On November 28, 2005 certain subsidiaries of Federated Investors, Inc. (the Respondents) reached a settlement with the United States Securities and Exchange Commission. The settlement concerned allegations that two (2) of the Respondents entered into arrangements with certain Federated mutual fund investors that resulted in market timing in certain Federated mutual funds during the period of March 2002 through September 2003. Also, there were allegations that one of the Respondents allowed a Federated mutual fund investor and a Federated employee to engage in late trading for the period of July 1998 through September 2003. The Respondents agreed to the settlement without admitting or denying the SEC’s findings.

Market timing includes frequent buying and selling of shares of the same mutual fund or the rapid buying and selling of mutual fund shares in order to exploit inefficiencies in mutual fund pricing. While not illegal per se, this practice can harm other mutual fund shareholders because it can dilute the value of their shares or it can disrupt the management of the mutual fund’s investment portfolio, which can cause the specific mutual fund to incur costs borne by other shareholders to accommodate the timer’s frequent buying and selling.

You have 3 options with this check:

The Federated Funds

ATTN: FED

P.O. Box 8600

Boston, MA 02266-8600

If your IRA account is with a custodian other than Federated you can forward this check with a letter of instruction to your current custodian and the funds will be deposited into your IRA account. Be sure to include your current account number with the correspondence. A mailing address may be listed on your most recent balance statement or you might need to contact your current custodian for an address.

b. Your current account number

We will return the new check to you so you can forward it to your new custodian with a letter of instruction explaining that the check is a return of capital and you want the funds deposited into your IRA account.

b. Include in your letter of instruction your date of birth

c. Complete and return the appropriate reissue form (substitute W-4P/w-9) that can be found in the Tax Information section of this website

d. All applicable Federal taxes and penalties will be deducted from your check as well as any required state taxes

e. Send this information to the following address:

Federated Investors

Settlement Administration

PO Box 9127

Canton, MA 02021-9127

You should consult with your financial advisor or tax professional prior to cashing this check to determine the potential tax consequences and appropriate tax treatment for your particular situation.

Yes, you may reinvest the check into your account by endorsing the check and sending a letter of instruction with your account number to:

The Federated Funds

ATTN: FED

P.O. Box 8600

Boston, MA 02266-8600

This is a real check. It was drawn from the Federated Investors Fair Fund. By cashing this check you are not obligating yourself to anything. You received your payment because the Independent Distribution Consultant identified you as an eligible shareholder of one or more of the funds involved in this settlement. On November 28, 2005 certain subsidiaries of Federated reached a settlement with The United States Securities and Exchange Commission regarding issues related to market timing. The check you received is your share of the Settlement distribution.

The settlement terms that were agreed to by the Respondents include payment of $72 million to the Fair Fund to compensate eligible shareholders.

Please contact the Fund Administrator for the Federated Investors Fair Fund Settlement Distribution. The numbers can be found in the Contact section of the website.

Links to the Distribution Plan and other related documents are available on the Related Documents tab.

You are part of the distribution if you held any of the affected Federated funds between March 2002 and September 2003 and the Independent Distribution Consultant determined that you were adversely affected by the alleged market timing. The affected funds are listed in the tables found at the end of the Distribution Plan. Click on the Related Documents tab on www.federatedfairfundsettlement.com for a link to the Distribution Plan.

The Distribution Plan was approved by the SEC on January 28, 2010. See the Related Documents tab for a link to the Order approving the Distribution Plan as well as a link to the approved Distribution Plan.

The SEC and the Tax Administrator have drafted a notice entitled Federated Investors Fair Fund — Statement to Eligible Investors. You should consult with your financial advisor or tax professional prior to cashing this check to determine the potential tax consequences and appropriate tax treatment for your particular situation.

You will not receive a Form 1099 for the distribution as currently registered, as these proceeds are non-reportable to the IRS. You should, however, consult with your financial or tax professional to determine the appropriate tax treatment for your situation.

Only the Federated employee engaged in trading subject to the settlement prior to March 2002. The Independent Distribution Consultant determined that, because the impact of the employee’s trading on the Federated Funds was small (less than $14,000), it would be more cost-effective to distribute the amount directly to the affected funds. All of the other trading addressed in the settlement occurred from March 2002 to September 2003, which is why investors during this period are receiving distributions.

The Independent Distribution Consultant has developed a Distribution Plan for the Fair Fund according to a methodology developed in consultation the Respondents and the independent Trustees of the affected Federated mutual funds, which was approved by the SEC. The Distribution Plan is to provide for investors their proportionate share of losses suffered by the fund due to market timing and late trading, and a proportionate share of advisory fees paid by funds that suffered such losses during the period of such market timing.

No. Eligible shareholders received an amount based on the adverse impact of alleged market timers on their funds, as calculated by the Independent Distribution Consultant.

The Distribution Plan accounts for changes in ownership and changes in brokerage accounts for the entire period in question. The Distribution Plan will attempt to distribute one payment to each eligible shareholder, regardless of where the securities were purchased or held.

The Distribution Plan does not require that eligible shareholders submit a claim form in order to participate in the distribution. The Independent Distribution Consultant will oversee the process to determine the amounts due to each eligible shareholder subject to the Distribution Plan.

These distributions are being made pursuant to an SEC order and not a class action settlement; there is not an option to exclude you from the distributions.

The IDC is responsible for the development of a plan for the distribution of the Fair Fund provided for in the SEC settlement. The Distribution Plan includes: