Federal Register / Vol. 74, No. 44 / Monday, March 9, 2009 / Notices 10111 

16 15 U.S.C. 78s(b)(3)(A). 

17 17 CFR 240.19b–4(f)(6). 

18 In addition, Rule 19b–4(f)(6)(iii) requires the 

self-regulatory organization to give the Commission 

notice of its intent to file the proposed rule change, 

along with a brief description and text of the 

proposed rule change, at least five business days 

prior to the date of filing of the proposed rule 

change, or such shorter time as designated by the 

Commission. NYSE Alternext has satisfied this 

requirement. 

19See Securities Exchange Act Release No. 59142 

(December 22, 2008), 73 FR 80494 (December 31, 

2008) (SR–NYSEALTR–2008–14), as amended. 

20See Securities Exchange Act Release No. 58092 

(July 3, 2008), 73 FR 40143 [sic] (July 11, 2008) 

(concerning 17 CFR parts 200 and 241). 

21For purposes only of waiving the operative 

delay for this proposal, the Commission has 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

15 U.S.C. 78c(f). 

22 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A). 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The proposed rule change has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act 16 and Rule 19b–4(f)(6) 

thereunder 17 because the foregoing 

proposed rule: (1) Does not significantly 

affect the protection of investors or the 

public interest; (2) does not impose any 

significant burden on competition; and 

(3) does not become operative for 30 

days after the date of filing, or such 

shorter time as the Commission may 

designate if consistent with the 

protection of investors and the public 

interest.18 The Exchange believes that 

this filing is non-controversial because 

it is consistent with its filing 

implementing the Options Relocation,19

as well as the Exchange’s current 

regulatory controls governing the use of 

personal portable or wireless 

communications devices and wireless 

trading devices, which were approved 

by the Commission. Accordingly, the 

Exchange believes that these rule 

changes are eligible for immediately 

effective treatment under the 

Commission’s Streamlining Order.20

The Exchange has asked the 

Commission to waive the 30-day 

operative delay and designate the 

proposed rule change as operative upon 

filing so that the proposed rule changes 

may become effective upon filing and 

operative on the date of the Options 

Relocation, currently scheduled for 

March 2, 2009. The Commission hereby 

grants the Exchange’s request.21 The 

Commission believes that such action is 

consistent with the protection of 

investors and the public interest 

because the Exchange’s proposal would 

clarify the Exchange’s policies 

governing the use of personal portable 

or wireless communication devices as 

well as wireless trading devices. This 

clarification is necessitated by the 

Options Relocation. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission may summarily abrogate 

such rule change if it appears to the 

Commission that such action is 

necessary or appropriate in the public 

interest, for the protection of investors, 

or otherwise in furtherance of the 

purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–NYSEALTR–2009–21 on 

the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

Station Place, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–NYSEALTR–2009–21. This 

file number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for inspection and copying in 

the Commission’s Public Reference 

Room, 100 F Street, NE., Washington, 

DC 20549, on official business days 

between the hours of 10 a.m. and 3 p.m. 

Copies of such filing also will be 

available for inspection and copying at 

the principal office of the Exchange. All 

comments received will be posted 

without change; the Commission does 

not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make publicly available. All 

submissions should refer to File 

Number SR–NYSEALTR–2009–21 and 

should be submitted on or before March 

30, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.22

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–4872 Filed 3–6–09; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59493; File No. SR– 

NYSEArca–2009–18] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change Relating to the Listing 

and Trading of Bear Market Strategic 

Accelerated Redemption Securities®

Linked to the S&P Small Cap Regional 

Banks Index 

March 3, 2009. 

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 2, 

2009, NYSE Arca, Inc. (‘‘NYSE Arca’’ or 

‘‘Exchange’’), through its wholly owned 

subsidiary, NYSE Arca Equities, Inc. 

(‘‘NYSE Arca Equities’’), filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been 

substantially prepared by the Exchange. 

NYSE Arca filed the proposed rule 

change pursuant to Section 19(b)(3)(A) 

of the Act 3 and Rule 19b–4(f)(6) 


dwashington3 on PROD1PC60 with NOTICES
10112 Federal Register / Vol. 74, No. 44 / Monday, March 9, 2009 / Notices 

4 17 CFR 240.19b–4(f)(6). 

5See registration statement on Form S–3 filed 

with the Securities and Exchange Commission on 

May 5, 2006 (Registration No. 333–133852); Product 

Supplement No. STR–1, dated January 2, 2009 

(‘‘Product Supplement No. STR–1’’); Series L 

Prospectus Supplement dated April 10, 2008; and 

Preliminary Term Sheet, subject to completion, 

dated January 29, 2009 (‘‘Registration Statement’’). 

6Equity Index-Linked Securities are securities 

that provide for the payment at maturity of a cash 

amount based on the performance of an underlying 

index or indexes of equity securities. 

7Capitalized terms used but not defined herein 

have the meanings set forth in Product Supplement 

No. STR–1. 

8Rule 5.2(j)(6)(B)(I)(1)(b)(i) requires that each 

component security in the index to which the 

security is linked has a minimum market value of 

at least $75 million, except that for each of the 

lowest dollar weighted component securities in the 

index that in the aggregate account for no more than 

10% of the dollar weight of the index, the market 

value can be at least $50 million. The Exchange 

states that, as of February 20, 2009, the Index fails 

to meet the requirement of Rule 

5.2(j)(6)(B)(I)(1)(b)(i) in that, with respect to each of 

the lowest dollar weighted component securities in 

the Index that in the aggregate account for no more 

than 10% of the dollar weight of the Index, two 

securities, accounting for a total of 0.35% of the 

Index weight, have a market value of less than $50 

million. These two Index securities have a market 

value of approximately $32 million and $25 

million, respectively. Index components comprising 

the top 90% of the Index weight have a market 

value of at least $75 million. In addition, 99.65% 

of the total Index weight is comprised of securities 

with a market value of at least $50 million. The 

average and median market capitalization of Index 

stocks is $406 million and $349.7 million, 

respectively, as of February 20, 2009. 

9 17 CFR 240.10A–3. 

10The Exchange may obtain information for 

surveillance purposes via the Intermarket 

Surveillance Group (‘‘ISG’’) from other exchanges 

who are members of ISG. For a list of the current 

members of ISG, see http://www.isgportal.org. 

11See, e.g., Securities Exchange Act Release No. 

56637 (October 10, 2007), 72 FR 58704 (October 16, 

2007) (SR–NYSEArca–2007–92) (order approving 

generic listing standards under NYSE Arca Equities 

Rule 5.2(j)(6)). 

thereunder,4 which renders the proposal 

effective upon filing with the 

Commission. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to list and 

trade Bear Market Strategic Accelerated 

Redemption Securities® Linked to the 

S&P Small Cap Regional Banks Index 

(‘‘Notes’’) under NYSE Arca Equities 

Rule 5.2(j)(6). The text of the proposed 

rule change is available at http:// 

www.nyse.com, the Exchange and the 

Commission’s Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange 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 

Exchange has prepared summaries, set 

forth in Sections A, B, and C below, of 

the most significant parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to list and 

trade the Notes 5 under NYSE Arca 

Equities Rule 5.2(j)(6), which includes 

the Exchange’s listing standards for 

Equity Index-Linked Securities.6

According to the Registration Statement, 

the Notes are Bank of America 

Corporation (‘‘BAC’’ or the ‘‘issuer’’) 

senior unsecured debt securities and are 

not guaranteed or insured by the Federal 

Deposit Insurance Corporation or 

secured by collateral. The Notes will 

rank equally with all of the issuer’s 

other unsecured and unsubordinated 

debt, and any payments due on the 

Notes, including any repayment of 

principal, will be subject to the credit 

risk of BAC. The Notes are designed for, 

but not limited to, investors who 

anticipate that the Observation Level 7

of the S&P Small Cap Regional Banks 

Index (the ‘‘Index’’) on any Observation 

Date will be less than or equal to the 

Call Level. The Notes provide for an 

automatic call if the Observation Level 

of the Index on any Observation Date is 

less than or equal to the Call Level. 

The Notes will be called at an amount 

equal to the $10 principal amount per 

unit plus the Call Premium of between 

15% and 19% per annum if the closing 

level of the Index on any Observation 

Date is less than or equal to 100% of its 

starting value. The Notes have a 

maturity of approximately 18 months. 

There will be a one-to-one downside 

loss if the Notes are not called prior to 

maturity and the closing level of the 

Index increases above a Threshold 

Value, with up to 100% of the principal 

amount at risk. There are no periodic 

interest payments. 

The Index is a capitalization weighted 

index. The Index is a sub-index of the 

S&P SmallCap 600 Index and is 

comprised of the regional banks 

included in the ‘‘Financials’’ sector of 

the S&P SmallCap 600 Index. Regional 

banks are defined as commercial banks 

whose businesses are derived primarily 

from commercial lending operations 

and have significant business activity in 

retail banking and small and medium 

corporate lending. Regional banks tend 

to operate in limited geographic regions. 

The Index excludes companies 

classified according to the Global 

Industry Classification Standard 

(‘‘GICS’’) in the Diversified Banks and 

Thrifts & Mortgage Banks sub-industries 

and also excludes investment banks 

classified in the Investment Banking & 

Brokerage Sub-Industry. The GICS 

methodology has been widely accepted 

as an industry analysis framework for 

investment research, portfolio 

management, and asset allocation. The 

Index was developed with a base value 

of 100 as of December 31, 1993. Of the 

companies included in the S&P 

SmallCap 600 Index, 41 were included 

in the Index as of January 15, 2009. 

The Exchange is submitting this 

proposed rule change because the Index 

for the Fund does not meet all of the 

‘‘generic’’ listing requirements of NYSE 

Arca Equities Rule 5.2(j)(6) applicable to 

listing of all Equity Index-Linked 

Securities. The Index meets all such 

requirements except for those set forth 

in Rule 5.2(j)(6)(B)(I)(1)(b)(i).8 The 

Exchange represents that: (1) Except for 

the requirement under 

5.2(j)(6)(B)(I)(1)(b)(i), the Notes 

currently satisfy all of the generic listing 

standards under NYSE Arca Equities 

Rule 5.2(j)(6); and (2) BAC is required to 

comply with Rule 10A–3 under the 

Act 9 for the initial and continued listing 

of the Notes. In addition, the Exchange 

represents that the Notes will comply 

with all other requirements applicable 

to Equity Index-Linked Securities, 

including, but not limited to, 

requirements relating to the 

dissemination of key information such 

as the Index value, rules governing the 

trading of equity securities, trading 

hours, trading halts, surveillance,10 and 

Information Bulletin to ETP Holders, as 

set forth in Exchange rules applicable to 

Equity Index-Linked Securities and in 

prior Commission orders approving the 

generic listing rules applicable to the 

listing and trading of Equity IndexLinked Securities.11 Detailed 

descriptions of the Notes, the Index 

(including the methodology used to 

determine the composition of the 

Index), fees, redemption procedures and 

payment at redemption, payment at 

maturity, taxes, and risk factors relating 

to the Notes are available in the 

Registration Statement. 

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) of the 


dwashington3 on PROD1PC60 with NOTICES
Federal Register / Vol. 74, No. 44 / Monday, March 9, 2009 / Notices 10113 

12 15 U.S.C. 78f(b). 

13 15 U.S.C. 78f(b)(5). 

14 15 U.S.C. 78s(b)(3)(A). 

15 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires a self-regulatory organization to 

provide the Commission with written notice of its 

intent to file the proposed rule change, along with 

a brief description and text of the proposed rule 

change, at least five business days prior to the date 

of filing of the proposed rule change, or such 

shorter time as designated by the Commission. The 

Exchange has fulfilled the pre-filing requirement. 

16 17 CFR 240.19b–4(f)(6). 

17 17 CFR 240.19b–4(f)(6)(iii). 18For purposes only of waiving the 30-day 

operative delay, the Commission has also 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

15 U.S.C. 78c(f). 

Act,12 in general, and furthers the 

objectives of Section 6(b)(5),13 in 

particular, in that it is designed to 

prevent fraudulent and manipulative 

practices, to promote just and equitable 

principles of trade, to foster cooperation 

and coordination with persons engaged 

in facilitating transactions in securities, 

and to remove impediments to, and 

perfect the mechanisms of, a free and 

open market and a national market 

system. The proposed rule change will 

allow the listing and trading of the 

Notes on the Exchange, which the 

Exchange believes will enhance 

competition among market participants, 

to the benefit of investors and the 

marketplace. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change: (1) Does not significantly affect 

the protection of investors or the public 

interest; (2) does not impose any 

significant burden on competition; and 

(3) by its terms does not become 

operative for 30 days after the date of 

this filing, or such shorter time as the 

Commission may designate if consistent 

with the protection of investors and the 

public interest, the proposed rule 

change has become effective pursuant to 

Section 19(b)(3)(A) 14 of the Act and 

subparagraph (f)(6) of Rule 19b–4 15

thereunder. 

A proposed rule change filed under 

Rule 19b–4(f)(6) 16 normally does not 

become operative for 30 days after the 

date of filing. However, Rule 19b– 

4(f)(6)(iii),17 permits the Commission to 

designate a shorter time if such action 

is consistent with the protection of 

investors and the public interest. The 

Exchange requests that the Commission 

waive the 30-day operative delay so that 

the proposal may become operative 

immediately upon filing. The Exchange 

states that the proposed rule change 

does not significantly affect the 

protection of investors or the public 

interest and does not impose any 

significant burden on competition. 

NYSE Arca believes that the proposed 

rule change is non-controversial in that 

the Index for the Notes fail to meet the 

requirements set forth in NYSE Arca 

Equities Rule 5.2(j)(6)(B)(I)(1)(b)(i) by 

only a small amount: Two securities 

accounting for a total of .35% of the 

Index weight have a market value of less 

than 50 million and the top 90% of the 

Index weight have a market value of $75 

million. The Notes currently satisfy all 

of the other applicable generic listing 

standards under NYSE Arca Equities 

Rule 5.2(j)(6) and all other requirements 

applicable to Index-Linked Securities 

and, in particular, Equity Index-Linked 

Securities, as set forth in Exchange rules 

and prior Commission orders approving 

the generic listing rules applicable to 

the listing and trading of Index-Linked 

Securities. In addition, the Exchange 

believes that it has developed adequate 

trading rules, procedures, surveillance 

programs, and listing standards for the 

continued listing and trading of the 

Notes. 

The Commission believes that 

waiving the 30-day operative delay is 

consistent with the protection of 

investors and the public interest.18

Given that the Notes comply with all of 

the NYSE Arca Equities generic listing 

standards for Equity Index-Linked 

Securities (except for narrowly missing 

the requirement that lowest dollar 

weighted component securities in the 

Index have a market value of at least $50 

million), the listing and trading of the 

Notes by NYSE Arca does not appear to 

present any novel or significant 

regulatory issues or impose any 

significant burden on competition. For 

these reasons, the Commission 

designates the proposed rule change as 

operative upon filing. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission may summarily abrogate 

such rule change if it appears to the 

Commission that such action is 

necessary or appropriate in the public 

interest, for the protection of investors, 

or otherwise in furtherance of the 

purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–NYSEArca–2009–18 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–NYSEArca–2009–18. This 

file number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for inspection and copying in 

the Commission’s Public Reference 

Room, 100 F Street, NE., Washington, 

DC 20549, on official business days 

between the hours of 10 a.m. and 3 p.m. 

Copies of the filing also will be available 

for inspection and copying at the 

principal office of the Exchange. All 

comments received will be posted 

without change; the Commission does 

not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. All 

submissions should refer to File 

Number SR–NYSEArca–2009–18 and 

should be submitted on or before March 

30, 2009. 


dwashington3 on PROD1PC60 with NOTICES
10114 Federal Register / Vol. 74, No. 44 / Monday, March 9, 2009 / Notices 

19 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4 15 U.S.C. 78s(b)(3)(A). 

5 17 CFR 240.19b–4(f)(6). 

6See E-mail from Jennifer D. Kim, Counsel, Office 

of the General Counsel, Exchange, to Michou H.M. 

Nguyen, Special Counsel, Division of Trading and 

Markets, Commission, on March 2, 2009. 

7See SR–NYSE–2009–16 (to be filed on February 

17, 2009). 

8See Securities Exchange Act Release No. 58673 

(September 29, 2008), 73 FR 57707 (October 3, 

2008) (SR–NYSE–2008–60 and SR–Amex 2008–62) 

(approving the Merger). 

9 15 U.S.C. 78f. 

10See Securities Exchange Act Release No. 58705 

(October 1, 2008), 73 FR 58995 (October 8, 2008) 

(SR–Amex 2008–63) (approving the Equities 

Relocation). 

11See Securities Exchange Act Release No. 58705 

(October 1, 2008), 73 FR 58995 (October 8, 2008) 

(SR–Amex 2008–63) (approving the Equities 

Relocation); Securities Exchange Act Release No. 

58833 (October 22, 2008), 73 FR 64642 (October 30, 

2008) (SR–NYSE–2008–106) and Securities 

Exchange Act Release No. 58839 (October 23, 2008), 

73 FR 64645 (October 30, 2008) (SR–NYSEALTR– 

2008–03) (together, approving the Bonds 

Relocation); Securities Exchange Act Release No. 

59022 (November 26, 2008), 73 FR 73683 

(December 3, 2008) (SR–NYSEALTR–2008–10) 

(adopting amendments to NYSE Alternext Equities 

Rules to track changes to corresponding NYSE 

Rules); Securities Exchange Act Release No. 59027 

(November 28, 2008), 73 FR 73681 (December 3, 

2008) (SR–NYSEALTR–2008–11) (adopting 

amendments to Rule 62—NYSE Alternext Equities 

to track changes to corresponding NYSE Rule 62). 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–4877 Filed 3–6–09; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59482; File No. SR– 

NYSEALTR–2009–13] 

Self-Regulatory Organizations; NYSE 

Alternext U.S. LLC; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change Amending NYSE 

Alternext Equities Rule 17 To Address 

Issues Related to Vendor Liability and 

To Make Amendments and Conforming 

Changes to NYSE Alternext Equities 

Rule 18 

March 2, 2009. 

