, and covenants as follows:

i.   the  Introducing  Firm  is a  member  in  good  standing  of  the  National
     Association of Securities Dealers, Inc.;

ii.  the Introducing Firm is duly registered or licensed and is in good standing
     as a broker/dealer under all applicable laws and regulations;

iii. 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 Agent in accordance with the terms hereof;

iv.  the Introducing Firm is in substantial compliance with: (A) the capital and
     financial  reporting  requirements  of  every  securities  exchange  and/or
     securities  association of which the Introducing Firm is a member;  (B) the
     capital requirements of the Securities and Exchange Commission; and (C) the
     capital  requirements  of  every  state in which  the  Introducing  Firm is
     licensed as a broker/dealer;
<PAGE>

v.   the Introducing  Firm has minimum net capital in an amount no less than the
     greater  of  130%  of the  net  capital  requirements  of  Rule  15c3-1  or
     $50,000.00;

vi.  the  Introducing  Firm  has  completed  the  requirements  imposed  by Rule
     382(e)(1) in that it has provided  written  notice to the Clearing Agent of
     those specific  reports  offered by the Clearing Agent that the Introducing
     Firm requires to supervise and monitor Introduced Accounts; and

vii. the Introducing  Firm has complied with the  requirements of Rule 382(f) by
     maintaining and enforcing supervisory procedures to the satisfaction of the
     Clearing  Agent with respect to the issuance of negotiable  instruments  to
     Introduced Accounts, for which the Clearing Agent is the maker or drawer.

b. Clearing Agent's  Representations.  The Clearing Agent  represents,
   warrants, and covenants as follows:

          i. the  Clearing  Agent is a member in good  standing  of the New York
     Stock  Exchange,  Inc. and the National  Association of Securities  Dealers
     Regulation,  Inc.,  and is duly  registered  as a  broker/dealer  under the
     Exchange Act and the rules and  regulations  of the Securities and Exchange
     Commission and the various states thereunder;

          ii. the Clearing Agent has all the requisite authority,  in conformity
     with all applicable  laws and  regulations,  to enter into and perform this
     Agreement;

          iii.  the Clearing  Agent is in  substantial  compliance  with (A) the
     capital and financial  reporting  requirements of every securities exchange
     or association of which it is a member, (B) the capital requirements of the
     Securities and Exchange  Commission,  and (C) the capital  requirements  of
     every state in which it is licensed as a broker/dealer; and

          iv. the Clearing Agent has completed the requirements  imposed by Rule
     382(e)(1) in that it has provided the  Introducing  Firm with a list of all
     reports made available by the Clearing Agent to assist the Introducing Firm
     to  supervise  and  monitor  its  Introduced  Accounts  in  order  for  the
     Introducing Firm to carry out its functions and  responsibilities  pursuant
     to this Agreement.

9.       Compensation, Charges and Credits.

     a. Customer  Charges.  The Clearing  Agent shall charge to and collect from
each Introduced Account the charge which the Introducing Firm directs it to make
for each transaction.  If specific instructions are not received with respect to
a specific  transaction  in the time period  required by the  Clearing  Agent to
implement  same,  the  Clearing  Agent shall charge the  Introduced  Account the
amount  prescribed  in the  Introducing  Firm's  basic rate  schedule as then in
effect.  The  basic  schedule  may be  amended  from  time to  time  by  written
instructions from the Introducing Firm to the Clearing Agent,  provided that the
proposed terms are within the usual  capabilities  of the Clearing  Agent's data
processing and operations systems.

     b.  Compensation.  As compensation for services  provided  hereunder by the
Clearing Agent, the Introducing Firm shall pay to the Clearing Agent:

               i.   the amounts  set forth in Exhibit A hereto,  as the same may
                    be amended from time to time by the Clearing Agent on thirty
                    (30)  days  prior  written  notice  or from  time to time by
                    agreement of the Introducing Firm and the Clearing Agent;

               ii.  the Clearing Agent's reasonable  charges,  as invoiced,  for
                    the  services  described in Exhibit B hereto as the same may
                    be amended from time to time by the Clearing Agent on thirty
                    (30)  days  prior  written  notice  or from  time to time by
                    agreement of the Introducing firm and the Clearing Agent;

               iii. an  amount  equal to the  daily  broker  call rate for debit
                    balances in the customers'  cash accounts.  For the purposes
                    of this  Agreement,  the "daily broker call rate" shall mean
                    the call  money  rate  published  daily  in The Wall  Street
                    Journal.  If the daily  broker call rate is  published  as a
                    range of rates, such rate shall be the median of such range.

