1. COMPARISON OF THE PROCESSES OF PHYSICAL TRANSFERS VS DRS TRANSFERS (from the perspective of a small transfer agent)

2. PhysicalDRS (First DTC must train TA on how to use DRS password, work the system, etc.) 1.Shareholder calls broker and places trade. Broker either executes trade or waits for certificate to execute trade, depending on customer relationship. 1. Shareholder calls broker and tries to place trade of the book entry position.

3. PhysicalDRS 2. Shareholder brings or sends certificate to broker. 2. (a) broker tells shareholder they need an account number from the issuer (via the TA) which is on the shareholder’s statement, or, (b) broker has no idea what DRS is, and tells shareholder to call issuer or TA.

4. PhysicalDRS 3. Broker can send certificate directly to TA, or to DTCC who then sends it to TA for cancellation and reissuance. 3. Shareholder calls either: (a) the issuer, and the issuer tells shareholder to call TA, or, (b) shareholder calls TA and TA tells them to check their statement for account number. If shareholder has statement he calls broker with account number. If he can not find statement, TA must send another statement to shareholder, with the resultant delay, unless caller is willing to identify themselves over the phone with address, shares and TIN, in which case TA gives the account number.

5. PhysicalDRS New certificate goes out and transaction is done. 4. Shareholder calls broker and gives him account number 5. Broker must enter order into FAST system with proper identifying information. 6. TA must go in and out of FAST system until transfer appears. TA is sometimes kicked out of the sign in screen on the system during the transaction. Each time TA is kicked off the system, TA must close all open windows and open secure internet site from scratch. Sometimes the system is too busy and TA can not log in at all.

6. PhysicalDRS Transaction is still done7.If, and only if and when, the broker puts up info, TA then can complete the transaction on the system. TA must then print out the transaction from the system in order to first, compare it to the TA’s system to make sure the information is correct, and second, to keep a record of the transaction. It can also be difficult to print out the record of the transaction without getting kicked out of the system. …Continued Still Going…

7. PhysicalDRS The transaction has been done for so long now that you can go out on your boat. 8. After the TA completes the DRS transaction, the TA then must go into their own system to record the transfer info. If this were physical transfer, the TA’s data base would be updated automatically at the time of the transfer. 9. TA must create and send out statement, as does broker. 10. TA must balance position of DTC for DTC, since DTC is unwilling to balance it’s own position with the TA’s books Still Going…

8. PhysicalDRS The transaction is a distant memory, and you are on vacation catching the big one. 11. If the position DTC posts does not match the TA’s (as it often does not), much time and effort has to be expended to find out where the discrepancy lies, because DTC and the TA have to reach out to all the participants that have used the system to try to find out what caused the discrepancy. Often, it is just items in transition, but they have to be tracked down. IMPORTANT NOTE: Even though the TA is doing DTC’s work in balancing DTC’s position - If the TA approves a transaction or DTC’s balance incorrectly, even if it was the broker that put it on the system in error, the TA is responsible for straightening it out, with possible financial consequences! This does not happen under the physical certificate processing scenario, because each certificate has a unique identifying number and denomination, and the TA is only balancing its own books. If it does not appear on the TA’s books, even DTC will not assert it has a non- existent certificate.

9. PhysicalDRS Who pays for this streamlined process?Who pays for this cumbersome, time-consuming process?

10. PhysicalDRS TA can bill the submitting party, i.e., the beneficiary of the process, for the transaction. Ha Ha! The joke’s on you! No one pays you - especially not the initiating, benefiting party, the broker.

11. PhysicalDRS You are already paid. Now you can pay your employees, your rent, utilities, supplies, etc. It has been suggested that maybe you can get paid by the issuer when a shareholder deposits shares to a broker, or vice versa. Which is kind of like this: you buy a car from a GM dealer, or, buy a used GM car from somebody, and 3 years later you decide to sell it to someone else. Can you imagine getting GM to pay the transfer taxes, and fees for re-registering your car?

12. PhysicalDRS Environmental and Social Considerations: 1. Time consumed : Whatever it takes to receive, cancel, re-issue, and deliver one certificate. 2. Natural Resources Consumed: The amount of a tree required to produce one certificate for each transaction 3. Energy consumed: The amount of energy consumed in printing and mailing one certificate per transaction Environmental and Social Considerations : 1. Time consumed: Whatever it takes for the six zillion steps above, plus the time spent pulling out your hair 2. Natural Resources Consumed: The amount of trees it will take to produce a statement for each transaction, a quarterly statement and an annual statement, for each book entry position —FOREVER! 3. Energy Consumed: The amount of energy consumed in the production and delivery of a never-ending stream of statements to all book entry positions

13. PhysicalDRS In Summary: 1.Less time consuming, less aggravating, and has less parties involved In Summary: 1. Keeps you busy so you are not roaming the streets 2. One-time process per transaction (presumably you don’t get kicked out of your own system repeatedly) 2. Maybe you can employ monkeys trained to get you back into the system five times per transaction for less money than people 3. Environmentally and socially responsible 3. Who needs trees anyway? 4.TA not required to balance DTCC’s position off the TA’s books (nor is the TA financially responsible for errors initiated by brokers) 4. DTC is poor, and you are helping them out by doing their work for them 5. TA gets paid, and from the party that is actually benefiting from the transaction 5. See #4 above.

14. CAN IT WORK FOR THE SMALL AGENT? 1.DTC or its participants pay a fair price for the service we provide 2.DTC participates in, and shares the responsibility for, correcting and balancing it’s own positions. 3.DTC makes it’s new standards for being a FAST agent commensurate with the potential risk. After all, dematerialization is supposed to decrease, not increase risk to the market. 4.DTC completes it’s promised upgrades to it’s systems so hours are not wasted in performing DRS transactions. 5.Retail brokers get continuing education regarding their roll in DRS. YES…IF: