Document ID: SEC-2019-0806-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: The Depository Trust Co.
Posted Date: 2019-06-06T04:00Z

[Federal Register Volume 84, Number 109 (Thursday, June 6, 2019)]
[Notices]
[Pages 26466-26480]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-11802]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-85986; File No. SR-DTC-2019-003]

Self-Regulatory Organizations; The Depository Trust Company; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
To Amend the Reorganizations Service Guide

May 31, 2019.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on May 21, 2019, The Depository Trust Company (``DTC'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change as described in Items I, II and III below, which Items have been 
prepared by the clearing agency. DTC filed the proposed rule change 
pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(4) 
thereunder.\4\ The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(4).
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I. Clearing Agency's Statement of the Terms of Substance of the 
Proposed Rule Change

    The proposed rule change by DTC would revise the Reorganizations 
Service Guide (``Guide'') \5\ to: (1) Update its corporate action 
service by transitioning corporate action \6\

[[Page 26467]]

functions on its Participant Terminal System (``PTS'') and its 
Participant Browser Service (``PBS'') systems \7\ for the processing of 
Reorganizations to its Corporate Action Web (``CA Web'') system; \8\ 
and (2) restructure, streamline and clarify the Guide for enhanced 
transparency and clarity, as more fully described below.
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    \5\ Each capitalized term not otherwise defined herein has its 
respective meaning as set forth in the Rules, By-Laws and 
Organization Certificate of DTC (``DTC Rules'') and in the Guide, 
available at http://www.dtcc.com/legal/rules-and-procedures.aspx.
    \6\ DTC offers an array of services for processing corporate 
action events. The services fall into three categories: (i) 
Distributions, such as cash and stock dividends, principal and 
interest, and capital gain distributions (collectively, 
``Distributions''); (ii) redemptions such as full and partial calls, 
final paydowns, and maturities (collectively, ``Redemptions''); and 
(iii) reorganizations, which include both mandatory and voluntary 
reorganizations such as exchange offers, conversions, Dutch 
auctions, mergers, puts, reverse stock splits, tender offers, and 
warrant exercises (collectively, ``Reorganizations'').
    \7\ PTS and PBS are user interfaces for DTC's Settlement and 
Asset Services functions. PTS is mainframe-based and PBS is web-
based with a mainframe back-end. Participants may use either PTS or 
PBS, as they are functionally equivalent. References to a particular 
PTS function in this rule filing include the corresponding PBS 
function.
    \8\ In PTS/PBS, corporate actions are announced using DTC 
proprietary codes to signify event types. CA Web replaces DTC's 
proprietary codes with market standard language. For example, a cash 
dividend payment that PTS/PBS identifies as a ``08'' function code 
is identified in CA Web as a ``Cash Dividend'' event. Additionally, 
CA Web incorporates the entire lifecycle of an event into one 
platform with a unique corporate action identifier that follows the 
event through its lifecycle. CA Web gives Participants the ability 
to customize screen displays and offers flexible methods for event 
search, neither of which is available in the PTS/PBS systems.
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II. Clearing Agency's Statement of the Purpose of, and Statutory Basis 
for, the Proposed Rule Change

    In its filing with the Commission, the clearing agency included 
statements concerning the purpose of and basis for the proposed rule 
change and discussed any comments it received on the proposed rule 
change. The text of these statements may be examined at the places 
specified in Item IV below. The clearing agency has prepared summaries, 
set forth in sections A, B, and C below, of the most significant 
aspects of such statements.

(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis 
for, the Proposed Rule Change

1. Purpose
    The proposed rule change by DTC would revise the Guide to: (1) 
Update its corporate action service by transitioning corporate action 
functions on its PTS and PBS systems for the processing of 
Reorganizations to its CA Web system; and (2) restructure, streamline 
and clarify the Guide for enhanced transparency and clarity, as more 
fully described below.
(i) Overview of the Proposed Rule Change
Transition of PTS/PBS Reorganizations Functions to CA Web
    Beginning in 2011, DTC has filed a series of rule changes to update 
its corporate action services by migrating the corporate action 
functions for Distributions from PTS/PBS to CA Web, a then new browser 
user interface.\9\ After a Participant testing phase, PTS/PBS functions 
for Distributions were retired in 2015, and the use of CA Web for 
processing Distributions became mandatory for all Participants.\10\
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    \9\ See Securities Exchange Act Release No. 68114 (October 26, 
2012), 77 FR 66497 (November 5, 2012) (SR-DTC-2012-08).
    \10\ See Securities Exchange Act Release No. 73864 (December 17, 
2014), 79 FR 77063 (December 23, 2014) (SR-DTC-2014-12).
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    In 2016, DTC filed a rule filing to transition PTS/PBS functions 
for Redemptions to CA Web, and to update the Guide to add the 
appropriate references.\11\ After a Participant testing phase, PTS/PBS 
functions for Redemptions were retired in 2017, and the use of CA Web 
for processing Redemptions became mandatory for all Participants.
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    \11\ See Securities Exchange Act Release No. 79746 (January 5, 
2017), 82 FR 3372 (January 11, 2017) (SR-DTC-2016-014).
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    Pursuant to the proposed rule change, DTC would transition PTS/PBS 
functions for Reorganizations to CA Web, and update the Guide to add 
the appropriate references.\12\ A pilot testing period began in Q3 of 
2018 and will conclude in Q2 of 2019, at which time Reorganizations 
activity within the following PTS and corresponding PBS functions would 
be retired and transitioned to CA Web: ADJI (Adjustment Inquiries), 
RIPS (Reorganization Inquiry for Participants), and SDAR Dept. R (Same 
Day Allocation Reporting).\13\ DTC has been communicating this change 
to Participants through CA Web review sessions, Important Notices, and 
industry outreach.\14\
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    \12\ As in the previous migrations of corporate action PTS/PBS 
functions to CA Web, corporate action functions relating to the 
submission of instructions by Participants will remain on PTS/PBS 
until a later date.
    \13\ See PTS/PBS Function Guides, available at http://www.dtcc.com/settlement-and-asset-services/edl-ptspbs-function-guides.
    \14\ See Important Notice B10792-19 (March 14, 2019); Important 
Notice B8760-18 (June 7, 2018), Important Notice B9072-18 (July 9, 
2018) and Important Notice B9122-18 (July 26, 2018), available at 
http://www.dtcc.com/legal/important-notices; and DTC Corporate 
Actions Product Update to SIFMA (October 11, 2018), available at 
https://www.sifma.org/wp-content/uploads/2017/05/SIFMA-CAS_DTCC-Corporate-Actions-Update_2018.pdf.
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Restructure, Streamline and Clarify the Guide
    DTC proposes to restructure, streamline and clarify the Guide for 
enhanced transparency and clarity as set forth below.
    DTC would restructure the Guide into three parts. The first part 
would provide an introduction and background on reorganizations. The 
second part would address Reorganizations announcements 
(``Announcements''). The third part would address the processing of 
mandatory events and voluntary offerings, including, but not limited 
to, Participant instructions.
    DTC would streamline the Guide as follows:
    (1) The Guide currently contains contact numbers for information 
about different services described in the Guide. As a practical matter, 
the contact information for information about each of these services is 
the same. Therefore, the individual references to contact information 
for information about a service would be deleted and would be replaced 
by a single reference in the beginning of the Guide.
    (2) Currently, each section of the Guide that describes a service 
contains a list of associated PTS and PBS functions. DTC is proposing 
to insert a table toward the beginning of the Guide that would contain 
a consolidated list of PTS/PBS functions that are associated with 
reorganization events generally, the parallel CA Web functionality, and 
the applicability to voluntary events, mandatory events, or proxy.
    (3) Sections relating to procedures for the hard copy submission of 
Participant instructions in connection with different offerings would 
be clarified and consolidated into one proposed section that outlines 
the common procedure and set of requirements for the submission of 
instructions outside of the Automated Tender Offer Program (``ATOP'') 
and the Automated Subscription Offer Program (``ASOP'').\15\
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    \15\ ATOP allows Participants to accept various voluntary 
offers, such as voluntary tender or exchange offers, in a book-entry 
environment. See Securities Exchange Act Release No. 33797 (March 
22, 1994), 59 FR 14696 (March 29, 1994) (SR-DTC-93-11) (approving 
enhancements to ATOP). ASOP allows Participants to accept rights 
offers and receive the underlying securities within a fully 
automated book-entry environment. See Securities Exchange Act 
Release No. 35108 (December 16, 1994), 59 FR 67356 (December 29, 
1994) (SR-DTC-94-15) (instituting ASOP).
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    (4) Currently, the Guide contains several sections titled 
``Important Considerations'' in connection with different 
reorganization services. These sections contain a substantial amount of 
overlapping information. Therefore, DTC is proposing to consolidate 
these

[[Page 26468]]

sections into a single proposed ``Important Considerations'' section.
    (5) Currently, the Guide contains several sections titled 
``Interest Payments, Dividends, Distributions, and Voting Rights for 
Tendered Securities,'' in connection with different reorganization 
services. These sections contain a substantial amount of overlapping 
information. Therefore, DTC is proposing to consolidate these sections 
into a single proposed ``Interest Payments, Dividends, Distributions, 
and Voting Rights for Tendered Securities'' section.
    Finally, DTC would clarify and enhance the transparency of certain 
services and procedures by:
    (1) Clarifying and simplifying language;
    (2) Inserting additional background information and clarifying 
information;
    (3) Replacing references to DTC's proprietary Computer-to-Computer 
Facility (``CCF'') announcement files with references to International 
Organization for Standardization (``ISO'') 20022 messaging in order to 
reflect the retirement and transition to ISO 20022 to communicate 
Reorganizations Announcements; \16\ and
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    \16\ See Securities Exchange Act Release Nos. 79746 (January 5, 
2017), 82 FR 3372 (January 11, 2017) (SR-DTC-2016-014); 76811 
(December 31, 2015), 81 FR 826 (January 7, 2016) (SR-DTC-2015-013); 
68114 (October 26, 2012), 77 FR 66497 (November 5, 2012) (SR-DTC-
2012-08); and 63886 (February 10, 2011), 76 FR 9070 (February 16, 
2011) (SR-DTC-2011-02).
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    (4) Making the following ministerial changes to accurately reflect 
current terminology or to remove references to retired systems:
     For simplicity, consolidate each reference to CCF/CCF II 
files in a reference to CCF files, because CCF/CCF II files are 
collectively known as CCF Files.
     Remove references to MDH (Mainframe Dual Host) message 
format files, which are no longer supported.\17\
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    \17\ As part of enhanced business continuity plans in the 
aftermath of the events of September 11, 2001, on or around 2005, 
MDH, a proprietary communications protocol, was retired by DTC. See 
Important Notice Z#0004 (October 2, 2002), available at http://
www.dtcc.com/~/media/Files/Downloads/Investment-Product-Services/
Insurance-and-Retirement-Services/SMART_user_guide.pdf.
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     References to ``product'' or ``program'' would be replaced 
by references to ``service,'' which is more appropriate for a service 
guide.
     References to ``relinquishment'' as an available put 
exercise would be deleted because they are no longer included as 
features of put bonds in the industry.
     References to ``hard copy'' reports, notifications, or 
instructions would be changed to refer more generally to any medium 
used by Participants for transmitting instructions to, or viewing 
messages from, DTC.
     Correct spelling, grammatical and typographical errors 
throughout.
     Update other text and contact information, such as 
addresses, phone numbers, website information, and email addresses.
(ii) Proposed Rule Change
    DTC proposes to amend the Guide as follows:
    (1) Important Legal Information: The copyright date would be 
updated from 2016 to 2019.
    (2) About Reorganization: This heading would be changed to ``About 
Reorganization Services.''
    a. Introduction: No change would be made to this title.
    b. Overview: The ``Overview'' section would be modified to include 
references to CA Web and ISO 20022 messaging, and to explain how the 
functionality for reorganization services can be accessed. The word 
``chapter'' would be replaced with the word ``guide'' to reflect that 
the overview addresses the reorganization services throughout the 
Guide. The second paragraph of the section would also be modified to 
remove the specific references to PTS/PBS functions that would cease to 
be available on PTS/PBS, since these functions would be already covered 
in the references to PTS and PBS in the amended first paragraph of the 
section. Further, the section would be modified to clarify a note about 
a Participant's obligation to check the accuracy of information 
regarding reorganization activities.
    c. Proposed ``Reorganization/Proxy Contact Number'' section: The 
new proposed section, ``Reorganization/Proxy Contact Number,'' would be 
added to provide Participants with the contact information for 
information regarding any aspect of reorganization/proxy processing or 
a specific event. In connection with this proposed change, DTC is 
proposing to remove the sections of contact information that are 
repeated throughout the Guide in connection with each particular 
service.
    d. About Reorganizations: The title would be changed to ``About the 
Reorganizations Service.'' The section would be modified to provide 
additional context for, and descriptions of, the Reorganizations 
service. The definition of ``agent,'' as used in the Guide, would be 
inserted into this section. In addition, the section would be modified 
to clarify what would occur if DTC is unable to fully support a 
Reorganizations event.
    e. Types of Reorganization Products: The title of the section would 
be changed to ``Types of Reorganization Event Services.'' The list of 
services that are announced and processed by the Reorganization 
Department would be clarified and narrowed to the main event types: 
Voluntary Offerings, Mandatory Reorganizations, and Proxy. Pursuant to 
the restructuring of the Guide, the event subtypes would be addressed 
later in the Guide.
    f. Reorganization Envelopes: The ``Reorganization Envelopes'' 
section would be removed because the relevant information about viewing 
Announcements would be included in the proposed section titled ``How to 
View Mandatory and Voluntary Reorganization Announcements.''
    g. Reorganization (RRG) Account/Contra-CUSIP Numbers: This section 
would be amended and relocated within the Guide. The title would be 
changed to ``Reorganization (RRG) Segregated Account.'' The text at the 
end of the section, which reads: ``059 = the activity code of the RIPS 
envelope (in this case, rights)'' and ``01 = The sequence number of the 
RIPS envelope'' would be modified to remove the references to the RIPS 
envelope, to provide more generally that the information is viewable on 
other platforms, in addition to RIPS.
    h. Pledged Securities: This section would be amended and relocated 
within the Guide. For clarity, the section would be modified to include 
the following sentence: ``There are specific processes for pledging on 
voluntary reorganization events detailed below.''
    i. Segregated Securities: This section would be relocated within 
the Guide, as discussed below.
    j. Chills on Reorg Activities: This section would be amended and 
relocated within the Guide. For additional clarity, the section would 
be modified to include the following sentence: ``The timing of the 
chills will vary depending upon the event type or security type such as 
book-entry only.''
    k. Frozen Letters: This section would be amended and relocated 
within the Guide. The section would be amended to remove the list of 
items that are required for a frozen letter request and would reflect 
that a template request form (that reflects these requirements) is 
available. In addition, the section would be amended to replace the 
reference to ``the appropriate person at DTC'' with a specific email 
contact at frozenletter@dtcc.com.\18\ Further, for accuracy, the 
following note would be removed: ``Note--DTC does not provide a 
specific

[[Page 26469]]

form for an indemnity clause. You must provide the indemnity clause in 
whatever format your own legal requirements dictate.'' The template 
request form includes an indemnity.\19\
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    \18\ See Important Notice B3751-16 (June 29, 2016), available at 
http://www.dtcc.com/~/media/Files/pdf/2016/6/29/3751-16.pdf.
    \19\ See Important Notice B3751-16 (June 29, 2016), available at 
http://www.dtcc.com/~/media/Files/pdf/2016/6/29/3751-16.pdf; 
Important Notice B7348 (January 5, 2005), available at www.dtcc.com/
~/media/Files/pdf/2005/1/27/7348.pdf.
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    l. Preparing to Use the Products: The title would be changed to 
``Preparing to Use the Services.'' The list of technical requirements 
would be amended to (i) make ministerial corrections to the references 
to PTS and PBS, (ii) add references to CA Web and to ISO 20022 Messages 
via MQ and file protocols, and (iii) delete the references to CCF II 
and MDH. In addition, the table of PTS/PBS functions would be modified 
to insert parallel CA Web functionality. The table would be accompanied 
by a note that reads: ``Note that in 2019, the following PTS/PBS 
functions will no longer be available for current Reorganization 
activity and will be replaced with CA Web functionality as indicated. 
PTS/PBS functions will, however, be available for historical research 
purposes.'' Further, the section would be amended to add the following 
clarifying text: ``DTC offers a comprehensive overview of 
reorganization activity comprised of Announcements, Allocations, 
Adjustments and applicable alerts via CA Web's Reorganization dashboard 
which ``pushes'' data to users. Understanding the Reorganizations 
lifecycle and data model are important prerequisites for successful use 
of the Reorganizations service. DTC offers robust training resources 
available at its Asset Services Learning Center--https://
dtcclearning.com/products-and-services/asset-services.'' Finally, the 
last sentence in the section would be changed to: ``Note: DTC also 
provides various reports, including on SMART/Search, and Participants 
have the ability to export data from CA Web to spreadsheets, for 
manipulation and analysis.'' The purpose of this modification to this 
general statement is to reflect that various reports are accessed 
through SMART/Search and CA Web data reports. In general, Participants 
no longer use, and therefore DTC no longer provides, hard copy reports.
    m. Reorganization Contact Numbers: This section would be deleted 
because contact information would be provided in the proposed section, 
``Reorganization/Proxy Contact Number.''
    n. Service Topics: This heading would be deleted because it is not 
relevant to the proposed restructuring of the Guide.
    o. Allocations: This entire section would be amended and relocated 
within the Guide.
    (i) About the Product: As noted above, this section would be 
amended and relocated within the Guide. The title ``About the Product'' 
would be replaced with ``About Allocations.'' The section would be 
amended to clarify that DTC will allocate cash and stock to Participant 
upon receipt of the confirmed position and entitlements from the agent. 
For enhanced transparency, the proposed section would include 
additional information on cash allocations, reorganization cash 
settlement reporting and stock allocations.
    p. Proposed ``How Reorganizations Work'' section: DTC is proposing 
to insert a section containing basic information on the elements of 
Reorganizations that are relevant to the reorganization services. In 
particular, the section would discuss the types of event information 
that may be relevant to reorganization events, the types of entitlement 
options, the types of entitlement payouts, and the methods by which DTC 
might deliver entitlement information to Participants.
    q. Associated PTS/PBS Functions: The table of PTS/PBS functions, 
which currently reflects PTS/PBS functions used in association with 
Allocations, would be modified to reflect a consolidated chart of PTS/
PBS functions that are used in association with Reorganization events 
more generally, and to insert parallel CA Web functionality and 
applicability of the functions to voluntary events, mandatory events, 
and/or proxy. In addition, certain function descriptions would be 
revised for clarity. The section heading would be changed to 
``Associated PTS/PBS and CA Web Functions.'' Further, the paragraphs 
beginning with ``PTOP (PTS)'' and ``PSOP (PTS)'' would be moved to the 
proposed ``Voluntary Reorganizations'' section later in the Guide.
    r. Allocations Contact Number: This section would be deleted 
because contact information would be provided in the proposed section, 
``Reorganization/Proxy Contact Number.''
    (3) Announcements: There would be no changes to this heading.
    a. About the Product: The title ``About the Product'' would be 
changed to ``About the Service.'' The section would be modified to 
replace a reference to ``product'' with ``service'' and to clarify the 
types of Reorganizations activities for which DTC provides 
Announcements. Further, the section would be updated to remove 
references to CCF, CCF II and MDH, and to insert references to CA Web 
and ISO 20022. For clarity, an additional note would be inserted, which 
would read: ``Note: For all the event/activity types listed, if the 
event involves a Canadian issue paying in Canadian dollars, DTC will 
announce either two events or one event with multiple options to 
include a U.S. dollar option.''
    b. How the Product Works: The title ``How the Product Works'' would 
be replaced with ``How the Announcement Service Works.'' The section 
would be modified to remove inaccurate references to an internal 
database and newspapers as sources of reorganization information. 
Although DTC may track anticipated reorganization events in its 
internal database, it does not announce an event until it retrieves 
information from one of the listed sources. DTC does not retrieve 
reorganization information from newspapers because, in contrast to the 
other listed sources, the information is not directly issued by the 
issuer or agent.
    c. About the RIPS Function: This section would be consolidated into 
and replaced by the proposed section titled ``How to View Mandatory and 
Voluntary Reorganization Announcements.''
    d. Proposed ``How to View Mandatory and Voluntary Reorganization 
Announcements'' section: The proposed section would replace the 
``Reorganization Envelopes'' and ``About the RIPS Function'' sections 
and would reflect the Reorganization Announcements functionality that 
would be available through CA Web and ISO 20022, and would be modified 
to reflect enhanced functionality offered by CA Web and ISO 20002.
    e. Associated PTS/PBS Functions: This section would be deleted 
because the information would be updated and included in the proposed 
``Associated PTS/PBS and CA Web Functions'' section at the beginning of 
the Guide.
    f. Announcements Contact Numbers: This section would be deleted 
because contact information would be provided in the proposed section, 
``Reorganization/Proxy Contact Number.''
    (4) CD Early Redemptions: This entire section, with the exception 
of ``Associated PBS/PTS functions'' and ``CD Early Redemptions Contact 
Numbers,'' would be amended and relocated within the Guide.
    a. About the Product: As noted above, this section would be amended 
and relocated within the Guide. The section

[[Page 26470]]

would be modified to replace references to ``product'' with 
``service.'' The modifications would include changing the title of the 
section ``About the Product'' to ``About the Service.''
    b. How the Product Works: As noted above, this section would be 
amended and relocated within the Guide. The title ``How the Product 
Works'' would be changed to ``How the Service Works.''
    c. Exempt Instructions: As noted above, this section would be 
relocated within the Guide.
    d. Non-Exempt Instructions: As noted above, this section would be 
amended and relocated within the Guide. For transparency, it would be 
modified to note that ``[t]he documents must be received by DTC within 
five days of the instruction otherwise the instruction will drop off 
the system (i.e., an incomplete instruction) and will have to be 
reentered into the system to re-initiate the process,'' which is the 
current process.
    e. Issuer Acceptance: As noted above, this section would be 
relocated within the Guide.
    f. Associated PTS/PBS Functions: This section would be deleted 
because the information would be updated and included in the proposed 
``Associated PTS/PBS and CA Web Functions'' section in the beginning of 
the Guide.
    g. CD Early Redemptions Contact Numbers: This section would be 
deleted because contact information would be provided in the proposed 
section, ``Reorganization/Proxy Contact Number.''
    (5) Change Mode of Payment (CMOP): This entire section, with the 
exception of ``Associated PBS/PTS functions'' and ``CMOP Contact 
Numbers,'' would be amended and relocated within the Guide.
    a. About the Product: As noted above, this section would be amended 
and relocated within the Guide. The title ``About the Product'' would 
be changed to ``About the Service.''
    b. Associated PTS/PBS Functions: This section would be deleted 
because the information would be updated and included in the proposed 
``Associated PTS/PBS and CA Web Functions'' section in the beginning of 
the Guide.
    c. CMOP Contact Numbers: This section would be deleted because 
contact information would be provided in the proposed section, 
``Reorganization/Proxy Contact Number.''
    (6) Conversions: This entire section, with the exception of 
``Associated PBS/PTS functions'' and ``Conversions Contact Numbers,'' 
would be amended and relocated within the Guide.
    a. About the Product: As noted above, this section would be amended 
and relocated within the Guide. The title ``About the Product'' would 
be changed to ``About the Service.'' The section would be modified to 
clarify that (i) if entitlements of cash and/or securities is not yet 
determined at the time of the instruction, DTC may move a Participant's 
instructed position into a contra CUSIP until the entitlements are 
determined, and (ii) the entry on the Participant Daily Activity 
Statement for conversions is ``Conversions (Account #2222/4444).''
    b. About Conversion Features: As noted above, this section would be 
relocated within the Guide. The section would be modified to add 
additional context and to reflect the trend in the industry to use 
market triggers as a conversion feature. In addition, DTC is proposing 
to add language that would explain the circumstances in which an 
entitlement amount would not be determined at the time of the 
Participant's instructions, and would further advise that, in these 
circumstances, Participants would input their instructions through 
ATOP, rather than the RCNV (PTS).\20\
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    \20\ RCNV is used to submit conversion instructions when the 
conversion rate(s) and/or new entitlements (securities) are known 
and the new securities are eligible for DTC services. Participants 
get immediate use of the securities. PTOP (ATOP) is used to submit 
conversion instructions when the rate(s) and or new entitlement(s) 
is cash, cash or securities or cash and securities, and is 
unavailable at the time of the instruction. Participants get 
credited with the entitlements upon receipt from the Issuer/Agent.
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    c. How the Product Works: As noted above, this section would be 
relocated within the Guide. The title ``How the Product Works'' would 
be changed to ``How the Service Works.'' This section would be modified 
to provide further clarity with respect to circumstances where the 
amount of the entitlement is undetermined at the time of the 
Participant's instruction and to reflect the increased utilization of 
market triggers for convertibility. DTC is further proposing to delete 
the sentence ``DTC credits these shares to your general free account if 
an underlying issue is in an interim period. The additional shares are 
allocated on the due bill redemption date,'' because the concept is 
covered elsewhere in the Guide.
    d. Pledge and Transfer of Underlying Securities by Book Entry: As 
noted above, this section would be relocated within the Guide. The 
section would be modified to clarify that the section relates to 
conversion instructions submitted to DTC via the PTS RCNV or PBS Reorg 
Conversion functions, as opposed to through ATOP. In addition, the 
section would be modified to (i) clarify that the conversion process 
does not complete until DTC receives the securities from the agent, and 
(ii) alert Participants that DTC will reverse the credits to a 
Participant's account for underlying securities if DTC does not receive 
the underlying securities from the agent promptly.
    e. Associated PTS/PBS Functions: This section would be deleted 
because the information would be updated and included in the proposed 
``Associated PTS/PBS and CA Web Functions'' section in the beginning of 
the Guide.
    f. Conversions Contact Numbers: This section would be deleted 
because contact information would be provided in the proposed section, 
``Reorganization/Proxy Contact Number.''
    (7) Eurobond Conversions: This entire section would be amended and 
relocated within the Guide, amended as discussed below.
    a. About the Product: As noted above, this section would be amended 
and relocated within the Guide. The title ``About the Product'' would 
be changed to ``About the Service.'' In addition, references to 
``product'' would be replaced with ``service.''
    b. How the Product Works: As noted above, this section would be 
amended and relocated within the Guide. The title ``How the Product 
Works'' would be changed to ``How the Service Works.'' For accuracy and 
because the list does not necessarily remain static, the section would 
be modified to replace the sentence ``A cumulative listing of the 
securities that qualify for the program appears in DTC's Monthly 
Reference Directory'' with ``To determine whether a security qualifies 
for the program, contact DTC's Customer Support Center at 1-888-382-
2721 and follow the menu options.''
    c. Important Considerations: This section would be consolidated 
with other ``Important Considerations'' sections into the proposed new 
``Important Considerations'' section. The proposed ``Important 
Considerations'' section would reflect a modification to replace a 
reference to ``product'' with ``service.'' In addition, the proposed 
``Important Considerations'' section would replace the statement ``DTC 
will make copy #4 of the Certification of Conversion form from the 
conversion agent available for you to pick up,'' with ``DTC will make 
available via email the agent's Certification of Conversion form.'' 
This modification would reflect that conversion agents no longer supply 
hard copy Certification of Conversion forms.

[[Page 26471]]

    d. Pledge and Transfer of Eurobond Underlying Securities by Book-
Entry: This section would be amended and relocated within the Guide. 
The section would be modified to (i) clarify that the conversion 
process does not complete until DTC receives the securities from the 
agent, and (ii) alert Participants that DTC will reverse credits to a 
Participant's account for underlying securities if DTC does not receive 
the underlying securities from the agent promptly. The section would 
also be revised to replace an enumeration of ``a, b, c, d, and e'' with 
``1, 2, 3, 4, and 5'' to conform to the referenced list.
    (8) Hard Copy Procedure for Conversions/Submitting a Hard Copy 
Conversion Instruction: These ``Hard Copy Procedure'' sections would be 
deleted and replaced by the proposed section ``Procedures for 
Submitting Instructions Outside of PTS/PBS,'' which would update and 
consolidate separate hard copy procedures for different event types. In 
addition, the proposed section would consolidate the ``Warning!'' 
statements that currently appear in the separate hard copy procedures 
sections. Finally, because the proposed section would apply to multiple 
event types, the section would include a new table that would list the 
forms for instructions to DTC outside of PTS/PBS. The new table would 
list the event types, the appropriate instruction form for each event, 
and the appropriate email address to which the form should be directed.
    (9) Hard Copy Procedure for Warrant Exercises/Exercising a Warrant 
via Hard Copy: These ``Hard Copy Procedure'' sections would be deleted 
and replaced by the proposed section ``Procedures for Submitting 
Instructions Outside of PTS/PBS,'' which, as noted above, would update 
and consolidate separate hard copy procedures for different event 
types. In addition, the proposed section would consolidate the 
``Warning!'' statements that currently appear in the separate hard copy 
procedures sections. Finally, because the proposed section would apply 
to multiple event types, the section would include a new table of forms 
for instructions to DTC outside of PTS/PBS. The new table would list 
the event types, the appropriate instruction form for each event, and 
the appropriate email address to which the form should be directed.
    (10) Hard Copy Procedures for Voluntary Offerings and Put Option 
Exercises/Overview, Accepting an Offer or Put Option Exercise, and 
Submitting a Notice of Guaranteed Delivery: These ``Hard Copy 
Procedure'' sections would be deleted and replaced by the proposed 
section ``Procedures for Submitting Instructions Outside of PTS/PBS,'' 
which, as noted above, would update and consolidate separate hard copy 
procedures for different event types. In addition, the proposed section 
would consolidate the ``Warning!'' statements that currently appear in 
the separate hard copy procedures sections. Finally, because the 
proposed section would apply to multiple event types, the section would 
include a new table of forms for instructions to DTC outside of PTS/
PBS. The new table would list the event types, the appropriate 
instruction form for each event, and the appropriate email address to 
which the form should be directed.
    (11) Hard Copy Procedures for Voluntary Offerings and Put Option 
Exercises/Accepting an Offer to Tender Securities by Sealed Bids, and 
Withdrawing an Acceptance: These ``Hard Copy Procedure'' sections would 
be deleted and replaced by the proposed section ``Procedures for 
Submitting Instructions Outside of PTS/PBS,'' which would consolidate 
and update the separate hard copy procedures for different event types.
    (12) Mandatory Reorganizations: This entire section, with the 
exception of ``Associated PBS/PTS functions'' and ``Mandatory 
Reorganization Contact Numbers,'' would be amended and relocated within 
the Guide.
    a. About the Product: As noted above, this section would be amended 
and relocated within the Guide. The title ``About the Product'' would 
be changed to ``About the Service.'' The section would be modified for 
enhanced readability and to add transparency about situations when a 
mandatory corporate action may be set-up or processed differently.
    b. How the Product Works: As noted above, this section would be 
amended and relocated within the Guide. The title ``How the Product 
Works'' would be changed to ``How the Service Works.''
    c. Various Types of Mandatory Reorganizations: As noted above, this 
section would be amended and relocated within the Guide. This section 
would be modified to clarify that the activities that are listed are 
examples of Mandatory Reorganization events. In addition, the list of 
event types would be revised for clarity and consistency, and 
additional event types would be added for enhanced transparency.
    d. Associated PTS/PBS Functions: This section would be deleted 
because the information would be updated and included in the proposed 
``Associated PTS/PBS and CA Web Functions'' section in the beginning of 
the Guide.
    e. Mandatory Reorganization Contact Numbers: This section would be 
deleted because contact information would be provided in the proposed 
section, ``Reorganization/Proxy Contact Number.''
    (13) Proxy: For clarity, the title of the section would be changed 
to ``Proxy Announcements.''
    a. About the Product: The title ``About the Product'' would be 
changed to ``About the Service.'' The section would be modified to 
change a reference to ``product'' with ``service,'' and to update the 
name of the service. For enhanced clarity, the section would be 
modified to include general and extraordinary meetings as issuer 
communications that are supported by Proxy Announcements. In addition, 
for accuracy, the bullet points for Bankruptcies, Legal notices, and 
Appraisal or dissenters' rights would be deleted. Announcements for 
those events are handled by the Reorganizations Announcements group, 
and not by the proxy announcements group.
    b. How the Product Works: The title ``How the Product Works'' would 
be changed to ``How the Service Works.'' The paragraphs of the section 
would be reordered. The section would also be modified to (i) add 
references to CA Web and ISO 20022, (ii) to make ministerial clarifying 
changes, (iii) to remove a reference to bankruptcy announcement, 
because bankruptcies would have its own section in the revised Guide, 
and (iv) remove the sentences ``DTC also offers election processing for 
consent solicitation events via its ATOP (Automated Tender Offer 
Program) service. Under this service, DTC allows participant 
instruction on consent solicitation events to be accepted via ATOP and 
transmitted electronically to balloting agents,'' because consent 
solicitations are not processed as part of the proxy service, but 
rather as part of voluntary reorganization services. In addition, the 
section would be revised to reflect that Omnibus Proxies are available 
through DTC's Securities Position Report (``SPR'') service for those 
issuers that are registered for the service. Further, the section would 
be modified to provide a reminder to Participants that they should make 
sure that their proxy contact information is up-to-date. Finally, a 
note about voting securities registered to Cede & Co. that have been 
withdrawn on or before record date would be updated from requiring 
microfilm copies of the front and back of the certificate to requiring 
images (i.e., scanned copies of the front and back of the certificate).

[[Page 26472]]

    (14) Proposed ``Processing'' section: As part of the proposed 
restructuring of the Guide, DTC is proposing that the ``Processing'' 
section follow the proposed ``Proxy Announcements'' section in the 
Guide.
    (15) Proposed ``Mandatory Reorganizations'' section: The entire 
Mandatory Reorganizations section, amended as discussed above, would be 
moved under the ``Processing'' heading.
    (16) Proposed ``Voluntary Offerings'' section: The Voluntary 
Offerings section, which appears later in the Guide, would be moved up 
to follow the proposed Mandatory Reorganization section. The Voluntary 
Offerings section would be modified, as discussed below.
    (17) About Legal Notices: This section would be modified for 
clarity and to remove references to LENP and the PBS Legal Notice 
System, because those platform-based functions were superseded by the 
web-based Legal Notice System (``LENS'').\21\ In addition, the section 
would be modified to clarify that the LENS service is available to both 
Participants and non-Participants.
---------------------------------------------------------------------------

    \21\ See Securities Exchange Act Release No. 62686 (August 10, 
2010), 75 FR 50032 (August 16, 2010) (SR-DTC-2010-10).
---------------------------------------------------------------------------

    (18) Other Shareholder or Bondholder Services: This section would 
be modified to accurately reflect the services offered. Specifically, 
DTC has not offered ``Ratification of Assertion of appraisal of 
Dissenter's Rights,'' as a discrete service and therefore this language 
would be deleted. DTC is proposing to add ``Confirmation of a 
position,'' as this is a specific service provided by DTC as a part of 
the shareholder or bondholder service offerings. The section would also 
be revised to add clarifying language and to provide a website address 
at which template instructions and letters may be found. Finally, 
contact information would be deleted, because, as discussed above, 
contact information would be provided at the beginning of the Guide.
    (19) Dissenters' Rights/Appraisal Rights: This section would be 
revised to state that stockholders may be required to present (and not 
deposit) share certificates (or in the case of Direct Registration 
Service (DRS) only securities, a DRS Statement) in connection with 
their dissent. The purpose of this revision would be to clarify that 
this is not a DTC requirement, but, rather, may be a required action 
pursuant to the terms of the merger. The section would also be modified 
to remove the requirement of an ``appraisal rights questionnaire or 
dissenters' rights questionnaire.'' An ``appraisal rights questionnaire 
or dissenters' rights questionnaire'' is substantively similar to the 
required instruction letter and is therefore no longer required. In 
addition, DTC is proposing to add a note providing a website address at 
which template instructions and letters may be found.
    (20) Associated PTS/PBS Functions: This section would be deleted 
because the information would be updated and included in the proposed 
``Associated PTS/PBS and CA Web Functions'' section in the beginning of 
the Guide.
    (21) Proxy Contact Numbers: This section would be deleted because 
contact information would be provided in the proposed section, 
``Reorganization/Proxy Contact Number.''
    (22) Puts: This entire section, except for ``Associated PTS/PBS 
Functions'' and ``Puts Contact Numbers,'' would be amended and 
relocated within the Guide.
    a. About the Product: As noted above, this section would be amended 
and relocated within the Guide. The section would be modified to change 
a reference to ``product'' with ``service.'' In addition, the reference 
to exercising relinquishments would be deleted. In addition, the 
provision referencing a relinquishment, ``[n]on-option securities based 
on your position in the contra (relinquishment) security,'' would be 
deleted.
    b. About Puts: This section would be relocated within the Guide, 
where it would proceed the proposed ``Puts/About the Product'' section.
    c. Types of Put Options: This section would be amended and 
relocated within the Guide, and would be amended to remove the 
reference to ``Relinquishment'' and to add a line item for ``Put 
(Survivor Option).'' ``Put (Survivor Option)'' would be described as 
``Issue has an early redemption feature. This feature allows the holder 
to elect to sell bonds back to the issuer on a predetermined basis 
(excluding monthly) according to specific priorities.''
    d. Exercising Put Options: This section would be relocated within 
the Guide. The section would be amended to clarify that ``[e]xcept with 
respect to put options that have an offer to purchase with no 
withdrawal privilege, you can submit exercise instructions via the PTS 
PUTS or PBS Put Option Bonds functions. Instructions relating to put 
options that have an offer to purchase with a withdrawal privilege can 
be submitted through the PTS PTOP or PBS Voluntary Tenders and 
Exchanges functions.''
    e. Withdrawing Put Option Instructions: This section would be 
relocated within the Guide, and would be amended to include CA Web and 
to further clarify that the event details would be available on PTS 
RIPS, PBS Redemptions and Reorganizations or CA Web.
    f. Rejection of Withdrawal of Put Option Instructions: This section 
would be relocated within the Guide, and would be modified to remove 
the specific reference to how DTC would communicate the rejection, 
because there are different ways for a Participant to access this 
information.
    g. Proration of a Repayment Option: This section would be relocated 
within the Guide. The text of the section would be deleted and would be 
replaced by an instruction to refer to ``the proration details found in 
the Proration of an Offer section of the About DTC's Automated Tender 
Offer Program (ATOP) topic of this guide.''
    h. Interest Payments, Dividends, Distributions, and Voting Rights 
for Tendered Securities: This section would be consolidated with 
``About ATOP/Interest Payments, Dividends, Distributions, and Voting 
Rights for Tendered Securities,'' and ``Warrant Exercises/Interest 
Payments, Dividends, Distributions, and Voting Rights,'' into a single 
proposed section, ``Interest Payments, Dividends, Distributions, and 
Voting Rights for Tendered Securities,'' which would appear later in 
the Guide. The proposed section would reflect the consolidation, and 
would enumerate the different types of tendered securities for which 
Cede & Co. may receive property or rights to distribute to 
Participants. References to specific offer options would be genericized 
(e.g., the reference to a specific ``repayment option period'' would be 
replaced with a more general reference to ``corporate action,'' and 
replace a reference to the terms ``of a repayment option'' with the 
terms ``of an offer'').
    i. Important Considerations: This section would be consolidated 
with other ``Important Considerations'' sections the proposed 
``Important Considerations'' section that would be inserted in the 
proposed ``Instructions/Expirations'' section. The eighth bullet, ``No 
legal deposits of the subject security will be accepted from the date 
of the PTS RIPS or PBS Reorganizations and Redemptions announcement for 
the duration of the put exercise period'' would be deleted because it 
is inaccurate.\22\ The ninth bullet would be removed because it would 
be covered in the Chills on Reorg Activities section.

[[Page 26473]]

The tenth bullet would be deleted because the necessary information 
would appear in the proposed ``Procedures for Submitting Instructions 
Outside of PTS/PBS'' section. The proposed section would also eliminate 
a reference to ``relinquishment.'' The proposed section would reflect 
the substance of the consolidated sections, and would, where 
appropriate, replace the references to specific tenders and designated 
PTS/PBS functions with generic references.
---------------------------------------------------------------------------

    \22\ DTC cannot prevent submission of legal deposits during the 
put exercise period because the target CUSIP is not chilled for 
deposits.
---------------------------------------------------------------------------

    j. Associated PTS/PBS Functions: This section would be deleted 
because the information would be updated and included in the proposed 
``Associated PTS/PBS and CA Web Functions'' section in the beginning of 
the Guide.
    k. Puts Contact Numbers: This section would be deleted because 
contact information would be provided in the proposed section, 
``Reorganization/Proxy Contact Number.''
    (23) Rejection by DTC or the Agent: This entire section would be 
relocated within the Guide, as noted above.
    a. Rejection by DTC: As noted above, this section would be 
relocated within the Guide.
    b. Rejection by the Agent: As noted above, this section would be 
relocated within the Guide.
    (24) Rights Subscriptions: This entire section, except for 
``Associated PTS/PBS Functions,'' ``Rights Subscriptions Contact 
Numbers,'' ``Distribution of Underlying Securities,'' ``Distribution of 
Sale Proceeds,'' ``Cancellation of Rights Offer,'' and ``About the 
Rights Subscription Instructions PTS/PBS Backup Form,'' which would be 
deleted, would be amended and relocated within the Guide.
    a. About the Product: As noted above, this section would be amended 
and relocated within the Guide. The title ``About the Product'' would 
be changed to ``About the Service.'' The section would be modified to 
change a reference to ``product'' with ``service,'' and to update the 
name of the service. In addition, for accuracy and clarity, the section 
would be amended to replace a reference to ``underlying securities'' 
with ``entitlements,'' and note that DTC would also allocate refunds 
when applicable. Further, the final sentence in the section would be 
updated to add a reference to CA Web.
    b. About Rights: As noted above, this section would be amended and 
relocated within the Guide. The last sentence in this section would be 
updated to add references to CA Web and ISO 20022.
    c. Relevant Terms: As noted above, this section would be amended 
and relocated within the Guide. For enhanced clarity, the term ``Cover 
of Protect,'' which refers to ``The surrendering of rights for which a 
previous protect had been submitted as a guarantee of delivery'' would 
be added to the table of relevant terms. For consistency, DTC is 
proposing to refer to ``agent,'' rather than a specific type of agent, 
and would therefore delete the definition of ``Subscription Agent (or 
Issuer's Agent).''
    d. About DTC's Automated Subscription Offer Program (ASOP): As 
noted above, this section would be amended and relocated within the 
Guide.
    e. General Information Regarding ASOP: As noted above, this section 
would be amended and relocated within the Guide. The section would be 
modified to include references to CA Web Announcements and ISO 20022.
    f. Subscription Instructions: As noted above, this section would be 
amended and relocated within the Guide. The following paragraph would 
be deleted because DTC would be adding the proposed ``Procedures for 
Submitting Instructions Outside of PTS/PBS'' section, which would be 
applicable to Subscription Instructions: ``No hardcopy instructions are 
accepted by DTC unless specifically authorized in advance by the 
appropriate DTC Reorganization department or Relationship Manager. In 
the event of a PTS or PBS outage, a backup hard copy form (Rights 
Subscription Instructions PTS/PBS Backup Form) is available for the 
purpose of instructing DTC to surrender rights and the required 
subscription payment (see About the Rights Subscription Instructions 
PTS/PBS Backup Form). If you experience a PTS or PBS outage, you can 
alternatively execute and submit the required Notice of Guaranteed 
Delivery document and subscription payment directly to the agent; a DTC 
backup hard copy form is not available for this purpose.''
    g. Subscription Payments: As noted above, this section would be 
amended and relocated within the Guide. The last sentence in the 
section would be amended to include references to CA Web and ISO 20022 
messages.
    h. Payments with Notices of Guaranteed Delivery: As noted above, 
this section would be amended and relocated within the Guide. The last 
sentence in the section would be amended to include references to CA 
Web and ISO 20022 messages.
    i. Movement of Underlying Securities: As noted above, this section 
would be amended and relocated within the Guide. The section would be 
modified to add references to contra-CUSIPs, which may, in certain 
circumstances be applicable. For clarity, the sentences in the first 
paragraph of the section would be reordered.
    j. Subscription Sub-Accounts: As noted above, this section would be 
amended and relocated within the Guide. The last sentence of this 
section would be modified to include a reference to CA Web.
    k. Schedule for Submitting Instructions: As noted above, this 
section would be amended and relocated within the Guide. The first 
paragraph of the section would be modified to include references to CA 
Web Announcements and ISO 20022 messaging. In addition, the table of 
instructions and PSOP times would be modified to remove the row 
relating to ``Notices of Guaranteed Delivery on the last day of the 
offer, with deferred subscription payments,'' because the information 
already appears in the note below.
    l. Inquiring About ASOP-Eligible Offers: As noted above, this 
section would be amended and relocated within the Guide and would be 
modified to (i) include references to CA Web and ISO 20022 messaging, 
and (ii) replace a reference to a ``hard copy notice'' with ``email 
alert,'' as hard copy notices are no longer provided. The section would 
also be amended to clarify that ``[w]ith certain rights subscription 
events you may be directed to submit your instructions through PTOP.''
    m. Accepting an ASOP-Eligible Offer: As noted above, this section 
would be amended and relocated within the Guide. The section would be 
amended to clarify that ``[i]nstructions being submitted to DTC after 
the DTC cutoff must be approved by, and delivered to, the agent 
handling the event, prior to submission to DTC.'' In addition, the 
section would be amended to add a reference to CA Web.
    n. Checklist for Submitting an Acceptance: As noted above, this 
section would be amended and relocated within the Guide. The section 
would be amended to clarify, with respect to special representations, 
that a Participant's ability to input these representations in specific 
fields on the PTS PSOP or PBS Rights Subscriptions screen, or in the 
Comments field, would be based on the terms of the offer. In addition, 
in respect to an acknowledgement message regarding the acceptance, the 
section would be modified to provide that ``Participants that subscribe 
to the ISO 20022 Instruction Statement Report (CAST) will be able to 
verify instructions status on the message.''

[[Page 26474]]

    o. Submitting a Protect for an ASOP-Eligible Offer: As noted above, 
this section would be amended and relocated within the Guide. The 
section would be amended to clarify that a Participant can cover its 
protect by ``on or before the end of the period, by either delivering 
securities [the Participant has] on deposit with DTC or having another 
participant deliver on [the Participant's] behalf to the agent via the 
PTS PSOP or PBS Rights Subscriptions function.'' In addition, 
references to ``hard copy instructions'' would be replaced with 
``instructions,'' so as to include emails, faxes, and other methods of 
instructions outside of PTS PSOP or the PBS Rights Subscriptions 
function. In addition, the section would be modified to instruct 
Participants that ``[i]f you intended to submit a protect instruction 
via PSOP but missed the cutoff for submitting the protect via PSOP it 
is your responsibility to contact the agent and determine if they will 
accept an email submission directly. If accepted, the agent will notify 
DTC and the Participant should submit a Protect Submission Form to DTC 
via email. DTC will then input the protect submission on behalf of the 
Participant. The Participant must confirm the protect submission input 
by DTC is accurate. The Participant will be able to cover the protect 
opened by DTC.'' Further, the section would be amended to include CA 
Web as a source for viewing a notice of an offer.
    p. Checklist for Submitting a Protect: As noted above, this section 
would be amended and relocated within the Guide. The section would be 
amended to clarify, with respect to special representations, that a 
Participant's ability to input these representations in specific fields 
on the PTS PSOP or PBS Rights Subscriptions screen, or in the Comments 
field, would be based on the terms of the offer. The section would also 
be amended to remove the statement that ``(The field available for this 
message is 150 characters in length.)'' because it is not directly 
relevant to the process and is subject to change. In addition, in 
respect to an acknowledgement message regarding the acceptance, the 
section would be modified to provide that ``Participants that subscribe 
to the ISO 20022 Instruction Statement Report (CAST) will be able to 
verify instructions status on the message.''
    q. Submitting a Cover of Protect via PTS PSOP or PBS Rights 
Subscriptions for an ASOP-Eligible Offer: As noted above, this section 
would be amended and relocated within the Guide. The section would be 
amended to clarify that a Participant ``cannot subsequently deliver the 
securities to the Agent via the PTS PSOP or PBS Rights Subscriptions 
function unless the instruction was subsequently input by DTC.'' In 
addition, the warning that states ``Warning! To be able to cover a 
protect via PTS PSOP or PBS Rights Subscriptions you must submit 
protect instructions for ASOP-eligible offers via PTS PSOP or PBS 
Rights Subscriptions; except as noted in Subscription Instructions, 
hard copy instructions will not be accepted by DTC on ASOP-eligible 
offers and, if submitted, will be rejected. DTC may attempt to notify 
you of the rejection, but DTC has no liability for any failure to 
notify'' would be replaced with a warning that states ``Warning! You 
must accept ASOP-eligible offers via PTS PSOP or PBS Rights 
Subscriptions; except as noted in Subscription Instructions, 
instructions outside of PTS/PBS will not be accepted by DTC on ASOP-
eligible offers during the period when instructions can be input via 
PTS PSOP or PBS Rights Subscriptions for ASOP eligible offers and, if 
submitted, will be rejected. If possible, DTC will attempt to notify 
you of the rejection, but DTC cannot guarantee such notification.'' The 
purpose of this change would be to clarify that, unless otherwise 
noted, no instruction would be accepted by DTC while the instruction 
window is open in PSOP. Finally, the section would be amended to 
include CA Web as a source for viewing a notice of an offer.
    r. Checklist for Submitting a Cover of Protect via PTS PSOP or PBS 
Rights Subscriptions: As noted above, this section would be amended and 
relocated within the Guide. The section would be modified to remove the 
first step that reads ``submit a Notice of Guaranteed Delivery and the 
required subscription payment to the subscription agent via PTS PSOP or 
PBS Rights Subscriptions before the offer expires,'' because this is a 
prerequisite to submitting a cover of protect and is not part of the 
actual process. DTC is proposing that the first step for a Participant 
would be to ``[v]erify that a Notice of Guaranteed Delivery and the 
required subscription payment to the agent via PTS PSOP or PBS Rights 
Subscriptions was submitted and accepted,'' so it confirms that the 
prerequisite occurred prior to submission of the cover. For clarity, 
the second step would be simplified to instruct a Participant to 
``[r]etrieve the specific protect instruction you want to cover.'' In 
step four, the sentence stating ``See Submitting Cover Protect 
Instructions Via PTS PSOP or PBS Rights Subscriptions'' would be 
deleted, as it is duplicative. Step five would be modified to clarify 
that a Participant can submit more than one instruction to cover the 
Notice of Guaranteed Delivery as long as the quantity of rights 
indicated in those instructions does not exceed the original Notice of 
Guaranteed Delivery quantity, with the total of all cover of protect 
instructions equaling the amount of the protect submission. Step eight 
would be amended to replace ``PTS POS or PBS Security Position 
functions'' with ``Settlement Web'' because the POS function has been 
retired and the functionality is currently available on the Settlement 
Web. The ninth step would be deleted because a Participant should make 
its own determination about its document retention procedures.
    s. Submitting a Cover of Protect on Behalf of another Participant: 
As noted above, this section would be amended and relocated within the 
Guide. The section would be modified to add a clarifying warning to 
Participants that states: ``Warning! To be able to cover a protect via 
PTS PSOP or PBS Rights Subscriptions on behalf of another participant 
you must submit protects on ASOP-eligible offers via PTS PSOP or PBS 
Rights Subscriptions or have had a protect submitted directly to the 
agent via email and subsequently communicated to DTC and input to PSOP 
by DTC; cover of protect instructions outside of PTS/PBS will not be 
accepted by DTC on ASOP-eligible offers and, if submitted, will be 
rejected. If possible, DTC will attempt to notify you of the rejection, 
but cannot guarantee such notification.'' Further, the section would be 
amended to include CA Web as a source for viewing a notice of an offer.
    t. Checklist for Submitting a Cover of Protect on Behalf of another 
Participant: As noted above, this section would be amended and 
relocated within the Guide. The section would be modified to amend the 
second step in the checklist to clarify that a Participant should enter 
and transmit an instruction to surrender rights and cover the protect 
via PTS PSOP or PBS Rights Subscriptions ``during the period when cover 
of protect submissions can be input.'' The fifth step would be amended 
for clarity and readability. The sixth step would be deleted because a 
Participant should make its own determination about its document 
retention procedures. Further, with respect to an acknowledgement 
message regarding the acceptance, the section would be modified to 
provide that ``Participants that subscribe to the ISO 20022 Instruction 
Statement Report

[[Page 26475]]

(CAST) will be able to verify instructions status on the message.''
    u. Surrendering Rights for Sale via ASOP: As noted above, this 
section would be amended and relocated within the Guide. The section 
would be amended to include CA Web as a source for viewing a notice of 
an offer.
    v. Checklist for Submitting Sell Instructions: As noted above, this 
section would be amended and relocated within the Guide. The section 
would be amended by modifying the seventh step in the checklist for 
clarity and readability, and to provide that, with respect to an 
acknowledgement message regarding the acceptance, ``Participants that 
subscribe to the ISO 20022 Instruction Statement Report (CAST) will be 
able to verify instructions status on the message.'' The eighth step 
would be deleted because a Participant should make its own 
determination about its document retention procedures.
    w. Rejection of Acceptances, Covers of Protects, or Sell 
Instructions: As noted above, this section would be relocated within 
the Guide.
    x. Distribution of Underlying Securities: This section would be 
deleted because it would be addressed in the proposed Allocations 
section.
    y. Distribution of Sale Proceeds: This section would be deleted 
because it would be addressed in the proposed Allocations section.
    z. Cancellation of Rights Offer: This section would be deleted 
because it would be addressed in the proposed Allocations section.
    aa. About the Rights Subscription Instructions PTS/PBS Backup Form: 
As discussed above, the proposed ``Procedures for Submitting 
Instructions Outside of PTS/PBS'' would replace the ``Hard Copy 
Procedure for Conversions/Submitting a Hard Copy Conversion 
Instruction,'' ``Hard Copy Procedure for Warrant Exercises/Exercising a 
Warrant via Hard Copy,'' ``Hard Copy Procedures for Voluntary Offerings 
and Put Option Exercises,'' and ``About the Rights Subscription 
Instructions PTS/PBS Backup Form'' sections.
    bb. Associated PTS/PBS Functions: This section would be deleted 
because the information would be updated and included in the proposed 
``Associated PTS/PBS and CA Web Functions'' section in the beginning of 
the Guide.
    cc. Rights Subscriptions Contact Numbers: This section would be 
deleted because contact information would be provided in the proposed 
section, ``Reorganization/Proxy Contact Number.''
    (25) Voluntary Offerings: This entire section would be amended and 
relocated within the Guide, as discussed above.
    a. About the Product: As noted above, this section would be amended 
and relocated within the Guide. The title ``About the Product'' would 
be replaced with ``About the Service.'' The section would be modified 
to streamline language and to reference CA Web as a source of 
information on voluntary offers. Further, the section would be modified 
to delete references to specific types of voluntary reorganizations in 
the first paragraph and provide a new table of various examples of 
voluntary reorganizations and descriptions of each. In addition, the 
last two paragraphs of the section would be deleted because one of the 
paragraphs is inaccurate, and the second because it is always the 
responsibility of a Participant to confirm that their transactions were 
properly processed and recorded. Finally, the section would be modified 
to insert the following language for additional context: ``Voluntary 
offerings are in the form of either (1) issuer or third party offers 
(e.g., tender, exchange, merger with elections), (2) offers that 
reflect the attributes of the security (e.g., Right, Convertible 
Security, Put Bond or Warrant) and (3) certain consent-only 
solicitations (which do not require securities being forwarded to the 
agent and may not include collecting and allocating proceeds to you). 
In addition, this service may require certifications as part of the 
acceptance of an offer (instruction process) and could include 
provisions such as conditional tenders and odd-lots.''
    b. Proposed ``Additional Processes Associated with Reorganization 
Events'' heading: For clarity, DTC is proposing to insert the heading 
``Additional Processes Associated with Reorganization Events.''
    c. Proposed ``Pledged Securities'' section: The ``Pledged 
Securities'' section, amended as discussed above, would be moved under 
the proposed ``Additional Processes Associated with Reorganization 
Events'' heading.
    d. Proposed ``Segregated Securities'' section: The ``Segregated 
Securities'' section, amended as discussed above, would be moved under 
the proposed ``Pledged Securities'' section.
    e. Proposed ``Reorganization (RRG) Segregated Account'' section: 
The ``Reorganization (RRG) Segregated Account'' section, amended as 
discussed above, would be moved under the proposed ``Segregated 
Securities'' section.
    f. About Contra-CUSIPs: No change.
    g. Pledge of Contra-Securities: The section would be amended to 
clarify that, for the purpose of its pledge, the contra-securities 
represent a Participant's rights through DTC to receive from the agent 
the cash ``and/or security'' payments based on the ``rate or accepted'' 
bid and/or the return of some or all of the surrendered securities in 
accordance with the terms of the offer.
    h. Solicitation Fees and Transfer Taxes: This section would be 
relocated within the Guide. The section would be modified to include 
references to CA Web Announcements and ISO 20022 messaging.
    i. Proposed ``Chills on Reorg Activities'' section: The ``Chills on 
Reorg Activities'' section, amended as discussed above, would be moved 
under the ``Pledge of Contra-Securities'' section.
    j. Proposed ``Frozen Letters'' section: The ``Frozen Letters'' 
section, amended as discussed above, would be moved under the proposed 
``Chills on Reorg Activities'' section.
    k. Proposed ``Interest Payments, Dividends, Distributions, and 
Voting Rights for Tendered Securities'' section: The ``Interest 
Payments, Dividends, Distributions, and Voting Rights for Tendered 
Securities'' section, amended as discussed above and below, would be 
moved under the proposed ``Frozen Letters'' section.
    (26) Proposed ``INSTRUCTIONS/EXPIRATIONS'' section: As part of the 
proposed restructuring of the Guide, DTC is proposing that a 
``INSTRUCTIONS/EXPIRATIONS'' section follow the ``Voluntary Offerings'' 
section in the Guide.
    a. Relevant Terms: As discussed above, for consistency, DTC is 
proposing to refer to ``agent,'' rather than a specific type of agent, 
and would therefore delete the definitions of ``Tender Agent'' and 
``Information Agent.''
    b. Proposed ``Important Considerations'' section: As discussed 
above and below, the other ``Important Considerations'' sections, 
including the proposed amendments, would be consolidated into the 
proposed ``Important Considerations'' section, which would be inserted 
under the ``Relevant Terms'' section.
    c. About DTC's Automated Tender Offer Program (ATOP): This section 
would be modified to replace a reference to ``product'' with 
``service,'' and to delete references to CCF II and MDH. The section 
would also be modified to clarify that ATOP allows a Participant to 
submit instructions on Consent Solicitation events for transmission to 
balloting agents. Further, the section would be amended

[[Page 26476]]

to include CA Web as a source for viewing information about an offer.
    d. Inquiring About ATOP-Eligible Offers: This section would be 
modified to (i) include references to CA Web and ISO 20022 messaging, 
(ii) delete a reference to a ``hard copy notice,'' as hard copy notices 
are no longer provided, and add ``email alert,'' and (iii) delete the 
bullet ``A PTS RIPS or PBS Reorganizations and Redemptions notice 
through CCF,'' because CCF corporate action announcement files were 
retired as of December 31, 2018. The section would also be amended to 
remind Participants that they should take note of (i) any special 
conditions of the offer, such as the existence of odd-lot preference or 
the ability to submit a conditional acceptance, and the price range and 
permissible increments on bid price tenders, as well as ``early 
expirations associated with a premium or consent,'' and ``If a 
withdrawal of a previously submitted instruction is part of the offer 
and the timeframes for requesting the withdrawal.''
    e. Accepting an ATOP-Eligible Offer: The reference to ``Submitting 
a VOI'' would be deleted because that section does not appear in the 
Guide. In addition, the warning in this section would be modified to 
clarify that DTC will not accept any instructions outside of ATOP 
during the period when the instruction window is open on ATOP. Further, 
the section would be amended to include CA Web as a source for viewing 
a notice of an offer. Finally, the reference to ``Hard Copy Procedures 
for Voluntary and Put Options'' would be replaced with ``Submitting a 
Protect for an ATOP-Eligible Offer,'' in order to conform to other 
proposed changes.
    f. Checklist for Submitting an Acceptance: The section would be 
amended to clarify, with respect to the second step regarding special 
representations, that a Participant's ability to input these 
representations in specific fields on the PTS PTOP or PBS Voluntary 
Tenders and Exchanges screen, or in the Comments field, would be based 
on the terms of the offer. With respect to comments, the statement that 
``[t]he field available for this message is 67 characters in length'' 
would be deleted because it is not directly relevant to the process and 
is subject to change. The third step would be modified to clarify that 
a Participant should enter and transmit the acceptance via PTS PTOP or 
PBS Voluntary Tenders and Exchanges ``during the period when 
submissions can be input via PTS or PBS for ATOP eligible offers.'' The 
reference to ``Submitting a VOI'' would be deleted because that section 
does not appear in the Guide. In the fourth step, a reference to the 
Viewing VOI Details section would be deleted because that section does 
not appear in the Guide. In the fifth step, the reference to a ``PTS/
PBS'' message would be replaced by a generic reference to a ``message'' 
because Participants can access the acknowledgement message on various 
platforms. In addition, in respect to an acknowledgement message 
regarding the acceptance of an instruction, the section would be 
modified to provide that ``Participants that subscribe to the ISO 20022 
Instruction Statement Report (CAST) will be able to verify instructions 
status on the message.'' Finally, in the sixth step, the reference to a 
``PTS PTOP or PBS Voluntary Tenders and Exchanges'' message would be 
replaced by a generic reference to a ``message'' because Participants 
can access the acknowledgement message through various platforms.
    g. Submitting a Protect for an ATOP-Eligible Offer: The section 
would be amended to clarify that (i) an offer has to include a 
guaranteed delivery option in order for a Participant to submit a 
protect, and (ii) a Participant can cover its protect ``on or before 
the end of the period, by either delivering securities [the Participant 
has] on deposit with DTC or having another participant deliver on [the 
Participant's] behalf to the subscription agent via the PTS PTOP or PBS 
Voluntary Tenders and Exchanges functions.'' Further, the warning would 
be amended to clarify the parameters of submitting an email submission 
to DTC. The reference to the ``Submitting a Protect'' section would be 
replaced with a reference to the ``Submitting a Cover of Protect.'' The 
warning would state: ``Warning! You must submit Notices of Guaranteed 
Delivery on ATOP-eligible offers via PTS PTOP or PBS Voluntary Tenders 
and Exchanges; hard copy instructions outside of PTS/PBS will not be 
accepted by DTC on ATOP-eligible offers during the period when protect 
submissions can be input via PTOP for ATOP eligible offers and, if 
submitted during this period, will be rejected. If possible, DTC will 
attempt to notify you of the rejection, but cannot guarantee such 
notification. If you intended to submit a protect instruction via PTOP 
but missed the cutoff for submitting the protect via PTOP, it is your 
responsibility to contact the agent and determine if they will accept 
an email submission directly. If accepted, the agent will notify DTC 
and the Participant should email a Protect Submission Form to DTC. DTC 
will then input the protect submission on behalf of the Participant. 
The Participant must confirm the protect submission input by DTC is 
accurate.'' In addition, references to ``hard copy instructions'' would 
be replaced with ``instructions,'' in order to include emails, faxes, 
and other methods of instructions outside of PTS PTOP or the PBS 
Voluntary Tenders and Exchanges function. In addition, the section 
would be amended to include CA Web as a source for viewing information 
about an offer.
    h. Checklist for Submitting a Protect: The section would be amended 
to clarify, with respect to special representations, that a 
Participant's ability to input these representations in specific fields 
on the PTS PTOP or PBS Voluntary Tenders and Exchanges screen, or in 
the Comments field, would be based on the terms of the offer. In 
addition, with respect to comments, the statement that ``[t]he field 
available for this message is 67 characters in length'' would be 
deleted because it is not directly relevant to the process and is 
subject to change. The section would be modified to amend the second 
step to clarify that a Participant should enter and transmit an 
instruction to surrender rights and cover the protect via PTS PTOP or 
PBS Voluntary Tenders and Exchanges functions ``during the period when 
cover of protect submissions can be input.'' Further, a reference to 
the Viewing VOI Details section would be deleted because that section 
does not appear in the Guide. In addition, the references to a ``PTS/
PBS'' or ``PTS PTOP or PBS Voluntary Tenders and Exchanges'' message 
would be replaced by a generic reference to a ``message'' because 
Participants can access the acknowledgement message on various 
platforms. Finally, in respect to an acknowledgement message regarding 
the acceptance, the section would be modified to provide that 
``Participants that subscribe to the ISO 20022 Instruction Statement 
Report (CAST) will be able to verify instructions status on the 
message.''
    i. Submitting a Cover of Protect via PTS PTOP or PBS Voluntary 
Tenders and Exchanges for an ATOP-Eligible Offer: The section would be 
modified to replace a reference to ``hard copy instructions'' with the 
generic ``instructions,'' to conform the language with the proposed 
``Procedures for Submitting Instructions Outside of PTS/PBS'' section. 
The section would also be modified to clarify that instructions outside 
of PTS PTOP or the PBS Voluntary Tenders and Exchanges function would 
not be accepted while the instruction window is open. In addition, the 
section would be amended

[[Page 26477]]

to include CA Web as a source for viewing information about an offer.
    j. Checklist for Submitting a Cover of Protect via PTS PTOP or PBS 
Voluntary Tenders and Exchanges: The section would be modified to 
remove the first step that reads ``Submit a Notice of Guaranteed 
Delivery to the tender agent via PTOP before the offer expires,'' 
because this is a prerequisite to submitting a cover of protect and is 
not part of the actual process. DTC is proposing that the first step 
state that a Participant ``[v]erify that a protect instruction was 
submitted and accepted,'' so that a Participant confirms that the 
prerequisite occurred prior to submission of the cover. The section 
would be amended to add a step that would remind Participants to 
``[v]erify the existence of sufficient position being available to 
cover the protect instruction position.'' For clarity, the following 
step would be simplified to instruct a Participant to ``[r]etrieve the 
specific protect instruction you want to cover.'' The next step would 
be amended to clarify that a Participant should ``[e]nter and transmit 
an instruction to surrender securities and cover the protect via PTS 
PTOP or PBS Voluntary Tenders and Exchanges during the period when 
cover of protect submissions can be input,'' and would add a reference 
to the Cover of Protect on Behalf of Another Participant section, if 
another participant is covering the protect on the Participant's 
behalf. Further, a reference to the Viewing VOI Details section would 
be deleted because that section does not appear in the Guide. In the 
subsequent steps, the reference to a ``PTS/PBS,'' ``PBS,'' or ``PTOP'' 
message would be replaced by a generic reference to a ``message'' 
because Participants can access the acknowledgement message on various 
platforms. In addition, in respect to an acknowledgement message 
regarding the acceptance, the section would be modified to provide that 
``Participants that subscribe to the ISO 20022 Instruction Statement 
Report (CAST) will be able to verify instructions status on the 
message.'' Finally, in the sixth step, the reference to a ``PTS PTOP or 
PBS Voluntary Tenders and Exchanges'' message would be replaced by a 
generic reference to a ``message'' because Participants can access the 
acknowledgement message through various platforms.
    k. Submitting a Cover of Protect via PTS PTOP or PBS Voluntary 
Tenders and Exchanges on Behalf of Another Participant: The section 
would be modified to replace a reference to ``hard copy instructions'' 
with the generic ``instructions,'' to conform the language with the 
proposed ``Procedures for Submitting Instructions Outside of PTS/PBS'' 
section. In addition, the warning language would be amended to conform 
with existing practice. The proposed warning would read: ``Warning! To 
be able to cover a protect via PTS PTOP or PBS Voluntary Tenders and 
Exchanges on behalf of another participant you must submit protects on 
ATOP-eligible offers via PTS PTOP or PBS Voluntary Tenders and 
Exchanges; hard copy or have had a protect submitted directly to the 
agent via email and subsequently communicated to DTC and input to PTOP 
by DTC; cover of protect instructions outside of PTS/PBS will not be 
accepted by DTC on ATOP-eligible offers and, if submitted, will be 
rejected. If possible, DTC will attempt to notify you of the rejection, 
but cannot guarantee such notification.'' Further, the section would be 
amended to include CA Web as a source for viewing a notice of an offer.
    l. Checklist for Submitting a Cover of Protect via PTS PTOP or PBS 
Voluntary Tenders and Exchanges on Behalf of Another Participant: The 
section would be modified by deleting a reference to the Viewing VOI 
Details section because that section does not appear in the Guide. In 
addition, references to a ``PTS/PBS'' or ``PBS'' message would be 
replaced by a generic reference to a ``message'' because Participants 
can access the acknowledgement message on various platforms. In 
addition, in respect to an acknowledgement message regarding the 
acceptance, the section would be modified to provide that 
``Participants that subscribe to the ISO 20022 Instruction Statement 
Report (CAST) will be able to verify instructions status on the 
message.''
    m. Withdrawing an Acceptance of an ATOP-Eligible Offer: The section 
would be modified to replace a reference to ``hard copy instructions'' 
with the generic ``instructions,'' to conform the language with the 
proposed ``Procedures for Submitting Instructions Outside of PTS/PBS'' 
section. In addition, the warning language would be amended for 
clarification. The proposed warning would read: ``Warning! You must 
submit withdrawals of acceptances on ATOP-eligible offers via PTS PTOP 
or PBS Voluntary Tenders and Exchanges; withdrawals outside PTS/PBS 
will not be accepted by DTC on ATOP-eligible offers during the period 
when withdrawal of instructions can be input, and, if submitted, will 
be rejected. If possible, DTC will attempt to notify you of the 
rejection, but cannot guarantee such notification.''
    n. Checklist for Withdrawing an Acceptance: The section would be 
modified by deleting references to the Viewing VOI Details section 
because that section does not appear in the Guide. In addition, 
references to a ``PTS/PBS'' or ``PTS PTOP or PBS Voluntary Tenders and 
Exchanges'' message would be replaced by a generic reference to a 
``message'' because Participants can access the acknowledgement message 
on various platforms. Further, in respect to an acknowledgement message 
regarding the acceptance, the section would be modified to provide that 
``Participants that subscribe to the ISO 20022 Instruction Statement 
Report (CAST) will be able to verify instructions status on the 
message.''
    o. About Rejections of Acceptances and Covers of Protects: This 
section would be retitled ``About Rejections of Instructions'' in order 
to encompass acceptances via Notices of Guaranteed Delivery.
    p. Proration of an Offer: This section would be modified to enhance 
transparency of the process and to clarify what would happen to 
unaccepted positions.
    q. Interest Payments, Dividends, Distributions, and Voting Rights 
for Tendered Securities: As discussed above, this section would be 
consolidated with ``Puts/Interest Payments, Dividends, Distributions, 
and Voting Rights for Tendered Securities,'' and ``Warrant Exercises/
Interest Payments, Dividends, Distributions, and Voting Rights,'' into 
a single proposed section by the same name, ``Interest Payments, 
Dividends, Distributions, and Voting Rights for Tendered Securities,'' 
which would appear later in the Guide.
    r. Available Reports: This section would be modified to delete 
references to CCF II and MDH, and to include references to CA Web and 
ISO 20022 Announcement messages. The sentence ``Allocation information 
is available through all of the normal cash and position inquiries such 
as the PBS functions PTS SDAR or PBS Reorg/Redemptions/Dividend 
Allocations, PTS POS or PBS Security Position, PTS PART or Participant 
Activity Research and PTS ART or PBS Activity Research Tool'' would be 
replaced with the following sentence: ``Allocation information is 
available through the Reorganization Cash/Stock Settlement Lists and 
the Participant Daily Activity Statement.'' The purpose of this 
proposed change is to remove references to functions (PTS POS or PBS 
Security Position and PTS ART or PBS Activity

[[Page 26478]]

Research Tool) that have been migrated to the Settlement Web.\23\
---------------------------------------------------------------------------

    \23\ See Securities Exchange Act Release No. 63936 (February 22, 
2011), 76 FR 10628 (February 25, 2011) (SR-DTC-2011-03).
---------------------------------------------------------------------------

