[Federal Register Volume 70, Number 159 (Thursday, August 18, 2005)]
[Notices]
[Pages 48611-48621]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-4510]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52249; File No. SR-PCX-2005-90]


Self-Regulatory Organizations; Pacific Exchange, Inc.; Notice of 
Filing of Proposed Rule Change and Amendment No. 1 Thereto Relating to 
the Certificate of Incorporation of PCX Holdings, Inc., PCX Rules and 
Bylaws of Archipelago Holdings, Inc.

August 12, 2005.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 
1934, as amended (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is 
hereby given that on August 1, 2005, the Pacific Exchange, Inc. 
(``PCX'' or the ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission'' or ``SEC'') the proposed rule change as 
described in Items I, II and III below, which Items have been prepared 
by the Exchange.\3\ On August 10, 2005, the Exchange filed Amendment 
No. 1 (``Amendment No. 1'') to the proposed rule change.\4\ The 
Commission is publishing this notice to solicit comments on the 
proposed rule change, as amended, from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ At the request of PCX, the Commission made clarifications to 
the description in Item II, as noted herein. Telephone conversations 
between Kathryn Beck, Deputy General Counsel, PCX and Jennifer Dodd, 
Special Counsel, Commission, Division of Market Regulation on August 
4, 2005 (``August 4, 2005 Telephone Conversation'') and August 12, 
2005 (``August 12, 2005 Telephone Conversation'').
    \4\ In Amendment No. 1, the Exchange made certain corrections to 
the descriptions in Items I, II and III and the proposed rule text.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    PCX submitted to the Commission (i) a proposed amendment to the 
certificate of incorporation of PCX Holdings, Inc. (``PCXH''), the 
parent company of the Exchange and its other operating subsidiaries, 
(ii) proposed new PCX Rules 1.1(cc) through (gg), Rule 3.4 and Rule 
13.2(a)(2)(E),\5\ which are intended to govern the ownership and voting 
of the stock of Archipelago Holdings, Inc. (``Archipelago''), a 
Delaware corporation that operates the equities trading facility of PCX 
and PCX Equities, Inc. (``PCXE''), by OTP Holders and OTP Firms,\6\ and 
(iii) a proposed amendment to the bylaws of Archipelago ((i), (ii) and 
(iii) together, the ``Proposed Rule Changes''). The text of the 
Proposed Rule Changes is available on PCX's Web site, http://www.pacificex.com/, at PCX's Office of the Secretary, at the 
Commission's Public Reference Room, and on the Commission's Web site, 
http://www.sec.gov/rules/sro.shtml.
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    \5\ See Amendment No. 1.
    \6\ PCX rules define an ``OTP Holder'' to mean any natural 
person, in good standing, who has been issued an Options Trading 
Permit (``OTP'') by the Exchange for effecting approved securities 
transactions on the Exchange's trading facilities, or has been named 
as a Nominee. PCX Rule 1.1(q). The term ``Nominee'' means an 
individual who is authorized by an ``OTP Firm'' (a sole 
proprietorship, partnership, corporation, limited liability company 
or other organization in good standing who holds an OTP or upon whom 
an individual OTP Holder has conferred trading privileges on the 
Exchange's trading facilities) to conduct business on the Exchange's 
trading facilities and to represent such OTP Firm in all matters 
relating to the Exchange. PCX Rule 1.1(n).
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II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of and basis for the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of these statements may be examined at 
the places specified in Item IV below. The self-regulatory organization 
has prepared summaries, set forth in sections A, B and C below, of the 
most significant aspects of such statements.

[[Page 48612]]

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange is submitting to the Commission the Proposed Rule 
Changes in connection with Archipelago's proposed acquisition of PCXH. 
On January 3, 2005, PCXH, Archipelago and New Apple Acquisitions 
Corporation (the ``Merger Sub''), a newly formed wholly-owned 
subsidiary of Archipelago, entered into an Agreement and Plan of Merger 
(the ``Original Merger Agreement''), pursuant to which Archipelago has 
agreed to acquire PCXH and all of its wholly owned subsidiaries, 
including PCX and PCXE, by way of a merger under Delaware law (the 
``Merger'') of the Merger Sub with and into PCXH, with PCXH as the 
surviving corporation. On July 22, 2005, PCXH, Archipelago and Merger 
Sub amended and restated the Original Merger Agreement to, among other 
things, provide that the consideration payable to PCXH stockholders 
would be made wholly in cash, and that, as contemplated by the Original 
Merger Agreement, the measurement dates for purposes of valuing the 
Archipelago stock held by PCXH would now be the ten consecutive trading 
days ending on the last trading day prior to the closing date of the 
Merger (as so amended, the ``Amended Merger Agreement'').
    Pursuant to the Amended Merger Agreement, subject to appraisal 
rights under Delaware law and other than with respect to treasury stock 
of PCXH and PCXH common stock beneficially owned by Archipelago for 
Archipelago's own account, each share of PCXH common stock issued and 
outstanding immediately prior to the effective time of the Merger (the 
``Effective Time'') will be converted into, and become exchangeable 
for, an amount in cash equal to the quotient of the aggregate merger 
consideration divided by the sum of the number of outstanding shares of 
PCXH common stock and the number of shares to be issued upon the 
exercise of all options at the consummation of the merger. The 
aggregate merger consideration equals the sum of the value of the 
shares of Archipelago common stock owned by PCX and its subsidiaries 
and $17 million, subject to market fluctuations in the Archipelago 
stock price and certain other adjustments pursuant to the Amended 
Merger Agreement. The value of Archipelago common stock shall be 
determined using the average of the per share closing prices for 
Archipelago common stock for the ten consecutive trading days ending on 
the last trading day prior to the closing date of the Merger. At the 
Effective Time, all PCXH common stock will be cancelled or retired and 
cease to exist.
    As a result of the Merger, PCXH, as the surviving corporation in 
the Merger, will become a direct, wholly-owned subsidiary of 
Archipelago (the post-Merger PCXH will hereinafter be referred to as 
the ``New PCXH''). The certificate of incorporation of PCXH as in 
effect immediately prior to the Effective Time will, subject to 
approval of the Commission, be amended pursuant to the Amended Merger 
Agreement and as so amended, will be the certificate of incorporation 
of the New PCXH. The bylaws of PCXH as in effect immediately prior to 
the Effective Time will be the bylaws of the New PCXH, until thereafter 
amended as provided therein or by applicable law. The directors of the 
Merger Sub at the Effective Time will become directors of the New PCXH 
and the officers of PCXH at the Effective Time will continue to be 
officers of the New PCXH.
    Except as described in the preceding paragraph or otherwise 
approved by the Commission, the Merger will not affect the internal 
corporate structure of PCXH or the regulatory relationship of PCX and 
PCXE to Archipelago Exchange, L.L.C. (``ArcaEx''), the exclusive 
equities trading facility of PCX and PCXE. PCX will remain a wholly-
owned subsidiary of the New PCXH, will continue operating the options 
business of the Exchange and will retain the self-regulatory 
organization function for the options business as well as for PCX's 
equities business subsidiary, PCXE. After the Merger, except as 
otherwise approved by the Commission, the board of directors of PCX 
will continue to comply with the compositional requirements set forth 
in the certificate of incorporation and bylaws of PCX. Except as 
otherwise approved by the Commission, PCXE's operations, governance 
structure, or rules will not be affected by the Merger. After the 
Merger, except as otherwise approved by the Commission, the board of 
directors of PCXE will continue to comply with the compositional 
requirements set forth in the certificate of incorporation and bylaws 
of PCXE. ArcaEx will remain the exclusive equities trading facility of 
PCX and PCXE and the Amended and Restated Facility Services Agreement 
among Archipelago, PCX and PCXE, dated as of March 22, 2002, which 
currently governs the regulatory relationship of PCX and PCXE to ArcaEx 
(the ``Facility Services Agreement''), will remain in full force and 
effect in its current form.
a. Certificate of Incorporation of PCXH
(i) Proposed Amendments
    In order to safeguard the independence of the self-regulatory 
functions of PCX and protect the Commission's oversight 
responsibilities, the certificate of incorporation of PCXH, which was 
approved by the Commission on May 17, 2004 in connection with the 
demutualization of the Exchange,\7\ imposes limitations on direct and 
indirect changes in control of PCXH through various ownership and 
voting restrictions placed on PCXH's capital stock. Specifically, the 
certificate of incorporation of PCXH provides that no person,\8\ either 
alone or together with its related persons,\9\ may own, directly or 
indirectly, shares constituting more than 40% of the outstanding shares 
of any class of PCXH capital stock,\10\ and that no person, either 
alone or together with its related persons who is a trading permit 
holder of PCX or an equities trading permit holder of PCXE, may own, 
directly or indirectly, shares

[[Page 48613]]

