A 5310 - August 20, 2001

A 5310
P&S 4880
August 20, 2001
TO: ALL PARTICIPANTS
ATTENTION: MANAGER MUTUAL FUNDS OPERATIONS, MANAGER DATA PROCESSING, MANAGER CASHIERS, MANAGER P&S DEPARTMENT
SUBJECT: VALUE CHANGES TO THE NAV REASON CODES AND THE LIQUIDATION INDICATOR IN THE FUND/SERV SYSTEM

National Securities Clearing Corporation (NSCC) will be modifying the NAV (Net Asset Value) Reason Codes and the Liquidation Indicator values in Fund/SERV. (See tables below for definitions.) The implementation date will be November 19, 2001.

Three (3) new reason codes have been added. Firms may use them to indicate a purchase order at NAV (i.e. without deduction of charges). They are:

6 = NAV Commissionable
9 = 529 Qualified State Tuition Plans
A = Dividend Reinvestment Trade

The Liquidation Indicator with a value 3 = No Sales Charge - Other, will be eliminated. Three (3) new values will be added. The Liquidation Indicator specifies why a CDSC (Contingent Deferred Sales Charge) should not be applied when redeeming back-end load fund shares. They are:

9 = Defined Contribution
A = Hardship
B = No Commission Paid

The revised file layouts will be posted to the NSCC web site, formats.nscc.com very shortly for participants to review. Participants are encouraged to test the layout changes prior to the implementation date of November 19, 2001. Beginning November 5, 2001, testing of the new record layouts will be provided in the Participant Services Environment (PSE) region. Participants wishing to test must contact the Enterprise Service Center Participant Test Group (PTG) at (212) 855- 5630. To ensure proper set up for the PSE region, a request must be received by PTG at least three days prior to the date you wish to initiate testing.

Liquidation Code	Definition

1 – Gross	Request to redeem amount of dollar, shares plus any CDSC charges.
2 – Net	Request to redeem specific dollar amount after CDSC charges.
4 – CDSC Waiver Due To Correction	Request to waive CDSC charges due to an error being made on an earlier trade.
5 – Death	Request to waive CDSC fees due to the death of the registered owner(s).
6 – Disability	Request to waive CDSC fees due to the permanent disability of the registered owner after their initial purchase.
7 – Mandatory Distribution	Request to waive CDSC fees due to an I.R.A. shareholder reaching the age of 70 ½.
8 – Systematic Withdrawal	Request to waive CDSC fees due to a monthly or quarterly distribution of a specific dollar or share amount (less than a % designated by each fund group).
9 – Defined Contribution	Request to waive CDSC fees based on a "plan" level distribution.
A: Hardship	Request to waive CDSC fees based on a retirement plan participant meeting specific "financial" criteria and therefore needing to take a loan against their mutual fund assets.
B: No Commission Paid	Request to waive CDSC fees based on the fact no commissions were paid to the broker on their fund purchases.

NAV Reason Code	Definition

0 - Other
1 – Net Asset Value Transfer	Assets purchased at NAV after having paid a "load" on the same assets previously.
2 – Repurchase	Assets purchased at NAV after being redeemed from that particular mutual fund previously (within a stated timeframe).
3 – Employee	Assets purchased at NAV by an employee of the particular mutual fund company or a broker.
4 – Error Correction	Assets purchased at NAV to correct a previously placed trade.
5 – WRAP Fee Account	Assets purchased at NAV as part of a WRAP or asset allocation model.
6 – NAV Commissionable	Assets purchased at NAV with a broker receiving compensation (finders fees) on these assets.
7 – Commissionable Defined Contribution Plan	Assets purchased at NAV for a qualified plan with a broker receiving compensation (finder's fees) on these accounts.
8 – Non-commissionable Defined Contribution Plan	Assets purchased at NAV for a qualified plan that will not pay compensation to the broker. Usually assets that have moved around and have previously paid a commission to the broker.
9 – Section 529 – Qualified State Tuition Program	Assets purchased at NAV in a Section 529 plan.
A – Dividend Reinvestment Trade	Assets purchased at NAV derived from a dividend previously paid in cash to the shareowner.

Any questions or concerns regarding this Important Notice can be directed to the Mutual Fund Hotline (212-855-8877) or the undersigned at 212-855-5674.

Randy Solomon
Director, Mutual Funds Marketing