SEC ALLEGES BIOPHARMA COMPANY AND OTHERS OF MISLEADING INVESTORS

The following is an excerpt from the SEC website: “Washington, D.C., Aug. 2, 2011 — The Securities and Exchange Commission has charged a California-based biopharmaceutical company, three shareholder companies, and four senior executives for fraudulently misleading investors about the regulatory status of the company’s sole product. Three of the executives were additionally charged with insider trading. The SEC alleges that Immunosyn Corporation misleadingly stated in various public filings from 2006 to 2010 that its controlling shareholder – Argyll Biotechnologies LLC – either planned to commence or had commenced the U.S. regulatory approval process for human clinical trials for SF-1019, a drug derived from goat blood that was intended to treat a variety of ailments. The public filings failed to disclose that the U.S. Food and Drug Administration (FDA) had already twice issued clinical holds on drug applications for SF-1019, prohibiting clinical trials from occurring. The SEC alleges that Immunosyn also misleadingly stated that the regulatory approval process in Europe for human clinical trials for SF-1019 was imminent or underway, when in fact Argyll never submitted an application in Europe to conduct human clinical trials. According to the SEC’s complaint filed in federal court in Chicago on August 1, Immunosyn’s CFO Douglas McClain Jr., Argyll’s Chief Scientific Officer Douglas McClain Sr., and Argyll’s CEO James Miceli engaged in insider trading by raising approximately $20 million from their sale of Immunosyn shares while knowing that misrepresentations were being made about the regulatory status of SF-1019. They sold most of these shares through Argyll and two other shareholders named in the SEC’s enforcement action: Argyll Equities, which McClain Jr. and Miceli jointly owned, and an offshore entity Padmore Holdings Ltd., which McClain Jr., McClain Sr., and Miceli jointly owned. Immunosyn’s CEO Stephen D. Ferrone also is charged by the SEC in the securities fraud scheme. “These executives routinely authorized public filings that told investors a story about the status of the company’s prized drug that was far different from the behind-the-scenes reality,” said Merri Jo Gillette, Regional Director of the SEC’s Chicago Regional Office. “Three of these executives went one step further to illegally profit from their tall tales by selling their company stock and reaping more than $20 million while repeatedly misleading investors about the drug.” For example, according to the SEC’s complaint, McClain Sr. made misstatements about the regulatory approval status of SF-1019 in a video on Immunosyn’s website and in a 2008 presentation in which he sold Immunosyn stock he owned through Padmore to patients at a Texas holistic clinic, some of whom were terminally ill. The SEC alleges that McClain Sr. raised approximately $300,000 from these patients, but never gave them the shares they bought. The SEC’s complaint seeks a final judgment permanently enjoining the defendants from future violations of the antifraud provisions of the federal securities laws, ordering each defendant to disgorge all ill-gotten gains plus prejudgment interest and pay financial penalties, and barring Ferrone, McClain Jr., McClain Sr. and Miceli from serving as an officer or director of a public company. Tracy Lo, Eric Phillips and John Kustusch of the SEC’s Chicago Regional Office conducted the SEC’s investigation. The SEC’s litigation will be handled by Ms. Lo and Mr. Phillips. The SEC acknowledges the assistance of the U.S. Food and Drug Administration.”

FDIC APPOINTED RECEIVER FOR BANK OR SHOREWOOD, SHOREWOOD ILL.

The following is an excerpt from an FDIC e-mail: FOR IMMEDIATE RELEASE August 5, 2011 Bank of Shorewood, Shorewood, Illinois, was closed today by the Illinois Department of Financial and Professional Regulation—Division of Banking, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Heartland Bank and Trust Company, Bloomington, Illinois, to assume all of the deposits of Bank of Shorewood. The three branches of Bank of Shorewood, including the location operating as Bank of Elwood, will reopen on Saturday as branches of Heartland Bank and Trust Company. Depositors of Bank of Shorewood will automatically become depositors of Heartland Bank and Trust Company. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Bank of Shorewood should continue to use their existing branch until they receive notice from Heartland Bank and Trust Company that it has completed systems changes to allow other Heartland Bank and Trust Company branches to process their accounts as well. This evening and over the weekend, depositors of Bank of Shorewood can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual. As of June 30, 2011, Bank of Shorewood had approximately $110.7 million in total assets and $104.0 million in total deposits. In addition to assuming all of the deposits of the failed bank, Heartland Bank and Trust Company agreed to purchase essentially all of the assets. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $25.6 million. Compared to other alternatives, Heartland Bank and Trust Company's acquisition was the least costly resolution for the FDIC's DIF. Bank of Shorewood is the 62nd FDIC-insured institution to fail in the nation this year, and the sixth in Illinois. The last FDIC-insured institution closed in the state was First Chicago Bank & Trust, Chicago, on July 8, 2011."

U.S. AND CHINA HOLD SYMPOSIUM ON AUDIT OVERSIGHT

The following is an excerpt from the SEC website: Washington, D.C., Aug. 8, 2011 – The Sino-U.S. Symposium on Audit Oversight was held in Beijing on July 11-12, 2011. In attendance were officials from the U.S. Securities and Exchange Commission, U.S. Public Company Accounting Oversight Board (PCAOB), China Securities Regulatory Commission (CSRC), and Chinese Ministry of Finance (MOF). The symposium, which was contemplated by the outcomes of the third U.S.-China Strategic and Economic Dialogue (S&ED), represented an important step toward Sino-U.S. cooperation on audit oversight of public companies. At the symposium, the officials briefed each other on their respective audit oversight system and inspection procedures. They also exchanged views on how to deepen cooperation on cross-border audit oversight. CSRC Chairman Shang Fulin met with the SEC-PCAOB delegation headed by PCAOB Board Member Lewis Ferguson and SEC Deputy Chief Accountant Mike Starr prior to the symposium. “The CSRC and MOF welcome constant communication and good cooperation with both the SEC and PCAOB. The regulators of both countries share common objectives in protecting investors’ rights and interests, raising the quality of accounting and auditing standards, and improving the transparency and disclosure of public companies. Therefore, the regulators of both countries should enhance cooperation on the basis of mutual trust and respect,” said Chairman Shang. The U.S. delegation brought Chairman Shang a letter from PCAOB Chairman James R. Doty, who stated his sincere hope for constructive discussions in Beijing and for enhanced cooperation between China and the U.S. on cross-border audit oversight in the near future. “The development of an effective cross-border oversight system is essential to market integrity and investor protection, and the PCAOB and CSRC share a common goal of promoting fair, open, and sound markets,” Chairman Doty wrote in the letter. Mr. Ferguson said, “Our delegates are willing to share with our Chinese counterparts the PCAOB inspection approaches as well as our practices in joint cross-border audit oversight. In return, the U.S. delegation expects to learn more, through future exchanges, about the methodology and practices of accounting and audit oversight in China.” As an outcome reached during the third U.S.-China Strategic and Economic Dialogue, both sides welcome continued dialogue concerning the oversight of accounting firms providing audit services to public companies in the two countries, so as to enhance mutual trust and strive to reach an agreement on cross-border audit oversight. During the two-day symposium, the PCAOB representatives gave detailed presentations on the background and organizational structure of the PCAOB, and its inspection process. With input from the SEC delegation, including officials from the SEC’s Office of International Affairs, the PCAOB explained how it works with foreign regulators on cross-border audit oversight cooperation. Senior officials from the CSRC and the MOF provided an overview of the auditing and accounting oversight framework governing China’s capital markets, supervision arrangements, and inspection methodology and process for accounting and auditing firms. Through candid discussions, the two sides enhanced mutual understanding, and discussed initial arrangements for follow-up collaboration. The two sides discussed a series of arrangements aiming to build mutual understanding and cooperation in the near future, including sending staff to observe the inspection of accounting firms in each other’s jurisdiction to learn more about each other’s inspection process and methodology. The U.S. delegation invited the CSRC and the MOF to send delegates to Washington, D.C. to have further discussions on the topics of common concern. Such trust and confidence-building exercises are helpful for both sides to fulfill their respective mandates. The parties believe that strengthened cooperation on audit oversight is an important part in implementing the S&ED outcomes. The symposium was very productive and served as a first step toward deeper cooperation. The parties share the view that increasing cooperation on cross-border audit oversight will help improve the quality of auditing and accounting information of public companies, protect the rights of investors, and assist in safeguarding of financial markets in both countries.”

SEC VOTES TO REMOVE CREDIT RATINGS AS ELEGIBILITY FOR SHORT FORM REGISTRATION

The following is an excerpt from the SEC website: “Washington, D.C., July 26, 2011 – The Securities and Exchange Commission today voted unanimously to adopt new rules in light of the Dodd-Frank Wall Street Reform and Consumer Protection Act to remove credit ratings as eligibility criteria for companies seeking to use “short form” registration when registering securities for public sale. Forms S-3 and F-3 are the “short forms” used by eligible issuers to register securities offerings under the Securities Act. Companies that qualify for these short forms can offer securities “off the shelf” or on an expedited basis. Companies currently qualify to use these forms if they are registering an offering of non-convertible securities, such as debt securities, that have received an investment grade rating by at least one nationally recognized statistical rating organization (NRSRO). The new rules eliminate the credit ratings criteria and replace it with four new tests, one of which must be satisfied for an issuer to use Form S-3 or Form F-3. In order to ease transition for companies, the rules include a temporary, three-year grandfather provision. “This action is part of our effort to reduce reliance on credit ratings, as the Dodd-Frank Act requires all financial regulators to do,” said SEC Chairman Mary L. Schapiro. “The new rules provide an appropriate and workable alternative to credit ratings for determining whether an issuer should be able to use short form registration and have access to the shelf offering process.” # # # FACT SHEET Security Ratings Background Short-Form Eligibility Under the federal securities laws, a company offering securities must register the offer and sale of those securities with the SEC unless the sale is otherwise exempt. The SEC’s rules generally allow a non-asset-backed security issuer to use “short-form” registration if that company meets two categories of criteria. The first category related to issuers requires among other things that the company has been subject to the SEC’s reporting provisions and filing its periodic reports in a timely manner for at least one year. An issuer is required to meet all of the criteria in the first category. The second category contains a list of transaction requirements of which issuers need to satisfy only one of the criteria. One of the options in this category involves a company having at least $75 million in common equity held by unaffiliated shareholders. Another provision in this second category – that would allow an issuer to use short-form registration for an offering of non-convertible securities such as debt securities – provides that those securities be rated investment grade by at least one credit rating agency that is a nationally recognized statistical rating organization (NRSRO). If a company qualifies for short-form registration, it is allowed to rely on its quarterly, annual and other reports filed with the SEC to provide historical and future information about itself, rather than repeating the information in the prospectus or amending the prospectus as future reports are filed. The prospectus disclosure in these offerings describes the particular securities being offered and focuses on other offering-specific information. The ability to “incorporate by reference” historic and future SEC reports for the company information can provide significant cost and time savings for companies. The short-form registration forms include Form S-3 for domestic companies and Form F-3 for foreign private issuers. Shelf Registration Companies that are “short-form eligible” also are allowed to register securities “on the shelf.” This means that the companies can file registrations for future offerings and can do one or multiple offerings from the single registration in the future without needing any new SEC staff clearance. This shelf registration provides companies with flexibility to issue the securities when they choose. Often times, companies use this process when they are planning to offer securities on multiple occasions. Companies that are not short-form and shelf eligible are required to file a new registration for each public securities offering and have the SEC staff take action before completing the offering. The New Rules Form S-3 and Form F-3 Under the Securities Act of 1933 The new rules remove the condition for an NRSRO investment grade rating that is included in current short forms, Form S-3 and Form F-3, which are used by eligible issuers to register offerings of non-convertible securities under the Securities Act. Instead of the ratings criteria, the final rules allow for the use of Form S-3 or Form F-3 if the issuer satisfies one of the following four tests: The issuer has issued (as of a date within 60 days prior to the filing of the registration statement) at least $1 billion in non-convertible securities other than common equity, in primary offerings for cash, not exchange, registered under the Securities Act, over the prior three years. The issuer has outstanding (as of a date within 60 days prior to the filing of the registration