constituting more than 20% of any class of PCXH capital stock.\11\ 
Furthermore, the certificate of incorporation of PCXH provides that, 
for so long as PCXH controls, directly or indirectly, PCX, no person, 
either alone or with its related persons, may directly or indirectly 
vote or cause the voting of shares of PCXH capital stock or give any 
proxy or consent with respect to shares representing more than 20% of 
the voting power of the issued and outstanding PCXH capital stock, and 
it also places limitations on the right of any person, either alone or 
with its related persons, to enter into any agreement with respect to 
the withholding of any vote or proxy.\12\ In order to permit 
Archipelago to own 100% of the capital stock of the New PCXH upon 
consummation of the Merger, PCX proposes to amend the certificate of 
incorporation of PCXH to create an exception, with certain limitations, 
for Archipelago and certain related persons of Archipelago from the 
voting and ownership restrictions described above.
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    \7\ Securities Exchange Act Release No. 49718 (May 17, 2005), 69 
FR 29611 (May 24, 2005) (order approving proposed rule change and 
notice of filing and order granting accelerated approval of 
Amendment No. 1 thereto relating to the demutualization of PCX).
    \8\ ``Person'' is defined to mean an individual, partnership 
(general or limited), joint stock company, corporation, limited 
liability company, trust or unincorporated organization, or any 
governmental entity or agency or political subdivision thereof. 
Restated Certificate of Incorporation of PCXH, Article Nine, Section 
1(b)(iv).
    \9\ The term ``related person,'' as defined in the Restated 
Certificate of Incorporation of PCXH, means (i) with respect to any 
person, all ``affiliates'' and ``associates'' of such person (as 
such terms are defined in Rule 12b-2 under the Act); (ii) with 
respect to any person constituting a trading permit holder of PCX or 
an equities trading permit holder of PCXE, any broker dealer with 
which such holder is associated; and (iii) any two or more persons 
that have any agreement, arrangement or understanding (whether or 
not in writing) to act together for the purpose of acquiring, 
voting, holding or disposing of shares of the capital stock of PCXH. 
Restated Certificate of Incorporation of PCXH, Article Nine, Section 
1(b)(iv).
    \10\ Restated Certificate of Incorporation of PCXH, Article 
Nine, Section 1(b)(i). However, such restriction may be waived by 
the Board of Directors of PCXH pursuant to an amendment to the 
Bylaws of PCXH adopted by the Board of Directors, if, in connection 
with the adoption of such amendment, the Board of Directors adopts a 
resolution stating that it is the determination of such Board that 
such amendment will not impair the ability of PCX to carry out its 
functions and responsibilities as an ``exchange'' under the Act and 
is otherwise in the best interests of PCXH and its stockholders and 
PCX, and will not impair the ability of the Commission to enforce 
said Act, and such amendment shall not be effective until approved 
by said Commission; provided that the Board of Directors of PCXH 
shall have determined that such Person and its Related Persons are 
not subject to any applicable ``statutory disqualification'' (within 
the meaning of Section 3(a)(39) of the Act). Restated Certificate of 
Incorporation of PCXH, Article Nine, Sections 1(b)(i)(B) and 
1(b)(i)(C).
    \11\ Id., Article Nine, Section 1(b)(ii).
    \12\ Id., Article Nine, Section 1(c).
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    Specifically, PCX proposes to add a new paragraph at the end of 
Article Nine of the certificate of incorporation of PCXH, providing 
that for so long as Archipelago directly owns all of the outstanding 
capital stock of PCXH, the provisions of Article Nine, including the 
ownership and voting limitations with respect to shares of PCXH capital 
stock, shall not be applicable to the voting and ownership of shares of 
PCXH capital stock by (i) except for prohibited persons (as defined 
below), Archipelago, (ii) except for prohibited persons, any person 
which is a related person (as such term is defined in the certificate 
of incorporation of PCXH) of Archipelago, either alone or together with 
its related persons, and (iii) except for prohibited persons, any other 
person to which Archipelago is a related person, either alone or 
together with its related persons.\13\
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    \13\ Amended and Restated Certificate of Incorporation of PCXH, 
Article Nine, Section 4.
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    ``Prohibited persons'' is defined to mean any person which is, or 
which has a related person which is (A) an OTP Holder or an OTP Firm 
(as such terms are defined in the rules of PCX, as such rules may be in 
effect from time to time) or (B) an ETP Holder,\14\ except for (1) any 
broker or dealer approved by the Commission after June 20, 2005 to be a 
facility (as defined in Section 3(a)(2) of the Act) of PCX; (2) any 
person which has been approved by the Commission prior to it becoming 
