Document ID: SEC-2006-0463-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: Chicago Stock Exchange, Inc.
Posted Date: 2006-04-10T04:00Z

[Federal Register: April 10, 2006 (Volume 71, Number 68)]
[Notices]               
[Page 18126-18127]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr10ap06-96]                         

[[Page 18126]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53587; File No. SR-CHX-2006-11]

 
Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Change To 
Amend the Bylaws of CHX Holdings, Inc.

April 3, 2006.
    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 27, 2006, the Chicago Stock Exchange, Inc. (``CHX'' or 
``Exchange'') 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 CHX. The CHX has 
filed this proposal pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ 
and Rule 19b-4(f)(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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    On behalf of its parent company, CHX Holdings, Inc. (``CHX 
Holdings''), the CHX proposes to amend the CHX Holdings Bylaws to 
confirm that CHX Holdings will take steps necessary to ensure that 
directors, officers, and employees of CHX Holdings consent to the 
applicability of the requirements of Article III, Sections 3 and 5 of 
the CHX Holdings Bylaws with respect to activities related to the 
Exchange. The text of this proposed rule change is available on the 
Exchange's Web site at http://www.chx.com/rules/proposed_rules.htm 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 change and 
discussed any comments it received regarding the proposal. The text of 
these statements may be examined at the places specified in Item IV 
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
    As a result of its demutualization in February 2005, the Exchange 
became the wholly-owned subsidiary of CHX Holdings, a Delaware 
corporation.\5\ The Demutualization Approval Order confirmed that the 
Exchange's staff had agreed to submit to the CHX Holdings Board of 
Directors a change to the Bylaws of CHX Holdings that would require CHX 
Holdings to take such action as is necessary to ensure that officers, 
directors, and employees of CHX Holdings consent to the applicability 
of two specific provisions of the CHX Holdings Bylaws.\6\ In general, 
these two CHX Holdings Bylaws confirm that: (1) To the extent that they 
are related to the activities of the CHX, CHX Holdings' officers, 
directors, and employees are deemed to be officers, directors, and 
employees of the CHX for the purposes of the Act; and (2) CHX Holdings' 
officers, directors, and employees, by virtue of their acceptance of 
such positions, are deemed to submit to the jurisdiction of the United 
States federal courts, the Commission, and the CHX for the purposes of 
securities law-related proceedings that arise out of, or are related 
to, the activities of the Exchange. The proposed Bylaws change that is 
the subject of this filing is designed to meet the requirement set out 
in the Demutualization Approval Order.\7\
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    \5\ See Securities Exchange Act Release No. 51149 (February 9, 
2005), 70 FR 7531 (February 14, 2005) (order approving File No. SR-
CHX-2004-26) (``Demutualization Approval Order'').
    \6\ See Demutualization Approval Order, supra note 5, at note 4.
    \7\ This proposal mirrors a similar proposal submitted by 
Pacific Exchange, Inc. in the context of a series of similar 
corporate changes. See Securities Exchange Act Release No. 51389 
(March 17, 2005), 70 FR 15374 (March 25, 2005) (notice of filing and 
immediate effectiveness of File No. SR-PCX-2005-17) (relating to the 
Bylaws of PCX Holdings, Inc.).
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2. Statutory Basis
    The CHX believes that the proposal is consistent with the 
requirements of the Act and the rules and regulations thereunder that 
are applicable to a national securities exchange, and, in particular, 
with the requirements of Section 6(b) of the Act.\8\ In particular, the 
CHX believes that the proposal is consistent with Section 6(b)(5) of 
the Act \9\ in that it is designed to promote just and equitable 
principles of trade, to remove impediments to, and perfect the 
mechanism of, a free and open market and a national market system, and, 
in general, to protect investors and the public interest by ensuring 
that the directors, officers, and employees of CHX Holdings consent to 
the applicability of the requirements Article III, Sections 3 and 5 of 
the CHX Holdings Bylaws with respect to activities related to the 
Exchange.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement of 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 Regarding the 
Proposed Rule Changes Received From Members, Participants or Others

    No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Changes and Timing for 
Commission Action

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \10\ and Rule 19b-
4(f)(6) thereunder.\11\ 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.
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    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(6). As required by Rule 19b-
4(f)(6)(iii) of the Act, the CHX provided the Commission with 
written notice of its intent to file the proposed rule change, along 
with a brief description of the text of the proposed rule change, at 
least five business days prior to the date of filing of the proposed 
rule change.
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposal is 
consistent with the Act. Comments may be submitted by any of the 
following methods:

[[Page 18127]]

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml.
); or     Send an e-mail to rule-comments@sec.gov. Please include 

File Number SR-CHX-2006-11 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, Station Place, 100 F 
Street, NE., Washington, DC 20549-1090.

All submissions should refer to File No. SR-CHX-2006-11. 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 changes 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. Copies of such 
filing will also be available for inspection and copying at the 
principal office of the CHX. 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-CHX-2006-11 and should be submitted on or before May 1, 
2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E6-5183 Filed 4-7-06; 8:45 am]

BILLING CODE 8010-01-P