statement) at least $750 million of non-convertible securities other than common equity, issued in primary offerings for cash, not exchange, registered under the Securities Act. The issuer is a wholly-owned subsidiary of a well-known seasoned issuer as defined under the Securities Act. The issuer is a majority-owned operating partnership of a real estate investment trust that qualifies as a well-known seasoned issuer. The final rules also include a temporary grandfather provision that allows an issuer to use Form S-3 or Form F-3 for a period of three years from the effective date of the amendments if it would have been eligible to register the securities offerings under the old provision. Form F-9 Under the Securities Act The final rules also rescind Form F-9, which is the form certain Canadian registrants use to register non-convertible investment grade debt. The primary advantage to Form F-9 over the only other available form (Form F-10) is that it does not require reconciliation to U.S. generally accepted accounting principles. Changes to Canadian regulations to require Canadian issuers to use International Financial Reporting Standards instead of GAAP will mean that reconciliation also will not be required on Form F-10. As a result, F-9 and F-10 will have the same requirements, so Form F-9 will be rescinded effective Dec. 31, 2012. Additionally, the final rules revise Form 40-F, the annual report form used by certain Canadian registrants, to ease the transition for issuers who previously filed registration statements on Form F-9. Other Rules and Forms There are other rules and forms that relied on similar criteria to the investment grade criteria in Form S-3 and Form F-3. The final rules revise the following rules and forms to refer to the new criteria in Form S-3 and Form F-3: Form S-4 and Form F-4 under the Securities Act. Schedule 14A under the Exchange Act. Rules 138, 139 and 168 under the Securities Act. Rule 134(a)(17) Under the Securities Act Securities Act Rule 134(a)(17) permits the disclosure of security ratings issued or expected to be issued by NRSROs in certain communications deemed not to be a prospectus or free writing prospectus, such as “tombstone ads” or press releases announcing offerings. The amendments remove this safe harbor. Instead, the determination of whether such information constitutes a prospectus will be made in light of all circumstances of the communication. What’s Next The new rules take effect 30 days after publication in the Federal Register, except the rescission of Form F-9 and amendments to remove references to Form F-9 in other rules and forms will be effective Dec. 31, 2012.”

SEC COMMISSIONER SPEAKS ON THE STATE OF THE MUNICIPAL SECURITIES MARKET

The following speech is an except from the SEC website: "Speech by SEC Commissioner: Statement at SEC Field Hearing on the State of the Municipal Securities Market by Commissioner Elisse B. Walter U.S. Securities and Exchange Commission Birmingham, AL July 29, 2011 Good morning, and thank you Mayor McBrayer, for that kind introduction, and for welcoming us to Homewood. It is a pleasure to be here with so many knowledgeable municipal market participants who are joining us today to give us the benefit of their expertise on issues of central importance to the municipal securities market. For those of you joining by webcast, thank you for tuning in. I am sure that all of you were looking forward to hearing from SEC Chairman Mary Schapiro this morning. Unfortunately, due to a family health emergency, Chairman Schapiro is not able to participate in today’s hearing. She sends her sincere regrets. The distinguished Chairman of the House Financial Services Committee, the Honorable Spencer Bachus, had also hoped to be with us today. However, as we all know, Capitol Hill is a particularly busy place at the moment. Due to the urgency of the national debt ceiling negotiations, Chairman Bachus is also unable to attend today’s hearing in person. We are very pleased, however, that Larry Lavender, the Majority Staff Director of the House Financial Services Committee, will be speaking to you on behalf of Chairman Bachus after I conclude my opening remarks. OVERVIEW OF FIELD HEARINGS Given the SEC’s limited authority over municipal securities, our options for addressing problems in this market have historically been quite limited. However, as the municipal market grows larger and more complex, it is increasingly important that we redouble our efforts and give this critical marketplace much needed concentrated and greater attention -- and we are doing just that. As many of you know, the SEC was created to be, in the words of one early Commission Chairman, “the investor’s advocate.” That means we work to help ensure that investors are protected and have the information they need to make informed decisions. As their advocates, we are concerned that investors in the municipal securities market may not have the protections and access to information that they need. We are also concerned that they may not be able to make fully informed investment decisions regarding the prices of securities they wish to buy or sell in many cases or the spreads demanded by the brokers who make the market. These conditions can lead to market distortions and prevent investors from accurately calculating risk when making investments, potentially leaving them more exposed than they understand or wish to be. That is why we have undertaken a concerted effort to study the municipal securities market. Last year, Chairman Schapiro asked me to lead an initiative to review the state of the municipal market by gathering input from market participants and identifying ways in which the Commission can improve the state of the market for investors. Today’s hearing is the third in a series of field hearings designed to elicit the analyses and opinions of a broad array of participants in the municipal market -- our first hearing was in San Francisco last September, and our second was held in Washington, DC in December. We scheduled these hearings because we believe policy-makers should be informed by experiences of those who live and work outside of Washington, D.C. This is particularly true with respect to municipal securities, given their impact on local communities and retail investors. In addition to these field hearings, our team has spent a tremendous amount of time over the past year meeting and speaking with interested parties on issues spanning from disclosure to accounting to market dynamics to credit ratings, and beyond. I can say from experience –- having participated in most of these meetings –- that this has been an extremely interesting, informative and rewarding process. As we draw to the close of the “information gathering stage” of our initiative, Commission staff will begin to prepare a report concerning what we have learned, including their recommendations for further action that we should pursue. These may include recommendations for changes in legislation, regulations, and industry practice. A BROADER IMPACT The SEC’s focus is and should be on protection of investors. However, investors who place their funds in municipal securities often are also residents and taxpayers of those municipalities. And, investors, taxpayers and municipal officials often have the same concerns about transparency and fair dealings in municipal finance. The case that may most starkly illustrate the alignment of investor and taxpayer interests happened right here, in Jefferson County. In 2009, an SEC enforcement action resulted in a settlement with JP Morgan, which we asserted used corrupt political contacts to win the role of underwriter for sewage system bond offerings -- and then helped Jefferson County enter into some of the financing and refinancing strategies that cost county ratepayers hundreds of millions of dollars. As a result of the SEC action, JP Morgan paid a $25 million penalty, which was sent to Jefferson County, and also paid Jefferson County an additional $50 million in compensation. And, most significantly, JP Morgan agreed to cancel more than $647 million in claimed termination fees. But, I strongly suspect that enforcement alone is cold comfort to many of those who have been affected by what has happened in Jefferson County. As you know, this has been a particularly difficult time. Over the past month, the County has been operating under a standstill agreement, in an attempt to avoid filing for bankruptcy. While our project began over a year ago, the confluence of events highlights the importance of municipal securities not only to the securities market and investors, but also to communities and taxpayers. It reinforces the fact that investors need to get good information from municipalities, and municipalities need to get fair and honest advice from financial professionals. We are here to explore whether investors need additional tools so that they can make better decisions and whether regulators need additional tools to do their best to enhance the soundness of, and investor confidence in, the municipal securities markets. OVERVIEW OF TODAY’S HEARING Today’s panels will focus on issues related to distressed communities, small issuers, disclosure, derivatives and pre-trade price transparency. Our first panel on distressed communities will explore some of the causes of financial distress for municipalities, the options available to distressed municipalities, including bankruptcy, and the consequences of various courses of action. Next, our panel on small issuers will provide an opportunity to hear about the practical implications of issuer size on issuers’ activities in the market, their interactions with financial intermediaries and their ability to meet regulatory requirements. And, our panel on derivatives will touch on municipal entities’ use of derivatives, municipal officials’ understanding of derivatives’ risks, the role of other market participants in municipal derivatives, and disclosures relating to these complex agreements. We will also be addressing the two topics that have been our principal areas of focus: disclosure and pre-trade price transparency. On disclosure, we have heard consistently that investors need more timely and accurate information from issuers in order to make informed decisions. On the