55580 Federal Register / Vol. 73, No. 187 / Thursday, September 25, 2008 / Notices 

12 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). 

6NYSE Arca gave the Commission written notice 

of its intention to file the proposed rule change on 

September 19, 2008. The Commission reviewed the 

proposed rule change and gave NYSE Arca 

permission to file the proposed the rule change on 

the same day. NYSE Arca asked the Commission to 

waive the 30-day operative delay. See Rule 19b– 

4(f)(6)(iii). 17 CFR 240.19b–4(f)(6)(iii). 

effectiveness is appropriate to ensure a 

smooth transition of the LBI businesses 

to another entity. In particular, with 

respect to BCI, time is of the essence as 

it has been announced that BCI may 

succeed to LBI’s assets as early as 

September 19, 2008. Therefore, the 

Commission believes that waiving the 

30-day operative delay is consistent 

with the protection of investors and the 

public interest and designates the 

proposed rule change as operative upon 

filing. 

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–NYSE–2008–86 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–NYSE–2008–86. 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 on official business days between 

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

of the filing will also be available for 

inspection and copying at the NYSE’s 

principal office and on its Internet Web 

site at www.nyse.com. 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–NYSE– 

2008–86 and should be submitted on or 

before October 16, 2008. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Jill M. Peterson, 

Assistant Secretary. 

[FR Doc. E8–22506 Filed 9–24–08; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58608; File No. SR– 

NYSEArca–2008–101] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by NYSE 

Arca, Inc. To Temporarily Suspend the 

Requirements of NYSE Arca Rule 2.4 

and Related NYSE Arca Rules 

Concerning Options Trading Permit 

Holder Applications and Approvals In 

Order To Immediately Approve 

Barclays Capital Inc. as an NYSE Arca 

OTP Holder 

September 19, 2008. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that, on 

September 19, 2008, NYSE Arca, Inc. 

(‘‘NYSE Arca’’ or the ‘‘Exchange’’) filed 

with the Securities and Exchange 

Commission (the ‘‘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 

proposal as a ‘‘non-controversial’’ 

proposed rule change pursuant to 

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

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

the proposal effective upon filing with 

the Commission.6 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 temporarily 

suspend the requirements of NYSE Arca 

Rule 2.4 and related NYSE Arca rules 

concerning Options Trading Permit 

(‘‘OTP’’) Holder applications and 

approvals in order to immediately 

approve Barclays Capital Inc. (‘‘BCI’’) as 

an NYSE Arca OTP Holder, subject to 

BCI complying with Exchange rules for 

applying to become an OTP Holder (and 

being approved by the Exchange) within 

60 days of the date that BCI is 

provisionally approved as an NYSE 

Arca OTP Holder. 

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 parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to temporarily 

suspend the requirements of NYSE Arca 

Rule 2.4 and related rules regarding the 

application and approval of OTP 

Holders in order to immediately 

approve, as an NYSE Arca OTP Holder, 

the entity that acquires the assets of 

Lehman Brothers Inc. (‘‘LBI’’). The 

Exchange proposes this temporary 

suspension on an emergency basis to 

ensure that the acquiring entity, 

Barclays Capital Inc. (‘‘BCI’’), which is 

a U.S. registered broker dealer and 

FINRA member, will be able to 

expeditiously complete its proposed 

acquisition of certain LBI assets and 

begin operating former LBI business 

lines, as early as September 22, 2008. 

This proposed temporary suspension is 

contingent upon BCI having applied for 

and been approved as a new NYSE Arca 

OTP Holder pursuant to Exchange rules 

within 60 days of the date that BCI is 

provisionally approved as an NYSE 

Arca OTP Holder pursuant to this rule 

filing. 

mstockstill on PROD1PC66 with NOTICES

Federal Register / Vol. 73, No. 187 / Thursday, September 25, 2008 / Notices 55581 

7 15 U.S.C. 78f(b). 

8 15 U.S.C. 78f(b)(5). 

1. Background 

A. Lehman Files for Bankruptcy 

On September 15, 2008, Lehman 

Brothers Holding Inc. (‘‘Lehman’’) filed 

for bankruptcy protection in the United 

States Bankruptcy Court for the 

Southern District of New York under 

Chapter 11 of the U.S. bankruptcy code. 

Lehman is the parent holding company 

of LBI, which is a registered broker 

dealer and NYSE Arca OTP Holder. 

Although LBI did not file for 

bankruptcy protection at that time, 

Lehman’s Chapter 11 status impacted 

the ability of LBI to continue operations. 

On September 17, 2008, Barclays 

Bank PLC (‘‘Barclays’’), a global 

financial services provider, announced 

that it had agreed to acquire the LBI 

investment banking and capital markets 

operations and supporting infrastructure 

for $1.75 billion (the ‘‘proposed 

acquisition’’). As part of the proposed 

acquisition, Barclays would be 

acquiring the LBI fixed income and 

equities sales, trading and research, and 

investment banking businesses, 

including Lehman Brothers Market 

Makers (‘‘LBMM’’) (the ‘‘LBI 

businesses’’). Barclays would also be 

acquiring approximately 10,000 LBI 

employees, the Lehman headquarters 

located at 745 Seventh Avenue in New 

York City, and two data centers located 

in New Jersey. 

The proposed acquisition is subject to 

a number of conditions, including 

approval by the United States 

Bankruptcy Court for the Southern 

District of New York and other 

regulatory approvals and antitrust 

review. Moreover, if the proposed 

acquisition is not completed by 

September 24, 2008, Barclays may 

terminate the agreement to acquire LBI 

businesses. 

B. Barclays Will Transfer LBI Assets to 

BCI 

On September 19, 2008, Barclays 

announced that certain LBI assets, 

including its employees and businesses, 

will be transferred to its wholly-owned 

subsidiary, BCI. BCI is a registered U.S. 

broker dealer and FINRA member. 

However, BCI is not currently approved 

as an NYSE Arca OTP Holder. 

The Exchange understands that LBI 

will likely file for some form of 

bankruptcy protection on Friday, 

September 19, 2008, and thus by the 

close of business on Friday, LBI will be 

in the control of a trustee. The Exchange 

further understands that, subject to 

approval by the bankruptcy court, as 

part of the bankruptcy proceeding, LBI 

assets will be sold to Barclays and 

transferred to BCI. Accordingly, as early 

as September 19, 2008, BCI may own 

and control the LBI businesses. 

2. Proposed Temporary Suspension of 

NYSE Arca Rule 2.4 and Related Rules 

A. Background 

NYSE Arca Rule 2.4 requires any 

individual or organization applying to 

become an OTP Holder to complete an 

application and file it with the 

Exchange. NYSE Arca OTP Holder 

status cannot be transferred to the 

acquiring entity; the entity that proposes 

to continue the business operations of 

the predecessor member organization 

must be separately approved as an 

NYSE Arca OTP Holder. 

B. A Temporary Suspension of NYSE 

Arca Rule 2.4 and Related Rules for BCI 

Is Consistent With the Act 

As proposed, BCI will continue the 

business operations of LBI in the same 

manner that they were operated by LBI. 

Because the bankruptcy proceeding for 

LBI will likely be on September 19, 

2008, BCI could be eligible to begin 

operations as an NYSE Arca OTP Holder 

on Monday, September 22, 2008. 

To ensure that BCI can continue the 

LBI operations without unnecessary 

interruption, including all operations 

that required LBI to be an NYSE Arca 

OTP Holder, such as entering orders 

directly with the Exchange, the 

Exchange believes that BCI should be 

approved immediately as an NYSE Arca 

OTP Holder. The Exchange notes that 

BCI is already a registered broker dealer, 

which is a prerequisite to becoming an 

NYSE Arca OTP Holder. See NYSE Arca 

Rule 2.3. 

The Exchange therefore proposes 

providing BCI with a temporary 

suspension of NYSE Arca Rules 2.4 and 

2.23, as they relate to approval to 

operate as an NYSE Arca OTP Holder 

and approval of a proposed OTP 

Holder’s approved persons, and 

immediately approve BCI as an OTP 

Holder. As proposed, this temporary 

suspension is contingent upon: 

• BCI providing the Exchange with 

sufficient information to confirm that 

BCI will meet its capital requirements as 

an NYSE Arca OTP Holder; and 

• Within 60 days of BCI’s approval as 

an NYSE Arca OTP Holder under this 

proposed filing, BCI and its approved 

persons will have applied for and 

complied with the Exchange’s new 

member organization requirements, as 

set forth in the Exchange’s rules. 

Moreover, the Exchange proposes that 

in addition to being approved as an 

NYSE Arca OTP Holder, to ensure that 

certain LBI market making operations 

can continue, BCI should also be 

deemed approved as a Market Maker as 

defined under NYSE Arca Rules 6.32A 

and 6.33. This approval is contingent 

upon BCI certifying in writing to the 

Exchange that, for the period 

immediately following approval as an 

NYSE Arca OTP Holder until such time 

that BCI is independently approved as 

an NYSE Arca OTP Holder: 

• BCI will maintain the existing 

LBMM technologies, staffing, 

supervisory structure, and written 

supervisory procedures with respect to 

its market making operations; and 

• Within 60 days of BCI’s approval as 

an NYSE Arca OTP Holder under this 

proposed filing, BCI and its approved 

persons will have applied for 

registration as a Market Maker and will 

have been approved by the Exchange as 

a Market Maker, consistent with the 

Exchange’s requirements for registration 

as a Market Maker pursuant to NYSE 

Arca Rule 6.33(a). 

Upon receipt of such written 

statement, the Exchange will approve 

BCI as a successor entity to LBI’s 

registration as a Market Maker on the 

Exchange. 

As proposed, if BCI does not apply for 

and be approved as a new NYSE Arca 

OTP Holder pursuant to Exchange rules 

within 60 days of the effective date of 

this filing, BCI’s provisional status as an 

approved NYSE Arca OTP Holder will 

no longer be effective. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Securities Exchange 

Act of 1934 (the ‘‘Act’’),7 in general, and 

furthers the objectives of Section 6(b)(5) 

of the Act,8 in particular, because it is 

designed to prevent fraudulent and 

manipulative acts and 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 mechanism of a free and 

open market and a national market 

system. 

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. 

mstockstill on PROD1PC66 with NOTICES

55582 Federal Register / Vol. 73, No. 187 / Thursday, September 25, 2008 / Notices 

9 15 U.S.C. 78s(b)(3)(A). 

10 17 CFR 240.19b–4(f)(6). 

11For purposes of waiving the 30-day operative 

delay, the Commission has considered the 

proposal’s impact on efficiency, competition, and 

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

12 17 CFR 200.30–3(a)(12). 

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

2Securities Exchange Act Release No. 58353 

(August 13, 2008), 73 FR 48423. 

3Securities Exchange Act Release No. 55258 

(February 8, 2007), 72 FR 7701 (February 16, 2007). 

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 does not: (1) Significantly affect 

the protection of investors or the public 

interest; (2) impose any significant 

burden on competition; and (3) become 

operative for 30 days from the date of 

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) of the Act 9 and Rule 

19b–4(f)(6) thereunder.10

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. 

NYSE Arca has requested the 

Commission to waive the 30-day 

operative delay. The Commission 

hereby grants NYSE Arca’s request.11

The Commission notes that the 

Exchange is proposing that certain of its 

rules relating to membership 

requirements be temporarily suspended 

so that BCI can be provisionally 

approved as an NYSE Arca OTP Holder. 

The proposed relief does not exempt 

BCI from Exchange rule requirements 

governing member organizations. BCI 

would have a 60-day grace period 

within which to apply for and be 

approved under relevant Exchange 

rules. Moreover, the Commission 

believes that immediate effectiveness is 

appropriate to ensure a smooth 

transition of the LBI businesses to 

another entity. In particular, with 

respect to BCI, time is of the essence as 

it has been announced that BCI may 

succeed to LBI’s assets as early as 

September 19, 2008. Therefore, the 

Commission believes that waiving the 

30-day operative delay is consistent 

with the protection of investors and the 

public interest and designates the 

proposed rule change as operative upon 

filing. 

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–2008–101 on 

the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–NYSEArca–2008–101. 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 between the hours of 10 a.m. and 

3 p.m. Copies of the filing will also be 

available for inspection and copying at 

NYSE Arca’s principal office and on its 

Internet Web site at http:// 

www.nyse.com. 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–2008–101 and should be 

submitted on or before October 16, 

2008. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Jill M. Peterson, 

Assistant Secretary. 

[FR Doc. E8–22504 Filed 9–24–08; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58586; File No. SR–OCC– 

2008–16] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Order 

Granting Approval of a Proposed Rule 

Change Relating to the Cash Dividend 

Threshold 

September 18, 2008. 

I. Introduction 

On July 24, 2008, The Options 

Clearing Corporation (‘‘OCC’’) filed with 

the Securities and Exchange 

Commission (‘‘Commission’’) proposed 

rule change SR–OCC–2008–16 pursuant 

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

Exchange Act of 1934 (‘‘Act’’).1 Notice 

of the proposal was published in the 

Federal Register on August 19, 2008.2

No comment letters were received. For 

the reasons discussed below, the 

Commission is approving the proposed 

rule change. 

II. Description 

The purpose of the proposed rule 

change is to mitigate inconsistencies 

that may result under the current policy 

for adjusting stock option contracts. In 

February 2007, the Commission 

approved rule change SR–OCC–2006– 

01, which amended Section 11A of 

Article VI of the OCC By-Laws 

governing adjustments to options as a 

result of cash dividends or 

distributions.3 Under the new 

adjustment policy, cash dividends paid 

by a company other than pursuant to a 

policy or practice of paying dividends 

on a quarterly or other regular basis 

would be deemed ‘‘special’’ and would 

normally trigger a contract adjustment 

provided the value of the adjustment is 

at least $12.50 per option contract. This 

new adjustment policy will become 

effective for cash dividends announced 

on or after February 1, 2009. 

However, certain inconsistencies may 

result when the threshold of ‘‘$12.50 per 

option contract’’ is applied to all 

mstockstill on PROD1PC66 with NOTICES