TO:	ALL CLEARING PARTICIPANTS
FROM:	CLIENT SERVICES AND SUPPORT
DATE:	July 7, 2005
SUBJECT:	Mainframe Migration of GAINS®

As previously announced, The Clearing Corporation (CCorp) has begun migrating its mainframe applications to a distributed environment. As part of the migration process, CCorp has enhanced and re-platformed the Give-up Automated Invoicing System (GAINS) as a web-base application allowing users to access the new application through the CCorp website. The new version of GAINS is scheduled to be implemented on Monday, August 1, 2005.

New Functionality

With the implementation of the new GAINS application, expanded rate functionality will be available that will give the executing participant added flexibility in negotiating and establishing execution service fees with a carrying client. The new rate set-ups include a per transaction volume based sliding scale and minimum and maximum fee per transaction. The new rate set-ups can be used individually or in conjunction with other rate set-ups. Additionally, participants have the ability to manually override a calculated rate by inserting a new fee for a specific transaction.

Furthermore, users will have the ability to review all elements of an agreement on a single screen. A user in an agreement, account, or rate inquiry/update screen can click on an agreement view tab which provides all pertinent agreement details within a single screen. In addition to the new agreement view screen, new search capability will also be implemented in the account and rates screens. This will allow users to quickly locate an account or rate within an agreement.

What’s Changed

The new GAINS application has been established as a participant-based system as opposed to an exchange-based system. This will give participants the option of choosing to process different exchanges under one participant ID or multiple IDs that each represents a different exchange. This gives participants the flexibility to centralize or decentralize operational resources for give-up billing. Clearing participants will be assigned a new GAINS participant ID(s) in order to accommodate the change to a participant based system.

Also, the search that GAINS performs to locate applicable rates for a give-up transaction has been expanded to include an optional executing account number in addition to a carrying firm participant ID and carrying firm account number. This will allow firms to create and define different rates by salesman/office without the need to create pass-through and secondary agreements.

Due to new enhancements in GAINS, daily and monthly data files records will be updated to support additional detail. This will be accomplished by expanding current fields, adding new fields, and creating new field values. Documentation pertaining to the daily and monthly data files will be provided upon request by contacting Client Services and Support. Additionally, GAINS daily and monthly reports will also be updated to reflect new detail and field values.

Future Enhancement

GAINS has been modified to facilitate the collection of give-up billing proceeds directly from a Third Party customer on behalf of the executing exchange participant, in the same manner that collections occur with a carrying exchange participant today. Participants that wish to bill a participating third-party will need to establish a ‘Third-party’ agreement. Participants that need to track give-up execution services fees and bill a customer outside of GAINS will have the option to set-up a ‘Calculate Fees Only’ agreement. Bulletins detailing ‘Third-party Direct’ billing along with an implementation date will be fourth coming.

Testing

The new GAINS application will be available for firms to perform testing beginning Monday, July 18, 2005. In addition to firm testing, CCorp will run a parallel processing of production data in the test environment. The parallel will run one business day behind production processing.

Training

Training for firms that are directly impacted by the migration of GAINS to a distributed environment will begin Tuesday, July 19, 2005. Firms will be contacted by Client Services and Support to schedule a training class.

What firms need to know

Agreements that reside in the current GAINS application will not be converted to the new application. Client Services and Support will contact executing firms and provide them with a list of agreements that have had activity in the past six months.

The August 2005 billing cycle for July 2005 activity will occur using the current mainframe based GAINS application. Billing details that remain outstanding at the completion of the August 2005 billing cycle due to rejection will need to be manually re-entered on the new web-based GAINS application.

Should you have any questions, please call or e-mail one of the following Client Services and Support Representatives: