[Federal Register: August 6, 2009 (Volume 74, Number 150)]
[Notices]
[Page 39353-39362]
[DOCID:fr06au09-97]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60409; File No. 4-587]

Program for Allocation of Regulatory Responsibilities Pursuant to
Rule 17d-2; Notice of Filing and Order Declaring Effective a Proposed
Plan for the Allocation of Regulatory Responsibilities Among the
Financial Industry Regulatory Authority, Inc., New York Stock Exchange
LLC, NYSE Regulation, Inc. and NYSE Amex LLC

July 30, 2009.
    Notice is hereby given that the Securities and Exchange Commission
(``Commission'' or ``SEC'') has issued an Order pursuant to Section
17(d) of the Securities Exchange Act of 1934 (``Act'') \1\ and Rule
17d-2 thereunder \2\ approving and declaring effective a plan dated
December 15, 2008 for the allocation of regulatory responsibilities
(``17d-2 Plan'' or the ``Plan'') filed with the Commission on July 29,
2009 pursuant to Rule 17d-2 of the Act, by the New York Stock Exchange
LLC (``NYSE''), NYSE Regulation, Inc. (``NYSE Regulation''), NYSE Amex
LLC (``NYSE Amex''), and the Financial Industry Regulatory Authority,
Inc. (``FINRA'') (each individually, a ``Party'' and collectively, the
``Parties'').
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    \1\ 15 U.S.C. 78q(d).
    \2\ 17 CFR 240.17d-2.
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I. Introduction

    Section 19(g)(1) of the Act,\3\ among other things, requires every
self-regulatory organization (``SRO'') registered as either a national
securities exchange or national securities association to examine for,
and enforce compliance by, its members and persons associated with its
members with the Act, the rules and regulations thereunder, and the
SRO's own rules, unless the SRO is relieved of this responsibility
pursuant to Section 17(d) or Section 19(g)(2) of the Act.\4\ Without
this relief, the statutory obligation of each individual SRO could
result in a pattern of multiple examinations of broker-dealers that
maintain memberships in more than one SRO (``common members''). Such
regulatory duplication would add unnecessary expenses for common
members and their SROs.
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    \3\ 15 U.S.C. 78s(g)(1).
    \4\ 15 U.S.C. 78q(d) and 15 U.S.C. 78s(g)(2), respectively.
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    Section 17(d)(1) of the Act \5\ was intended, in part, to eliminate
unnecessary multiple examinations and regulatory duplication.\6\ With
respect to a common member, Section 17(d)(1) authorizes the Commission,
by rule or order, to relieve an SRO of the responsibility to receive
regulatory reports, to examine for and enforce compliance with
applicable statutes, rules, and regulations, or to perform other
specified regulatory functions.
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    \5\ 15 U.S.C. 78q(d)(1).
    \6\ See Securities Act Amendments of 1975, Report of the Senate
Committee on Banking, Housing, and Urban Affairs to Accompany S.
249, S. Rep. No. 94-75, 94th Cong., 1st Session 32 (1975).
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    To implement Section 17(d)(1), the Commission adopted two rules:
Rule 17d-1 and Rule 17d-2 under the Act.\7\ Rule 17d-1 authorizes the
Commission to name a single SRO as the designated examining authority
(``DEA'') to examine common members for compliance with the financial
responsibility requirements imposed by the Act, or by Commission or SRO
rules.\8\ When an SRO has been named as a common member's DEA, all
other SROs to which the common member belongs are relieved of the
responsibility to examine the firm for compliance with the applicable
financial responsibility rules. On its face, Rule 17d-1 deals only with
an SRO's obligations to enforce member compliance with financial
responsibility requirements. Rule 17d-1 does not relieve an SRO from
its obligation to examine a common member for compliance with its own
rules and provisions of the Federal securities laws governing matters
other than financial responsibility, including sales practices and
trading activities and practices.
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    \7\ 17 CFR 240.17d-1 and 17 CFR 240.17d-2, respectively.
    \8\ See Securities Exchange Act Release No. 12352 (April 20,
1976), 41 FR 18808 (May 7, 1976).
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    To address regulatory duplication in these and other areas, the
Commission adopted Rule 17d-2 under the Act.\9\ Rule 17d-2 permits SROs
to propose joint plans for the allocation of regulatory
responsibilities with respect to their common members. Under paragraph
(c) of Rule 17d-2, the Commission may declare such a plan effective if,
after providing for appropriate notice and comment, it determines that
the plan is necessary or appropriate in the public interest and for the
protection of investors; to foster cooperation and coordination among
the SROs; to remove impediments to, and foster the development of, a
national market system and a national clearance and settlement system;
and is in conformity with the factors set forth in Section 17(d) of the
Act. Commission approval of a plan filed pursuant to Rule 17d-2
relieves an SRO of those regulatory responsibilities allocated by the
plan to another SRO.
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    \9\ See Securities Exchange Act Release No. 12935 (October 28,
1976), 41 FR 49091 (November 8, 1976).
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II. Proposed Plan

    On January 17, 2008, NYSE Euronext, Inc. and The Amex Membership
Corporation, a New York not-for-profit company and parent of the
American Stock Exchange LLC (``Amex'') entered into an Agreement and
Plan of Merger, whereby NYSE Euronext would acquire Amex and as a
result, Amex would become a wholly-owned subsidiary of NYSE Group, Inc.
and would be renamed ``NYSE Amex.'' \10\ In connection with the merger,
the Commission approved proposed rule changes to permit the merger and
related transactions, including the adoption of an operating agreement
for NYSE Amex.\11\ The Commission also approved an NYSE Amex rule
proposal to adopt new rules governing member organizations, member firm
conduct, and equity trading.\12\ NYSE Amex's new membership and member
conduct rules are closely modeled on, and largely identical to,
existing NYSE membership and firm conduct rules,\13\ many of which are
``common rules'' under the existing 17d-2 plan between NYSE and
FINRA.\14\
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    \10\ On March 13, 2009, the exchange then known as NYSE
Alternext U.S. LLC filed for immediate effectiveness a proposal to
change its name to NYSE Amex LLC. See Securities Exchange Act
Release No. 59575 (March 13, 2009), 74 FR 11803 (March 19, 2009)
(SR-NYSEALTR-2009-24).
    \11\ See Securities Exchange Act Release No. 58673 (September
29, 2008), 73 FR 57707 (October 3, 2008) (SR-Amex-2008-62 and SR-
NYSE-2008-60).
    \12\ See Securities Exchange Act Release No. 58705 (October 1,
2008), 73 FR 58995 (October 8, 2008) (SR-Amex-2008-63).
    \13\ See id. at 58995.
    \14\ See id.; See also Securities Exchange Act Release No. 56148
(July 26, 2007), 72 FR 42146 (August 1, 2007) (order declaring
effective the plan between NYSE and FINRA).
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    The purpose of the Plan is to add NYSE Amex as a party to the
existing 17d-2 plan by and among National Association of Securities
Dealers, Inc.

(``NASD'') (n/k/a FINRA), NYSE, and NYSE Regulation without altering
the scope of that plan. Accordingly, the proposed 17d-2 Plan is
intended to reduce regulatory duplication for firms that are common
members of either NYSE and FINRA or NYSE Amex and FINRA. Pursuant to
the proposed 17d-2 Plan, FINRA would assume certain examination,
enforcement, and surveillance responsibilities for members of either
NYSE and FINRA or NYSE Amex and FINRA as well as the associated persons
therewith (``Common Members'') with respect to certain rules.
    The text of the Plan delineates the proposed regulatory
responsibilities with respect to the Parties. Included in the proposed
Plan is Exhibit 1 (the ``List of Common Rules'') that lists every NYSE
rule, and NYSE Amex Equities rule, for which FINRA would bear
responsibility under the Plan for overseeing and enforcing with respect
to Common Members.
    Specifically, under the 17d-2 Plan, FINRA would assume examination
and enforcement responsibility relating to compliance by Common Members
with the rules of NYSE and NYSE Amex that are substantially similar to
the applicable rules of FINRA (``Common Rules'').\15\ The 17d-2 Plan
would not include the application of any Common Rule to the extent that
it pertains to matters covered by a separate agreement under Rule 17d-
2.\16\ In the event that a Common Member is the subject of an
investigation, examination, or enforcement proceeding, the 17d-2 Plan
acknowledges that any Party may, in its discretion, exercise concurrent
jurisdiction.\17\
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    \15\ See paragraph 1(a) of the proposed 17d-2 Plan.
    \16\ See, e.g., the Multiparty Agreement made pursuant to Rule
17d-2 of the Exchange Act among the American Stock Exchange LLC, the
BATS Exchange, Inc., the Boston Stock Exchange, Inc., the CBOE Stock
Exchange, LLC, the Chicago Stock Exchange, Inc., Financial Industry
Regulatory Authority, Inc., the International Securities Exchange,
LLC, the NASDAQ Stock Market LLC, the National Stock Exchange, Inc.,
the New York Stock Exchange, LLC, NYSE Arca Inc., NYSE Regulation,
Inc., and the Philadelphia Stock Exchange, Inc., approved by the
Commission on October 17, 2008, as may be amended from time to time,
involving the allocation of regulatory responsibilities with respect
to common members for compliance with the surveillance,
investigation, and enforcement of common insider trading rules. See
Securities Exchange Act Release No. 58806 (October 17, 2008), 73 FR
63216 (October 23, 2008); see also paragraph 20 of the proposed 17d-
2 Plan.
    \17\ See paragraph 7 of the proposed 17d-2 Plan.
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    While NYSE Amex has adopted a number of NYSE member firm conduct
rules, NYSE Amex equities rules do not include all NYSE rules.\18\
Accordingly, certain Common Rules between NYSE and FINRA that have not
been adopted by NYSE Amex (e.g., NYSE Rule 414 and the NYSE Series 700
Rules) will not be Common Rules among NYSE, NYSE Amex, and FINRA. In
addition, certain other NYSE Amex equities trading rules that qualify
as Common Rules have been modified to reflect the difference in
products trading at NYSE Amex (e.g., NYSE Amex Equities Rules 345
(Employees--Registration, Approval, Records) and 408 (Discretionary
Power in Customers' Accounts)).
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    \18\ For example, NYSE Amex has not adopted rules based on the
following NYSE products: Cabinet Securities (NYSE Rule 85), Options
(NYSE Series 700 Rules), Index and Currency Warrants (NYSE Rule
414), and Basket Trades (NYSE Series 800 Rules).
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    Under the Plan, each of NYSE and NYSE Amex would retain full
responsibility for surveillance and enforcement with respect to trading
activities or practices involving the systems and facilities of the
respective exchange. Each of NYSE and NYSE Amex also would retain
regulatory responsibility for examinations of conduct or action of a
Common Member that is not covered under the Common Rules and/or by
related Federal regulations or laws; processing of applications for
membership in the respective exchange; qualification and registration
of member firm personnel to effect transactions on the floor of the
exchange; and regulatory responsibility for the application of any
Common Rule as it pertains to matters other than member firm
regulation.\19\
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    \19\ See paragraphs 2(d) and 2(e) of the proposed 17d-2 Plan.
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    The text of the proposed 17d-2 Plan is as follows:
* * * * *

Agreement by and Among Financial Industry Regulatory Authority, Inc.,
New York Stock Exchange LLC, NYSE Regulation, Inc., and NYSE Amex LLC
Pursuant to SEC Rule 17d-2 Promulgated by the Securities and Exchange
Commission Under the Securities Exchange Act of 1934

    This Agreement, (``Agreement'') by and among Financial Industry
Regulatory Authority, Inc., a Delaware non-stock, not-for-profit
membership corporation (``FINRA''), New York Stock Exchange LLC, a New
York limited liability company (``NYSE LLC''), NYSE Regulation, Inc., a
New York not-for-profit corporation and an indirectly wholly-owned
subsidiary of NYSE Group, Inc. (``NYSE Regulation''), and NYSE Amex LLC
(``NYSE Amex''), a Delaware limited liability company and wholly-owned
subsidiary of NYSE Group, Inc. (herein collectively referred to as the
``Participants''), dated as of December 15, 2008, pursuant to the
provisions of Rule 17d-2 promulgated by the Securities and Exchange
Commission (the ``Commission'') under the Securities Exchange Act of
1934, as amended (the ``Act''), which authorizes agreements between
self-regulatory organizations for plans to reduce or eliminate
regulatory duplication.
    This Agreement amends and restates the agreement entered into among
National Association of Securities Dealers, Inc. (``NASD'' n/k/a
FINRA), NYSE LLC, and NYSE Regulation on July 30, 2007, entitled
``Agreement between National Association of Securities Dealers, Inc.,
New York Stock Exchange LLC, and NYSE Regulation, Inc., pursuant to SEC
Rule 17d-2 promulgated by the Securities and Exchange Commission under
the Securities Exchange Act of 1934'' (the ``July 30, 2007
Agreement'').
    Whereas, NYSE Euronext, a Delaware corporation and the parent
entity of NYSE Group (as hereinafter defined), and The Amex Membership
Corporation, a New York not-for-profit corporation and parent company
of the American Stock Exchange LLC (``Amex''), entered into an
Agreement and Plan of Merger, dated January 17, 2008 (``Merger
Agreement''), whereby, through a series of mergers, on October 1, 2008,
NYSE Euronext acquired Amex (``Merger Transaction'') and as a result of
these mergers, Amex became a wholly-owned subsidiary of NYSE Group and
was renamed NYSE Amex; and
    Whereas, the Participants are desirous of reducing duplication in
the regulation of broker-dealer firms and associated persons therewith
that are members of NYSE, NYSE Amex, and FINRA (``Common Members'') and
allocating regulatory responsibilities with respect to such Common
Members and for which they are subject to Common Rules (as hereinafter
defined); and
    Whereas, the Participants intend that FINRA will perform various
functions formerly performed by NYSE Regulation; and
    Whereas, the Participants intend this Agreement to describe the
functions to be performed by FINRA pursuant to Section 17(d) of the Act
and Rule 17d-2 promulgated thereunder, and intend to file such with the
Commission for its approval.
    Now, therefore, in consideration of the foregoing, the mutual
covenants contained hereinafter, and other good and valuable
consideration, the Participants hereby agree as follows:

1. Assumption of Regulatory Responsibilities
    (a) On the effective date, which shall be the date that the
Commission has declared effective this Agreement, FINRA will assume
regulatory responsibilities for all Common Members for the list of
rules attached as Exhibit 1 (``Common Rules'') to this Agreement and
made part hereof including examination, enforcement and surveillance
responsibilities for such Common Rules to the extent that such
responsibilities involve member firm regulation (the ``Regulatory
Responsibilities''). The Participants agree that the NYSE and NYSE Amex
rules listed on Exhibit 1 are identical or substantially similar to the
corresponding FINRA rule.
    (b) FINRA shall not charge NYSE or NYSE Amex for performing the
Regulatory Responsibilities except for the reasonable notification
expenses and travel and out-of-pocket expenses, as provided in
paragraphs 4(c) and 5.
2. Scope of Regulatory Responsibilities
    (a) Whenever a Participant proposes to make a change to the
substance of any of the Common Rules, before filing such proposal with
the SEC, it shall inform the other Participants to determine whether
the other Participants will agree to promptly propose a conforming
change to its version of the Common Rule. In the event the Participants
do not agree to propose conforming changes, the Participants agree that
they will file with the SEC for approval an amendment to this Agreement
deleting such rule from the list of Common Rules, such amendment to be
effective no earlier than the date of SEC approval of the change to the
Common Rule proposed by the NYSE, NYSE Amex, or FINRA, as the case may
be.
    (b) Common Rulebook. FINRA intends to create a single set of Rules
to replace the FINRA NASD Rules and the NYSE Rules incorporated by
FINRA. There is a substantial likelihood that each FINRA rule that
would replace an existing NYSE Rule incorporated by FINRA and
applicable to Common Members would be substantially different from the
then-existing NYSE Rule or NYSE Amex Rule. In such case, pursuant to
paragraph 2(a) above, NYSE and NYSE Amex would need to file with the
Commission a proposal to amend their respective corresponding Rules to
conform to the new FINRA Rule. As provided in Section 13, the
Participants may make certain amendments to the list of Common Rules in
Exhibit 1 without constituting an amendment to this Agreement.
    (c) Each year within 30 days of the anniversary date of Commission
approval of this Agreement, or more frequently if required by changes
in the rules of a Participant, NYSE and NYSE Amex will submit to FINRA
an updated list of Common Rules for review. This updated list may add
to Exhibit 1 rules that qualify as Common Rules, shall delete from
Exhibit 1 rules of that Participant that are no longer identical or
substantially similar to the Common Rules, and shall confirm that the
remaining rules of the Participant included on Exhibit 1 continue to
qualify as Common Rules. Within 30 days from the date that FINRA has
received revisions to Exhibit 1, FINRA shall confirm in writing to NYSE
and NYSE Amex whether the rules listed in Exhibit 1 are Common Rules.
    (d) Notwithstanding anything contained in this Agreement to the
contrary, NYSE shall retain regulatory responsibility for the following
(collectively, the ``NYSE Retained Responsibilities''):
    (i) Examinations of conduct or action by a Common Member that is
otherwise covered by NYSE rules that are not Common Rules (the ``NYSE-
only Rules'') and/or by related Federal laws or regulations;
    (ii) Surveillance of, and investigation and enforcement with
respect to, conduct or action undertaken in connection with trading on
or through the systems and facilities of the NYSE, or conduct or
actions by a Common Member that are otherwise covered by NYSE-only
Rules, additionally, in all such cases, surveillance, investigation and
enforcement with respect to how such conduct may constitute a violation
of applicable Federal laws or regulations;
    (iii) Processing of applications for trading licenses or other
indicia of membership in the NYSE, including without limitation
applying NYSE's rules relating to the rights and obligations of Common
Members that hold a trading license to effect transactions on the floor
of the NYSE or through any systems or facilities of the NYSE;
    (iv) Qualification and registration of member firm personnel to
effect transactions or work as Floor employees on the Floor of the
NYSE, pursuant to the NYSE's applicable rules regarding qualifications
and registration; and
    (v) The application of any Common Rule as it pertains to matters
other than member firm regulation, including matters relating to NYSE's
exclusive responsibility for (ii)-(iv) above (the ``Non-Exclusive
Common Rules''). The Participants have identified the Non-Exclusive
Common Rules, which are specifically designated on Exhibit 1, as those
rules for which both NYSE and FINRA will bear responsibility when
performing their respective regulatory responsibilities.
    (e) Notwithstanding anything contained in this Agreement to the
contrary, NYSE Amex shall retain regulatory responsibility for the
following (collectively, the ``NYSE Amex Retained Responsibilities''):
    (i) Examinations of conduct or action by a Common Member that is
otherwise covered by NYSE Amex rules that are not Common Rules (the
``NYSE Amex-only Rules'') and/or by related Federal laws or
regulations;
    (ii) Surveillance of, and investigation and enforcement with
respect to, conduct or action undertaken in connection with trading on
or through the systems and facilities of the NYSE Amex, or conduct or
actions by a Common Member that are otherwise covered by NYSE Amex-only
Rules, additionally, in all such cases, surveillance, investigation and
enforcement with respect to how such conduct may constitute a violation
of applicable Federal laws or regulations;
    (iii) Processing of applications for trading licenses or other
indicia of membership in the NYSE Amex, including without limitation
applying NYSE Amex rules relating to the rights and obligations of
Common Members that hold a trading license to effect transactions on
the floor of the NYSE Amex or through any systems or facilities of the
NYSE Amex;
    (iv) Qualification and registration of member firm personnel to
effect transactions or work as Floor employees on the Floor of the NYSE
Amex, pursuant to the NYSE Amex's applicable rules regarding
qualifications and registration; and
    (v) The application of any Common Rule as it pertains to matters
other than member firm regulation, including matters relating to NYSE
Amex's exclusive responsibility for (ii)-(iv) above (the ``Non-
Exclusive Common Rules''). The Participants have identified the Non-
Exclusive Common Rules, which are specifically designated on Exhibit 1,
as those rules for which both NYSE Amex and FINRA will bear
responsibility when performing their respective regulatory
responsibilities.
3. Violations
    (a) Should FINRA become aware of potential violations of another
Participant's rules that are not within the scope of the Regulatory
Responsibilities, FINRA will promptly notify the other Participant of
those

potential violations, and such matters will be handled by the
Participant responsible for those regulatory responsibilities.
    (b) Should a Participant other than FINRA become aware of potential
violations of Common Rules, the Participant will promptly notify FINRA
of those potential violations, and such matters will be handled by
FINRA as provided in this Agreement.
4. Applications for, Qualification for, and Termination of, Membership
    (a)(i) Common Members subject to this Agreement will be required to
submit to FINRA, and FINRA will be responsible for processing, and
acting upon, all applications (each an ``Application'') submitted on
behalf of the Common Member and any individual associated with such
Common Member required to be approved by the rules of NYSE, NYSE Amex,
and FINRA (collectively, an ``Applicant'').
    (ii) Promptly upon receipt of any complete Application, but in any
event no later than seven (7) business days thereafter, FINRA shall
advise NYSE and NYSE Amex of the qualifications and registration status
of the Applicant required to be approved pursuant to the rules of NYSE,
NYSE Amex, and FINRA. The NYSE and NYSE Amex each reserve the right to
require additional qualifications or registrations prior to approving
an Applicant as a member of the NYSE and NYSE Amex, pursuant to the
process described in NYSE and NYSE Amex rules.
    (b) FINRA shall promptly advise NYSE and NYSE Amex of information
regarding changes in status of any person required to be approved
pursuant to the rules of NYSE, NYSE Amex, and FINRA that relates to a
statutory disqualification, involuntary termination from employment or
any other submission made to FINRA pursuant to Incorporated NYSE Rule
351(a)-(c). The NYSE and NYSE Amex each reserve the right to disqualify
a member pursuant to the process described in their respective rules.
    (c) Common Members will be required to send to FINRA all letters,
termination notices or other material respecting persons required to be
approved pursuant to the rules of NYSE, NYSE Amex, and FINRA. When as a
result of processing said submissions FINRA becomes aware of a
statutory disqualification as defined in the Act with respect to a
Common Member or person associated with a Common Member, FINRA will
determine pursuant to Section 15A(g) or 6(c) of the Act the
acceptability or continued acceptability of the person to whom such
disqualification applies but will not make a determination regarding
NYSE or NYSE Amex membership or participation, or association of a
person with an NYSE or NYSE Amex member. FINRA shall advise the other
Participants in writing of its actions in this regard. The other
Participants shall, within 30 days of receiving such information from
FINRA, determine whether to permit a Common Member that has been
determined to be statutorily disqualified by FINRA from becoming or
remaining an NYSE or NYSE Amex member or a participant, or a person
associated with a member. The other Participant will advise FINRA of
its decision.
    The other Participant will reimburse FINRA for reasonable expenses
incurred in notifying a Participant of FINRA's decision regarding a
statutory disqualification under Section 15A(g) or Section 6(c) of the
Act.
    FINRA will also be responsible for processing and, if required,
acting upon all requests for the opening, address changes, and
terminations of branch offices by Common Members and any other
applications required of Common Members under the Common Rules.
5. Information Sharing
    The Participants agree to share information as follows:
    (a) General.
    A Participant shall promptly furnish to the other Participants any
information that it determines indicates possible financial or
operational problems that may affect the continued ability of any
Common Member to conduct business.
    (b) Reports and Other Documents.
    A Participant shall upon request promptly make available to the
other Participants at no cost any existing financial, operational, or
related report filed with that Participant by a Common Member, as well
as any existing files, information on customer complaints, termination
notices, copies of an examination report, examination workpapers,
investigative material, enforcement referrals or other documents
involving compliance with the Federal securities laws and regulations
and the rules of the Participants by the Common Member, or other
documents in the possession of the Participant relating to the Common
Member as necessary to assist the other Participants in fulfilling
their Retained Responsibilities.
    (c) Third-party Complaints.
    If a Participant receives a copy of a complaint from any third
party, including but not limited to a report from a Common Member
pursuant to FINRA Incorporated NYSE Rule 351 or NYSE Amex Equities Rule
351, relating to possible violations by a Common Member or persons
associated with a Common Member that is not within the scope of that
Participant's regulatory responsibilities and is within the scope of
another Participant's regulatory responsibilities, that Participant
shall promptly forward to the other Participant copies of such
complaints. The Participant with the regulatory responsibilities vis-
[agrave]-vis such complaint shall have responsibility to review and
take any appropriate action with respect to such complaint.
    (d) Information on Formal and Informal Discipline.
    A Participant shall promptly make available to the other
Participants information on (1) formal disciplinary actions taken by
that Participant involving a Common Member or persons associated with a
Common Member; and (2) informal disciplinary actions taken by that
Participant involving a Common Member. For purposes of this paragraph
(d), informal disciplinary actions shall mean Cautionary Actions and
MRVP (if FINRA) and Letters of Education, Letters of Admonition, and
Summary Fines (if NYSE or NYSE Amex).
    (e) Participants to Make Personnel Available as Witnesses.
    A Participant shall make its personnel available to the other
Participants to serve as testimonial or non-testimonial witnesses as
necessary to assist the respective Participant in fulfilling the self-
regulatory responsibilities retained by it under this Agreement. The
Participant requiring the services of such witnesses shall pay all
reasonable travel and other out-of-pocket expenses incurred by the
other Participant's employees to the extent that the requesting
Participant requires such employees to serve as a witness, and provide
information or other assistance pursuant to this Agreement.
    (f) Confidentiality. The Participants agree that documents or
information shared shall be held in confidence, and be used only for
the purposes of carrying out their respective regulatory obligations.
No Participant shall assert regulatory or other privileges as against
the others with respect to documents or information that is required to
be shared pursuant to this Agreement.
    (g) No Waiver of Privilege. The sharing of documents or information
among the Participants pursuant to this Agreement shall not be deemed a
waiver as against third parties of regulatory or other privileges
relating to the discovery of documents or information.

    (h) Periodic Meetings. The Participants agree that they shall
conduct regular joint meetings among them for the purposes of reporting
on the conduct of the Regulatory Responsibilities and current
investigations involving significant rule violations by a Common
Member, and identifying issues or concerns with respect to the
regulation of Common Members.
6. Arbitration of Disputes Under This Agreement
    (a) Regulatory Services Manager. The Participants hereby each
appoint the employee identified on Exhibit 2 hereto as its respective
Regulatory Services Manager (the ``Regulatory Services Manager'') to,
among other things, resolve disputes pursuant to Section 6(b) of this
Agreement and oversee day-to-day management of the services and
activities contemplated by this Agreement. On reasonable prior written
notice to the other, the Participants shall each have the right to
replace its respective Regulatory Services Manager with an employee or
officer with comparable knowledge, expertise and decision-making
authority.
    (b) Dispute Resolution. Except as otherwise expressly set forth in
this Agreement, any dispute arising out of or relating to this
Agreement shall be submitted for resolution to the Regulatory Services
Managers. In the event the Regulatory Services Managers fail to resolve
a dispute pursuant to this Section 6(b) within a reasonable time of
receiving notice of such dispute from a Participant, then the
Participants shall refer the dispute to the employee identified on
Exhibit 2 as its respective Senior Officer (the ``Senior Officer'') and
such Senior Officers shall attempt in good faith to conclusively
resolve any such dispute. On reasonable prior written notice to the
other, the Participants shall each have the right to replace its
respective Senior Officer with an officer with comparable rank,
knowledge, expertise and decision-making authority. If the Senior
Officers are unable to resolve the dispute amicably within 30 days, the
dispute will be resolved by binding arbitration between or among the
Participants as provided herein. Arbitration shall be conducted by a
single arbitrator agreed upon by the Participants in accordance with
the arbitration rules of the American Arbitration Association (the
``AAA''); provided, that, if the Participants cannot agree on the
identity of the arbitrator, then the arbitrator shall be chosen by the
AAA in accordance with its rules. All arbitration hearings shall be
conducted in New York, New York. Each Participant shall pay its own
costs for the arbitration, with the cost of the arbitrator to be
equally divided between or among the Participants; provided, that the
arbitrator may, in his or her discretion, award reasonable attorneys'
fees and expenses to the prevailing Participant. The arbitrator will
have no authority to award punitive damages or any other damages not
measured by the prevailing Participant's actual damages, and may not,
in any event, make any ruling, finding or award that does not conform
to the terms and conditions of this Agreement. A judgment upon an award
may be entered in any court having jurisdiction. No Participant or the
arbitrator may disclose the existence, content, or results of any
arbitration hereunder without the prior written consent of the other
Participants, other than to the Commission. Except as otherwise
expressly set forth in this Agreement, the procedures set forth in this
Section 6(b) must be satisfied as a condition precedent to a
Participant commencing any arbitration in connection with any dispute
arising hereunder. A Participant's failure to comply with the preceding
sentence shall constitute cause for the dismissal without prejudice of
any such arbitration.
    (c) Continuity of Services. Each Participant acknowledges that the
timely and complete performance of its obligations pursuant to this
Agreement is critical to the business and operations of the other
Participants. In the event of a dispute between or among the
Participant, the Participants will continue to perform their respective
obligations under this Agreement in good faith during the resolution of
such dispute unless and until this Agreement is terminated in
accordance with its provisions. Nothing in this Section 6(c) will
interfere with a Participant's right to terminate this Agreement as set
forth in this Agreement.
7. No Restrictions on Regulatory Action
    Nothing contained in this Agreement shall restrict or in any way
encumber the right of a Participant to conduct its own independent or
concurrent investigation, examination or enforcement proceeding of or
against Common Members, as a Participant, in its sole discretion, shall
deem appropriate or necessary.
8. Limitation of Liability
    None of the Participants nor any of their respective directors,
governors, officers, employees, affiliates or agents shall be liable to
any other Participants or such Participant's directors, governors,
officers, employees, affiliates or agents for any liability, loss or
damage resulting from any delays, inaccuracies, errors or omissions
with respect to its performing or failing to perform its obligations
under this Agreement, except as otherwise provided for under the Act or
for any liability, loss or damage resulting from the gross negligence,
willful misconduct, reckless disregard or breach of confidentiality by
a Participant or its directors, governors, officers, employees,
affiliates or agents. The Participants understand and agree with each
other that the Regulatory Responsibilities are being performed on a
good faith and best effort basis and no warranties, express or implied,
are made by any Participant to any other Participant with respect to
any of the obligations to be performed by the Participants hereunder.
9. Commission Approval
    (a) The Participants agree to file promptly this Agreement with the
Commission for its review and approval. This Agreement shall be
effective upon approval of the Commission.
    (b) If approved by the Commission, FINRA will notify Common Members
of the general terms of the Agreement and its impact on such members.
The notice will be sent on behalf of all Participants and, prior to
being sent, NYSE and NYSE Amex will review and approve the notice.
10. Applicability of Certain Laws
    Notwithstanding any provision hereof, this Agreement shall be
subject to any applicable Federal or State statute, or any rule or
order of the Commission reassigning regulatory responsibilities between
self-regulatory organizations. To the extent such statute, rule, or
order is inconsistent with one or more provisions of this Agreement,
such statute, rule, or order shall supersede the provision(s) hereof to
the extent necessary to be properly effectuated and the provision(s)
hereof in that respect shall be null and void.
11. Definitions
    Unless otherwise defined in this Agreement, or unless the context
otherwise requires, the terms used in this Agreement shall have the
same meaning as they have under the Act and the rules and regulations
promulgated by the Commission thereunder.
12. Severability
    Any term or provision of this Agreement that is invalid or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or

unenforceability without rendering invalid or unenforceable the
remaining terms and provisions of this Agreement or affecting the
validity or enforceability of any of the terms or provisions of this
Agreement in any other jurisdiction.
13. Amendment
    This Agreement may be amended in writing duly approved by each
Participant. All such amendments, other than modifications to the list
of Common Rules in Exhibit 1 pursuant to (i) a Commission order or
other effective proposed rule change to FINRA approving the deletion of
an NYSE Rule incorporated by FINRA or the creation of a FINRA rule to
replace an NYSE Rule incorporated by FINRA, and (ii) a Commission order
or other effective proposed rule change to NYSE or NYSE Amex approving
the deletion of an NYSE or NYSE Amex Equities Rule or an amendment to
an NYSE or NYSE Amex rule that makes such NYSE or NYSE Amex rule
substantially identical to a FINRA rule, must be filed with and
approved by the Commission before they become effective.
14. Termination
    This Agreement may be terminated by a Participant at any time upon
the approval of the Commission after 180 days written notice to the
other Participants.
15. General
    The Participants agree to perform all acts and execute all
supplementary instruments or documents that may be reasonably necessary
or desirable to carry out the provisions of this Agreement.
16. Liaison and Notices
    All questions regarding the implementation of this Agreement shall
be directed to the persons identified in subsections (a), (b) and (c),
as applicable, below. All notices and other communications required or
permitted to be given under this Agreement shall be in writing and
shall be deemed to have been duly given upon (i) actual receipt by the
notified Participant or (ii) constructive receipt (as of the date
marked on the return receipt) if sent by certified or registered mail,
return receipt requested, to the following addresses:
    (a) If to NYSE Regulation: NYSE Regulation, Inc., 11 Wall Street,
New York, New York 10005. Telephone:<PHONE_NUMBER>. Facsimile: (212)
656-8101. Attention: General Counsel, Regulatory Services Manager.
    (b) If to New York Stock Exchange LLC: New York Stock Exchange LLC,
11 Wall Street, New York, NY 10005. Telephone:<PHONE_NUMBER>.
Facsimile:<PHONE_NUMBER>. Attention: General Counsel.
    (c) If to FINRA: Financial Industry Regulatory Authority, Inc.,
1735 K Street, NW., Washington, DC 20006-1500. Telephone: (202) 728-
8071. Facsimile:<PHONE_NUMBER>. Attention: General Counsel, Regulatory
Services Manager.
    (d) If to NYSE Amex LLC: NYSE Amex LLC, 11 Wall Street, New York,
NY 10005. Telephone:<PHONE_NUMBER>. Facsimile:<PHONE_NUMBER>.
Attention: General Counsel, Regulatory Services Manager.
17. Relief From Regulatory Responsibility
    Pursuant to Section 17(d)(1)(A) of the Act, and Rule 17d-2
thereunder, the Participants jointly request the SEC, upon its approval
of this Agreement, to relieve the NYSE and NYSE Amex of any and all
responsibilities with respect to the matters allocated to FINRA
pursuant to this Agreement for purposes of Sections 17(d) and 19(g) of
the Act.
18. Governing Law
    This Agreement shall be deemed to have been made in the State of
New York, and shall be construed and enforced in accordance with the
law of the State of New York, without reference to principles of
conflicts of laws thereof. Each of the Participants hereby consents to
submit to the jurisdiction of the courts by or for the State of New
York or the United States District Court for the Southern District of
New York in connection with any action or proceeding relating to this
Agreement.
19. Survival of Provisions
    Provisions intended by their terms or context to survive and
continue notwithstanding delivery of the regulatory services by FINRA,
the payment of the price by the NYSE or NYSE Amex, and any termination
of this Agreement shall survive and continue.
20. Prior Agreements
    This Agreement is wholly separate from: (a) The multiparty
Agreement made pursuant to Rule 17d-2 of the Exchange Act among the
American Stock Exchange LLC, the Boston Stock Exchange, Inc., the
Chicago Board Options Exchange, Incorporated, the International
Securities Exchange LLC, the National Association of Securities
Dealers, Inc., the New York Stock Exchange, LLC, the NYSE Arca, Inc.,
and the Philadelphia Stock Exchange, Inc. involving the allocation of
regulatory responsibilities with respect to common members for
compliance with common rules relating to the conduct by broker-dealers
of accounts for listed options or index warrants entered into on June
5, 2008, and as may be amended from time to time; (b) the multiparty
Agreement made pursuant to Rule 17d-2 of the Exchange Act among the
American Stock Exchange LLC, the BATS Exchange, Inc. the Boston Stock
Exchange, Inc., the CBOE Stock Exchange, LLC, the Chicago Stock
Exchange, Inc., Financial Industry Regulatory Authority, Inc., the
International Securities Exchange, LLC, the NASDAQ Stock Market LLC,
the National Stock Exchange, Inc., the New York Stock Exchange, LLC,
NYSE Arca Inc., NYSE Regulation, Inc., and the Philadelphia Stock
Exchange, Inc., approved by the Commission on October 17, 2008, as may
be amended from time to time, involving the allocation of regulatory
responsibilities with respect to common members for compliance with the
surveillance, investigation, and enforcement of common insider trading
rules; and (c) the multiparty Agreement made pursuant to Rule 17d-2 of
the Exchange Act among American Stock Exchange LLC, Boston Stock
Exchange, Inc., Chicago Board Options Exchange, Incorporated, the
International Securities Exchange LLC, Financial Industry Regulatory
Authority, Inc., NYSE Arca, Inc., The NASDAQ Stock Market LLC, and the
Philadelphia Stock Exchange, Inc. involving the allocation of
regulatory responsibilities with respect to common members for
compliance with common rules relating to certain options-related market
surveillance matters entered into on March 31, 2008, as amended October
1, 2008, and as may be amended from time to time.
21. Counterparts
    This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, and such counterparts together shall
constitute but one and the same instrument.
    In witness whereof, the Participants hereto have caused this
Agreement to be executed by their respective officers thereunto duly
authorized, as of the date first written above.

Financial Industry Regulatory Authority
By:--------------------------------------------------------------------
Name:------------------------------------------------------------------
Title:-----------------------------------------------------------------

New York Stock Exchange, LLC
By:--------------------------------------------------------------------
Name:------------------------------------------------------------------
Title:-----------------------------------------------------------------

-----------------------------------------------------------------------
Nyse Regulation, Inc.
By:--------------------------------------------------------------------
Name:------------------------------------------------------------------
Title:-----------------------------------------------------------------

NYSE AMEX LLC
By:--------------------------------------------------------------------
Name:------------------------------------------------------------------
Title:-----------------------------------------------------------------

Exhibit 1

List of Common Rules

    As referenced in paragraph 2(d)(v) of the Agreement, rules
designated with a ``*'' are Non-Exclusive Common Rules, and NYSE and
NYSE Amex shall retain regulatory responsibility for these rules
insofar as necessary to discharge their respective Retained
Responsibilities.

------------------------------------------------------------------------
                               NYSE Amex Equities
          NYSE Rule                   Rule               FINRA Rule
------------------------------------------------------------------------
*Rule 1 ``The Exchange''....  *Rule 1 ``The         NYSE Rule 1 ``The
                               Exchange''.           Exchange''.
*Rule 2 ``Member,''           *Rule 2 ``Member,''   NYSE Rule 2
 ``Membership,'' ``Member      ``Membership,''       ``Member,''
 Firm,'' etc.                  ``Member Firm,''      ``Membership,''
                               etc.                  ``Member Firm,''
                                                     etc.
*Rule 2A ``Jurisdiction''...  *Rule 2A              NYSE Rule 2A
                               ``Jurisdiction''.     ``Jurisdiction''.
*Rule 2B No Affiliation       *Rule 2B No           NYSE Rule 2B No
 between Exchange and any      Affiliation between   Affiliation between
 Member Organization.          Exchange and any      Exchange and any
                               Member Organization.  Member
                                                     Organization.
*Rule 3 ``Security''........  *Rule 3 ``Security''  NYSE Rule 3
                                                     ``Security''.
*Rule 4 ``Stock''...........  *Rule 4 ``Stock''...  NYSE Rule 4
                                                     ``Stock''.
*Rule 5 ``Bond''............  *Rule 5 ``Bond''....  NYSE Rule 5
                                                     ``Bond''.
*Rule 6 ``Floor''...........  *Rule 6 ``Floor''...  NYSE Rule 6
                                                     ``Floor''.
*Rule 8 ``Delivery''........  *Rule 8 ``Delivery''  NYSE Rule 8
                                                     ``Delivery''.
*Rule 9 ``Branch Office       *Rule 9 ``Branch      NYSE Rule 9 ``Branch
 Manager''.                    Office Manager''.     Office Manager''.
*Rule 10 ``Registered         *Rule 10              NYSE Rule 10
 Representative''.             ``Registered          ``Registered
                               Representative''.     Representative''.
*Rule 11 Effect of            *Rule 11 Effect of    NYSE Rule 11 Effect
 Definitions.                  Definitions.          of Definitions.
*Rule 12 ``Business Day''...  *Rule 12 ``Business   NYSE Rule 12
                               Day''.                ``Business Day''.
*Rule 134 Differences and     *Rule 134             NYSE Rule 134
 Omissions--Cleared            Differences and       Differences and
 Transactions.                 Omissions --.         Omissions--Cleared
                                                     Transactions.
Rule 176 Delivery Time......  Rule 176 Delivery     NYSE Rule 176
                               Time.                 Delivery Time.
Rule 177 Delivery Time--      Rule 177 Delivery     NYSE Rule 177
 ``Cash'' Contracts.           Time--``Cash''        Delivery Time--
                               Contracts.            ``Cash'' Contracts.
Rule 180 Failure to Deliver.  Rule 180 Failure to   NYSE Rule 180
                               Deliver.              Failure to Deliver.
Rule 282 Buy-in Procedures..  Rule 282 Buy-in       NYSE Rule 282 Buy-in
                               Procedures.           Procedures.
Rule 291 Failure to Fulfill   Rule 291 Failure to   NYSE Rule 291
 Closing Contract.             Fulfill Closing       Failure to Fulfill
                               Contract.             Closing Contract.
Rule 292 Restrictions on      Rule 292              NYSE Rule 292
 Members' Participation in     Restrictions on       Restrictions on
 Transaction to Close          Members'              Members'
 Defaulted Contracts.          Participation in      Participation in
                               Transaction to        Transaction to
                               Close Defaulted       Close Defaulted
                               Contracts.            Contracts.
Rule 293 Closing Contracts    Rule 293 Closing      NYSE Rule 293
 in Suspended Securities.      Contracts in          Closing Contracts
                               Suspended             in Suspended
                               Securities.           Securities.
Rule 294 Default in Loan of   Rule 294 Default in   NYSE Rule 294
 Money.                        Loan of Money.        Default in Loan of
                                                     Money.
Rule 296 Liquidation of       Rule 296 Liquidation  NYSE Rule 296
 Securities Loans and          of Securities Loans   Liquidation of
 Borrowings.                   and Borrowings.       Securities Loans
                                                     and Borrowings.
Rule 311 Formation and        Rule 311 Formation    NYSE Rule 311
 Approval of Member            and Approval of       Formation and
 Organizations.                Member                Approval of Member
                               Organizations.        Organizations.
Rule 312 Changes Within       Rule 312 Changes      NYSE Rule 312
 Member Organizations.         Within Member         Changes Within
                               Organizations.        Member
                                                     Organizations.
Rule 313 Submission of        Rule 313 Submission   NYSE Rule 313
 Partnership Articles--        of Partnership        Submission of
 Submission of Corporate       Articles--Submissio   Partnership
 Documents.                    n of Corporate        Articles--Submissio
                               Documents.            n of Corporate
                                                     Documents.
Rule 319 Fidelity Bonds.....  Rule 319 Fidelity     NYSE Rule 319
                               Bonds.                Fidelity Bonds.
Rule 321 Formation of         Rule 321 Formation    NYSE Rule 321
 Acquisition of Subsidiaries.  of Acquisition of     Formation of
                               Subsidiaries.         Acquisition of
                                                     Subsidiaries.
Rule 322 Guarantees by, or    Rule 322 Guarantees   NYSE Rule 322
 Flow Through Benefits for     by, or Flow Through   Guarantees by, or
 Members or Member             Benefits for          Flow Through
 Organizations.                Members or Member     Benefits for
                               Organizations.        Members or Member
                                                     Organizations.
*Rule 325 Capital             *Rule 325 Capital     NYSE Rule 325
 Requirements Members          Requirements          Capital
 Organizations.                Members               Requirements
                               Organizations.        Members
                                                     Organizations.
Rule 326(a) Growth Capital    Rule 326(a) Growth    NYSE Rule 326(a)
 Requirement.                  Capital Requirement.  Growth Capital
                                                     Requirement.
Rule 326(b) Business          Rule 326(b) Business  NYSE Rule 326(b)
 Reduction Capital             Reduction Capital     Business Reduction
 Requirement.                  Requirement.          Capital
                                                     Requirement.
Rule 326(c) Business          Rule 326(c) Business  NYSE Rule 326(c)
 Reduction Capital             Reduction Capital     Business Reduction
 Requirement.                  Requirement.          Capital
                                                     Requirement.
Rule 326(d) Reduction of      Rule 326(d)           NYSE Rule 326(d)
 Elimination of Loans and      Reduction of          Reduction of
 Advances.                     Elimination of        Elimination of
                               Loans and Advances.   Loans and Advances.
Rule 328 Sale-and-            Rule 328 Sale-and-    NYSE Rule 328 Sale-
 Leasebacks, Factoring,        Leasebacks,           and-Leasebacks,
 Financing and Similar         Factoring,            Factoring,
 Arrangements.                 Financing and         Financing and
                               Similar               Similar
                               Arrangements.         Arrangements.
*Rule 342 Offices--Approval,  *Rule 342 Offices--   NYSE Rule 342
 Supervision and Control.      Approval,             Offices--Approval,
                               Supervision and       Supervision and
                               Control.              Control.
Rule 343 Offices--Sole        Rule 343 Offices--    NYSE Rule 343
 Tenancy, Hours, Display of    Sole Tenancy,         Offices--Sole
 Membership Certificates.      Hours, Display of     Tenancy, Hours,
                               Membership            Display of
                               Certificates.         Membership
                                                     Certificates.
Rule 344 Research Analysts    Rule 344 Research     NYSE Rule 344
 and Supervisory Analysts.     Analysts and          Research Analysts
                               Supervisory           and Supervisory
                               Analysts.             Analysts.

Rule 345 Employees--          Rule 345 Employees--  NYSE Rule 345
 Registration, Approval,       Registration,         Employees--Registra
 Records.                      Approval, Records.    tion, Approval,
                                                     Records.
Rule 345A Continuing          Rule 345A Continuing  NYSE Rule 345A
 Education for Registered      Education for         Continuing
 Persons.                      Registered Persons.   Education for
                                                     Registered Persons.
Rule 346 Limitations--        Rule 346              NYSE Rule 346
 Employment and Association    Limitations--Employ   Limitations--Employ
 with Members and Member       ment and              ment and
 Organizations.                Association with      Association with
                               Members and Member    Members and Member
                               Organizations.        Organizations.
Rule 351 Reporting            Rule 351 Reporting    NYSE Rule 351
 Requirements.                 Requirements.         Reporting
                                                     Requirements.
Rule 352 Guarantees, Sharing  Rule 352 Guarantees,  NYSE Rule 352
 in Accounts, and Loan         Sharing in            Guarantees, Sharing
 Arrangements.                 Accounts, and Loan    in Accounts, and
                               Arrangements.         Loan Arrangements.
Rule 353 Rebates and          Rule 353 Rebates and  NYSE Rule 353
 Compensation.                 Compensation.         Rebates and
                                                     Compensation.
Rule 354 Reports to Control   Rule 354 Reports to   NYSE Rule 354
 Persons.                      Control Persons.      Reports to Control
                                                     Persons.
*Rule 375 Missing the Market  *Rule 375 Missing     NYSE Rule 375
                               the Market.           Missing the Market.
Rule 382 Carrying Agreements  Rule 382 Carrying     NYSE Rule 382
                               Agreements.           Carrying
                                                     Agreements.
Rule 387 COD Orders.........  Rule 387 COD Orders.  NYSE Rule 387 COD
                                                     Orders.
Rule 401A Customer            Rule 401A Customer    NYSE Rule 401A
 Complaints.                   Complaints.           Customer
                                                     Complaints.
Rule 402 Customer             Rule 402 Customer     NYSE Rule 402
 Protection--Reserves and      Protection--Reserve   Customer
 Custody of Securities.        s and Custody of      Protection--Reserve
                               Securities.           s and Custody of
                                                     Securities.
Rule 404 Individual Members   Rule 404 Individual   NASD Rule 1014.
 Not To Carry Accounts.        Members Not To
                               Carry Accounts.
Rule 405 Diligence as to      Rule 405 Diligence    NYSE Rule 405
 Accounts.                     as to Accounts.       Diligence as to
                                                     Accounts.
Rule 406 Designation of       Rule 406 Designation  NYSE Rule 406
 Accounts.                     of Accounts.          Designation of
                                                     Accounts.
*Rule 407 Transactions--      *Rule 407             NYSE Rule 407
 Employees of Members,         Transactions--Emplo   Transactions--Emplo
 Member Organizations and      yees of Members,      yees of Members,
 the Exchange.                 Member                Member
                               Organizations and     Organizations and
                               the Exchange.         the Exchange. \20\
*Rule 407A Disclosure of All  *Rule 407A            NYSE Rule 407A
 Member Accounts.              Disclosure of All     Disclosure of All
                               Member Accounts.      Member Accounts.
Rule 408 Discretionary Power  Rule 408              NYSE Rule 408
 in Customers' Accounts.       Discretionary Power   Discretionary Power
                               in Customers'         in Customers'
                               Accounts.             Accounts.
Rule 409 Statements of        Rule 409 Statements   NYSE Rule 409
 Accounts to Customers.        of Accounts to        Statements of
                               Customers.            Accounts to
                                                     Customers.
Rule 409A SIPC Disclosures..  Rule 409A SIPC        NYSE Rule 409A SIPC
                               Disclosures.          Disclosures.
*Rule 410 Records of Orders.  *Rule 410 Records of  NYSE Rule 410
                               Orders.               Records of Orders.
*Rule 411 Erroneous Reports.  *Rule 411 Erroneous   NYSE Rule 411
                               Reports.              Erroneous Reports.
Rule 412 Customer Account     Rule 412 Customer     NASD Rule 11870.
 Transfer Contracts.           Account Transfer
                               Contracts.
Rule 413 Uniform Forms......  Rule 413 Uniform      NYSE Rule 413
                               Forms.                Uniform Forms.
*Rule 416 Questionnaires and  *Rule 416             NYSE Rule 416
 Reports.                      Questionnaires and    Questionnaires and
                               Reports.              Reports.
*Rule 416A Member and Member  *Rule 416A Member     NYSE Rule 416A
 Organization Profile          and Member            Member and Member
 Information Updates and       Organization          Organization
 Quarterly Certifications      Profile Information   Profile Information
 Via The Electronic Filing     Updates and           Updates and
 Platform.                     Quarterly             Quarterly
                               Certifications Via    Certifications Via
                               The Electronic        the Electronic
                               Filing Platform.      Filing Platform.
Rule 418 Audit..............  Rule 418 Audit......  NYSE Rule 418 Audit.
Rule 420 Reports of           Rule 420 Reports of   NYSE Rule 420
 Borrowings and Subordinate    Borrowings and        Reports of
 Loans for Capital Purposes.   Subordinate Loans     Borrowings and
                               for Capital           Subordinate Loans
                               Purposes.             for Capital
                                                     Purposes.
Rule 421 Periodic Reports...  Rule 421 Periodic     NYSE Rule 421
                               Reports.              Periodic Reports.
Rule 430 Partial Delivery of  Rule 430 Partial      NYSE Rule 430
 Securities to Customers on    Delivery of           Partial Delivery of
 C.O.D. Purchases.             Securities to         Securities to
                               Customers on C.O.D.   Customers on C.O.D.
                               Purchases.            Purchases.
Rule 431 Margin Requirements  Rule 431 Margin       NYSE Rule 431 Margin
                               Requirements.         Requirements.
Rule 432 Daily Record of      Rule 432 Daily        NYSE Rule 432 Daily
 Required Margin.              Record of Required    Record of Required
                               Margin.               Margin.
Rule 434 Required Submission  Rule 434 Required     NYSE Rule 434
 of Requests for Extensions    Submission of         Required Submission
 of Time for Customers.        Requests for          of Requests for
                               Extensions of Time    Extensions of Time
                               for Customers.        for Customers.
*Rule 435 Miscellaneous       *Rule 435             NYSE Rule 435
 Prohibitions (Excessive       Miscellaneous         Miscellaneous
 Trading by Members).          Prohibitions          Prohibitions
                               (Excessive Trading    (Excessive Trading
                               by Members).          by Members).
*Rule 440 Books and Records.  *Rule 440 Books and   NYSE Rule 440 Books
                               Records.              and Records.
Rule 440A Telephone           Rule 440A Telephone   NYSE Rule 440A
 Solicitation.                 Solicitation.         Telephone
                                                     Solicitation.
Rule 440I Records of          Rule 440I Records of  NYSE Rule 440I
 Compensation Arrangements--   Compensation          Records of
 Floor Brokerage.              Arrangements--Floor   Compensation
                               Brokerage.            Arrangements--Floor
                                                     Brokerage.
Rule 445 Anti-Money           Rule 445 Anti-Money   NYSE Rule 445 Anti-
 Laundering Compliance         Laundering            Money Laundering
 Program.                      Compliance Program.   Compliance Program.
Rule 446 Business Continuity  Rule 446 Business     NASD Rule 3510
 and Contingency Plans.        Continuity and        Business Continuity
                               Contingency Plans.    Plans and NASD Rule
                                                     3520 Emergency
                                                     Contact
                                                     Information.
Rule 472 Communications with  Rule 472              NYSE Rule 472
 the Public.                   Communications with   Communications with
                               the Public.           the Public.
*Rule 3130 (Annual            *Rule 3130 (Annual    *Rule 3130 (Annual
 Certification of Compliance   Certification of      Certification of
 and Supervisory Processes).   Compliance and        Compliance and
                               Supervisory           Supervisory
                               Processes).           Processes). \21\
Rule 3220 (Influencing or     Rule 3220             Rule 3220
 Rewarding Employees of        (Influencing or       (Influencing or
 Others).                      Rewarding Employees   Rewarding Employees
                               of Others).           of Others).
Rule 4560 (Short-Interest     Rule 4560 (Short-     Rule 4560 (Short-
 Reporting).                   Interest Reporting).  Interest
                                                     Reporting).

*Rule 5190 (Notification      *Rule 5190            *Rule 5190
 Requirements for Offering     (Notification         (Notification
 Participants).                Requirements for      Requirements for
                               Offering              Offering
                               Participants).        Participants).\22\
*Rule 6140 (Other Trading     *Rule 6140 (Other     *Rule 6140 (Other
 Practices).                   Trading Practices).   Trading Practices).
------------------------------------------------------------------------

Exhibit 2

    For purposes of this Agreement, the Regulatory Services Managers
required under paragraph 6 shall be:
---------------------------------------------------------------------------

    \20\ Those portions of the NYSE and NYSE Amex Equities Rules
407(a) and 407.10 that concern Exchange employees, which differ from
the FINRA Incorporated NYSE Rule 407, are not Common Rules and FINRA
will not be allocated regulatory responsibility for compliance with
those portions of the rules.
    \21\ Those portions of NYSE and NYSE Amex Equities Rule
3130(c)(1), 3130.03, and 3130.10 that relate to compliance with
Exchange Rules are not Common Rules and FINRA will not be allocated
regulatory responsibility for compliance with those portions of the
rules.
    \22\ Those portions of NYSE and NYSE Amex Equities Rules
5190(c)(1) requiring notice to the Exchange and 5190(e) that relate
to placing or transmitting a stabilizing bid or filing are not
Common Rules and FINRA will not be allocated regulatory
responsibility for compliance with those portions of the rules.
---------------------------------------------------------------------------

    For NYSE Regulation (on behalf of both NYSE and NYSE Amex): Clare
F. Saperstein, Managing Director, NYSE Regulation, Inc., 20 Broad
Street, 24th Floor, New York, NY 10005<PHONE_NUMBER> (phone). (212)
656-2333 (fax).
    For FINRA: James F. Price, Jr., Senior Vice President, Business and
Exchange Solutions, FINRA, 9509 Key West Avenue, Rockville, MD 20850-
33329.<PHONE_NUMBER> (phone).<PHONE_NUMBER> (fax).
    For purposes of this Agreement, the Senior Officers required under
paragraph 6 shall be: For NYSE Regulation (on behalf of both NYSE and
NYSE Amex): James F. Duffy, Interim Chief Executive Officer, NYSE
Regulation, Inc., 11 Wall Street, New York, NY 10005.<PHONE_NUMBER>
(phone).<PHONE_NUMBER> (fax).
    For FINRA: Stephen I. Luparello, Senior Executive Vice President,
FINRA, 1735 K Street, NW., Washington, DC 20006.<PHONE_NUMBER>
(phone).<PHONE_NUMBER> (fax).

III. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/other.shtml); or
     Send an e-mail to<EMAIL_ADDRESS>Please include
File Number 4-587 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 4-587. 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/other.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed plan that are filed with the
Commission, and all written communications relating to the proposed
plan 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 plan also will be
available for inspection and copying at the principal offices of FINRA,
NYSE, and NYSE Amex. 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 4-
587 and should be submitted on or before August 27, 2009.

IV. Discussion

    Pursuant to paragraph (c) of Rule 17d-2,\23\ the Commission may,
after appropriate notice and comment, declare a plan effective if the
Commission finds that the plan is necessary or appropriate in the
public interest and for the protection of investors, to foster
cooperation and coordination among self-regulatory organizations, or to
remove impediments to and foster the development of the national market
system and a national system for the clearance and settlement of
securities transactions and in conformity with the factors set forth in
Section 17(d) of the Act.
---------------------------------------------------------------------------

    \23\ 17 CFR 240.17d-2.
---------------------------------------------------------------------------

    In this instance, the Commission believes that appropriate notice
and comment can take place after the proposed Plan is effective. The
purpose of this Plan is to add NYSE Amex as a party to the existing
17d-2 plan between NYSE, NYSE Regulation, and FINRA. As NYSE Amex has
adopted many of the NYSE rules covered by the existing plan,\24\ the
proposed Plan does not change the scope of that existing plan.
Consequently, the Commission does not believe that the Plan raises any
new regulatory issues that the Commission has not previously considered
in the context of the existing plan between NYSE, NYSE Regulation, and
FINRA. By declaring the Plan effective today, the Commission can reduce
regulatory duplication for common members of FINRA and NYSE Amex, the
latter of which has adopted many of the NYSE rules crossed by the Plan,
as it has done for common members of FINRA and NYSE, and the new Plan
can be implemented without delay.
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    \24\ See Securities Exchange Act Release No. 58705 (October 1,
2008), 73 FR 58995 (October 8, 2008) (SR-Amex-2008-63).
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    The Commission finds that the proposed Plan is consistent with the
factors set forth in Section 17(d) of the Act \25\ and Rule 17d-2(c)
thereunder \26\ in that the Plan is necessary or appropriate in the
public interest and for the protection of investors, fosters
cooperation and coordination among SROs, and removes impediments to and
fosters the development of the national market system. In particular,
the Commission believes that the Plan will reduce unnecessary
regulatory duplication by fostering cooperation and coordination
between NYSE, NYSE Amex, and FINRA, and will thereby remove impediments
to the development of the national market system. In particular, the
Plan will allocate to FINRA certain responsibilities for Common Members
that would otherwise be performed by

both NYSE and FINRA or NYSE Amex and FINRA. Accordingly, the Plan
promotes efficiency by reducing costs to Common Members. Furthermore,
because FINRA, NYSE, and NYSE Amex will coordinate their regulatory
functions in accordance with the Plan, the Plan should promote investor
protection and the public interest.
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    \25\ 15 U.S.C. 78q(d).
    \26\ 17 CFR 240.17d-2(c).
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    In particular, the Commission notes that, under the proposed Plan,
FINRA, NYSE, and NYSE Amex have allocated regulatory responsibility for
Common Rules to the extent that such responsibilities involve member
firm regulation. The Plan also sets forth those areas for which NYSE
and NYSE Amex will retain regulatory responsibility, including:
examinations of conduct or actions by a Common Member covered by NYSE-
only or NYSE Amex-only rules and/or by related Federal laws or
regulations; surveillance, investigation, and enforcement with respect
to conduct or action relating to trading on or through the systems and
facilities of NYSE or NYSE Amex and conduct otherwise covered by NYSE-
only or NYSE Amex-only rules, as well as whether such conduct may
constitute a violation of Federal laws or regulations; processing of
applications for trading licenses or other membership in NYSE or NYSE
Amex; and qualification and registration of member firm personnel to
effect transactions or work on the floor of NYSE or NYSE Amex pursuant
to such SRO's rules.\27\
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    \27\ See paragraphs 2(d)(i)-(iv) and (e)(i)-(iv) of the proposed
17d-2 Plan.
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    In addition, the proposed Plan provides that NYSE and NYSE Amex
will retain regulatory responsibility for the application of any Common
Rule as it pertains to matters other than member firm regulation,
including matters relating to such SRO's retained responsibilities as
set forth in the Plan (the ``Non-Exclusive Common Rules''). The Non-
Exclusive Common Rules are specifically annotated in the List of Common
Rules and include those rules for which FINRA, NYSE, and NYSE Amex will
each bear their respective regulatory responsibilities, consistent with
the scope of the 17d-2 Plan. Such rules are ``non-exclusive'' in the
sense that they may relate to member firm regulation (for which FINRA
would assume regulatory responsibility) as well as matters other than
member firm regulation (for which NYSE or NYSE Amex would retain
regulatory responsibility). Accordingly, NYSE and NYSE Amex will each
bear responsibility for the application of their Non-Exclusive Common
Rules concerning their particular regulatory responsibilities.
    According to the Plan, whenever any Party seeks to make a change to
any of its rules that are Common Rules, before filing a proposed rule
change with the Commission, it will inform the other Parties of the
intended change to determine whether the other Parties will propose a
conforming change to its version of the Common Rule. If the Parties do
not agree to propose conforming changes, the Parties agree to file with
the Commission an amendment to the 17d-2 Plan to delete such rule from
the list of Common Rules.\28\ Finally, the proposed Plan requires the
Parties annually (or more frequently if required by changes in the
rules of a Party) to confirm in writing the accuracy of the list of
Common Rules.\29\ This provision ensures that the Parties keep the
Common Rules up-to-date vis-[agrave]-vis the other Parties and should
facilitate the ability of the Parties to accurately administer their
responsibilities under the proposed Plan consistent with the scope of
the Plan declared effective by the Commission herein.
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    \28\ See paragraph 2(a) of the proposed 17d-2 Plan.
    \29\ See paragraph 2(c) of the proposed 17d-2 Plan.
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    The proposed Plan also requires the Parties to share information on
a number of matters, including, for example, financial and operational
matters of Common Members, third-party complaints, and disciplinary
actions.\30\ The Commission believes that the information-sharing
provisions contained in the proposed Plan fosters cooperation and
coordination among the Parties, thereby promoting investor protection
and removing impediments to the development of a national market
system.
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    \30\ See paragraph 5 of the proposed 17d-2 Plan.
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    Finally, the Plan permits any Party to terminate the Plan at any
time, subject to 180 days written notice to the other Parties and
subject to Commission approval.\31\
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    \31\ See paragraph 14 of the proposed 17d-2 Plan. The Commission
notes that, as reflected in paragraph 14, Commission approval is
required for any Party to terminate its participation in the Plan.
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V. Conclusion

    This Order gives effect to the Plan filed with the Commission in
File No. 4-587. The Parties shall notify all members affected by the
Plan of their rights and obligations under the Plan.
    It is therefore ordered, pursuant to Section 17(d) of the Act,\32\
that the Plan, made by and among NYSE, NYSE Regulation, NYSE Amex, and
FINRA, that is contained in File No. 4-587 and filed pursuant to Rule
17d-2, is hereby approved and declared effective.
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    \32\ 15 U.S.C. 78q(d).
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    It is therefore ordered that NYSE and NYSE Amex are relieved of
those responsibilities allocated to FINRA under the Plan in File No. 4-
587.
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    \33\ 17 CFR 200.30-3(a)(34).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\33\
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-18762 Filed 8-5-09; 8:45 am]

BILLING CODE 8010-01-P