📑📑📑I have translated 'SR-NSCC-2021-004-Approval-Notice' into apespeak for anybody that want's to read along. 🐵🐵🐵
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| Author       | Source       | 
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|  [u/Dannyboi93](https://www.reddit.com/user/Dannyboi93/) | [Reddit](https://www.reddit.com/r/GME/comments/mhx3p8/i_have_translated_srnscc2021004approvalnotice/) | 

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[DD 📊](https://www.reddit.com/r/GME/search?q=flair_name%3A%22DD%20%F0%9F%93%8A%22&restrict_sr=1)

Quick note, original text is in the blocks, mine is in italics, and I randomly switch between their 1st person and my 1st person and I can't be bothered to go through putting quotation marks to differentiate so you'll have to figure it out for yourself. Similarly, I am just an ape who shoves crayons in his butt, takes pictures, uploads them to /r/ buttcrayons of which I am the only real member and then I upvote them with alts and comment on them to boost my own self-esteem. Similarly, if anybody wants to chime in (on the article, not my ass) then feel free to point shit out and I will amend it, there are a few points in there were I need somebody with more wrinkles to clarify what they mean.

Anyway...

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Section 1, the really complicated f-cking way to just say hello...

> Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 ("Act")1 and Rule 19b-4 thereunder, 2 notice is hereby given that on March 23, 2021, The Depository Trust Company ("DTC") filed with the Securities and Exchange Commission ("Commission") the proposed rule change as described in Items I, II and III below, which Items have been prepared by the clearing agency. DTC filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act3 and Rule 19b-4(f)(4) thereunder. 4 The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.

"*Because we have to tell you, incase you want to comment on it. We filed a change to some regulations."*

> The proposed rule change5 consists of amendments to the R&W Plan to (i) reflect business and product developments, (ii) make certain changes to improve the clarity of the Plan, (iii) remove provisions covering certain "business-as-usual" actions, and (iv) make certain technical corrections, as described in greater detail below.

"*We're changing the rules on the R&W plan because of all the shit that's currently going on." (The R&W plan is a plan of what to do when the NSCC is in jeopardy.)*

> In its filing with the Commission, the clearing agency included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The clearing agency has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.*We've talked about this previously, here is proof.*The proposed rule change would amend the R&W Plan to (i) reflect business and product developments, (ii) make certain changes to improve the clarity of the Plan, (iii) remove provisions covering certain "business-as-usual" actions, and (iv) make certain technical corrections. Each of the proposed revisions is further described below.

*"As you can see, shit is currently hitting the fan so we're changing some of the rules to protect ourselves."*

Section 2, here's some info on the R&W plan.

> The R&W Plan was adopted in August 20186 and is maintained by NSCC for compliance with Rule 17Ad-22(e)(3)(ii) under the Act.7 The R&W Plan sets forth the plan to be used by the Board and NSCC management in the event NSCC encounters scenarios that could potentially prevent it from being able to provide its critical services as a going concern. The R&W Plan is structured as a roadmap that defines the strategy and identifies the tools available to NSCC to either (i) recover, in the event it experiences losses that exceed its prefunded resources (such strategies and tools referred to herein as the "Recovery Plan") or (ii) wind-down its business in a manner designed to permit the continuation of NSCC's critical services in the event that such recovery efforts are not successful (such strategies and tools referred to herein as the "Wind-down Plan"). The recovery tools available to NSCC are intended to address the risks of (a) uncovered losses or liquidity shortfalls resulting from the default of one or more of its Members, and (b) losses arising from non-default events, such as damage to NSCC's physical assets, a cyber-attack, or custody and investment losses, and the strategy for implementation of such tools. The R&W Plan also describes the strategy and framework for the orderly wind-down of NSCC and the transfer of its business in the event the implementation of the available recovery tools does not successfully return NSCC to financial viability.

*The R&W plan was enacted in August 2018, the plan conerns the National Securities Clearing Corporation (NSCC). This plan is for when the NSCC can't do it's job. (The NSCC are responsible for being the middle man for broker-to-broker trades. So essentially this plan is for when the NSCC can no longer do that.) The plan is a roadmap and it tells the NSCC what they can do to get shit back on track.* *This includes members defaulting, and all sorts of other shit, but mostly defaulting.* *Additionally, it also tells the NSCC how to shut up shop and transfer their business to somebody else. (Yo, what the f--k does that mean? I'm purely speculating here, but does that mean they can privatise the NSCC? Sell it to the highest bidder if shit doesn't work out?)*

> The R&W Plan is managed and developed by NSCC's parent company, the Depository Trust & Clearing Corporation ("DTCC"),8 and is managed by the Office of Recovery & Resolution Planning (referred to in the Plan as the "R&R Team") on behalf of NSCC, with review and oversight by the DTCC Management Committee and the Board.

