Federal Register / Vol. 71, No. 178 / Thursday, September 14, 2006 / Notices 54313 

where they will be processed through 

security prior to entering GSFC. Please 

provide the appropriate data, via fax 

301–286–1230, noting at the top of the 

page ‘‘Public Admission to the NASA 

Advisory Council Meeting at GSFC’’. 

For security questions, please call 

Chuck Lombard at 301–286–1109. 

It is imperative that the meeting be 

held on this date to accommodate the 

scheduling priorities of the key 

participants. 

P. Diane Rausch, 

Advisory Committee Management Officer, 

National Aeronautics and Space 

Administration. 

[FR Doc. E6–15272 Filed 9–13–06; 8:45 am] 

BILLING CODE 7510–13–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Rel. No. IC–27477; File No. 812–13244] 

National Life Insurance Company, et al. 

September 7, 2006. 

AGENCY: Securities and Exchange 

Commission (‘‘SEC’’ or ‘‘Commission’’). 

ACTION: Notice of application for an 

order pursuant to Section 26(c) of the 

Investment Company Act of 1940, as 

amended (the ‘‘Act’’), approving a 

certain substitution of securities. 

Applicants: National Life Insurance 

Company (‘‘NLIC’’), National Variable 

Annuity Account II (‘‘Annuity 

Account’’), and National Variable Life 

Insurance Account (‘‘Life Account’’) 

(NLIC, Annuity Account and Life 

Account collectively, the ‘‘Applicants’’). 

Summary of Application: Applicants 

have submitted an application for an 

order of the Commission, pursuant to 

Section 26(c) of the Act, permitting 

NLIC to substitute securities issued by 

Fidelity VIP Index 500 Portfolio 

(‘‘Fidelity Fund’’), a series of Variable 

Insurance Products Fund II, or DWS 

Equity Index 500 VIP (‘‘DWS Fund’’), a 

series of DWS Investments VIT Funds, 

to support variable annuity contracts or 

variable life insurance contracts 

(separately, ‘‘Contract’’, collectively, 

‘‘Contracts’’) issued by NLIC, for 

securities issued by Sentinel Variable 

Products Growth Index Fund (‘‘Sentinel 

Fund’’), a series of Sentinel Variable 

Products Trust, held by both the 

Annuity Account or the Life Account 

(individually, ‘‘Account’’ and 

collectively, ‘‘Accounts’’). 

Filing Date: The application was filed 

on October 28, 2005, amended on 

February 2, 2006, June 16, 2006, July 17, 

2006, and September 1, 2006. 

Hearing or Notification of Hearing: An 

order granting the application will be 

issued unless the Commission orders a 

hearing. Interested persons may request 

a hearing by writing to the Secretary of 

the Commission and serving the 

Applicants with a copy of the request in 

person or by mail. Hearing requests 

must be received by the Commission by 

5:30 p.m., on October 2, 2006 and 

should be accompanied by proof of 

service of Applicants in the form of an 

affidavit or, for lawyers, a certificate of 

service. Hearing requests should state 

the nature of the writer’s interest, the 

reason for the request and the issues 

contested. Persons may request 

notification of a hearing by writing to 

the Secretary of the Commission. 

ADDRESSES: Secretary, Securities and 

Exchange Commission, 100 F Street, 

NE., Washington, DC 20549–0609. 

Applicants, c/o Kerry A. Jung, Esq., 

Senior Counsel, National Life Insurance 

Company, One National Life Drive, 

Montpelier, VT 05604. 

FOR FURTHER INFORMATION CONTACT: 

Curtis A. Young, Senior Counsel, or 

Harry Eisentein, Branch Chief, Office of 

Insurance Products, Division of 

Invstmetn Management, at 202–551–

6795. 

SUPPLEMENTARY INFORMATION: The 

following is a summary of the amended 

and restated application. The complete 

application may be obtained for a fee 

from the Public Reference Room, 100 F 

street, NE., Washington, DC 20549, or by 

calling (202) 551–8090. 

Applicants’ Representations 

1. NLIC is a stock life insurance 

company, all the outstanding stock of 

which is indirectly owned by National 

Life Holding Company, a mutual 

insurance holding company. All owners 

of NLIC contracts, including the 

Contracts, are voting members of 

National Life Holding Company. NLIC is 

authorized to transact life insurance and 

annuity business in Vermont and 50 

other jurisdictions. For purposes of the 

Act, NLIC is the depositor and sponsor 

of the Accounts as those terms have 

been interpreted by the Commission 

with respect to variable life insurance 

and variable annuity separate accounts. 