subject to the provisions of Article Nine of the certificate of 
incorporation of PCXH with respect to the voting and ownership of 
shares of PCXH capital stock by such person; and (3) any person which 
is a related person of Archipelago solely by reason of beneficially 
owning, either alone or together with its related persons, less than 
20% of the outstanding shares of Archipelago capital stock (any person 
covered by (1) through (3) is referred to as a ``permitted person'' in 
the proposed amendment).\15\ The proposed Section 4 to Article Nine of 
the certificate of incorporation of PCXH further provides that any 
other prohibited person not covered by the definition of a permitted 
person who would be subject to and exceed the voting and ownership 
limitations imposed by Article Nine as of the date of the closing of 
the Merger shall be permitted to exceed the voting and ownership 
limitations imposed by Article Nine only to the extent and for the time 
period approved by the Commission.\16\
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    \14\ PCXE rules define an ``ETP Holder'' to mean any sole 
proprietorship, partnership, corporation, limited liability company 
or other organization in good standing that has been issued an 
Equity Trading Permit, a permit issued by the PCXE for effecting 
approved securities transactions on the trading facilities of PCXE. 
PCXE Rule 1.1(n).
    \15\ Amended and Restated Certificate of Incorporation and PCXH, 
Article Nine, Section 4.
    \16\ Id.
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    PCX believes that by creating a limited exemption from the voting 
and ownership restrictions in the certificate of incorporation of PCXH, 
the proposed amendment will permit the consummation of the Merger and 
the continued ownership of PCXH by Archipelago after the Merger while 
preserving the general applicability of such restrictions as they 
currently exist, so that these restrictions may continue safeguarding 
the independence of PCX's self-regulatory function and the Commission's 
oversight responsibilities. In addition, PCX believes that by 
eliminating prohibited persons from the exemption, other than those 
approved by the Commission, it will prevent OTP Holders, OTP Firms and 
ETP Holders (as such terms are defined in the rules of PCX, as such 
rules may be amended from time to time) from acquiring, directly or 
indirectly, a substantial number of outstanding shares of PCXH and 
exercising undue influence over the operation of PCX, including its 
self-regulatory functions, without proper oversight by the Commission.
(ii) Archipelago Securities, L.L.C.
    In connection with the proposed amendment to the certificate of 
incorporation of PCXH described above, the Exchange requests that the 
Commission approve Archipelago Securities, L.L.C. (``Archipelago 
Securities'') to be a facility (as defined in Section 3(a)(2) of the 
Act) of PCX.
    Archipelago Securities, a wholly-owned subsidiary of Archipelago, 
is a registered broker-dealer, a member of the National Association of 
Securities Dealers, Inc. (``NASD'') and an ETP Holder. Archipelago 
Securities provides an optional routing service for ArcaEx, and, as 
necessary, routes orders to other securities exchanges, facilities of 
securities exchanges, automated trading systems, electronic 
communications networks or other brokers or dealers (collectively, 
``Market Centers'') from ArcaEx (such function of Archipelago 
Securities is referred to as the ``Outbound Router''). In its capacity 
as an Outbound Router, Archipelago Securities has operated as a 
facility (as defined in Section 3(a)(2) of the Act) of PCX. It was 
approved by the Commission as a facility (as defined in Section 3(a)(2) 
of the Act) of PCXE on October 25, 2001 in connection with the 
Commission's approval of the rules of PCX establishing ArcaEx as a 
facility of PCXE.\17\
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    \17\ See Self Regulatory Organizations; Order Approving Proposed 
Rule Change by the Pacific Exchange, Inc., as Amended, and Notice of 
Filing and Order Granting Accelerated Approval of Amendment Nos. 4 
and 5 Concerning the Establishment of Archipelago Exchange as the 
Equities Trading Facility of PCX Equities, Inc., Exchange Act 
Release No. 44983 (October 25, 2001), 66 FR 55225 (November 1, 2001) 
(SR-PCX-00-25) (the ``Original Outbound Router Release''). The name 
of the order routing broker-dealer was originally Wave Securities, 
L.L.C. as approved by the Commission in the Original Outbound Router 
Release.
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    Archipelago intends to continue to own and operate Archipelago 
Securities following the closing of the Merger. The proposed operation 
of Archipelago Securities as an Outbound Router after the closing of 
the Merger will not change from the way it is administered and operated 
today.\18\ As an Outbound Router, Archipelago Securities will continue 
to receive instructions from ArcaEx, route orders to other Market 
Centers in accordance with those instructions and be responsible for 
reporting resulting executions back to ArcaEx.\19\ In addition, all 
orders routed through Archipelago Securities would