               iv.  the interest  charges made with respect to debit balances in
                    margin  Introduced  Accounts in  accordance  with  Exhibit C
                    hereto,  as may be amended from time to time by agreement of
                    the Clearing  Agent and the  Introducing  Firm, but interest
                    income from such Introduced Accounts shall be proprietary to
                    and fully retained by the Clearing Agent, subject to certain
                    credits  provided  to the  Introducing  Firm as set forth on
                    Exhibit D  hereto,  as may be  amended  from time to time by
                    Clearing  Agent on 30 days prior written notice or from time
                    to  time  by  agreement  of  the  Clearing   Agent  and  the
                    Introducing Firm; and
<PAGE>

               v.   additional charges, costs and fees if applicable:

                         (1)     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
                                 Agent, the Clearing Agent reserves the right to
                                 charge the Introduced  Account interest,  based
                                 upon the then current  brokers' call loan rate,
                                 respecting  the total  payment due the Clearing
                                 Agent  from  the date of such  rejection  until
                                 such time as such valid  delivery  is  accepted
                                 and payment  received  therefore.  Any interest
                                 charged  pursuant  to  this  provision  may  be
                                 deducted  by  the   Clearing   Agent  from  net
                                 commission  revenues  then  due and  owing  the
                                 Introducing  Firm pursuant to the provisions of
                                 this  Agreement.  The  Introducing  Firm agrees
                                 that all COD clients  and/or  their agents will
                                 use the  facilities of a securities  depository
                                 for the confirmation,  acknowledgment  and book
                                 entry  settlement  of all  depository  eligible
                                 transactions,  subject  to the  exceptions  set
                                 forth under Rule 387(a)(5) of the Rules;

                         (2)     Custodial  Fee. The Clearing Agent may charge a
                                 custodial   fee  in  respect  of  any  inactive
                                 Introduced  Account that maintains a fully paid
                                 for security position. Inactivity is defined as
                                 the absence of a bona fide security transaction
                                 during any calendar year.

     c. Credits. The Clearing Agent shall give the Introducing Firm a credit for
free credit  balances in Customer cash accounts in excess of $1,000 as set forth
in  Exhibit  D  hereto,  as the same  may be  amended  from  time to time by the
Clearing  Agent on thirty (30) days prior written notice or from time to time by
agreement of the Introducing Firm and the Clearing Agent.

     d.  Additional  Charges.  The  charges  set forth  herein  notwithstanding,
additional  reasonable  charges for specific services rendered may be charged to
the Introducing Firm upon proper prior notification by the Clearing Agent to the
Introducing Firm which are not otherwise covered by this Agreement.

     e. Payments.  Payment of commission  revenue due the Introducing Firm shall
be made by the  Clearing  Agent  to the  Introducing  Firm  twice a  month.  The
mid-month payment will be based on trade activity to date of payment. The end-of
month  payment,  to be paid by the seventh  business  day of the next  following
month,  shall be an adjusted  amount  after  deduction of all clearing and other
charges,  costs and expenses due the Clearing Agent in accordance with the terms
of the  Agreement  and all  amounts  due and  owing  the  Clearing  Agent by the
Introducing  Firm arising from any losses,  liabilities or damages in accordance
with the terms of the  Agreement  which are not in dispute.  Such  end-of  month
payment shall be  accompanied by a settlement  statement  which will reflect the
deduction of all clearing and other charges,  costs or expenses due the Clearing
Agent in  accordance  with the terms of the  Agreement  and all  amounts due and
owing the  Clearing  Agent by the  Introducing  Firm  arising  from any  losses,
liabilities or damages in accordance  with the terms of this Agreement which are
not in dispute.

     f. Cash  Payments  to  Introducing  Firm.  The  amounts of and  methodology
regarding  cash payments by the Clearing Agent to the  Introducing  Firm will be
detailed in the Financial  Venture  Agreement between the Clearing Agent and the
Introducing  Firm,  attached hereto as Exhibit E and the terms of which shall be
incorporated  into the body of this  Agreement  as if fully set forth  herein at
length.
<PAGE>

10.      Conversions.

     The following  provisions  shall apply to the Introducing Firm in the event
the Introducing Firm is converting  Introduced  Accounts maintained with another
broker/dealer:

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

     b. Open  Orders.  The  Clearing  Agent  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 Agent to
reflect  that the  Clearing  Agent has acted as broker on the open  orders  with
specialists on any securities exchange.

     c.  Adjustments  - Dividends.  The  Clearing  Agent 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. Adjustments - Other. The Clearing Agent shall have the power to allocate
and make appropriate adjustments for fails,  reorganization accounts, other work
in process  accounts,  and overages relating to accounts of the customers of the
Introducing Firm that have become  Introduced  Accounts pursuant to the terms of
this Agreement.

     e.  Assumption  of  Liability.   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.  Unsecured debits in the Introduced Accounts shall be paid
within 30 days of their origin date, and it shall be the  responsibility  of the
Introducing  Firm to collect such  payments from its customers and transmit them
to the Clearing Agent within such 30-day period. If any unsecured debit balances
remain  outstanding  beyond such 30-day period, the Clearing Agent 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.

     f. Activity  Before  Conversion.  Introducing  Firm shall provide  specific
written notice to Clearing Agent  conversion team of any transfers of securities
relating  to  Introduced  Accounts  effected  during the period  commencing  ten
business days prior to the conversion date.

11.      Termination of Agreement; Events of Default; Remedies

     a. Term. The term of this  Agreement  shall be for an initial period of ten
years commencing on May 8, 2000 (the  "Commencement  Date") and continuing until
the close of business on May 8, 2010 (the "Termination Date"). At no time during
the initial term of this  Agreement  shall either  Introducing  Firm or Clearing
Agent cancel this Agreement  except for an Event of Default.  During any renewal
term, either party hereto may cancel this Agreement without cause on ninety (90)
days prior written  notice to the other party.  Notwithstanding  the  foregoing,
Introducing  Firm must  provide  written  notice no later than  ninety (90) days
prior to Termination Date if it intends not to renew this Agreement.  Failure to
do so will result in this  Agreement  being renewed for an  additional  one year
period.

     b. Events of Default.  Each of the  following  events shall  constitute  an
event of default (an "Event of Default") under this Agreement:

               i.   Compliance with Agreement,. Either the Clearing Agent or the
                    Introducing Firm shall fail to perform,  undertake,  observe
                    or  comply  with  any  term,  covenant,   responsibility  or
                    condition to be performed,  undertaken, observed or complied
                    with by it hereunder, or any representation or warranty made
                    by either the Clearing Agent or the Introducing  Firm herein
                    shall  prove  to be  false  or  misleading  in any  material
                    respect and such failure or  misrepresentation,  if curable,
                    shall  continue  unremedied  for a period  of 30 days  after
                    written notice from the non-defaulting  party is transmitted
                    to  the   defaulting   party   specifying   the  failure  or
                    misrepresentation  and demanding  that the same be remedied;
                    or
<PAGE>

               ii.  Bankruptcy. A receiver,  liquidator or trustee of either the
                    Clearing Agent or the  Introducing  Firm, or of any 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  Agent  or  the  Introducing  Firm  is  adjudicated
                    bankrupt or 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 Agent 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

               iii. Creditor   Relief.   Either  the   Clearing   Agent  or  the
                    Introducing Firm files a petition in voluntary bankruptcy or
                    seeking  relief  under  any  provisions  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;

               iv.  Insolvency.  Either the  Clearing  Agent 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
                    Agent or the  Introducing  Firm,  or of any property held by
                    either party;

               v.   False  Representation.  The  Introducing  Firm  in  any  way
                    attempts  to hold  itself  out as,  advertise  or in any way
                    represents that it is the agent of the Clearing Agent; or

               vi.  Failure  to  Comply   with   Financial   Agreement.   Either
                    Introducing  Firm or Clearing Agent fails to comply with the
                    terms of the Financial Agreement.

                 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 the Agreement  shall be hereby
                 terminated  and such  termination  shall be effective as of the
                 date  such  notice  has  been  sent  or   communicated  to  the
                 defaulting party.

         c.      Payment for Terminations by Introducing Firm. In the event that
                 Introducing Firm gives notice to terminate this Agreement prior
                 to the close of business on Termination Date, other than for an
                 Event of Default,  as defined  above,  it will pay the Clearing
                 Agent an early termination fee as set forth Section 3(b) of the
                 Financial  Agreement  between  the parties  attached  hereto as
                 Exhibit E.

                 The  amount  and   methodology   regarding  the  payment  of  a
                 termination fee by the Introducing  Firm to the Clearing Agent,
                 including the unamortized portion of the cash payment, shall be
                 governed by the Financial  Agreement between the Clearing Agent
                 and  the  Introducing   Firm,  the  terms  of  which  shall  be
                 incorporated  into the body of this  Agreement  as if fully set
                 forth herein at length.

         d.      Continuation of Certain  Responsibilities.  Termination of this
                 Agreement however caused shall not release the Introducing Firm
                 or the Clearing Agent from any liability or  responsibility  to
                 the other with respect to  transactions  effected  prior to the
                 effective  date  of such  termination,  whether  or not  claims
                 relating  to such  transactions  shall have been made before or
                 after  such  termination.  If no  arrangements  have  been made
                 regarding the conversion of Introduced  Accounts within 30 days
                 after  termination  of this  Agreement,  the Clearing Agent may
                 maintain  such  accounts  in its  own  name  until  process  is
                 completed.
<PAGE>

         e.      Release  of  Information.  In the event of  termination  of the
                 Agreement,  the Clearing Agent shall release to the Introducing
                 Firm, at the Introducing Firm's request and upon payment by the
                 Introducing  Firm to the Clearing Agent of a reasonable  charge
                 for conversion  expenses  incurred by the Clearing Agent at the
                 request  of  the   Introducing   Firm,  all   information   the
                 Introducing Firm may reasonably  require to continue  servicing
                 such Introduced Accounts.

         f.      Right of Offset. In the event that the Introducing  Firm's acts
                 or omissions result in an Event of Default,  the Clearing Agent
                 shall offset any and all liabilities,  costs or expenses due it
                 from the Introducing  Firm which remained unpaid as of the date
                 of such Event of Default against the commission revenue then in
                 the possession of the Clearing Agent, and if insufficient  then
                 against the  Introducing  Firm's  $50,000.00  deposit  with the
                 Clearing   Agent.   Any  remaining   liability   shall  not  be
                 extinguished thereby.

12.      Action Against Customers

               a.   Withholding Payment or Delivery. The Clearing Agent shall be
                    obligated   to  follow  the   Introducing   Firm's   written
                    instructions  to withhold  payment for securities sold or to
                    withhold  delivery of securities  purchased  for  Introduced
                    Accounts  after the  Introducing  Firm  makes such a request
                    based  upon  failure of an  Introduced  Account to pay for a
                    purchase  of  securities  or upon  failure of an  Introduced
                    Account to deliver securities sold.

               b.   Remedial  Action.  The Clearing Agent reserves the right (i)
                    to give prior oral or written notice to the Introducing Firm
                    and to any  Introduced  Account  for  failure to make timely
                    settlement  and of the  Clearing  Agent's  intention to take
                    remedial  action and (ii) to take such remedial  action with
                    respect to the  Introduced  Account which the Clearing Agent
                    in its sole judgment deems necessary or appropriate.

               c.   Account  Responsibility.  In the  case  of all  transactions
                    placed  by the  Introducing  Firm on  behalf  of  Introduced
                    Accounts,  the  Introducing  Firm  assumes  the risk of loss
                    associated with Introduced Accounts'  obligations to pay for
                    securities  purchased and to deliver securities sold and for
                    other defaults of customers. Nothing in this Agreement shall
                    relieve  Introduced  Accounts  of  responsibility  for their
                    obligations.  In the event any  obligation  of an Introduced
                    Account shall not be satisfied by the Introducing  Firm, the
                    Clearing  Agent  shall have the right at all  times,  in its
                    sole  discretion (but shall not be obliged) to institute and
                    prosecute in its name, any action or proceeding  against any
                    of the  Introduced  Accounts as to any  controversy or claim
                    arising out of the Clearing  Agent's  transactions  with the
                    Introducing  Firm  or  with  the  Introduced  Accounts,  and
                    nothing  contained  in the  Agreement  shall  be  deemed  or
                    construed  to  impair  or  prejudice  such  right in any way
                    whatsoever,  nor shall the institution or prosecution of any
                    such action or proceeding  relieve the  Introducing  Firm of
                    any liability or  responsibility  which the Introducing Firm
                    would  otherwise have or have had under this  Agreement.  If
                    the  Introducing  Firm shall pay or satisfy an obligation of
                    an  Introduced  Account,   the  Introducing  Firm  shall  be
                    subrogated to the rights of the Clearing  Agent against such
                    Introduced Account.
<PAGE>

13.      Indemnification

     a.  Introducing  Firm. The  Introducing  Firm shall  indemnify and hold the
Clearing  Agent  harmless  from  and  against  any  losses,   claims,   damages,
liabilities  or  expenses   including  without   limitation  those  asserted  by
Introduced  Accounts  (which shall include,  but not be limited to, all costs of
defense  and  investigation  and all  reasonable  attorney's  fees) to which the
Clearing  Agent may become  subject,  insofar as such losses,  claims,  damages,
liabilities or expenses arise out of or are based upon any of the following:

          i.  any  breach  of  any   representation  or  warranty  made  by  the
          Introducing   Firm  under  this   Agreement  or  any  failure  of  the
          Introducing  Firm to perform,  undertake,  honor or comply with any of
          its responsibilities or covenants under this Agreement;

          ii. the negligence or willful  misconduct of the  Introducing  Firm or
          its  employees  in  providing  the  services  contemplated  hereunder,
          including the unreasonable failure to obtain relevant information from
          customers  as  requested  by the  Clearing  Agent or  required by this
          Agreement;

          iii. the loss of securities or cash prior to the actual receipt by the
          Clearing Agent or an appropriate  national  clearing  organization  of
          such securities  from the Introducing  Firm or after actual receipt of
          such securities by the Introducing  Firm from the Clearing Agent or an
          appropriate national clearing organization;

          iv.  failure  of the  Introducing  Firm to  collect  margin  from  its
          customers  after  instruction  by the  Clearing  Agent to collect such
          margin;

          v. failure of the Introducing  Firm to provide the Clearing Agent with
          a customer's correct tax identification number or address;

          vi. with respect to any Introduced Account, errors, misunderstandings,
          controversies  or  failure  of  any  customer  to  satisfy  his or her
          obligations,  unless such  losses,  claims,  damages,  liabilities  or
          expenses are the result of the Clearing  Agent's error,  negligence or
          willful misconduct;

          vii. the exercise by the Introducing Firm, its officers, affiliates or
          employees of discretionary authority over Introduced Accounts;

          viii.any  attempt  of the  Introducing  Firm  to hold  itself  out as,
          advertise or in any way represent that it is the agent of the Clearing
          Agent,  or has  apparent  authority to act as an agent of the Clearing
          Agent or agency by estoppel; or

          ix. the Introducing  Firm executes its own  over-the-counter  order or
          designates the counter party and the over-the-counter dealer with whom
          the  Introducing  Firm dealt or whom it designated  fails to honor its
          part of the transaction.

     b.  Clearing  Agent.  The  Clearing  Agent  shall  indemnify  and  hold the
Introducing  Firm  harmless  from  and  against  any  losses,  claims,  damages,
liabilities  or expenses  including  without  limitation  those  asserted by its
Introduced  Accounts  (which shall include,  but not be limited to, all costs of
defense  and  investigation  and all  reasonable  attorney's  fees) to which the
Introducing Firm may become subject,  insofar as such losses,  claims,  damages,
liabilities or expenses arise out of or are based upon any of the following:

          i. any breach of any  representation  or warranty made by the Clearing
          Agent under this  Agreement  or any failure of the  Clearing  Agent to
          perform,  undertake,  honor or comply with any of its responsibilities
          or covenants under this Agreement;

          ii. the negligence or willful  misconduct of the Clearing Agent or its
          employees in providing the services contemplated hereunder;

          iii.  the loss of  securities  or cash  after  actual  receipt  by the
          Clearing Agent from the  Introducing  Firm or an appropriate  national
          clearing   organization  or  prior  to  the  actual  receipt  of  such
          securities or cash by the Introducing Firm or an appropriate  national
          clearing organization from the Clearing Agent; or

          iv. the  operation  of margin  accounts in a manner not in  conformity
          with  applicable  law provided that such lack of conformity is not the
          result of the failure by the Introducing  Firm to follow  instructions
          of the Clearing Agent as provided hereunder.
<PAGE>

     c.  Claims - Legal  Authority.  To the  extent  any  legal  challenge  by a
regulatory  body or any other  entity or  individual  is brought  which seeks to
declare or is based in whole or in part on a claim that the Introducing  Firm or
the  Clearing  Agent is  without  authority  to offer or  provide  the  services
contemplated by this Agreement to its customers or the Introduced  Accounts,  or
has  violated or will violate any  statute,  regulation  or other rule of law in
connection with the offering of or providing of such services, each party hereto
shall bear its own cost and expenses related hereto.

     d. Notification.  Promptly after receipt by an indemnified party under this
Paragraph of notice of the commencement of any action,  such  indemnified  party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Paragraph, notify the indemnifying party of the commencement thereof;
but the  omission so to notify the  indemnifying  party will not relieve it from
any liability  which it may have to any  indemnified  party otherwise than under
this  Paragraph.  In case any such  action is brought  against  any  indemnified
party, and it notified the indemnifying party of the commencement  thereof,  the
indemnifying party will be entitled to participate in and, to the extent that it
may wish,  to assume  the  defense  thereof,  subject to the  provisions  herein
stated,  with counsel  reasonably  satisfactory to such  indemnified  party, and
after  notice  from  the  indemnifying  party to such  indemnified  party of its
election so to assume the defense thereof,  the  indemnifying  party will not be
liable to such  indemnified  party under this  Paragraph  for any legal or other
expenses  subsequently incurred by such indemnified party. The indemnified party
shall  have the right to  employ  separate  counsel  in any such  action  and to
participate  in the defense  thereof,  but the fees and expenses of such counsel
shall not be at the expense of the indemnifying  party if the indemnifying party
has assumed the defense of the action with counsel  reasonably  satisfactory  to
the indemnified party.

     e.  Survival of  Indemnification  after  Termination.  The  indemnification
provision  in this  Paragraph 13 shall  remain  operative  and in full force and
effect,  regardless of the termination of this Agreement,  and shall survive any
such termination.

14.      Miscellaneous.

          a.  Limitation  of  Authority.  The  Clearing  Agent  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
          Agent or any of the subsidiaries or companies  controlled  directly or
          indirectly by or affiliated with the Clearing Agent.

          b.  Modification of Agreement.  Except as otherwise  provided  herein,
          this  Agreement  may be  modified  only by a  writing  signed  by both
          parties to this  Agreement.  Such  modification  shall not be deemed a
          cancellation of this Agreement.

          c.  Regulatory  Review.  This  Agreement  may be  submitted  to and/or
          approved  by  any   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 any such  regulatory  body  disapproves  of any provision of
          this  Agreement,  the parties hereto agree to bargain in good faith to
          achieve the requisite approval.

          d.  Disputes.  Any dispute,  controversy  or claim arising out of this
          Agreement or the performance or breach hereof respecting an Introduced
          Account which the parties have not been able to settle  amicably shall
          be settled exclusively by arbitration in accordance with the NASD Code
          of Arbitration  Procedure by arbitrators  appointed in accordance with
          such Code. Any other dispute, controversy or claim arising out of this
          Agreement or the  performance  or breach  thereof,  including  matters
          which the  parties  have not been able to  settle  amicably,  shall be
          settled  exclusively  by litigation  in the federal  courts unless the
          parties mutually agree to arbitration in accordance with the NASD Code
          of Arbitration  Procedure by arbitrators  appointed in accordance with
          such Code.

          e.  Investigation  of Facts.  The Clearing  Agent 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 Introduced  Accounts or
          other persons. The Clearing Agent will not be under any responsibility
          for  compliance by the  Introducing  Firm with any laws or regulations
          which may be applicable to the Introducing Firm.
<PAGE>

          f.  Assignment.  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  Agent.  Any assignment of the 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   shall  be  valid  unless  the
          non-assigning  party  consents to such an assignment in writing,  such
          consent  shall not however be  unreasonably  withheld by either party.
          Any assignment by either the Clearing Agent or the Introducing Firm to
          any subsidiary that they may create or to a company affiliated with or
          controlled  directly  or  indirectly  by either of them will be deemed
          valid and enforceable in the absence of any consent from either party.
          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 Agent.

          g. Choice of Law. The  construction  and effect of every  provision of
          this Agreement,  the rights of the parties hereunder and any questions
          arising out of this  Agreement,  shall be subject to the statutory and
          common law of the Commonwealth of Pennsylvania.

          h.  Headings.  The headings  preceding  the 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.

          i. Validity.  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.

          j. No Ties.  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  Agent or which  may
          hereinafter  exist.  The Introducing Firm shall be under no obligation
          whatsoever to deal with the Clearing Agent or any of its  subsidiaries
          or any  companies  controlled  directly or indirectly by or affiliated
          with the Clearing  Agent,  in any capacity  other than as set forth in
          this  Agreement.  Likewise,  the  Clearing  Agent  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.

          k. 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.

          l. Time is of the Essence. The parties agree that, with respect to the
          time  deadlines  stated  in  this  Agreement,  Exhibits  or  documents
          incorporated by reference herein, time is of the essence.

          m.  Exhibits.  The  terms  and  conditions  of the  Exhibits  to  this
          Agreement  are  incorporated   herein  by  this  reference  and  shall
          constitute part of this Agreement as if fully set forth herein.

          n.  Severability.  In the event any one or more of the  provisions  of
          this Agreement shall for any reason be held to be invalid,  illegal or
          unenforceable,  the remaining  provisions of this  Agreement  shall be
          unimpaired,  and the invalid, illegal or unenforceable provision shall
          be replaced by a mutually  acceptable  provision,  which, being valid,
          legal and  enforceable,  comes closest to the intention of the parties
          underlying the invalid,  illegal, or unenforceable  provision. If this
          Agreement or any provision  hereof are held to be invalid,  illegal or
          unenforceable under the laws of a particular state or jurisdiction, it
          is the  intention  of the parties that all of the  provisions  of this
          Agreement  shall  remain in full force and effect in all other  states
          and jurisdictions.

<PAGE>

          o.  Force  Majeure.  No party  shall be liable for delay or failure in
          performance hereunder due to causes beyond its control, including acts
          of  God,  fires,   strikes,   acts  of  war  or  intervention  by  any
          governmental  authority,  and each party  shall take steps to minimize
          any such delay.

          p. Entire Agreement. The terms and conditions stated herein constitute
          the entire agreement  between Clearing Agent and Introducing Firm, and
          no other statements,  unless specifically agreed to in writing,  shall
          be binding upon the parties.

          q.  Notices.  Any notice or request  required or permitted to be given
          under this  Agreement  shall be  sufficient  if in writing and sent by
          hand or by certified mail, in either case,  return receipt  requested,
          to the parties at the following addresses:

                    As to the Introducing Firm:
                         Mr. William Kurinsky, CFO and COO
                         First Montauk Securities Corp.
                         328 Newman Springs Road
                         Parkway 109 Office Center
                         Red Bank, NJ  07701

                    As to the Clearing Agent:
                         Mr. Lawrence E. Donato, President
                         Fiserv Securities, Inc.
                         One Commerce Square
                         2005 Market Street
                         Philadelphia, PA  19103-3212

                    With a copy to:
                         Mr. Scott M. Donnini, VP, General Counsel & Secretary
                         Fiserv Securities, Inc.
                         One Commerce Square
                         2005 Market Street
                         Philadelphia, PA  19103-3212

                         Mr. Paul A. Lieberman, General Counsel
                         First Montauk Securities Corp.
                         Parkway 109 Office Center
                         328 Newman Springs Road
                         Red Bank, NJ 07701

                 IN WITNESS  WHEREOF,  the parties hereto have made and executed
this Agreement at Philadelphia,  Pennsylvania, as of the date first herein above
set forth.

First Montauk Securities Corp.                   Fiserv Securities, Inc.

By _________________________                     By___________________________
Title:                                           Title:

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