    s. Important Considerations: This section would be consolidated 
with the other ``Important Considerations'' sections into the proposed 
``Important Considerations'' section that would be inserted in the 
proposed ``Instructions/Expirations'' section, as discussed above. The 
proposed section would reflect the substance of the consolidated 
sections, and would, where appropriate, replace references to specific 
tenders and designated PTS/PBS functions with generic references.
    t. Associated PTS/PBS Functions: This section would be deleted 
because the information would be updated and included in the proposed 
``Associated PTS/PBS and CA Web Functions'' section in the beginning of 
the Guide.
    u. Voluntary Offerings Contact Numbers: This section would be 
deleted because contact information would be provided in the proposed 
section, ``Reorganization/Proxy Contact Number.''
    v. Proposed ``Voluntary Offers Representing Attributes of the 
Security (processed via various functions)'' section: This proposed 
section would be added in order to provide direction as to which PTS 
function to use for submitting voluntary instructions in connection 
with securities with specific attributes.
    (27) Proposed ``Conversions'' section, including the proposed 
``About the Service,'' ``About Conversion Features,'' ``How the Service 
Works,'' and ``Pledge and Transfer of Underlying Securities by Book-
Entry'' sections: These proposed sections, as discussed above, would be 
inserted after the proposed ``Voluntary Offers Representing Attributes 
of the Security (processed via various functions)'' section.
    (28) Proposed ``Eurobond Conversions'' section, including the 
proposed ``About the Service,'' ``How It Works,'' ``Important 
Considerations,'' and ``Pledge and Transfer of Eurobond Underlying 
Securities by Book-Entry'' sections: These proposed sections, as 
discussed above, would be inserted after the proposed ``Conversions'' 
sections.
    (29) Proposed ``Puts'' section, including the proposed ``About 
Puts,'' ``About the Service,'' ``Types of Put Options,'' ``Exercising 
Put Options,'' ``Withdrawing Put Options,'' ``Rejection of Withdrawal 
of Put Option Instructions,'' and ``Proration of Repayment Option'' 
sections: These proposed sections, as discussed above, would be 
inserted after the proposed ``Eurobond Conversions'' sections.
    (30) Proposed ``Rejection by DTC or Agent'' section, including the 
proposed ``Rejection by DTC,'' and ``Rejection by the Agent'' sections: 
These proposed sections, as discussed above, would be inserted after 
the proposed ``Puts'' sections.
    (31) Proposed ``Rights Subscriptions,'' including the proposed 
``About the Service,'' ``About Rights,'' ``Relevant Terms,'' ``About 
DTC's Automated Subscription Offer Program (ASOP),'' ``General 
Information Regarding ASOP,'' ``Subscription Instructions,'' 
``Subscription Payments,'' ``Payments with Notices of Guaranteed 
Delivery,'' ``Movement of Underlying Securities,'' ``Subscription Sub-
Accounts,'' ``Schedule for Submitting Instructions,'' ``Inquiring About 
ASOP-Eligible Offers,'' ``Accepting an ASOP-Eligible Offer,'' 
``Checklist for Submitting an Acceptance,'' ``Submitting a Protect for 
an ASOP-Eligible Offer,'' ``Checklist for Submitting a Protect,'' 
``Submitting a Cover of Protect via PTS PSOP or PBS Rights 
Subscriptions for an ASOP-Eligible Offer,'' ``Checklist for Submitting 
a Cover of Protect via PTS PSOP or PBS Rights Subscriptions,'' 
``Submitting a Cover of Protect via PTS PSOP or PBS Rights 
Subscriptions on Behalf of Another Participant,'' ``Checklist for 
Submitting a Cover of Protect via PTS PSOP or PBS Rights Subscriptions 
on Behalf of Another Participant,'' ``Surrendering Rights for Sale via 
ASOP,'' ``Checklist for Submitting Sell Instructions,'' and ``Rejection 
of Acceptances, Covers of Protects, or Sell Instructions'' sections: 
These proposed sections, as discussed above, would be inserted after 
the proposed ``Rejection by DTC or Agent'' section.
    (32) Warrant Exercises: No changes would be made to this title.
    a. About the Product: This section would be retitled ``About the 
Service'' and references to ``product'' would be replaced with 
``service.'' The section would also be modified to (i) clarify that 
warrants could be exercised as a cash or cashless exercise, if part of 
the relevant offer, and to make conforming changes, and (ii) delete the 
bullets for ``Notify you of upcoming expirations and record dates for 
warrant exercises'' because it would be covered by the proposed bullet 
``Announce key terms and dates related to the warrant as provided by 
the issuer and/or agent.''
    b. Interest Payments, Dividends, Distributions, and Voting Rights: 
As discussed above, this section would be consolidated with the ``Puts/
Interest Payments, Dividends, Distributions, and Voting Rights for 
Tendered Securities'' section and the ``About ATOP/Interest Payments, 
Dividends, Distributions, and Voting Rights'' section into a single 
proposed section, also named ``Interest Payments, Dividends, 
Distributions, and Voting Rights for Tendered Securities,'' which would 
appear later in the Guide.
    c. About Warrants: No changes would be made to this section.
    d. How the Product Works: The section would be retitled ``How the 
Service Works.'' In addition, a reference to the ``Hard Copy Procedure 
for Warrant Exercises'' section would be replaced by a reference to the 
proposed ``Procedures for Submitting Instructions Outside of PTS/PBS'' 
section.
    e. Pledge and Transfer of Underlying Securities by Book-Entry: 
Ministerial changes only.
    f. Interest Payments, Dividends, Distributions, and Voting Rights: 
This section would be deleted because it is duplicative of the earlier 
``Warrant Exercises/Interest Payments, Dividends, Distributions, and 
Voting Rights'' section.
    g. Associated PTS/PBS Functions: This section would be deleted 
because the information would be updated and included in the proposed 
``Associated PTS/PBS and CA Web Functions'' section in the beginning of 
the Guide.
    h. Warrant Exercises Contact Numbers: This section would be deleted 
because contact information would be provided in the proposed section, 
``Reorganization/Proxy Contact Number.''
    (33) Proposed ``Procedures for Submitting Instructions Outside of 
PTS/PBS'' section: As discussed above, the proposed ``Procedures for 
Submitting Instructions Outside of PTS/PBS'' would replace the ``Hard 
Copy Procedure for Conversions/Submitting a Hard Copy Conversion 
Instruction,'' ``Hard Copy Procedure for Warrant Exercises/Exercising a 
Warrant via Hard Copy,'' ``Hard Copy Procedures for Voluntary Offerings 
and Put Option Exercises,'' and ``About the Rights Subscription 
Instructions PTS/PBS Backup Form'' sections.
    (34) Reorganization Presentments for MMI Issues: Ministerial 
changes only.
    (35) Proposed ``CD Early Redemptions'' section, including the 
proposed ``About the Service,'' ``How the Service Works,'' ``Exempt 
Instructions,'' ``Non-Exempt Instructions,'' and ``Issuer Acceptance'' 
sections: These proposed sections, as discussed above, would be 
inserted after under the Reorganization Presentments for MMI Issues 
section.
    (36) Proposed ``Change Mode of Payment (CMOP)'' section, including 
the

[[Page 26479]]

proposed ``About the Service'' section: The Change Mode of Payment 
(CMOP)/About the Product sections, amended as discussed above, would be 
moved under the Proposed ``CD Early Redemptions/Issuer Acceptance'' 
section.
    (37) Proposed ``Allocations'' section, including the proposed 
``About Allocations'' section: These proposed sections, as discussed 
above, would be inserted under the proposed ``Change Mode of Payment 
(CMOP)/About the Service'' section.
    (38) Proposed ``Solicitation Fees and Transfer Taxes'' section: 
This section, as discussed above, would be inserted after under the 
proposed ``About Allocations'' section.
2. Statutory Basis
    DTC believes that this proposal is consistent with the requirements 
of the Act and the rules and regulations thereunder applicable to a 
registered clearing agency. Specifically, DTC believes that this 
proposal is consistent with Section 17A(b)(3)(F) \24\ of the Act and 
Rule 17Ad-22(e)(23)(i),\25\ as promulgated under the Act, for the 
reasons described below.
---------------------------------------------------------------------------

    \24\ 15 U.S.C. 78q-1(b)(3)(F).
    \25\ 17 CFR 240.17Ad-22(e)(23)(i).
---------------------------------------------------------------------------

    Section 17A(b)(3)(F) of the Act requires, inter alia, that the DTC 
Rules be designed to promote the prompt and accurate clearance and 
settlement of securities transactions.\26\ DTC believes that the 
proposed rule change with respect to the migration of Reorganizations 
processing functions from PTS/PBS to CA Web is consistent with this 
provision of the Act because it would migrate Reorganizations functions 
to a more flexible interface that utilizes market standard language and 
incorporates the entire lifecycle of an event into one platform. By 
providing Participants with more efficient access to reorganization 
services and a broader view of a reorganization event, DTC believes 
that the proposed rule change is designed to promote the prompt and 
accurate clearance and settlement of securities transactions relating 
to Reorganizations, consistent with Section 17A(b)(3)(F) of the 
Act.\27\
---------------------------------------------------------------------------

    \26\ 15 U.S.C. 78q-1(b)(3)(F).
    \27\ Id.
---------------------------------------------------------------------------

    DTC believes that the proposed rule change with respect to the 
restructuring, streamlining, and clarification of the Guide is 
consistent with Section 17A(b)(3)(F) of the Act.\28\ DTC believes that 
the proposed rule change would enhance the clarity and transparency of 
the Guide, which would allow a Participant to more efficiently conduct 
its business in connection with processing reorganization events. 
Therefore, DTC believes that the proposed rule change is designed to 
promote the prompt and accurate clearance and settlement of securities 
transactions related to Reorganizations, consistent with Section 
17A(b)(3)(F) of the Act.\29\
---------------------------------------------------------------------------

    \28\ Id.
    \29\ Id.
---------------------------------------------------------------------------

    Rule 17Ad-22(e)(23)(i) under the Act requires, inter alia, that DTC 
establish, implement, maintain and enforce written policies and 
procedures reasonably designed to publicly disclose all relevant rules 
and material procedures.\30\ DTC believes that the proposed rule change 
with respect to the restructuring, streamlining, and clarification of 
the Guide would enhance the transparency and clarity of the Guide. 
Having clear and transparent provisions about the DTC Reorganizations 
services would enable Participants to better understand the processes 
and provide Participants with increased predictability and certainty 
regarding their rights and obligations with respect to their use of the 
services. Therefore, DTC believes that the proposed rule changes with 
respect to the restructuring, streamlining, and clarification of the 
Guide are consistent with Rule 17Ad-22(e)(23)(i) under the Act, cited 
above.
---------------------------------------------------------------------------

    \30\ 17 CFR 240.17Ad-22(e)(23)(i).
---------------------------------------------------------------------------

(B) Clearing Agency's Statement on Burden on Competition

    DTC believes that the proposed rule change with respect to the 
migration of Reorganizations processing functions from PTS/PBS to CA 
Web may have an impact on competition, because it would facilitate a 
more efficient process for communicating and processing Reorganizations 
information.\31\ Having a more efficient process could promote 
competition by potentially reducing Participants' operating costs. In 
addition, CA Web is an existing DTC platform that all Participants are 
required to use to access other types of services, including 
Distributions and Redemptions processing, and so would not affect the 
rights and obligations of any Participant. Therefore, DTC believes that 
the proposed rule change with respect to the migration of functions 
from PTS/PBS to CA Web may promote competition but would not create a 
burden on competition.\32\
---------------------------------------------------------------------------

    \31\ 15 U.S.C. 78q-1(b)(3)(I).
    \32\ Id.
---------------------------------------------------------------------------

    DTC believes that the proposed rule changes with respect to 
restructuring, streamlining, and clarifying the Guide would not have an 
impact on competition.\33\ The proposed rule change would enhance the 
clarity and transparency of the Guide to better reflect DTC's 
Reorganizations services and practices. Improving the clarity and 
transparency of the DTC Rules and Procedures, including the Guide, 
would help Participants to better understand their rights and 
obligations regarding DTC services, and so would not affect the rights 
and obligations of any Participant or other interested party.
---------------------------------------------------------------------------

    \33\ Id.
---------------------------------------------------------------------------

(C) Clearing Agency's Statement on Comments on the Proposed Rule Change 
Received From Members, Participants, or Others

    Written comments relating to the proposed rule change have not been 
solicited or received. DTC will notify the Commission of any written 
comments received by DTC.

III. Date of Effectiveness of the Proposed Rule Change, and Timing for 
Commission Action

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \34\ and paragraph (f) of Rule 19b-4 
thereunder.\35\ At any time within 60 days of the filing of the 
proposed rule change, the Commission summarily may temporarily suspend 
such rule change if it appears to the Commission that such action is 
necessary or appropriate in the public interest, for the protection of 
investors, or otherwise in furtherance of the purposes of the Act.
---------------------------------------------------------------------------

    \34\ 15 U.S.C. 78s(b)(3)(A).
    \35\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-DTC-2019-003 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549.

All submissions should refer to File Number SR-DTC-2019-003. This file 
number should be included on the

[[Page 26480]]

subject line if email is used. To help the Commission process and 
review your comments more efficiently, please use only one method. The 
Commission will post all comments on the Commission's internet website 
(http://www.sec.gov/rules/sro.shtml). Copies of the submission, all 
subsequent amendments, all written statements with respect to the 
proposed rule change that are filed with the Commission, and all 
written communications relating to the proposed rule change between the 
Commission and any person, other than those that may be withheld from 
the public in accordance with the provisions of 5 U.S.C. 552, will be 
available for website viewing and printing in the Commission's Public 
Reference Room, 100 F Street NE, Washington, DC 20549 on official 
business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of 
the filing also will be available for inspection and copying at the 
principal office of DTC and on DTCC's website (http://dtcc.com/legal/sec-rule-filings.aspx). All comments received will be posted without 
change. Persons submitting comments are cautioned that we do not redact 
or edit personal identifying information from comment submissions. You 
should submit only information that you wish to make available 
publicly. All submissions should refer to File Number SR-DTC-2019-003 
and should be submitted on or before June 27,2019.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\36\
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    \36\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-11802 Filed 6-5-19; 8:45 am]
 BILLING CODE 8011-01-P