2. NLIC established the Annuity 

Account on November 1, 1996 and the 

Life Account on February 1, 1985, as 

segregated investment accounts under 

Vermont law. Under Vermont law, the 

assets of each Account attributable to 

the Contracts through which interests in 

that Account are issued are owned by 

NLIC but are held separately from all 

other assets of NLIC for the benefit of 

the owners of, and the persons entitled 

to payment under, those Contracts. 

Consequently, such assets in each 

Account equal to the reserves and other 

liabilities with respect to such Account 

are not chargeable with liabilities 

arising out of any other business that 

NLIC may conduct. Income, gains and 

losses, realized and unrealized, from 

assets allocated to each Account are 

credited to or charged against that 

Account without regard to the other 

income, gains or losses of NLIC. Each 

Account is a ‘‘separate account’’ as 

defined by Rule 0–1(e) under the Act 

(File No. 811–08015 for the Annuity 

Account and File No. 811–09044 for the 

Life Account). 

3. The Annuity Account is divided 

into forty-nine subaccounts. Each 

subaccount invests exclusively in a 

corresponding series of one of thirteen 

management investment companies. 

The assets of the Annuity Account 

support variable annuity contracts, and 

interests in the Account offered through 

the Contracts have been registered 

under the Securities Act of 1933, as 

amended (‘‘1933 Act’’) on Form N–4 

(File No. 333–19583). 

4. The Life Account is divided into 

one hundred and twenty-nine 

subaccounts. Each subaccount invests 

exclusively in shares representing an 

interest in a corresponding series of one 

of thirteen management investment 

companies. The assets of the Life 

Account support variable life insurance 

contracts, and interests in this Account 

offered through the Contracts have been 

registered under the 1933 Act on Form 

N–6 (File Nos. 33–91938, 333–44723, 

and 333–67003). 

5. The Sentinel Variable Products 

Trust was organized as a business trust 

in Delaware on March 14, 2000, and is 

currently registered under the Act as an 

open-end diversified management 

investment company. It is a series 

investment company as defined by Rule 

18f–2 under the Act. 

6. The Sentinel Fund’s investment 

advisor, Sentinel Asset Management, 

Inc. (‘‘SAM’’), is an affiliated person of 

NLIC because it is controlled by NLIC. 

7. The Variable Insurance Products 

Fund II was created under an initial 

declaration of trust dated March 21, 

1988, and is currently registered under 

the Act as an open-end management 

investment company. It is a series 

investment company as defined by Rule 

18f–2 under the Act. 

8. The DWS Investments VIT Funds 

was organized on January 18, 1996, 

under the laws of the Commonwealth of 

Massachusetts, and is currently 

registered under the Act as an open-end 

management investment company. SVIT 


rwilkins on PROD1PC63 with NOTICES
54314 Federal Register / Vol. 71, No. 178 / Thursday, September 14, 2006 / Notices 

is a series investment company as 

defined by Rule 18f–2 under the Act. 

9. Neither NLIC nor the Accounts are 

affiliated with the Fidelity Fund or the 

DWS Fund. In consideration for 

administrative services provided by 

NLIC to the Fidelity and DWS Funds, 

NLIC is paid an annual fee of 0.05% and 

0.13%, respectively, of each fund’s 

average net assets that are attributable to 

the Accounts. 

10. The Contracts are flexible 

premium variable life insurance 

Contracts and individual flexible 

premium deferred variable annuity 

Contracts. The Contracts provide for the 

accumulation of values on a variable 

basis, fixed basis, or both, during the 

accumulation period, and provide 

settlement or annuity payment options 

on a fixed basis. In each of the 

prospectuses for the Contracts, NLIC 

reserves the right to substitute shares of 

one series of an investment company for 

shares of another series, including a 

series of a different investment 

company. 

11. Contract owners may transfer 

among the subaccounts of the Variable 

Account and, subject to certain 

limitations, among the Variable 

Account, the fixed account and the 

guaranteed accounts. Contract owners 

may transfer among the subaccounts of 

the Life Account and between the Life 

Account and NLIC’s general account, 

where available. Currently there is no 

charge for transfers. However, NLIC 

reserves the right to assess a $25 charge 

for each transfer in excess of twelve in 

any Contract year. Each series of an 

investment company in which a 

subaccount invests may also impose its 

own redemption fees. 

12. NLIC proposes to substitute (a) 

The Fidelity Fund, which is currently 

offered as an investment option, for the 

Sentinel Fund in the Annuity Account 

and the VariTrak and Sentinel Estate 

Provider products of the Life Account 

and (b) the DWS Fund, which is 

currently offered as an investment 

option, for the Sentinel Fund in the 

Sentinel Benefit Provider product of the 

Life Account. NLIC believes that by 

making the proposed substitution in 

each of the Accounts they can better 

serve the interests of the Contracts 

owners. 

13. The investment objective and 

principal investment strategies of each 

of the Sentinel Fund, the Fidelity Fund 

and the DWS Fund are as follows: 

Fund Objective Principal strategies 

Sentinel Fund Seeks to match, as closely as possible 

before expenses, the performance of 

the S&P 500/ Citigroup Growth Index 

(‘‘Index’’), by investing in common 

stocks of the companies comprising the 

Index in approximately the same 

weightings as the Index.

Invests at all times at least 80% of its total assets in the common stocks of the 

companies that comprise the Index. 

Normally intends to invest substantially all its total assets in these common stocks, 

in approximately the same weightings as the Index. 

May hold up to 20% of its assets in money market instruments and stock index options and futures, which it intends to buy, if at all, only in anticipation of buying 

stocks. The Fund may not purchase or sell derivative instruments if, as a result, 

the aggregate initial margin and options premiums required to establish these positions exceed 5% of the Fund’s total assets. 

Fidelity Fund .. Seeks investment results that correspond 

to the total return of common stocks 

publicly traded in the United States, as 

represented by the S&P 500.

Normally invests at least 80% of assets in common stocks included in the S&P 

500. 

May buy and sell futures contracts, swaps, and exchange traded funds, to increase 

or decrease the Fund’s exposure to changing security prices or other factors that 

affect security values. The Fund will not purchase any option if, as a result, more 

than 5% of its total assets would be invested in option premiums. Under normal 

conditions, the Fund will not enter into any futures contract, option, or swap 

agreement if, as a result, the sum of (i) the current value of assets hedged in the 

case of strategies involving the sale of securities, and (ii) the current value of the 

indices or other instruments underlying the fund’s other futures, options, or 

swaps positions, would exceed 35% of the Fund’s total assets. These limitations 

do not apply to options attached to, or acquired or traded together with their underlying securities, and do not apply to securities that incorporate features similar 

to futures, options or swaps. 

Lends securities to earn income for the Fund. 

DWS Fund ..... Seeks to replicate, as closely as possible, 

before the deduction of expenses, the 

performance of the S&P 500.

Investments at least 80% of its assets in the securities of the companies included 

in the Standard & Poor’s 500 Composite Stock Price Index (‘‘S&P 500 Index’’) 

and derivative instruments such as futures contracts and options, relating to the 

benchmark. 

May not invest more than 15% of assets in options on securities indices and may 

not invest more than 5% of assets in futures on securities indices or on options 

on futures. 

Invests in a statistically selected sample of the securities found in the S&P 500 

Index, using a process known as ‘‘optimization.’’

May exclude or remove any S&P stock if its investment advisor believes that the 

stock is illiquid or that the merit of the investment has been impaired by financial 

conditions or other extraordinary events. 

May purchase a stock not included in the S&P 500 Index when it is believed to be 

a cost-efficient way of approximating the S&P 500 Index’s performance. 

May hold assets in short-term debt securities or money market instruments for liquidity purposes. 

My lend its investment securities up to 30% of its total assets. 

14. Projected advisory fees and 

expense ratios for the Fidelity Fund and 

DWS Fund are lower than the advisory 

fees and net expense ratios of the 

Sentinel Fund as of December 31, 2005. 


rwilkins on PROD1PC63 with NOTICES
Federal Register / Vol. 71, No. 178 / Thursday, September 14, 2006 / Notices 54315 

EXPENSE RATIOS FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2005 

Fund Management fee 

(percent) 12b–1 fee Other expenses (percent) 

Total annual 

expense ratio 

(percent) 

Waivers and reimbursements 

(percent) 

New annual 

expense ratio 

(percent) 

Sentinel Fund ................... 0.30 ............................ 1.59 1.89 11.29 0.60 

Fidelity Fund .................... 0.10 0.25 0.00 0.35 ............................ 2 0.35 

DWS Fund ....................... 0.19 ............................ 0.15 0.34 30.06 0.28 

1SAM and/or an affiliate has agreed to waive fees and/or reimbursement expenses so that the net annual expense ratio of the Sentinel Fund, 

after expense offsets, is no more than 0.60% through December 31, 2006. 2Fidelity management & Research Company (‘‘FMR’’) has contractually agreed to reimburse the Fidelity Fund to the extent that total operating 

expenses (excluding interest, taxes, certain securities lending costs, brokerage commissions and extraordinary expenses) as a percentage of average net assets exceed 0.35%. The expense limitation may not be increased without approval of the Fidelity Fund’s shareholders and board of 

trustees. Therefore the expense limit is required by contact and is not voluntary on the Fidelity Fund manager’s part. 3Effective September 19, 2005, the DWS Fund’s advisor contractually agreed to waive its fees and/or reimbursement expenses to the extent 

necessary to limit all expenses to 0.28% for Class A Shares until April 30, 2009. 

15. The Applicants note that the 

primary differences between the 

Sentinel Fund and the Fidelity Fund are 

that (1) The Fidelity Fund seeks to 

match the S&P 500 index, while the 

Sentinel Fund seeks to match only the 

Citigroup Growth portion of the S&P 

500 Index and (2) the Fidelity Fund may 

lend securuities while the Sentinel 

Fund does not. Applicants state the 

primary difference between the Sentinel 

Fund and the DWS Fund are that (1) 

The DWS Fund seeks to match the S&P 

500 Index, while the Sentinel Fund 

seeks to match only the Citigroup 

Growth portion of the S&P 500 Index, 

(2) the DWS Fund may invest in 

securities other than those included in 

the S&P 500 Index under certain 

cirucmstances in which the Sentinel 

Fund could not and (3) DWS Fund may 

lend securities, while the Sentinel Fund 

does not. While there are some 

differences in these strategies, NLIC 

believes that the Fidelity Fund and the 

DWS Fund offer an investment strategy 

that is sufficiently similar to the 

Sentinel Fund considering the benefits 

of the proposed substitution. 

16. Applicants state that the Fidelity 

and DWS Funds each have significantly 

more assets than the Sentinel Fund. In 

addition, each of the Fidelity and DWS 

Funds has also significantly 

outperformed the Sentinel Fund in the 

one and three year peiods ended June 

30, 2006 as well as the period since the 

inception of the Sentinel fund. 

PERFORMANCE AS OF JUNE 30, 2006 

Fund 1-year 

(percent) 

3-year 

(percent) 

5-year 

(percent) 

10-year 

(percent) 

Since 

inception 

(percent) 

Since 11/30/00 

percent) 

Sentinel Fund ........................................... 3.81 6.42 ¥0.26 (1) ¥3.36 3.36 

Fidelity Fund ............................................ 8.57 11.04 2.27 8.05 10.26 8.76 

DWS Fund ............................................... 8.34 10.91 2.18 (1) 4.64 0.76 

1 Not applicable. 

17. Supplements to the prospectus 

will advise Contract owners that they 

are permitted from the date of the 

supplement until the date of the 

proposed substitution to make transfers 

of all amounts under the Contracts 

invested in the Sentinel Fund 

subaccount to another subaccount 

available under the Contracts without 

those transfers counting as ‘‘free’’

transfers permitted under the Contracts 

at any time prior to the substitution. 

18. The proposed substitution will 

take place at relative net asset value 

with no change in the amount of any 

Contract owner’s account value or death 

benefit or in the dollar value of any 

Account. Contract owners will not incur 

any fees or charges as a result of the 

proposed substitutions, nor will their 

rights or NLIC’s obligations under the 

Contracts be altered in any way. All 

expenses incurred in connection with 

the proposed substitution is not 

expected to impose any tax liability on 

Contract owners. The proposed 

substitution will not cause the Contract 

fees and charges currently being paid by 

Contract owners to be greater than those 

being charged at the time of the 

substitution. The proposed substituting 

will not be treated as a transfer or 

exchange for purposes of assessing 

transfer charges or for determining the 

number of remaining ‘‘free’’ transfers or 

exchanges in a Contract year. 