[[Page 48614]]

remain subject to the terms and conditions of PCXE rules.\20\
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    \18\ See, e.g., Original Outbound Router Release, at 55233-55235 
(describing the operation of the order routing broker-dealer 
approved by the Commission).
    \19\ See Original Outbound Router Release, at 55234.
    \20\ See Archipelago Securities Routing Agreement, http://www.tradearca.com/exchange/pdfs/ETPApplication.pdf (last visited 
July 21, 2005).
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    PCX and PCXE currently regulate the Outbound Router function of 
Archipelago Securities as a facility (as defined in Section 3(a)(2) of 
the Act) subject to Section 6 of the Act. As such, the Outbound Router 
function of Archipelago Securities is subject to the Commission's 
continuing oversight. In particular, and without limitation, under the 
Act, PCX is responsible for filing with the Commission rule changes and 
fees relating to the Archipelago Securities Outbound Router function, 
and Archipelago Securities is subject to exchange non-discrimination 
requirements.\21\
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    \21\ See, e.g., Section 6(b)(5) of the Act, 15 U.S.C. 78f(b)(5).
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    Pursuant to Rule 17d-1 under the Act, where a member of the 
Securities Investor Protection Corporation is a member of more than one 
self-regulatory organization (``SRO''), the Commission shall designate 
to one of such organizations the responsibility for examining such 
member for compliance with the applicable financial responsibility 
rules.\22\ The SRO so designated by the Commission is referred to as a 
``Designated Examining Authority.'' Archipelago Securities is a member 
of two SROs, PCX and the NASD. The NASD is an SRO not affiliated with 
Archipelago or any of its affiliates (including, without limitation, 
PCX and PCXE) and it has been designated by the Commission as the 
Designated Examining Authority for Archipelago Securities pursuant to 
Rule 17d-1 of the Act with the responsibility for examining Archipelago 
Securities for compliance with the applicable financial responsibility 
rules. Furthermore, under an agreement between NASD and PCX originally 
entered into on May 27, 1977 pursuant to Rule 17d-2 \23\ under the Act 
(the agreement was amended on February 1, 1980, and as so amended, the 
``NASD PCX Agreement''), there is currently a plan in place allocating 
to the NASD the responsibility to receive regulatory reports from 
Archipelago Securities, to examine Archipelago Securities for 
compliance and to enforce compliance by Archipelago Securities with the 
Act, the rules and regulations thereunder and the rules of the NASD, 
and to carry out other specified regulatory functions with respect to 
Archipelago Securities.
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    \22\ 17 CFR 240.17d-1. Pursuant to Rule 17d-1 under the Act, in 
making such designation the Commission shall take into consideration 
the regulatory capabilities and procedures of the SROs, availability 
of staff, convenience of location, unnecessary regulatory 
duplication, and such other factors as the Commission may consider 
germane to the protection of investors, the cooperation and 
coordination among self-regulatory organizations, and the 
development of a national market system for the clearance and 
settlement of securities transactions.
    \23\ Rule 17d-2 provides that any two or more SROs may file with 
the Commission a plan for allocating among such SROs the 
responsibility to receive regulatory reports from persons who are 
members or participants of more than one of such SROs to examine 
such persons for compliance, or to enforce compliance by such 
persons, with specified provisions of the Act, the rules and 
regulations thereunder, and the rules of such SROs, or to carry out 
other specified regulatory functions with respect to such persons. 
17 CFR 240.17d-2.
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    ETP Holders' use of Archipelago Securities to route orders to 
another Market Center is currently optional, and will remain optional 
after the closing of the Merger. Those ETP Holders who choose to use 
the Outbound Routing service of Archipelago Securities must sign an 
Archipelago Securities Routing Agreement. Importantly, among other 
things, the Archipelago Securities Routing Agreement provides that all 
orders routed through Archipelago Securities are subject to the terms 
and conditions of PCXE rules.\24\
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    \24\ See Archipelago Securities Routing Agreement, http://www.tradearca.com/exchange/pdfs/ETPApplication.pdf (last visited 
July 21, 2005).
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    PCX and Archipelago recognize that after the closing of the Merger 
such continued ownership and operation by Archipelago of Archipelago 
Securities--by virtue of Archipelago Securities being an ETP Holder and 
a related person of Archipelago \25\--would be in violation of the 
current and proposed limitations \26\ to be set forth in the 
certificate of incorporation of PCXH described above, unless 
Archipelago Securities is approved by the Commission after June 20, 
2005 to be a facility of PCXE \27\ in accordance with the terms of the 
proposed amendment to the certificate of incorporation of PCXH 
described above.
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    \25\ At the request of the Exchange the Commission deleted the 
phrase ``as an Outbound Router.'' See August 4, 2005 Telephone 
Conversation.
    \26\ The Exchange clarified that the ownership and operation by 
Archipelago of Archipelago Securities would violate the current, as 
well as the proposed, limitations in the certificate of 
incorporation of PCXH, unless approved by the Commission after June 
20, 2005 to be a facility of PCXE. See August 12, 2005 Telephone 
Conversation.
    \27\ See Amendment No. 1.
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    PCX and Archipelago further recognize that the ownership of both 
PCX and Archipelago Securities by Archipelago may pose a conflict of 
interest between the regulatory responsibilities of PCX and PCXE and 
the broker or dealer activities of Archipelago Securities. This is 
because the financial interests of Archipelago may conflict with the 
responsibilities of PCX and PCXE as an SRO regarding Archipelago 
Securities.
    PCX and Archipelago believe, however, that such conflict may be 
mitigated with the following proposed undertakings of Archipelago, PCX 
and Archipelago Securities.\28\
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    \28\ The Exchange clarified that the undertakings of PCX should 
also be included. See August 12, 2005 Telephone Conversation.
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(x) Proposed Undertakings
    Each of Archipelago, PCX and Archipelago Securities undertakes as 
follows:
    (1) PCX will regulate the Outbound Router function of Archipelago 
Securities as a facility (as defined in Section 3(a)(2) of the Act), 
subject to Section 6 of the Act. In particular, and without limitation, 
under the Act, PCX will be responsible for filing with the Commission 
rule changes and fees relating to the Archipelago Securities Outbound 
Router function and Archipelago Securities will be subject to exchange 
non-discrimination requirements.
    (2) Currently, NASD, an SRO unaffiliated with Archipelago or any of 
tis affiliates (including, without limitation, PCX or PCXE), carries 
out oversight and enforcement responsibilities as the Designated 
Examining Authority designated by the Commission pursuant to Rule 17d-1 
of the Act with the responsibility for examining Archipelago Securities 
for compliance with the applicable financial responsibility rules.\29\
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    \29\ See Amendment No. 1.
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    (3) The NASD PCX Agreement will stay in full force and effect and 
PCX will continue to abide by the terms of such agreement.\30\ 
Furthermore, PCX undertakes to amend the agreement to expand the scope 
of NASD's regulatory functions so as to encompass all of the regulatory 
oversight and enforcement responsibilities with respect to Archipelago 
Securities pursuant to applicable laws, except for real-time market 
surveillance.
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    \30\ Id.
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    (4) An ETP Holder's or OTP Holder's use of Archipelago Securities 
to route orders to another Market Center will continue to be optional. 
Any ETP Holder or OTP Holder that does not want to use Archipelago 
Securities may use other routers to route orders \31\ to other Market 
Centers.\32\
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    \31\ Id.
    \32\ An ETP Holder may chose to route an order to ArcaEx that, 
if not executable on ArcaEx, will be cancelled and returned to the 
ETP Holder, at which time the ETP Holder could chose to route the 
order to another market. See August 4, 2005 Telephone Conversation.

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[[Page 48615]]

    (5) Archipelago Securities will not engage in any business other 
than its Outbound Router function (including, in that function, the 
self-clearing functions that it currently performs for trades with 
respect to orders routed to other Market Centers and the clearing 
functions that it may perform for trades with respect to orders for 
securities not trades on any securities exchange) \33\ and any other 
activities it may engage in as approved by the Commission.
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    \33\ See Amendment No. 1.
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    The above undertakings of Archipelago, PCX and Archipelago 
Securities would become effective at the effective time of the Merger.
(y) Request for Approval
    In sum, PCX and Archipelago believe that the proposed undertakings 
of Archipelago, PCX and Archipelago Securities set forth above would 
address the potential conflict of interest with the regulatory 
responsibilities of PCX and PCXE and the continued ownership and 
operation of Archipelago Securities by Archipelago after the closing of 
the Merger.\34\ Consequently, subject to the proposed undertakings of 
Archipelago, PCX and Archipelago Securities set forth above, PCX and 
Archipelago request that the Commission approve Archipelago Securities 
to be a facility (as defined in Section 3(a)(2) of the Act) \35\ of 
PCX.
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    \34\ Id.
    \35\ 15 U.S.C. 78c(a)(2).
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b. Proposed PCX Rules
    Archipelago is a public company whose common stock is listed on PCX 
for trading on ArcaEx. The certificate of incorporation of Archipelago, 
which was approved by the Commission on August 9, 2004 prior to the 
initial public offering of Archipelago common stock,\36\ currently 
contains certain provisions intended to ensure that the ownership of 
Archipelago by the public will not unduly interfere with or restrict 
the ability of the Commission or PCX to effectively carry out their 
regulatory oversight responsibilities under the Act, with respect to 
ArcaEx, and generally to enable ArcaEx to operate in a manner that 
complies with the federal securities laws, including furthering the 
objectives of Section 6(b)(5) of the Act.\37\ Some of these provisions 
impose ownership and voting limitations on Archipelago's stockholders 
and their related persons,\38\ including persons who are ETP Holders 
and the broker-dealers with whom such ETP Holders are associated.\39\ 
In order to ensure that upon consummation of the Merger, the public 
company nature of Archipelago will not unduly interfere with or 
restrict the regulatory oversight responsibilities of the Commission or 
PCX with respect to the options business and the general compliance of 
the operations of the options business with federal securities laws, 
PCX proposes to impose on any OTP Holder or OTP Firm, that is not an 
ETP Holder, voting and ownership limitations that are analogous to 
those imposed on ETP Holders by the certificate of incorporation of 
Archipelago. In addition, PCX proposes to require such OTP Holder and 
OTP Firm, as well as ``associated persons'' (as such term is defined in 
Section 3(a)(18) of the Act) \40\ of such OTP Holder or OTP Firm, to 
enter into an agreement with PCX and Archipelago within certain 
specific time periods set forth in the proposed PCX rules, pursuant to 
which such OTP Holder, OTP Firm and any person who is deemed an 
``associated person'' (as such term is defined in Section 3(a)(18) of 
the Act) of such OTP Holder or OTP Firm (such persons are referred to 
in this filing as ``OTP Associates'') would agree to comply with the 
ownership and voting limitations imposed by the proposed PCX rules, to 
authorize Archipelago to vote their shares of Archipelago stock in 
favor of amendments to the certificate of incorporation of Archipelago 
that incorporate such ownership and voting limitations, and to be 
subject to the disciplinary action in the proposed PCX rules if they 
violate any of the ownership or voting limitations or fail to enter 
into such ownership and voting agreement (such agreement, the 
``Ownership and Voting Agreement''). Under the proposed PCX rules, 
failure to comply with the ownership and voting limitations or failure 
to enter into the Ownership and Voting Agreement will subject the 
responsible OTP Holder or OTP Firm to the possible suspension of all 
trading rights and privileges. The proposed PCX Rules 1.1(cc) through 
(gg), Rule 3.4 and Rule 13.2(a)(2)(E) are summarized below.
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    \36\ Securities Exchange Act Release No. 50170 (August 9, 2004), 
69 FR 50419 (August 16, 2004) (SR-PCX-2004-56) (order granting 
approval of proposed rule change and notice of filing and order 
granting accelerated approval to Amendment No. 1 to the proposed 
rule change by the Pacific Exchange, Inc. relating to the 
Certificate of Incorporation and Bylaws of Archipelago).
    \37\ Id.
    \38\ The term ``related persons,'' as defined in the Certificate 
of Incorporation of Archipelago, means with respect to any person: 
(a) Any other person(s) whose beneficial ownership of shares of 
stock of Archipelago with the power to vote on any matter would be 
aggregated with such first person's beneficial ownership of such 
stock or deemed to be beneficially owned by such first person 
pursuant to Rules 13d-3 and 13d-5 under the Act; (b) in the case of 
a person that is a natural person, for so long as ArcaEx remains a 
facility of PCX and PCXE and the Facility Services Agreement is in 
full force and effect, any broker or dealer that is an ETP Holder 
with which such natural person is associated; (c) in the case of a 
person that is an ETP Holder, for so long as ArcaEx remains a 
facility of PCX and PCXE and the Facility Services Agreement is in 
full force and effect, any broker or dealer with which such ETP 
Holder is associated; (d) any other person(s) with which such person 
has any agreement, arrangement or understanding (whether or not in 
writing) to act together for the purpose of acquiring, voting, 
holding or disposing of shares of the stock of Archipelago; and (e) 
in the case of a person that is a natural person, any relative or 
spouse of such person, or any relative of such spouse, who has the 
same home as such person or who is a director or officer of 
Archipelago or any of its parents or subsidiaries. Certificate of 
Incorporation of Archipelago, Article FOURTH, paragraph H(3).
    \39\ Certificate of Incorporation of Archipelago, Article 
FOURTH, paragraphs (C) and (D).
    \40\ Pursuant to Section 3(a)(18) of the Act, the term 
``associated person of a broker or dealer'' means any partner, 
officer, director, or branch manager of such broker or dealer (or 
any person occupying a similar status or performing similar 
functions), any person directly or indirectly controlling, 
controlled by or under common control with such broker or dealer, or 
any employee of such broker or dealer, except that such term does 
not include any person associated with a broker or dealer whose 
functions are solely clerical or ministerial. 15 U.S.C. 78c(a)(18).
---------------------------------------------------------------------------