Pursuant to Section 19(b)(1)1 of the 

Securities Exchange Act of 1934 

(‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on February 

17, 2009, NYSE Alternext U.S. LLC 

(‘‘Exchange’’ or ‘‘NYSE Alternext’’) filed 

with the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change as described in 

Items I and II below, which Items have 

been prepared by the self-regulatory 

organization. The Exchange filed the 

proposed rule change pursuant to 

Section 19(b)(3)(A) 4 of the Act and Rule 

19b–4(f)(6) thereunder,5 which renders 

the proposal effective upon filing with 

the Commission. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

NYSE Alternext Equities Rule 17 (‘‘Use 

of Exchange Facilities’’) to address 

issues related to vendor liability. The 

Exchange also seeks to make 

amendments and conforming changes to 

NYSE Alternext Equities Rule 18 

(‘‘Compensation in Relation to Exchange 

System Failure’’). The text of the 

proposed rule change is available at the 

Exchange, the Commission’s Public 

Reference Room, and http:// 

www.nyse.com. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization 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 those statements may be examined at 

the places specified in Item IV below. 

The Exchange has prepared summaries, 

set forth in Sections A, B, and C below, 

of the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend 

NYSE Alternext Equities Rule 17 (‘‘Use 

of Exchange Facilities’’) to address 

issues related to vendor liability. 

Specifically, the proposed rule would 

require that member organizations that 

have trading losses due to malfunctions 

of third-party systems provided by the 

Exchange submit such losses to the 

Exchange’s compensation fund prior to 

pursuing legal remedies against the 

third-party vendors that provided these 

systems.6

The Exchange also seeks to make 

amendments and conforming changes to 

NYSE Alternext Equities Rule 18 

(‘‘Compensation in Relation to Exchange 

System Failure’’). Specifically, the 

Exchange seeks to include in the 

definition of ‘‘Exchange system failure’’ 

the malfunction of a third-party system 

or technology provided by the 

Exchange, i.e., vendor and/or 

subcontractor systems and to codify a 

net loss requirement for members or 

member organizations that seek 

compensation for losses sustained from 

an Exchange system failure. 

These amendments are proposed to 

conform to amendments filed by the 

New York Stock Exchange (‘‘NYSE’’).7

Background 

As described more fully in a related 

rule filing,8 NYSE Euronext acquired 

The Amex Membership Corporation 

(‘‘AMC’’) pursuant to an Agreement and 

Plan of Merger, dated January 17, 2008 

(the ‘‘Merger’’). In connection with the 

Merger, the Exchange’s predecessor, the 

American Stock Exchange LLC 

(‘‘Amex’’), a subsidiary of AMC, became 

a subsidiary of NYSE Euronext called 

NYSE Alternext U.S. LLC, and 

continues to operate as a national 

securities exchange registered under 

Section 6 of the Securities Exchange Act 

of 1934, as amended (the ‘‘Act’’).9 The 

effective date of the Merger was October 

1, 2008. 

In connection with the Merger, on 

December 1, 2008, the Exchange 

relocated all equities trading conducted 

on the Exchange legacy trading systems 

and facilities located at 86 Trinity Place, 

New York, New York, to trading systems 

and facilities located at 11 Wall Street, 

New York, New York (the ‘‘Equities 

Relocation’’). The Exchange’s equity 

trading systems and facilities at 11 Wall 

Street (the ‘‘NYSE Alternext Trading 

Systems’’) are operated by the NYSE on 

behalf of the Exchange.10

As part of the Equities Relocation, 

NYSE Alternext adopted NYSE Rules 1– 

1004, subject to such changes as 

necessary to apply the Rules to the 

Exchange, as the NYSE Alternext 

Equities Rules to govern trading on the 

NYSE Alternext Trading Systems.11 The 

NYSE Alternext Equities Rules, which 

became operative on December 1, 2008, 

are substantially identical to the current 

NYSE Rules 1–1004 and the Exchange 

continues to update the NYSE Alternext 

Equities Rules as necessary to conform 

with rule changes to corresponding 

NYSE Rules filed by the NYSE. 

Proposed Amendments 

Currently, NYSE Alternext Equities 

Rule 17 provides that the Exchange 

shall not be liable for any damages 

sustained by a member or member 

organization growing out of the use or 


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