19. Within five days of the 

substitution, Contract owners affected 

by the substitution will be sent a written 

notice informing them that the 

substitution was carried out and that for 

the next 30 days they may make 

transfers of all accumulated or contract 

value under a Contract invested in the 

Fidelity Fund or DWS Fund subaccount, 

as applicable, on the date of the notice 

to another subaccount available under 

the Contract without the transfers 

counting as part of the limited number 

of transfers permitted in a Contract year 

free of charge. The notice as delivered 

in certain states also may explain that, 

under the insurance regulations in those 

states, Contract owners who are affected 

by the substitutions may exchange their 

Contracts for fixed-benefit life insurance 

contracts or annuity contracts, as 

applicable, issued by NLIC during the 

60 days following the proposed 

substitutions. A current prospectus for 

the Fidelity Fund or DWS Fund, as 

applicable, each of which is a currently 

available investment option under the 

applicable Contract, will precede or 

accompany the notice. 

20. NLIC will not receive, for three 

years from the date of the substitution, 

any direct or indirect benefits from the 

Fidelity Fund or the DWS Fund or their 

respective advisors or underwriters or 

any of their respective affiliates in 

connection with the assets attributable 

to the Contracts, which in the aggregate 

(including, without limitation, all 

advisory, 12b–1, shareholder servicing, 

administration, marketing support or 

similar fees) is higher than the benefit 

it would have received from the 


rwilkins on PROD1PC63 with NOTICES
54316 Federal Register / Vol. 71, No. 178 / Thursday, September 14, 2006 / Notices 

1 15 U.S.C. 78s(b)(1). 

2Securities Exchange Act Release No. 54126 (July 

11, 2006), 71 FR 40768 (July 18, 2006) [File No. SR–

NYSEArca–2006–31]. 

3Letter from Loren K. Hanson, Director of 

Investor Relations, to Nancy M. Morris, Secretary, 

Commission (August 15, 2006). 

4The Commission has also granted approval to 

similar rule changes submitted by the New York 

Stock Exchange LLC (‘‘NYSE’’), American Stock 

Exchange LLC (‘‘Amex’’), and The NASDAQ Stock 

Market LLC (‘‘Nasdaq’’). Securities Exchange Act 

Release Nos. 54289 (August 8, 2006), 71 FR 47278 

(August 16, 2006) [File No. SR–NYSE–2006–29]; 

54288 (August 8, 2006), 71 FR 47276 (August 16, 

2006) [File No. SR–NASDAQ–2006–08]; and 54290 

(August 8, 2006), 71 FR 47262 (August 16, 2006) 

[File No. SR–Amex–2006–40]. 

5Currently, the only registered clearing agency 

operating a DRS is DTC. For a detailed description 

of DRS and the DRS facilities administered by DTC, 

see Securities Exchange Act Release Nos. 37931 

(November 7, 1996), 61 FR 58600 (November 15, 

1996), [File No. SR–DTC–96–15] (order granting 

approval to establish DRS) and 41862 (September 

10, 1999), 64 FR 51162 (September 21, 1999), [File 

No. SR–DTC–99–16] (order approving 

implementation of the Profile Modification System). 

Sentinel Fund or its advisor, 

underwriter or affiliates absent any 

waivers. 

21. Applicants state that the 

substitution and selection of the Fidelity 

Fund and the DWS Fund was not 

motivated by any financial 

consideration paid or to be paid to NLIC 

or its affiliates by the Fidelity Fund or 

the DWS Fund or their respective 

advisor, underwriters or affiliates. 

Applicants’ Legal Analysis 

1. Applicants state that the proposed 

substitution is a substitution within the 

meaning of Section 26(c) of the Act, 

which requires the depositor of a 

registered unit investment trust holding 

the securities of a single issuer to 

receive commission approval before 

substituting the securities held by the 

trust. 

2. Applicants note that the 

prospectuses disclose that the Contracts 

expressly reserve for NLIC the right, 

subject to compliance with applicable 

law, to substitute shares of one series of 

an investment company held by a 

subaccount for another series, including 

a series of a different investment 

company, when, among other things, in 

NLIC’s judgment the investment in such 

series is inappropriate. 

3. Applicants assert that the proposed 

substitution will provide Contract 

owners a sufficiently similar investment 

strategy considering the opportunity for 

lower expenses and greater economies 

of scale. In addition, Applicants 

generally submit that the proposed 

substitution meets the standards that the 

Commission and its staff have applied 

to similar substitutions that have been 

approved in the past. 

4. Applicants anticipate that Contract 

owners will be at least as well off with 

the proposed array of subaccounts 

offered after the proposed substitution 

as they have been with the array of 

subaccounts offered prior to the 

substitution. Applicants’ assert that the 

proposed substitution retains for 

Contract owners the investment 

flexibility that is a central feature of the 

Contracts. 

5. Applicants assert that the proposed 

substitution is not the type of 

substitution which Section 26(c) was 

designed to prevent. Unlike traditional 

unit investment trusts where a depositor 

could only substitute an investment 

security in a manner that permanently 

affected all the investors in the trust, the 

Contracts provide each Contract owner 

with the right to exercise her or his own 

judgment and transfer accumulation and 

contract values into other subaccounts. 

6. Applicants note that the Contracts 

will offer Contract owners an 

opportunity to transfer amounts out of 

the Sentinel Fund, prior to the 

substitution, or the Fidelity Fund or 

DWS Fund, as applicable, after the 

substitution, into any of the remaining 

subaccounts without cost or other 

disadvantage. The proposed 

substitution, therefore, will not result in 

the type of costly forced redemption 

which Section 26(c) was designed to 

prevent. 

7. The Applicants note that within 

five days after the proposed 

substitution, Contract owners affected 

by the substitution will be sent a written 

notice informing them that the 

substitution was carried out and that, 

for the next 30 days, they may make one 

transfer of all accumulated or contract 

value under a Contract invested in the 

Fidelity Fund or the DWS Fund, as 

applicable, on the date of the notice to 

another subaccount available under 

their Contract without the transfer 

counting as one of a limited number of 

transfers permitted in a Contract year 

free of charge. 

8. Applicants state the proposed 

substitution in also unlike the type of 

substitutions which Section 26(c) was 

designed to prevent in that by 

purchasing a Contract, Contract owners 

select much more than a particular 

investment company in which to invest 

their account values. They also select 

the specific type of insurance coverage 

offered by NLIC under their Contract as 

well as numerous other rights and 

privileges set forth in the Contract. 

Contract owners may also have 

considered NLIC’s size, financial 

condition, type and its reputation for 

service in selecting their Contract. These 

factors will not change as a result of the 

proposed substitution. 

Conclusion 

Applicants submit that, for all the 

reasons stated above, the proposed 

substitution is consistent with the 

protection of investors and the purposes 

fairly intended by the policy and 

provisions of the Act. 

For the Commission, by the Division of 

Investment Management, pursuant to 

delegated authority. 

J. Lynn Taylor, 

Assistant Secretary. 

[FR Doc. 06–7641 Filed 9–13–06; 8:45 am] 

BILLING CODE 8010–01–M 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–54410; File No. SR–

NYSEArca–2006–31] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Order Granting Approval of 

a Proposed Rule Change Amending 

Rules to Mandate Listed Companies 

Become Eligible To Participate in a 

Direct Registration System 

September 7, 2006. 

I. Introduction 

On June 19, 2006, NYSE Arca, Inc. 

(‘‘NYSE Arca’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) proposed rule change 

SR–NYSEArca–2006–31 pursuant to 

Section 19(b)(1) of the Securities 

Exchange Act of 1934 (‘‘Act’’).1 Notice 

of the proposal was published in the 

Federal Register on July 18, 2006.2 One 

comment letter was received.3 For the 

reasons discussed below, the 

Commission is granting approval of the 

proposed rule change.4

II. Description 

The Direct Registration System 

(‘‘DRS’’) allows an investor to establish 

either through the issuer’s transfer agent 

or through the investor’s broker-dealer a 

book-entry position on the books of the 

issuer and to electronically transfer her 

position between the transfer agent and 

the broker-dealer of her choice through 

a facility currently administered by The 

Depository Trust Company (‘‘DTC’’).5

DRS, therefore, enables an investor to 

have securities registered in her name 

on the books of the issuer without 

having a securities certificate issued to 

her and to electronically transfer her 


rwilkins on PROD1PC63 with NOTICES