A 5861 - July 20, 2004

A#	5861
P&S #:	5431
DATE:	July 20, 2004
TO:	ALL PARTICIPANTS
ATTENTION:	MANAGER MUTUAL FUNDS OPERATIONS, MANAGER DATA PROCESSING, MANAGER CASHIERS, MANAGER P&S DEPARTMENT
FROM:	DISTRIBUTION SERVICES - MUTUAL FUNDS
SUBJECT:	*FEE CHANGES: MUTUAL FUND PROFILE SERVICE AND FUND/SPEED^SM*

National Securities Clearing Corporation ("NSCC" or “the Corporation”) has filed a rule change with the Securities and Exchange Commission ("SEC") pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Effective September 1, 2004, changes to the Mutual Fund service fee schedule will be implemented for the Mutual Fund Profile Service (MFPS) and Fund/SPEED.

Revised Fees for Mutual Fund Profile Service (MFPS)

MFPS Phase I, Price and Rate, provides participants with daily prices in the form of net asset values (NAV) and/or rates for daily accrual funds. MFPS Phase II, consists of three components (Distribution Declaration, Member Profile and Security Issue ID Profile) which act as a conduit and repository of mutual fund data available to participants by subscription. Participants can choose several options for receiving data and can access MFPS either through their mainframe or PC interfaces. NSCC accommodates single and multiple batch or interactive transmissions for the Price & Rate files, and single batch for Phase II components.

Recently MFPS Phase II was enhanced to accept a host of fund-related information to assist distributors to facilitate more accurate tracking and application of breakpoint related information, consistent with the recommendations of the Joint NASD/ Industry Task Force on Breakpoints. These enhancements are described in NSCC’s Important Notice dated February 12, 2004,

A# 5765, P&S# 5335.

The revised fees for MFPS Phases I and II will be effective September 1, 2004 (reflected in participants’ monthly bills sent out by October 10th), and will introduce two tier pricing for MFPS as follows:

MFPS, Phase I (Price and Rate) Only $325.00 per month

MFPS, Phase I and II $750.00 per month

Participants currently subscribing to MFPS will automatically be subject to the $750.00 per month fee applicable to MFPS, Phase I and II effective September 1, 2004. Participants that want MFPS Phase I (Price and Rate only) must contact their Relationship Manager no later than August 25, 2004 to elect MFPS Phase I (Price and Rate Only) and have the appropriate fee reflected in the bill for September activity.

Revised Fees for Fund/SPEED

NSCC currently charges fees for the following Fund/SPEED activities, depending on the nature of the activity:

Inquiries $.005 per transaction

Trade Data Transmission $.50 per transaction

New Accounts $.75 per transaction

A transaction is identified as a request for information and a response.

NSCC is adding an activity function, Account Maintenance, for which there will be a fee of $.25 per transaction. The fee will be effective September 1, 2004 (reflected in participants’ monthly bills sent out by October 10, 2004).

Please contact your Relationship Manager with any questions or concerns regarding these changes to the fee schedule.

The full text of the rule change (SR-NSCC-2004-03) as well as the NSCC Important Notice referred to above regarding the MFPS Phase II enhancements may be obtained by visiting our web site at www.nscc.com. Written comments on the proposed rule change filing may be addressed to Lisa T. Siebold, Assistant Secretary, National Securities Clearing Corporation, 55 Water Street, New York, New York 10041, and your comments will be forwarded to the SEC. You may also address your written comments to the Secretary of the Commission, Securities and Exchange Commission, 450 Fifth Street NW, Washington, D.C. 20549. We request that you provide NSCC with a copy of your comments.

Questions regarding this notice may be directed to Carol Jameson at (212) 855-3213.

Carol A. Jameson

Senior Counsel