Self-Regulatory Organizations; Boston Stock Exchange, Incorporated; Notice of Filing of Proposed Rule Change Amending the Certificate of Incorporation of Boston Stock Exchange, Incorporated, 25809-25811 [E8-10072]
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Federal Register / Vol. 73, No. 89 / Wednesday, May 7, 2008 / Notices
III. Discussion and Commission
Findings
After careful review, the Commission
finds that the proposed rule change, as
amended, is consistent with the
requirements of the Act and the rules
and regulations thereunder.32 In
particular, the Commission finds the
proposed rule change, as amended,
would integrate the supervision and
compliance functions relating to
member organizations’ public customer
options activities into the overall
supervisory structure of a member
organization, thereby eliminating any
uncertainty over where supervisory
responsibility lies. In addition, the
proposed rule change would foster the
strengthening of members’ and member
organizations’ internal controls and
supervisory systems. As such, the
Commission finds the proposal to be
consistent with the objectives of Section
6(b)(5) of the Act,33 in that it is designed
to promote just and equitable principles
of trade, to prevent fraudulent and
manipulative acts and practices, and in
general, to protect investors and the
public interest.
The Commission also finds good
cause for approving Amendment No.1 to
the proposed rule change prior to the
30th day after its publication in the
Federal Register. Amendment No. 1
corrects an internal cross-reference and
does not contain any substantive
modifications to the rule text. The
Commission finds that it is in the public
interest to approve the proposed rule
change as soon as possible to expedite
its implementation. Accordingly, the
Commission believes good cause exists,
consistent with Sections 6(b)(5) and
19(b) of the Act to approve Amendment
No. 1 to the proposed rule change on an
accelerated basis.
sroberts on PROD1PC70 with NOTICES
IV. Solicitation of Comments
Concerning Amendment No. 1
Interested persons are invited to
submit written data, views, and
arguments concerning Amendment No.
1, including whether Amendment No. 1
is consistent with the Act. Comments
may be submitted by any of the
following methods:
Electronic comments
• Use the Commission’s Internet
comment form https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
32 In approving this rule change, as amended, the
Commission notes that it has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
33 15 U.S.C. 78f(b)(5).
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25809
Number SR–Amex–2007–129 on the
subject line.
SECURITIES AND EXCHANGE
COMMISSION
Paper comments
[Release No. 34–57760; File No. SR–BSE–
2008–02]
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–Amex–2007–129. 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 (https://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 available publicly. All
submissions should refer to File
Number SR–Amex–2007–129 and
should be submitted on or before May
28, 2008.
V. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,34 that the
proposed rule change (SR–Amex–2007–
129), as amended by Amendment No. 1,
be, and hereby is, approved on an
accelerated basis.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.35
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8–10019 Filed 5–6–08; 8:45 am]
BILLING CODE 8010–01–P
Self-Regulatory Organizations; Boston
Stock Exchange, Incorporated; Notice
of Filing of Proposed Rule Change
Amending the Certificate of
Incorporation of Boston Stock
Exchange, Incorporated
May 1, 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 April 23,
2008, the Boston Stock Exchange,
Incorporated (‘‘BSE’’ 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 substantially prepared by
BSE. 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 BSE proposes to amend its
Certificate of Incorporation in order to
make distributions to Exchange
membership 3 owners under certain
circumstances. Specifically, the
amended Certificate of Incorporation
will permit the Exchange to distribute
the net proceeds from the Exchange’s
intended sale of its equity interests in
the Boston Options Exchange Group
´
LLC (‘‘BOX’’) to the Bourse de Montreal
(‘‘MX’’) by means of a pro rata
redemption of a portion of each
Exchange membership. The text of the
proposed rule change is available on the
Exchange’s Web site (https://
www.bostonstock.com), at the principal
offices of the Exchange, 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, BSE
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. BSE has prepared
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 As that term is defined in Article I, Section 3(h),
and Article IX of the BSE Constitution.
2 17
34 15
35 17
PO 00000
U.S.C. 78s(b)(2).
CFR 200.30–3(a)(12).