(i) Ownership and Voting Limitations
    The proposed PCX rules provide that for as long as Archipelago 
shall control, directly or indirectly, PCX, no OTP Holder or OTP Firm, 
either alone or with its related persons, shall own beneficially shares 
of Archipelago stock representing in the aggregate more than 20% of the 
then outstanding votes entitled to be cast on any matter (the 
``Ownership Limitation'').\41\ ``Related persons'' is defined to mean, 
with respect to any OTP Holder or OTP Firm: (a) Any broker or dealer 
with which such OTP Holder or OTP Firm is associated; (b) any natural 
person who is an associated person of such OTP Firm; (c) any other 
person(s) \42\ whose beneficial ownership of shares of stock of 
Archipelago with the power to vote on any matter would be aggregated 
with the OTP Holder's or OTP Firm's beneficial ownership of such stock 
or deemed to be beneficially owned by such OTP Holder or OTP Firm 
pursuant to Rules 13d-3 and 13d-5 under the Act; \43\ (d) any other 
person(s) with

[[Page 48616]]

which such OTP Holder or OTP Firm has any agreement, arrangement or 
understanding (whether or not in writing) to act together for the 
purpose of acquiring, voting, holding or disposing of shares of the 
stock of Archipelago; and (e) with respect to any OTP Holder and any 
person described in (a) to (d) above who is a natural person, any 
relative or spouse of such person, or any relative of such spouse, who 
has the same home as such person or who is a director or officer of 
Archipelago or any of its parents or subsidiaries.\44\ PCX and 
Archipelago believe that stockholders of Archipelago, including OTP 
Holders, OTP Firms and their related persons who own Archipelago stock, 
will be able to effectively monitor their shareholdings in Archipelago 
using systems they already have in place.
---------------------------------------------------------------------------

    \41\ Proposed PCX Rule 3.4(a).
    \42\ PCX Rule 1.1(v) defines ``Person'' to mean a natural 
person, corporation, partnership, limited liability company, 
association, joint stock company, trustee of a trust fund, or any 
organized group of persons whether incorporated or not. PCX Rule 
1.1(v).
    \43\ PCX believes that this definition, by incorporating a 
``beneficial ownership'' concept, will help PCX to monitor ownership 
of the common stock of Archipelago by monitoring filings on 
Schedules 13D and 13G by stockholders of Archipelago. PCX further 
believes that the definition of ``beneficial ownership'' used will 
cover persons which control, are controlled by or are under common 
control with an OTP Holder or an OTP firm.
    \44\ Proposed PCX Rule 1.1(gg). The proposed Rule 1.1(gg) 
further provides that ``related persons'' includes, with respect to 
any OTP Holder or OTP Firm: (1) any other person beneficially owning 
pursuant to Rules 13d-3 and 13d-5 under the Act shares of 
Archipelago stock with the power to vote on any matter that also are 
deemed to be beneficially owned by such OTP Holder or OTP Firm 
pursuant to Rules 13d-3 and 13d-5 under the Act; (2) any other 
person that would be deemed to own beneficially pursuant to Rules 
13d-3 and 13d-5 under the Act shares of Archipelago stock with the 
power to vote on any matter that are beneficially owned directly or 
indirectly by such OTP Holder or OTP Firm pursuant to Rules 13d-3 
and 13d-5 under the Act; and (3) any additional person through which 
such other person would be deemed to directly or indirectly own 
beneficially pursuant to Rules 13d-3 and 13d-5 under the Act shares 
of Archipelago stock with the power to vote on any matter.
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    For purposes of the Ownership Limitation, no OTP Holder or OTP Firm 
shall be deemed to have any agreement, arrangement or understanding to 
act together with respect to voting shares of stock of Archipelago 
solely because such OTP Holder, OTP Firm or any of their related 
persons, has or shares the power to vote or direct the voting of such 
shares of stock pursuant to a revocable proxy given in response to a 
public proxy or consent solicitation conducted pursuant to, and in 
accordance with, Regulation 14A promulgated pursuant to the Act, except 
if such power (or the arrangements relating thereto) is then reportable 
under Item 6 of Schedule 13D under the Act (or any similar provision of 
a comparable or successor report).\45\
---------------------------------------------------------------------------