*The plan was made by the DTC, NSCC's dad, and is enforced by him and also the ORRP, NSCC's step-mom, they like to call themselves the "R&R Team" (What the f--k does that even mean? "The R&R Team" sounds like some sort of corporate bogeyman.)*

Section 3 -- so what's getting changed then? Sub-section A1.

*Changes to reflect all the shit going on right now.*

> The Board, or such committees as may be delegated authority by the Board from time to time pursuant to its charter, is required to review and approve the R&W Plan biennially.9 In connection with the first biennial review of the Plan, NSCC is proposing the revisions described in greater detail below. The proposed rule change is designed to update and enhance the clarity of the Plan to ensure it is current in the event it is ever necessary to be implemented. None of the proposed changes modify NSCC's general objectives and approach with respect to its recovery and wind-down strategy as set forth under the current Plan.*The board, and whoever the board says, are to review the plan every two years. We're going to talk about it below, it's so we can edit it and make sure it suits our needs should it ever need to be implemented. We're still cool though. Everything is all good.*NSCC is proposing the following changes to the DTCC Business Profile, Intercompany Arrangements, FMI Links and Governance sections of the Plan based upon business updates that have occurred since the time the Plan was adopted.

*In the plan, we wanna change our bio, some stuff we agreed on earlier, and we want to change how some of us are connected to each other, (or atleast contractually) and we want to change what the plan tells us to do.(Note: here's a link on what an FMI actually is,* (link in comments) ,an FMI link is, from my basic understanding, a contract or agreement that links FMIs together.)

> Section 2.1 (DTCC Business Profile) of the Plan describes that DTCC is a user-owned and user-governed holding company for a group of direct and indirect subsidiaries and joint ventures. This section includes a brief summary of each of the three subsidiaries (DTC, FICC and NSCC) that have been designated as systemically important financial market utilities ("SIFMUs") by the Financial Stability Oversight Council. The proposed rule change would revise the introductory paragraph of this section to remove reference to joint ventures because DTCC currently has no joint ventures. Section 2.4 (Intercompany Arrangements) of the Plan currently describes how corporate support services are provided to NSCC from DTCC, and to DTCC's other subsidiaries through intercompany agreements under a shared services model. NSCC is proposing to update Table 2-A (SIFMU Legal Entity Structure and Intercompany Agreements), which delineates NSCC's affiliates, to reflect the name change of Omgeo Pte Ltd by removing "Omgeo Pte Ltd" and replacing it with the new name of this entity, "DTCC Singapore Pte. Ltd." A related footnote would also be added to make clear that the services provided by DTCC Singapore Pte. Ltd. are performed through its branch office in Manila, DTCC Manila. Additionally, this section includes a separate table, Table 2-B, that lists each of the DTCC facilities utilized by the Clearing Agencies and indicates whether the facility is owned or leased by DTCC. NSCC proposes to update this table to add Boston, Massachusetts as an additional location of a DTCC facility and to indicate that this facility is leased by DTCC.

*The beginning of the plan says we have joint-ventures, but we don't anymore. We are supported by a company called Omgeo Pte Ltd, (**link in comments*) *but now they've changed their name to DTCC Singapore Ltd, so put that in the plan too. Also put in the plan that their branch office is in Manila. Also, there's a table that tells you where our buildings are, utilized (by our?) Clearing Agencies, we have added two new buildings. One in Boston, one in Massachusetts.*

> Currently, Section 2.5 (FMI Links) of the Plan describes some, but not all, of the key financial market infrastructures ("FMIs"), both domestic and foreign, that NSCC has identified as critical "links."10 In order to better align with the structure of DTCC's inventory of links maintained by DTCC's Systemic Risk Office ("SRO"), which includes all of NSCC's link relationships, the proposed rule change would delete the current "FMI Links" section of the R&W Plan and replace it with a revised version of Section 2.5 that would include an overview of NSCC's link arrangements, a related footnote to the definition of a "link" under Rule 17Ad-22(a)(8) under the Act, and a table (Table 2-C: Links) listing all of NSCC's FMI link arrangements. The table would list the link, the link category (i.e., whether the link is a central counterparty, settlement interface, or matching utility), and a brief description. The proposed rule change would also add a table (Table 2-D: Schedule A Relationships) that would identify certain critical external service providers that, as determined by NSCC's management, do not meet the specified criteria of "link" but nevertheless are subject to the same review process as is conducted for links, referred to within NSCC as "Schedule A Relationships," and a related footnote. This change would align with the structure of SRO's inventory of Schedule A Relationships.

*So we have a better idea of risk, we want to amend the table to include more info on our FMI Links. We wanna add another table too, that documents all the 3rd parties we work with that could get us in shit. We just wanna document everybody we work with, just in case.*

> Section 4.3 (Recovery and Wind-down Program Governance) of the Plan currently contains a paragraph that identifies DTCC's "R&R Steering Group" as the internal group responsible for ensuring that each of the Clearing Agencies observes recovery planning requirements, and that recovery planning is integrated into the Clearing Agencies' overall governance processes including the preparation, review, and filing of the Clearing Agencies' R&W Plans. Pursuant to the proposed rule change, NSCC would revise Section 4.3 to reflect an internal organizational name change. The proposal would change the name of the R&R Steering Group to the "Recovery and Wind-down Planning Council" to reflect its role as an advisory body.11 This name change would not change the composition, role or responsibilities of this internal group, which includes selected members of DTCC's Management Committee and members of DTCC's financial and operational risk management, product management, legal, and treasury/finance teams that are responsible for providing strategic guidance and direction for the recovery and wind-down program12 and the Plan. Additionally, for purposes of clarification, the proposal would add the words ", where necessary," to refer to when the council would engage with internal working groups.

*We wanna change the name of a group who work for us because they've changed their name because it sounds better, but it doesn't change what they do. (That last bit seems to give them wiggle room somewhere, but I don't know what for.)*

> Section 5.3 (Liquidity Shortfalls) of the Plan identifies tools that may be used to address foreseeable shortfalls of NSCC's liquidity resources following a Member default. The goal in managing NSCC's qualified liquidity resources is to maximize resource availability in an evolving stress situation, to maintain flexibility in the order and use of sources of liquidity, and to repay any third-party lenders of liquidity in a timely manner. This section includes a table (Table 5-C) that lists NSCC liquidity tools and resources.13 The proposed rule change would update this section to include a reference to cash proceeds from outstanding term debt issuance in addition to the other examples of NSCC's qualifying liquid resources. A footnote would also be added providing the citation to NSCC's advance notice filing covering the term debt issuance.

*There's a section of the plan dedicated to 'Liquidity Shortfalls' it tells the NSCC what they can do when one of their members (who fund them) goes caput. We also wanna make sure we can pay 3rd party lenders in a timely manner. There's a table (table 5-c) which lists our tools and resources. The rule change we are proposing would add information on debt issues we have given out, so we can keep track of them. There'd also be a footnote stating what 'debt issuance' actually is, cos we know ya'll r------ed af.*

Sub-section B -- Clarifications to the R&W plan

> Section 3 (Critical Services) of the Plan defines the criteria for classifying certain of NSCC's services as "critical,"15 and identifies such critical services and the rationale for their classification. The identification of NSCC's critical services is important for evaluating how the recovery tools and the wind-down strategy would facilitate and provide for the continuation of NSCC's critical services to the markets it serves. This section also includes a list of indicative non-critical services.

*We clarify what a 'critical service' actually is. We do this because we need to get critical services up and running before anything else.*

> This section includes a table (Table 3-B: NSCC Critical Services) that lists each of the services, functions or activities that NSCC has identified as "critical" based on the applicability of the criteria. As more fully described below, the proposed rule change would clarify in Table 3-B the description of some of the critical services and update the table to include an additional critical service. While the clarifying changes do not change the classification of the relevant service (as being either "critical" or "indicative non-critical"), nor impact the existing classification of other services, NSCC believes these revisions would enhance the clarity of the descriptions of them.

*There's a table with some shit about critical services, we wanna further clarify what they are and add something to it. (I presume to give them some wiggle room for whatever reason.)*

> First, the proposed rule change would revise the entries for "3. Obligation Warehouse" and "10. CNS/Prime Broker Interface" to delete the check mark denoting the lack of alternative providers and products as one of the determinants for its classification as a critical service. Second, the proposed rule change would replace the name of the service identified in the current plan as exchange-traded fund "5. ETF" to exchange-traded products "5. ETPs" in order to more accurately align with the scope of what is covered by these services. Third, currently the critical service "6. ACATS"16 is described as "A service under which Members can transfer their customers' assets from one brokerage account and/or bank to another, while processing through CNS." The proposed rule change would add at the end of this description the phrase ", DTC, Obligation Warehouse, OCC and others," in order to include a more comprehensive description of this service. Fourth, in the description of "11. Balance Order Netting," the proposed rule change would delete the phrase "balance order transactions" and replace it with "Balance Order Contracts" because it is a defined term under the Rules.17

*(F--k me this is a lot of words. I'm gonna bullet point this.)* *So*

-   *they're allowing themselves to (I believe) use 3rd parties in the event of an emergency for broket2broker transactions.*

-   *Don't know why, but this used to include ETFs, now its exppanded to include ETPs -- I assume for more wiggle room. Essentially it just adds ETNs to the equation* *(link in comments)*

-   *Rewording some descriptions of stuff to better clarify what they are, with regards to transactions between brokers.*

-   *Right now this last part is weird, not the rule change, but of what it actually is. We need to clarify a few things here.*

    -   *A balance order is a "trade settlement instruction generated for*

        -   *a Non-CNS security"* *a non-CNS security is a security that has been traded without the DTCC acting as a middle man (I think, somebody please verify this.)*

    -   *netting is when I owe you £2, but you owe me £3, instead of giving you 2 to give me 3 back you just give me 1 and we call it squits.*

> Also, the proposed rule change would update Table 3-B (NSCC Critical Services) to add "Account Information Transmission" ("AIT"). This new entry would include in the description of AIT18 that it is being enhanced in support of the bulk transfer initiative, which is an industry effort designed to prepare carrying broker-dealers for an emergency mass transfer of large quantities of customer accounts and assets from a distressed broker to a financially secure broker.19 In the column that delineates the determinant for its classification as a critical service, this new entry would have a check mark that denotes this is because of a lack of alternative providers and products.

*This one is pretty self-explanotory, my question is -- why would a stock broker move everything to another broker, I thought if a broker defaulted everything was lost?*

> Section 5 (Member Default Losses through the Crisis Continuum) of the Plan is comprised of multiple subsections that identify the risk management surveillance, tools, and governance that NSCC may employ across an increasing stress environment, referred to as the "Crisis Continuum."20 This section currently identifies, among other things, the tools that can be employed by NSCC to mitigate losses, and mitigate or minimize liquidity needs, as the market environment becomes increasingly stressed. As more fully described below, the proposed rule change would clarify certain language."

*We have a section for when shit gets real, and it tells us what to do. We just wanna clarify some language."*

> Section 5.2.1 (Stable Market Phase) describes NSCC's risk management activities in the normal course of business. These activities include (i) the routine monitoring of margin adequacy through daily evaluation of backtesting and stress testing results that review the adequacy of NSCC's margin calculations, and escalation of those results to internal and Board committees and (ii) routine monitoring of liquidity adequacy through review of daily liquidity studies that measure sufficiency of available liquidity resources to meet cash settlement obligations of the Member that would generate the largest aggregate payment obligation. Further, under the heading "Market Risk Monitoring and Stable Market Indicators," this section states that the amount of Clearing Fund required from each Member is determined principally by Value-at-Risk ("VaR") calculations,21 and that in order to ensure the VaR model accurately reflects market conditions and provides adequate protection against market risk, NSCC evaluates several factors on an ongoing basis.

*We do tests and calculations and stuff on risk, and we monitor our members to make sure they have assets to pay in accordance with how risky we deem their activities.*

> The proposed rule change would remove the following factor as one of those evaluated, because it is no longer part of NSCC's model calculation, "Implied volatility to assess whether a potential increase in market price volatility may not be fully incorporated in the historical price moves."22 The elimination of the language regarding implied volatility provides a more accurate representation of the risk model calculation. Consistent with the above, NSCC would also remove the paragraph in this section that states that implied market price volatility as measured by benchmarks such as the VIX index does not indicate material changes in market price volatility are expected.

