Federal Register / Vol. 73, No. 187 / Thursday, September 25, 2008 / Notices 55573 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(6). 

5Amex 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 Amex permission to 

file the proposed rule change on the same day. 

Amex 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). 

6LBI also was an associate member organization. 

‘‘Associate’’ denotes that the member organization 

has no floor presence and only accesses the 

Exchange electronically. 

By the Commission. 

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E8–22547 Filed 9–24–08; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58606; File No. SR–Amex– 

2008–72] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of a Proposed Rule Change by the 

American Stock Exchange LLC 

Temporarily Suspending the 

Requirements of Its Rules Concerning 

the Approval of New Member 

Organizations in Order To Approve 

Barclays Capital Inc. Immediately and 

Provisionally as a New Member 

Organization 

September 19, 2008. 

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

Securities Exchange Act of 1934, as 

amended (‘‘Act’’) 1 and Rule 19b–4 

thereunder,2 notice is hereby given that 

on September 19, 2008, the American 

Stock Exchange LLC (‘‘Amex’’ or 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission (‘‘SEC’’ or 

‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Exchange filed the 

proposal as a ‘‘non-controversial’’ 

proposed rule change pursuant to 

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

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

the proposal effective upon filing with 

the Commission.5 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 is proposing to 

temporarily suspend the requirements 

of Article IV, Section 2 of the Amex 

Constitution and related Amex rules 

concerning the approval of new member 

organizations in order to approve 

Barclays Capital Inc. (‘‘BCI’’) as a new 

associate member organization, subject 

to BCI complying with Exchange rules 

for a new member organization within 

60 days of the date that BCI is 

provisionally approved. 

The text of the proposed rule change 

is available on the Amex’s Web site at 

http://www.amex.com, the Office of the 

Secretary, the Amex and at 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 

Amex 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 Amex 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 the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes this rule filing 

to temporarily suspend the 

requirements of Article IV, Section 2 of 

the Amex Constitution and related 

Amex rules concerning the approval of 

new member organizations in order to 

immediately approve as an Amex 

associate member organization BCI, 

which is the entity acquiring the assets 

of Lehman Brothers Inc. (‘‘LBI’’).6 The 

Exchange proposes this temporary 

suspension on an emergency basis to 

ensure that BCI will be able to 

expeditiously complete its proposed 

acquisition of certain LBI assets and 

begin operating former LBI business 

lines by September 22, 2008. This 

proposed temporary suspension is 

contingent upon BCI complying with all 

requirements of a new Amex member 

organization applicant within 60 days of 

the date that BCI is provisionally 

approved as an Amex member 

organization under this rule filing. 

a. Background 

(i) Lehman Files for Bankruptcy 

On September 15, 2008, Lehman 

Brothers Holding Inc. (‘‘Lehman’’), after 

a precipitous decline in its financial 

condition, 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 

Amex member organization. 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 (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. 

(ii) 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, but 

not currently approved as an Amex 

member organization. 

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. 

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55574 Federal Register / Vol. 73, No. 187 / Thursday, September 25, 2008 / Notices 

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

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

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). 

b. Proposed Temporary Suspension of 

Article IV, Section 2 of the Amex 

Constitution and Related Rules 

(i) Amex Member Organization 

Application Process 

When a corporate acquisition 

concerns an asset transfer only, and not 

an acquisition of the corporate entity 

itself, Amex member organization status 

cannot be simply transferred to the 

acquiring entity. Rather, the entity that 

proposes to continue the business 

operations of the predecessor member 

organization must be separately 

approved as an Amex member 

organization. 

Article IV, Section 2 of the Amex 

Constitution generally provides in 

relevant part that ‘‘[n]o * * * entity 

shall become or remain a member 

organization * * * unless such 

organization * * * meets and continues 

to meet the standards prescribed in the 

Constitution and rules of the Exchange.’’ 

More specifically, Amex Rule 310 

provides that any organization which 

proposes to become a member 

organization shall notify the Exchange 

in writing and submit such information 

as may be required by Amex rules. 

Collectively, Amex Rules 310–312 and 

354–356 set forth the specific 

information that must be submitted to 

the Exchange, and procedures that must 

be followed, by a prospective 

membership organization (and/or its 

associate members, allied members, and 

approved persons) before membership 

will be approved. Information that must 

typically be submitted with an 

application to become a member 

organization includes, among other 

things: 

• Charters, certificates of 

incorporation, by-laws, stock 

certificates, and other miscellaneous 

agreements and documents relating to 

corporate governance matters; 

• Statements of financial condition; 

• Certified lists of stockholders; 

proposed members, directors or 

approved persons; and principal 

executive officers; and 

• Opinions of counsel as to various 

matters. 

Amex membership department staff, 

working with Amex regulation staff, 

review all of the information submitted 

to verify that all of the rules of the 

Exchange are being followed, with such 

process generally taking several months 

to complete. 

Ordinarily, in the context of an 

acquisition, the separate Amex approval 

of the new membership organization 

would occur following adequate 

advance notice by the acquirer, in order 

to afford the Amex membership 

department sufficient time to collect, 

evaluate, and process all of the materials 

it needs from the acquirer without any 

cessation of the target’s business 

operations while the approval of the 

new membership organization is 

pending. However, in light of the speed 

of the acquisition of LBI’s business 

operations by BCI, the ordinary Amex 

membership department approval 

process cannot occur on its usual time 

frame without creating a substantial gap 

in LBI’s operations on the Exchange. To 

avoid such a gap—which the exchange 

understands would be damaging to 

LBI’s business, the interests of its 

numerous customers, and the 

prospective transaction with Barclays— 

Amex proposes to temporarily suspend 

the rules governing the approval process 

for new membership organizations, 

solely insofar as they apply to BCI. 

(ii) A Temporary Suspension of Article 

II, Section 2 (and Related Amex Rules) 

for BCI Is Necessary 

As noted, BCI—already a registered 

broker-dealer and FINRA member—will 

continue the business operations of LBI 

in the same manner that they were 

operated by LBI. Because the 

bankruptcy court is expected to approve 

BCI’s acquisition of the assets of LBI as 

early as Friday, September 19, 2008, BCI 

could be ready to begin operations on 

the Amex as early as Monday, 

September 22, 2008. However, absent a 

suspension of the relevant Amex rules, 

BCI would be unable to continue LBI’s 

operations without interruption because 

of the time frame required to complete 

the member organization application 

process. 

The Exchange therefore proposes 

providing BCI with a temporary 

suspension of Article IV, Section 2 of 

the Amex Constitution, as well as Amex 

Rules 310–312 and 354–356, as they 

relate to approval to operate an Amex 

member organization and approval of a 

proposed member organization’s 

approved persons, so that BCI can be 

immediately approved as a member 

organization. As proposed, this 

temporary suspension is contingent 

upon BCI and its approved persons 

within 60 days completing all steps 

otherwise required to obtain approval as 

a member organization (as set forth in 

Article IV, Section 2 of the Amex 

Constitution and Amex Rules 310–312 

and 354–56), failing which BCI’s 

provisional status as an Amex member 

organization will no longer be effective. 

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) 7 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’), in general, and furthers the 

objectives of Section 6(b)(5) 8 in 

particular in that 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. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

The Exchange did not receive any 

written comments on 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. 

The Amex has requested the 

Commission to waive the 30-day 

operative delay. The Commission 

hereby grants Amex’s request.11 The 

Commission notes that the Exchange is 

mstockstill on PROD1PC66 with NOTICES

Federal Register / Vol. 73, No. 187 / Thursday, September 25, 2008 / Notices 55575 

12 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 3 17 CFR 240.19b–4(e). 

proposing that certain of its rules 

relating to membership requirements be 

temporarily suspended so that BCI can 

be provisionally approved as an Amex 

member organization. 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 No. SR–Amex–2008–72 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 No. 

SR–Amex–2008–72. 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 at (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 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 

available publicly. All submissions 

should refer to File No. SR–Amex– 

2008–72 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. E8–22505 Filed 9–24–08; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58568; File No. SR–CHX– 

2008–12) 

Self-Regulatory Organizations; 

Chicago Stock Exchange, Inc.; Notice 

of Filing and Order Granting 

Accelerated Approval of Proposed 

Rule Change Consolidating Into a 

Single Rule Certain Requirements for 

Securities Traded on the Exchange 

Pursuant to Unlisted Trading 

Privileges 

September 17, 2008. 

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 

September 15, 2008, the Chicago Stock 

Exchange, Inc. (‘‘Exchange’’ or ‘‘CHX’’) 

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. This order provides notice of 

the proposed rule change and approves 

the proposal on an accelerated basis. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The CHX proposes to amend its rules 

to add and consolidate into a single rule 

certain requirements for products traded 

on the Exchange pursuant to unlisted 

trading privileges (‘‘UTP’’) that have 

been established in various new 

products proposals previously approved 

by the Commission. The text of the 

proposed rule change is available on the 

Exchange’s Web site (http:// 

www.chx.com) and at 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 

CHX included statements concerning 

the purpose of and basis for the 

proposed rule changes and discussed 

any comments it received on the 

proposal. The text of these statements 

may be examined at the places specified 

in Item III below. The CHX 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 its 

rules to add and consolidate into a 

single rule certain requirements for 

products traded on the Exchange 

pursuant to UTP that have been 

established in various new products 

proposals previously approved by the 

Commission. The Exchange proposes to 

add CHX Article 22, Rule 6 to set forth 

rules regarding the extension of UTP to 

a security that is listed on another 

national securities exchange. Any such 

security will be subject to all Exchange 

trading rules applicable to NMS Stocks, 

unless otherwise noted. The Exchange 

will file with the Commission a Form 

19b–4(e) with respect to any such 

security that is a ‘‘new derivative 

securities product’’ as defined in Rule 

19b–4(e) under the Act.3 In addition, 

any new derivative securities product 

traded on the Exchange pursuant to 

proposed CHX Article 22, Rule 6 will be 

subject to the following criteria. 

Proposed CHX Article 22, Rule 6(a)(i) 

provides that the Exchange will 

distribute an information circular prior 

to the commencement of trading in such 

new derivative securities product which 

generally will include the same 

information as the information circular 

provided by the listing exchange, 

including: (1) The special risks of 

trading the new derivative securities 

product; (2) the Exchange’s rules that 

will apply to the new derivative 

securities product, including the 

mstockstill on PROD1PC66 with NOTICES