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Fmt 4703
Sfmt 4703
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Federal Register / Vol. 73, No. 89 / Wednesday, May 7, 2008 / Notices
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
sroberts on PROD1PC70 with NOTICES
1. Purpose
On October 2, 2007, the Exchange
announced that it had entered into an
agreement to be acquired by The Nasdaq
Stock Market, Inc., (n/k/a The NASDAQ
OMX Group, Inc.) (‘‘NASDAQ OMX’’) in
a transaction that is subject to approval
by the Exchange’s members and by the
Commission. The Exchange is being
sold in its entirety to NASDAQ OMX,
including all of its subsidiaries, with the
exception of BOX. The sale will be
structured as a merger of the Exchange
with and into a wholly- owned
subsidiary of NASDAQ OMX. The
Exchange will be the surviving
corporation and will become a whollyowned subsidiary of NASDAQ OMX.
Proposed rule changes, filed pursuant to
Section 19 of the Act, relating to
NASDAQ OMX’s planned acquisition of
the Exchange must be approved by the
Commission in order for the transaction
to close and are the subject of a separate
filing.4 The sale of the Exchange’s
equity interest in BOX to a third party
is a condition precedent to completing
the sale of the Exchange to NASDAQ
OMX.
Currently, BOX is owned by the
Exchange, MX, and several other
investors. On December 21, 2007, the
Exchange announced that it had reached
an agreement with MX to sell the
Exchange’s remaining equity interest in
BOX to MX. Upon closing of this
transaction, which is also subject to
approval by the Commission, the
Exchange will no longer have an equity
interest in BOX, and MX will have
increased its ownership interest in BOX
from 31.4% to 53.24%.5 Exchange
membership owners 6 will be
compensated for their equity interest in
BOX as would be provided in Article
Fourth of the Restated Certificate of
Incorporation of Boston Stock Exchange,
Incorporated (‘‘Restated Certificate’’).
After completing the sale of all of its
equity interests in BOX, the Exchange
will continue to act as the self4 See Securities Exchange Act Release No. 57757
(May 1, 2008) (SR–BSE–2008–23).
5 See Securities Exchange Act Release No. 57714
(April 25, 2008) (SR–BSE–2008–25).
6 All holders of outstanding BSE memberships,
including lessors but not lessees, and excluding
electronic access members (‘‘EAMs’’), will be
entitled to receive their pro rata share of the equity
interest in BOX based on the outstanding number
of such BSE memberships.
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Jkt 214001
regulatory organization for the BOX
facility, and the Exchange’s whollyowned subsidiary Boston Options
Exchange Regulation, LLC (‘‘BOXR’’)
will provide the regulatory framework
for the BOX facility. BOXR, together
with BOX, will continue to have
regulatory responsibility for the
activities of the BOX facility.
In order for the Exchange to distribute
the net proceeds from the BOX sale to
the Exchange’s membership owners, the
Exchange’s Certificate of Incorporation
must be amended in order to remove the
existing provision that prevents the
Exchange from making distributions to
Exchange membership owners, and to
add a provision that allows the
Exchange to redeem a portion of each
membership for a pro rata share of the
net proceeds of the BOX sale.7 The
Exchange has been advised that the use
of the redemption as a means to
distribute proceeds from the sale of its
equity interest in BOX may provide
beneficial tax treatment. Therefore, the
Restated Certificate would permit the
Exchange to make distributions to
membership owners, and also would
permit the use of such pro rata
redemption. The Restated Certificate
also would delete obsolete text
regarding the incorporators of the
Exchange.
If approved by the Commission, the
Restated Certificate would be effective
immediately prior to the closing of the
BOX distribution upon the filing of the
Restated Certificate with the Secretary
of State of the State of Delaware. It is
anticipated that the Restated Certificate
would be amended again upon the
closing of NASDAQ OMX’s planned
acquisition of the Exchange.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
the requirements under section 6(b)(5)
of the Act,8 that an exchange have rules
that are designed to promote just and
equitable principles of trade, to remove
impediments to and to perfect the
mechanism of a free and open market
and a national market system, and, in
general, to protect investors and the
public interest in that, if approved, the
proposed rule change will provide a
means for the Exchange to distribute the
proceeds from the sale of the Exchange’s
equity interest in BOX to all of the
Exchange’s owners of memberships.
7 See
8 15
PO 00000
Restated Certificate, Article Fourth.
U.S.C. 78f(b)(5).
Frm 00170
Fmt 4703
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B. Self-Regulatory Organization’s
Statement on Burden on Competition
BSE 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
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within 35 days of the date of
publication of this notice in the Federal
Register or within such longer period (i)
as the Commission may designate up to
90 days of such date if it finds such
longer period to be appropriate and
publishes its reasons for so finding or
(ii) as to which the self-regulatory
organization consents, the Commission
will:
(A) By order approve such proposed
rule change, or
(B) institute proceedings to determine
whether the proposed rule change
should be disapproved.
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 (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–BSE–2008–02 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
Number SR–BSE–2008–02. 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 (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
E:\FR\FM\07MYN1.SGM
07MYN1
Federal Register / Vol. 73, No. 89 / Wednesday, May 7, 2008 / Notices
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–BSE–2008–02 and should
be submitted on or before May 28, 2008.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.9
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8–10072 Filed 5–6–08; 8:45 am]
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–57747; File No. SR–CBOE–
2008–49]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Related to Off-Floor
LMMs
sroberts on PROD1PC70 with NOTICES
April 30, 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 April 24,
2008, the Chicago Board Options
Exchange, Incorporated (‘‘Exchange’’ or
‘‘CBOE’’) 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 substantially prepared by the
Exchange. The Exchange filed the
proposal as a ‘‘non-controversial’’
proposed rule change pursuant to
Section 19(b)(3)(A)(iii) of the Act 3 and
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(iii).
1 15
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Jkt 214001
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
CBOE rules relating to Lead MarketMakers (‘‘LMMs’’). The text of the
proposed rule change is available on the
Exchange’s Web site (https://
www.cboe.org/Legal), at the Exchange’s
Office of the Secretary and at the
Commission.
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 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
BILLING CODE 8010–01–P
9 17
Rule 19b–4(f)(6) thereunder.4 The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
1. Purpose
Last year, CBOE amended its rules to
provide Designated Primary MarketMakers (‘‘DPMs’’) with the flexibility to
operate remotely away from CBOE’s
trading floor as a so-called ‘‘Off-Floor
DPM.’’ 5 CBOE is now proposing to
provide LMMs with the same flexibility
to operate remotely away from CBOE’s
trading floor. Specifically, CBOE
proposes to amend Rule 8.15A, Lead
Market-Makers in Hybrid Classes, to
provide the following:
• An LMM generally will operate on
CBOE’s trading floor (‘‘On-Floor
LMM’’). However, an LMM can request
that the Exchange authorize the LMM to
function remotely away from CBOE’s
trading floor (‘‘Off-Floor LMM’’) on a
class-by-class basis.
4 17
CFR 240.19b–4(f)(6).
Securities Exchange Act Release No. 55531
(March 26, 2007), 72 FR 15736 (April 2, 2007) (SR–
CBOE–2006–94). See also Securities Exchange Act
Release No. 57568 (March 26, 2008), 73 FR 18016
(April 2, 2008) (SR–CBOE–2008–32) (immediately
effective rule change expanding the Off-Floor DPM
program, which had originally been limited to
equity option classes to include all option classes
traded on the Hybrid Trading System and Hybrid
2.0 Platform (collectively ‘‘Hybrid’’)).
5 See
PO 00000
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25811
• An LMM can request that the
Exchange authorize it to operate as an
Off-Floor LMM in one or more Hybrid
classes. The Exchange will consider the
factors specified in Rule 8.15A(a)(i)(A),6
as well as the factors applicable to OffFloor DPMs specified in paragraph (g) of
Rule 8.83, Approval to Act as a DPM,7
in determining whether to permit an
LMM to operate as an Off-Floor LMM.
If an LMM is approved to operate as an
Off-Floor LMM in one or more Hybrid
classes, the Off-Floor LMM can have an
LMM designee trade in open outcry in
the option classes allocated to the OffFloor LMM, but the Off-Floor LMM
shall not receive a participation
entitlement under Rule 8.15B,
Participation Entitlement of LMMs, with
respect to orders represented in open
outcry.8
• An LMM that is approved to
operate as an Off-Floor LMM in one or
more Hybrid classes can request that the
Exchange authorize it to operate as an
On-Floor LMM in those option classes.
In making a determination pursuant to
this paragraph, the Exchange should
evaluate whether the change is in the
best interests of the Exchange, and may
6 CBOE Rule 8.15A(a)(i) provides that the factors
to be considered in selecting LMMs include:
Adequacy of capital; experience in trading index
options or options on ETFs; presence in the trading
crowd; adherence to CBOE Rules; and ability to
meet the obligations specified in the Rule. An
individual may be appointed as an LMM for one
expiration month at a time. When individual
members are associated with one or more other
members, only one member may receive an LMM
appointment.
7 CBOE Rule 8.83(g) provides that the factors to
be considered in determining whether to permit a
DPM to operate as an Off-Floor DPM include, but
are not limited to, any one or more of the following:
(i) Adequacy of capital; (ii) operational capacity;
(iii) trading experience of and observance of
generally accepted standards of conduct by the
applicant, its associated persons, and the DPM
Designees who will represent the applicant in its
capacity as a DPM; (iv) number and experience of
support personnel of the applicant who will be
performing functions related to the applicant’s DPM
business; (v) regulatory history of and history of
adherence to CBOE Rules by the applicant, its
associated persons, and the DPM Designees who
will represent the applicant in its capacity as a
DPM; (vi) willingness and ability of the applicant
to promote the Exchange as a marketplace; (vii)
performance evaluations conducted pursuant to
CBOE Rule 8.60, Evaluation of Trading Crowd
Performance; and (viii) in the event that one or
more shareholders, directors, officers, partners,
managers, members, DPM Designees, or other
principals of an applicant is or has previously been
a shareholder, director, officer, partner, manager,
member, DPM Designee, or other principal in
another DPM, adherence by such DPM to the
requirements set forth in Section C of Chapter VIII
of the CBOE Rules respecting DPM responsibilities
and obligations during the time period in which
such person(s) held such position(s) with the DPM.
8 In addition to the changes to CBOE Rule 8.15A,
CBOE is proposing related updates to paragraph (b)
of CBOE Rule 8.15B, Participation Entitlement of
LMMs, and subparagraphs (d)(v) and (vii) of CBOE
Rule 6.74, Crossing Orders.
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]]>Agencies
[Federal Register Volume 73, Number 89 (Wednesday, May 7, 2008)]
[Notices]
[Pages 25809-25811]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-10072]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-57760; File No. SR-BSE-2008-02]
Self-Regulatory Organizations; Boston Stock Exchange,
Incorporated; Notice of Filing of Proposed Rule Change Amending the
Certificate of Incorporation of Boston Stock Exchange, Incorporated
May 1, 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 April 23, 2008, the Boston Stock Exchange, Incorporated (``BSE'' 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 substantially prepared by BSE. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The BSE proposes to amend its Certificate of Incorporation in order
to make distributions to Exchange membership \3\ owners under certain
circumstances. Specifically, the amended Certificate of Incorporation
will permit the Exchange to distribute the net proceeds from the
Exchange's intended sale of its equity interests in the Boston Options
Exchange Group LLC (``BOX'') to the Bourse de Montr[eacute]al (``MX'')
by means of a pro rata redemption of a portion of each Exchange
membership. The text of the proposed rule change is available on the
Exchange's Web site (https://www.bostonstock.com), at the principal
offices of the Exchange, and at the Commission's Public Reference Room.
---------------------------------------------------------------------------
\3\ As that term is defined in Article I, Section 3(h), and
Article IX of the BSE Constitution.
---------------------------------------------------------------------------
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, BSE 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. BSE has prepared
[[Page 25810]]
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
On October 2, 2007, the Exchange announced that it had entered into
an agreement to be acquired by The Nasdaq Stock Market, Inc., (n/k/a
The NASDAQ OMX Group, Inc.) (``NASDAQ OMX'') in a transaction that is
subject to approval by the Exchange's members and by the Commission.
The Exchange is being sold in its entirety to NASDAQ OMX, including all
of its subsidiaries, with the exception of BOX. The sale will be
structured as a merger of the Exchange with and into a wholly- owned
subsidiary of NASDAQ OMX. The Exchange will be the surviving
corporation and will become a wholly- owned subsidiary of NASDAQ OMX.
Proposed rule changes, filed pursuant to Section 19 of the Act,
relating to NASDAQ OMX's planned acquisition of the Exchange must be
approved by the Commission in order for the transaction to close and
are the subject of a separate filing.\4\ The sale of the Exchange's
equity interest in BOX to a third party is a condition precedent to
completing the sale of the Exchange to NASDAQ OMX.
---------------------------------------------------------------------------
\4\ See Securities Exchange Act Release No. 57757 (May 1, 2008)
(SR-BSE-2008-23).
---------------------------------------------------------------------------
Currently, BOX is owned by the Exchange, MX, and several other
investors. On December 21, 2007, the Exchange announced that it had
reached an agreement with MX to sell the Exchange's remaining equity
interest in BOX to MX. Upon closing of this transaction, which is also
subject to approval by the Commission, the Exchange will no longer have
an equity interest in BOX, and MX will have increased its ownership
interest in BOX from 31.4% to 53.24%.\5\ Exchange membership owners \6\
will be compensated for their equity interest in BOX as would be
provided in Article Fourth of the Restated Certificate of Incorporation
of Boston Stock Exchange, Incorporated (``Restated Certificate'').
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release No. 57714 (April 25,
2008) (SR-BSE-2008-25).
\6\ All holders of outstanding BSE memberships, including
lessors but not lessees, and excluding electronic access members
(``EAMs''), will be entitled to receive their pro rata share of the
equity interest in BOX based on the outstanding number of such BSE
memberships.
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After completing the sale of all of its equity interests in BOX,
the Exchange will continue to act as the self-regulatory organization
for the BOX facility, and the Exchange's wholly- owned subsidiary
Boston Options Exchange Regulation, LLC (``BOXR'') will provide the
regulatory framework for the BOX facility. BOXR, together with BOX,
will continue to have regulatory responsibility for the activities of
the BOX facility.
In order for the Exchange to distribute the net proceeds from the
BOX sale to the Exchange's membership owners, the Exchange's
Certificate of Incorporation must be amended in order to remove the
existing provision that prevents the Exchange from making distributions
to Exchange membership owners, and to add a provision that allows the
Exchange to redeem a portion of each membership for a pro rata share of
the net proceeds of the BOX sale.\7\ The Exchange has been advised that
the use of the redemption as a means to distribute proceeds from the
sale of its equity interest in BOX may provide beneficial tax
treatment. Therefore, the Restated Certificate would permit the
Exchange to make distributions to membership owners, and also would
permit the use of such pro rata redemption. The Restated Certificate
also would delete obsolete text regarding the incorporators of the
Exchange.
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\7\ See Restated Certificate, Article Fourth.
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If approved by the Commission, the Restated Certificate would be
effective immediately prior to the closing of the BOX distribution upon
the filing of the Restated Certificate with the Secretary of State of
the State of Delaware. It is anticipated that the Restated Certificate
would be amended again upon the closing of NASDAQ OMX's planned
acquisition of the Exchange.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the requirements under section 6(b)(5) of the Act,\8\ that an
exchange have rules that are designed to promote just and equitable
principles of trade, to remove impediments to and to perfect the
mechanism of a free and open market and a national market system, and,
in general, to protect investors and the public interest in that, if
approved, the proposed rule change will provide a means for the
Exchange to distribute the proceeds from the sale of the Exchange's
equity interest in BOX to all of the Exchange's owners of memberships.
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\8\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
BSE 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
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) By order approve such proposed rule change, or
(B) institute proceedings to determine whether the proposed rule
change should be disapproved.
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 (https://
www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-BSE-2008-02 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 Number SR-BSE-2008-02. 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
(https://www.sec.gov/rules/sro.shtml). Copies of the submission, all
subsequent
[[Page 25811]]
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-BSE-2008-02 and should be submitted on or before May 28,
2008.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8-10072 Filed 5-6-08; 8:45 am]
BILLING CODE 8010-01-P