-   *We're removing a factor because we don't use it in our model calculations anymore.*

-   *We're removing the sentence "Implied volatility to assess whether a potential increase in market price volatility may not be fully incorporated in the historical price moves."*

-   *We're removing it to better clarify our calculation model.*

-   *We're also removing a paragraph because we believe that implied market price volatility measured by benchmarks like the VIX index* *does* *indicate material changed in market price volatility.*

> Section 5.2.4 (Recovery Corridor and Recovery Phase) outlines the early warning indicators to be used by NSCC to evaluate its options and potentially prepare to enter the "Recovery Phase," which phase refers to the actions to be taken by NSCC to restore its financial resources and avoid a wind-down of its business. Included in this section are descriptions of potential stress events that could lead to recovery, and several early warning indicators and metrics that NSCC has established to evaluate its options and potentially prepare to enter the Recovery Phase. These indicators, which are referred to in the Recovery Plan as recovery corridor indicators ("Corridor Indicators"),23 are calibrated against NSCC's financial resources and are designed to give NSCC the ability to replenish financial resources, typically through business as usual ("BAU") tools applied prior to entering the Recovery Phase.

*There's a section about cleaning everything up after the shitstorm, and acknowledges what needs to be done to stop NSCC going under. No idea what a "stress event(s) that could lead to recovery" means though. Somebody please clarify that. But there's a section describing what those events are. This part basically seems to be, 'shit has hit the fan, here are our options'.*

> Included in this section is a table (Table 5-A: Corridor Indicators) that for each Corridor Indicator identifies the (i) measures of the indicator, (ii) evaluations of the status of the indicator, (iii) metrics for determining the status of the deterioration or improvement of the indicator, and (iv) "Corridor Actions," which are steps that may be taken to improve the status of the indicator,24 as well as management escalations required to authorize those steps. For the entry in the table for "Hedge Effectiveness," the proposed rule change would revise the text for clarity by adding to the existing description of measures of this indicator that hedge effectiveness is most relevant prior to commencing the hedging and liquidation strategy but is updated as necessary with changes in market prices and/or position liquidations. Also, the text that identifies Financial Risk Management as the internal group responsible for measuring the metrics for determining the status of the deterioration or improvement of the "Hedge Effectiveness" indicator would be revised to add that this is done with input from NSCC's investment advisor.

*I don't have a f--king scooby, on what a corridor is. Somebody please enlighten me. However, "management escalations required to authorize those steps." is mildly concerning, why would any steps need to be authorized, unless they have serious ramifications if misused. Purely speculating there. Other than that, this shit is just clarifying descriptions and such.*

> Section 5.2.4 also includes language that requires NSCC management to review the Corridor Indicators and the related metrics at least annually and modify these metrics as necessary in light of observations from simulation of Member defaults and other analyses. In order to more closely align with the biennial cycle of DTCC's multi-member closeout simulation exercise, the proposed rule change would shift the timing of management's review of the Corridor Indicators and related metrics from annually to biennially. NSCC believes this change is necessary for consistency with the cycle of the multi-member closeout simulation, in which the Corridor Indicators and metrics are assessed as part of the simulation exercise.

*Biennially just means every 2 years. So, NSCC simulates members defaulting, and then uses those metrics for their 'corridor indicators', this is just saying that, they want to reduce the frequency of those metric tests from every year to every 2 years. They have a 'multi-member closeout simulation exercise' which I assume is when they pretend all hell has let loose. And they want to align the metrics of the corridor indicators with the cycle of the hell let loose simulation.*

> There is an additional table in Section 5.2.4, (Table 5-B: Loss Waterfall Tools) that delineates the tools that comprise NSCC's loss allocation waterfall as set forth under the Rules.25 This table has four columns ("Order," "Tool," "Relevant Rules/Documents," and "Responsible Body/Personnel") and is organized by the order in which the liquidity resources are to be applied by NSCC. Within Table 5-B, Corporate Contribution is the first entry under the column labeled "Tool." Currently, the narrative for this entry includes a description of Corporate Contribution and delineates that in the event of a cease to act, before applying the Clearing Fund deposits of Members (other than the defaulting Member) to cover any resulting loss, NSCC will apply the Corporate Contribution.26 For purposes of clarity, this language would be revised to remove the words "applying the Clearing Fund Deposits of" and replace them with "charging the Members on a pro rata basis."

*There's a table going on about tools the comprise 'NSCC's Loss Allocation Waterfall'. A loss allocation waterfall, is a tiered system where expenses are taken sequentially, so money is derived from tier 1, then tier 2, etc. This states that, should the NSCC need money, they'll take Corporate Contributions first, before applying Clearing Fund Deposits of NSCC members. It's also been specified that these costs will be taken in proportionate allocation, so everybody foots the bill equally.*

> Within this same entry in Table 5-B, the proposed rule change would also revise the current text of the definition of Corporate Contribution, in order to more closely align with how this term is defined under Rule 4. Specifically, pursuant to the proposed rule change the definition of Corporate Contribution would be revised to state that, "The Corporate Contribution is an amount that is equal to 50% of the amount calculated by NSCC in respect of its General Business Risk Capital Requirement for losses that occur over any rolling 12 month period."27

*So, over a calculation period lasting 12 months, NSCC want 50% of the risk they've calculated from corporate contributions.*

> Additionally, with respect to the second entry in Table 5-B, "Loss Allocation," the descriptive text in the "Responsible Body/Personnel" column would be revised to more closely align with the same language contained in Rule 4. The revised text would state, "Members will be obligated to pay the loss allocation on the second business day after the Corporation issues any such notice and to continue to fully fund their Clearing Fund required deposits to the extent of any shortfalls."

*Members have 2 business days to pay any loss allocation (legal fees I think that means, clarification needed) after the corporation (don't know who that is) says so, they still need to pay their clearing fund any required deposits. No exemptions basically.*

*Section 3 -- Non-default Losses*

> Section 6 (Non-Default Losses) of the Plan outlines how NSCC would address losses that result other than from a Member default. This section provides a roadmap to other documents that describe these events in greater detail and outlines NSCC's approach to monitoring losses that could result from a non-default event. This section also includes a description of Rule 60 (Market Disruption and Force Majeure), referred to in the Plan as the "Force Majeure Rule,"28 which pertains to how NSCC addresses extraordinary events that occur outside the control of NSCC and its Members. As more fully described below, the proposed rule change would clarify certain language.

*This says how we address losses that aren't due to member defaults. Links to documents that expand on this are here too. Also tells us what to do when crazy crazy crazy shit happens, like if we get nuked or something.*

> Section 6.4 (Resources to Cover Non-Default Losses) provides that NSCC maintains two categories of financial resources to cover losses and expenses arising from non-default risks or events: (i) Liquid Net Assets Funded by Equity ("LNA"), including, pursuant to Rule 4, the required Corporate Contribution,29 and (ii) loss-allocation charges to Members in accordance with the provisions of Rule 4.30 Following an overview of the four buckets of LNA which can be applied towards non-default losses,31 there is a paragraph under the heading "Loss Allocation to Members, backed by the Clearing Fund" that provides that non-default losses could be allocated among Members as provided in Rule 4. There is sentence that describes the timeframe in which such losses charged to Members are required to be paid. Currently, this sentence states that losses are to be paid by Members "within 2 business days of the date of receipt of a notice of a loss allocation charge . . . ." However, this is not the same language used to describe this timing in Rule 4. In order to be consistent with the language formulation set out in Rule 4, the proposed rule change would revise this sentence to state, "Losses charged to Members are required to be paid by Members on the second business day after the Corporation issues any such notice of a loss allocation charge and, if not timely paid by any Member, the Corporation may treat that Member as having failed to satisfy its obligation and apply the Clearing Fund deposit of that Member to satisfy its loss allocation obligation."32

-   *This is about resources they have to cover losses from non-default shit. Two categories:*

    -   *Liquid Net Assets Funded by Equity (LNA) which also includes required Corporate Contributions.*

    -   *Loss Allocation charges*

-   *There are 4 buckets of LNA to use for non-default shit*

-   *Non-default losses may be charged to members*

-   *then just some language clarification*

> Section 6.6 (Market Disruption and Force Majeure Rule) describes the Force Majeure Rule. The Force Majeure Rule was adopted at the same time as the Plan33 and provides an additional resiliency tool designed to mitigate the risks caused by market disruption events and thereby minimize the risk of financial loss that may result from such events. The proposed rule change would remove the following phrase after the reference to the Force Majeure Rule in the first paragraph of this section, ", adopted in conjunction with this Plan," because it is not necessary as both the Plan and the Force Majeure Rule are no longer newly adopted. In addition, to remain consistent with the usage of "Force Majeure" and "Market Disruption Event" throughout this section, NSCC would conform all references to the defined terms "Force Majeure" and "Market Disruption Event," so that they appear as capitalized terms.

*We have an additional tool at our disposal to mitigate risk crazy shit, like being nuke (didn't specifically mention that but that's an example), or a zombie apocalypse. Yea just language clarification shit.*

> The proposed rule change would also make revisions to the second paragraph of Section 6.6. First, for purposes of clarity and readability, the following text would be removed from the beginning of the second sentence: "Most FMIs have rules designed to deal with force majeure or market disruption events, and." Second, the reference to "Superstorm Sandy" would be removed from the last sentence of this paragraph along with the related footnote that references Superstorm Sandy as an example of circumstances in which NSCC needed to fashion a work-around necessitated by a force majeure event. NSCC believes inclusion of references to Superstorm Sandy are outdated and no longer necessary to be included in the Plan.

*We mentioned superstorm sandy as one of the aforementioned 'crazy shits' but that's not relevant now.*

> Remove Provisions Covering Certain "Business-as-Usual" Actions Section 8.6 (Actions and Preparation) of the Plan sets forth the legal framework and strategy for the orderly wind-down of NSCC if the use of the recovery tools described in the Recovery Plan do not successfully return NSCC to financial viability. This section includes an overview of the actions and preparations to be taken by NSCC and DTCC in connection with executing the wind-down portions of the Plan. Section 8.6.1 (Business-as-Usual Actions) describes those actions that NSCC or DTCC may take to prepare for wind-down in the period before NSCC experiences financial distress.

*This section is what to do when we f--k up big time and we are going bye bye.*

> Under the current plan, the Business-as-Usual Actions are (i) educating the Board to keep them informed of the Plan and the actions the Board would need to take to implement it, (ii) engaging in discussions with key linked FMIs as to the key elements of NSCC's wind-down strategy and the expected actions of the respective link parties should a wind-down be implemented, (iii) developing and maintaining an index of internal data that includes the critical, ancillary, and non-critical services that NSCC provides to its membership, the support NSCC receives from DTCC and from its other affiliates, key third-party vendors, key personnel, NSCC assets and liabilities, and agreements and arrangements NSCC has with liquidity providers and with other FMIs, (iv) developing administrative wind-down guidance that identifies key Board and management actions that would be taken during the Recovery Phase and "Runway Period"34 prior to NSCC's failure, and in connection with its Chapter 11 proceedings, and (v) preparing constituent documents for the Failover Entity35 and evaluating capitalization options.

*Our BUA actions are:*

-   *tell the board what the plan is, and tell them what they need to do*

-   *tell the FMIs that the wind-down is happening, should it need to* *record everything happening*

-   *Guide the closedown of the NSCC*

-   *Prepare for next steps, whether we close or sell off to somebody else.*

> Pursuant to the proposed rule change, NSCC would remove the Business-as-Usual Actions section (currently Section 8.6.1) in its entirety because each of the actions outlined have either been completed or would be addressed in NSCC's internal procedures going forward. This includes certain documents necessary to effect the wind-down aspects of the Plan that were in the process of being finalized when the Plan was adopted and have since been completed. Since adoption of the Plan,36 NSCC has completed all necessary internal documentation, including DTCC's internal wind-down guidance, the constituent documentation for the Failover Entity, and the evaluation of NSCC's capitalization options. Further, the other actions included in this section (e.g., maintaining an index of non-critical services, educating the Board on the Plans) would be addressed, going forward, in DTCC's Recovery & Resolution Planning Procedures maintained by the R&R Team.37 As a result of this proposed change, current Section 8.6.2 (Recovery and Runway Period Actions) would be renumbered as Section 8.6.1. Also, consistent with the proposed removal of Business-as-Usual Actions that have been completed, the proposed rule change would remove from the first sentence of proposed Section 8.6.1 (current Section 8.6.2) the words "Among other things, the guidance would provide" and replace them with "The DTCC Clearing Agency Wind-down Guidance developed in connection with this Plan provides."

*We're getting rid of the BUA's because they're already available somewhere else in whatever document.*

*Closing notes: That's it, there are some mumbo-jumbo shit after that I'm going to go over. It's mostly technical stuff like changing random words and punctuation but I wanna make sure it's not massively altering anything. So if it's relevant I'll do a part 2.*

TL;DR - Mostly just language clarification shit, nothing particularly alarming, but there were some interesting insights into how the NSCC works. Also included are some links for technical shit you probably didn't know about, that'll give you some more wrinkles.
