Client Notification

New Fees for CMA and IRA Accounts through Merrill Lynch Direct^®

Effective July 1, 2005, new account maintenance and custodial fees will be implemented for Merrill Lynch Direct clients who have low-balance and/or inactive (low trading activity) Merrill Lynch Direct Cash Management Accounts^® (CMA^® account) and/or Traditional or Roth individual retirement accounts (IRAs). These fees will be collected by direct deduction from the affected CMA and IRA accounts, which may require the liquidation of securities positions if there are not sufficient available funds, and will not be billed separately. These new MLD fees are in line with industry pricing for online accounts.

If you have a CMA account, unless a waiver applies as set forth below, an account maintenance fee of $25 will be assessed on the first day of each calendar quarter, based on the account’s valuation on the last day of the previous quarter and the trading activity of the previous six months. Valuation of the account will be based on the long market value of securities and deposit balances with the Merrill Lynch banks, plus the outstanding amount of any indebtedness to Merrill Lynch or any of its affiliates (i.e., margin balances, mortgages, etc.). The new CMA fee will not be charged until the first quarter after the account has been opened for a year.

The CMA account maintenance fee will be waived in any quarter for any Merrill Lynch Direct CMA account that is part of a client household (i.e, accounts that are linked to the same family household address) if any one of the following conditions apply:

Households that have more than $25,000 in total assets at Merrill Lynch.
Households that have more than $15,000 in total mutual fund assets at Merrill Lynch.
Households that have made at least two equity, debt or option trades through their Merrill Lynch Direct accounts within the previous six months.

If you have a Traditional or Roth IRA account, the minimum annual custodial fee of $50 (as described in the Traditional and Roth IRA Disclosure Statements, available on the Merrill Lynch Direct website under Agreements and Disclosures) will be charged. The custodial fee will be deducted from your IRA during the last month of the calendar quarter containing your account opening anniversary date. For IRAs opened after April 1, 2005, the first year's fee will be charged in the quarter following the account opening,

The annual IRA custodial fee will be waived for any IRA account that is part of a client household (as described above) that has more than $20,000 in total assets at Merrill Lynch based on the valuation of the accounts on the last day of the previous quarter. Valuation of the account will be calculated in the same manner as described above for the CMA account maintenance fee.

If you have any questions, call Merrill Lynch Direct at 1-877-ML-DIRECT (653-4732) Monday – Friday 8:00 a.m. through 7:00 p.m. ET.