Group Surety Bond Buying Program

TO: All NASD Members and Other Interested Persons

It is a pleasure to announce the commencement of an NASD sponsored program to provide members with the surety bonds required by many States under their securities laws.

The program will provide a quick and easy way for members to acquire surety bonds at reasonable premium rates. Bonds will be issued automatically with no underwriting on receipt of the required forms and premium payment.

It will not be necessary for members to provide financial statements to the underwriter or to post collateral at inception. The program is available in all States that have surety bond requirements.

The program will be underwritten by the American Insurance Company, a member of the Fireman's Fund Group of Insurance Companies. It will be administered by Marsh & McLennan, Inc., using the facilities it created for the Group Fidelity Bond Buying Program.

Full details about the program are contained in the attached material.

Please direct all inquiries about the program to Marsh & McLennan, Inc., 5130 MacArthur Boulevard, N.W., Washington, D.C. 20016; telephone number: (202) 364-1300.

Questions about State surety bond requirements should be directed to the appropriate State Securities Commissioners Office.

Sincerely,

Gordon S. Macklin
President

Enclosures