other hand, we hear from issuers about the practical limitations they face: difficulties aggregating fiscal information from constituent governments, resource constraints and other challenges. Our panel on disclosure will feature issuer and investor representatives, and I look forward to an engaging discussion exploring both sides’ perspectives. Regarding pre-trade price transparency, investors tell us that they face challenges because municipal securities – like other types of bonds – are traded for the most part through decentralized, dealer intermediated, over-the-counter markets. Unfortunately, information about quotes and trading interest in these markets is not readily available to retail investors. Great strides have been made in terms of post-trade transparency of information in the last few years, thanks to real-time reporting and the EMMA system available via the website of the Municipal Securities Rulemaking Board, or MSRB. However, because of the low liquidity levels of many municipal bonds, trade data can be weeks or months old –- and, therefore, not very helpful to investors who are trying to assess bond pricing. Investors need better information and better access both to tap liquidity and to provide it. Our panel on pre-trade price transparency will focus on the existing landscape for pricing information in the municipal market, and ways in which the market can move toward giving investors better information, and consequently, greater confidence in pricing. We have gathered an impressive group of knowledgeable individuals representing a wide spectrum of viewpoints for all our panels today, and I am confident that they will shed light on –- and advance the discussion of –- all of these important issues. What we hear from today’s panelists, along with what we have gleaned from our prior hearings and countless meetings and conference calls, will be instrumental in informing the recommendations that will be included in the SEC staff report. INTRODUCTIONS And now, let me introduce you to my colleagues who are here with us today. I am joined at this table by Robert Cook, the Director of the Division of Trading and Markets, the Division that helps the Commission carry out its mission of maintaining fair, orderly, and efficient markets for the benefit of investors. Robert’s division currently houses the SEC’s Office of Municipal Securities. Our role will be to listen, learn and engage with the panelists by asking questions. And, in addition to welcoming you, I must remind you, on behalf of myself and all other Commission participants, of the Commission's standard disclaimer –- that is that our remarks today represent our own views, and not necessarily those of the Commission, other Commissioners, or members of the staff.1 The moderators of today's panels are Dave Sanchez, Attorney-Fellow, Office of Municipal Securities, Division of Trading and Markets; Amy Starr, Chief, Office of Capital Market Trends, Division of Corporation Finance; and Alicia Goldin, Special Counsel, Office of Chief Counsel, Division of Trading and Markets. My appreciation goes as well to my counsels Cyndi Rodriguez and Lesli Sheppard who have been by my side throughout this effort, to the entire team of municipal securities experts at the Commission – including Will Hines, from the Division of Corporation Finance and Suzanne McGovern from the Office of Compliance, Inspections and Examinations – who are here with us today; and to all of those who are busy at work back in DC, including Rachel Hurnyak from Chairman Schapiro's office who has handled the logistics for all of our hearings. Rachel has been incredibly helpful to us up until her very last day at Commission headquarters –- which happens to be today –- and we will miss her greatly. We also want to thank Ammani Nagesh, from Chairman Schapiro’s office -- who probably greeted you as you walked in today –- and who is ensuring that today’s event runs smoothly. And, we are happy to be joined as well by the Director of the Commission’s Atlanta Regional Office, Rhea Dignam, as well as Peter Diskin from that office, Judy Burns from the Office of Public Affairs and our audio-visual experts, Myron Fears and Tony Cook. I would also like to welcome and introduce our fellow regulators in attendance: from the MSRB, we have Ernie Lanza, Deputy Executive Director and General Counsel and from the Financial Industry Regulatory Authority (“FINRA”), we have Malcolm Northam, Director of Fixed Income Securities. The MSRB and FINRA, as you know, play critical roles in regulating professionals who operate in the municipal market and their assistance has been invaluable. Also participating in today’s event are former SEC Commissioner Rick Roberts and the Director of the Alabama Securities Commission, Joe Borg. We have with us as well a number of other highly knowledgeable state and local officials — Luther Strange, Alabama Attorney General; Bob Scott, Assistant City Manager and Chief Financial Officer of the City of Carrollton, Texas; Charlie Duggan, City Manager of the City of Auburn, Alabama; Ben Watkins, Director of the Division of Bond Finance for the State of Florida; and Mary-Margaret Collier, Director of the Office of State and Local Finance in the State of Tennessee. I am also delighted that Treasurer David H. Lillard from the State of Tennessee and, I believe, a number of Jefferson County Commissioners are in the audience today. And of course, we are extremely grateful to all of our panelists for agreeing to participate in our field hearing – many of whom have travelled in order to join us today. Thank you. Last, but not least, I’d like to thank Chairman Bachus for taking a strong interest in these important issues. We very much appreciate the assistance that Chairman Bachus’s staff has provided as we planned this hearing, and we are pleased that Larry Lavender, Walton Liles and Kevin Edgar are here with us today. I would now like to welcome Larry Lavender to make a few remarks this morning. [Larry Lavender Remarks] Thank you, Larry. I will conclude by providing a brief overview of the mechanics of today’s hearing. STRUCTURE OF TODAY’S HEARING AND OTHER LOGISTICS We have an exciting agenda for today –- packed with interesting and timely topics. The format of today's field hearing will entail five panels. As moderators, Dave, Amy and Alicia will introduce their topics and panelists. Each panelist will then make brief opening remarks. Following the opening remarks, the panelists will be asked questions by the moderator and those of us at this table. We will look to each panel to help us to understand better the particular concerns of different market participants, highlight key areas for improvement, and provide some concrete ideas for moving forward. At our past hearings, panelists have engaged with us and with each other in candid and lively discussions, and I look forward to similar engagement today. A few housekeeping items before we begin. First, we'd like to ask the panelists, moderators, and other questioners to please stand your nameplate vertically when you would like to speak. Second, there will be a lunch break from 12:30 to 2 p.m. There are a number of restaurants within walking distance of Rosewood Hall. Our last panel of the day will conclude by 4:00 p.m. A live video stream of this hearing is available on the Commission’s website. Additionally, a written transcript of today's event will be made available on the Commission's website, as well as any written statements and presentations provided by the panelists. Finally, we encourage investors and all other interested parties to submit comments related to the municipal securities market by using the comment form on the SEC website or sending an e-mail to munifieldhearings@sec.gov. Again, we’re so pleased that you are here today and hope this will prove to be an enlightening experience for all. I will now turn it over to Dave to start our first panel. Endnotes 1 The Securities and Exchange Commission, as a matter of policy, disclaims responsibility for any private publications or statements by any of its employees. The views expressed herein are those of the author and do not necessarily reflect the views of the Commission, other Commissioners, or the staff."

FDIC TAKES OVER VIRGINIA BUSINESS BANK

The following excerpt is from an e-mail sent out by the FDIC: Virginia Business Bank, Richmond, Virginia, was closed today by the Virginia State Corporation Commission. The Federal Deposit Insurance Corporation (FDIC) was appointed as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Xenith Bank, Richmond, Virginia, to assume all of the deposits of Virginia Business Bank. The sole branch of Virginia Business Bank will reopen on Monday as a branch of Xenith Bank. Depositors of Virginia Business Bank will automatically become depositors of Xenith Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Virginia Business Bank should continue to use their existing branch until they receive notice from Xenith Bank that it has completed systems changes to allow other Xenith Bank branches to process their accounts as well. This evening and over the weekend, depositors of Virginia Business Bank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual. As of March 31, 2011, Virginia Business Bank had approximately $95.8 million in total assets and $85.0 million in total deposits. In addition to assuming all of the deposits of the failed bank, Xenith Bank agreed to purchase essentially all of the assets. Customers with questions about today's transaction should call the FDIC toll-free at 1-800-837-0215. The phone number will be operational this evening until 9:00 p.m., Eastern Daylight Time (EDT); on Saturday from 9:00 a.m. to 6:00 p.m., EDT; on Sunday from noon to 6:00 p.m., EDT; and thereafter from 8:00 a.m. to 8:00 p.m., EDT. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/vbb.html. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $17.3 million. Compared to other alternatives, Xenith Bank's acquisition was the least costly resolution for the FDIC's DIF. Virginia Business Bank is the 59th FDIC-insured institution to fail in the nation this year, and the first in Virginia. The last FDIC-insured institution closed in the state was Imperial Savings and Loan Association, Martinsville, on August 20, 2010."