Temporary Disruption Impacting Corporate Office

The ShareBuilder corporate office, where brokerage and administrative operations are conducted, is protected from power failures by an on-site emergency power system. This system is fully automated and tested monthly. In the event of a local power failure, ShareBuilder Corporate can continue to operate normally without business interruption. The ShareBuilder website is hosted from another location, as discussed below, and all of the company's business and customer records are maintained at highly secure remote locations.

In the event that the corporate office becomes inaccessible to employees, critical employees are provided remote access through notebook computers and may conduct limited business activities such as trading and cashiering from remote locations.

Disruption Affecting Primary Data Center

The ShareBuilder website is hosted from a highly secure and data center with redundant systems and which is designed to withstand a major earthquake and other regional disasters. The data center provides redundant power, redundant Internet connectivity, redundant environmental controls, primary and standby data and application servers and robust physical and network security. In the event of a disaster that destroys the data center, a secondary location has sufficient infrastructure to support hosting the website. This failover is not automatic, however, and could take up to a week. During this time, customers could communicate with ShareBuilder via telephone or email.

Citywide Disaster

In the event of a citywide disaster that prevents access to our corporate building or causes the building to be without power or telecom infrastructure, ShareBuilder would be able to operate for several days in the same manner described above for a temporary disruption impacting our corporate office. Critical employees would be able to obtain remote access through notebook computers and would be able to conduct limited business activities from remote sites. Although the ShareBuilder website is hosted from a separate location outside of the city, operating the daily business of the broker-dealer from remote locations would become increasingly difficult after several days. Under extreme circumstances, the company would actively seek to reestablish its permanent operations in a new location. Although customer access to funds and securities might be temporarily impacted in the event of an extremely severe Citywide disaster, all customer funds are held by the Bedford Money Market Portfolio of the RBB Fund and processed through corporate accounts at Wells Fargo, and all securities are held through Pershing, none of which should be severely impacted by a disaster impacting the city of Bellevue. Restoring access to such funds and securities in the event of a large scale citywide disaster could take days.

Regional Disaster

In the event of a disaster of such magnitude that one or both of ShareBuilder's two facilities are destroyed or seriously damaged and the region is without power and telecom infrastructure for an extended period of time, ShareBuilder would seek to establish operations outside of the effected area, which could take weeks or months. During a regional outage, ShareBuilder will continue to communicate with its customers via email, automated phone response, or web site notices, provided its customers have access to the Internet, email, and a working phone. Email and web site notices would be used to provide instructions to customers about how and when to access their funds through the ShareBuilder website. As described above, all customer funds are held by the Bedford Money Market Portfolio of the RBB Fund and processed through corporate accounts at Wells Fargo, and all securities are held through Pershing, none of which should be severely impacted by a disaster limited to the Northwest region of the United States. Restoring access to such funds and securities in the event of a large scale regional disaster could take days or weeks.