    \45\ Proposed PCX Rule 3.4(a).
---------------------------------------------------------------------------

    In addition to the Ownership Limitation, the proposed PCX rules 
provide that for as long as Archipelago shall control, directly or 
indirectly, PCX, no OTP Holder or OTP Firm, either alone or together 
with its related persons, shall (1) have the right to vote, vote or 
cause the voting of shares of stock of Archipelago to the extent such 
shares represent in the aggregate more than 20% of the then outstanding 
votes entitled to be cast on any matter (the ``Voting Limitation'') or 
(2) enter into any agreement, plan or arrangement not to vote shares, 
the effect of which agreement, plan or arrangement would be to enable 
any person, either alone or with its related persons, to vote or cause 
the voting of shares that would represent in the aggregate more than 
20% of the then outstanding votes entitled to be cast on any matter 
(the ``Nonvoting Agreement Prohibition'').\46\
---------------------------------------------------------------------------

    \46\ Proposed PCX Rule 3.4(b).
---------------------------------------------------------------------------

    The Voting Limitation and Nonvoting Agreement Prohibition shall not 
apply to (1) any solicitation of any revocable proxy from any 
stockholder of Archipelago by or on behalf of Archipelago or by an 
officer or director of Archipelago acting on behalf of Archipelago or 
(2) any solicitation of any revocable proxy from any stockholder of 
Archipelago by any other stockholder that is conducted pursuant to, and 
in accordance with, Regulation 14A promulgated pursuant to the Act.\47\
---------------------------------------------------------------------------

    \47\ Id.
---------------------------------------------------------------------------

(ii) Ownership and Voting Agreement
    The proposed PCX Rule 3.4 also requires certain OTP Holders and OTP 
Firms that are not ETP Holders, and certain OTP Associates,\48\ to 
enter into an Ownership and Voting Agreement with PCX and Archipelago, 
which Ownership and Voting Agreement shall provide that for as long as 
Archipelago shall control, directly or indirectly, PCX: (i) No OTP 
Holder or OTP Firm, either alone or with its related persons, shall, at 
any time, own beneficially shares of Archipelago stock in excess of the 
Ownership Limitation; (ii) no OTP Holder or OTP Firm, either alone or 
together with its related persons, shall have the right to vote, vote 
or cause the voting of shares of Archipelago stock, in person or by 
proxy or through any voting agreement or other arrangement, in excess 
of the Voting Limitation; and (iii) no OTP Holder or OTP Firm, either 
alone or together with its related persons, shall enter into any 
agreement, plan or other arrangement relating to shares of Archipelago 
stock entitled to vote on any matter with any other person, either 
alone or with its related persons, in contravention of the Nonvoting 
Agreement Prohibition.\49\ In addition, the Ownership and Voting 
Agreement provides that each OTP Holder, OTP Firm and OTP Associate who 
is party to such agreement shall agree to be subject to the 
implementation provisions imposed by the proposed PCX Rule 3.4(d), 
which are also going to be set forth in the Ownership and Voting 
Agreement; \50\ these provisions are described in more detail below.
---------------------------------------------------------------------------

    \48\ PCX clarified that only certain OTP Holders, OTP Firms and 
OTP Associates would be required to enter into the Ownership and 
Voting Agreement. See August 4, 2005 Telephone Conversation and text 
accompanying note 51, infra, for a discussion of which OTP Holders, 
OTP Firms, and OTP Associates would be required to enter into an 
Ownership and Voting Agreement.
    \49\ Proposed PCX Rule 3.4(c).
    \50\ Id.
---------------------------------------------------------------------------

    Finally, the Ownership and Voting Agreement provides that each OTP 
Holder, OTP Firm and OTP Associate who is party to such agreement shall 
vote, or authorize Archipelago to vote on their behalf, shares of 
Archipelago stock owned by such OTP Holder, OTP Firm or OTP Associate, 
as appropriate, in favor of amendments to the certificate of 
incorporation of Archipelago that incorporate ownership and voting 
limitations that are substantially similar to the Ownership Limitation, 
Voting Limitation and Nonvoting Agreement Prohibition set forth in the 
proposed Rules 3.4(a) and 3.4(b), as well as implementation provisions 
imposed by the proposed PCX Rule 3.4(d).\51\ The Ownership and Voting 
Agreement shall be governed by Delaware law.\52\
---------------------------------------------------------------------------

    \51\ Proposed PCX Rule 3.4(c)(3).
    \52\ Proposed PCX Rule 3.4(c)(5).
---------------------------------------------------------------------------

    Under the proposed PCX rules, the OTP Holders, OTP Firms and OTP 
Associates who are required to enter into the Ownership and Voting 
Agreement have to do so within certain specified time periods set forth 
in the proposed rules. Specifically, in the case of an OTP Holder, OTP 
Firm or OTP Associate which is not an ETP Holder and which (x) owns 
beneficially any shares of Archipelago stock or (y) has entered into 
any agreement, plan or other arrangement relating to the voting or 
ownership of any shares of Archipelago stock, at the time of the 
closing of the Merger, such person will be required to enter into the 
Ownership and Voting Agreement no later than 30 calendar days following 
the date of closing of the Merger; in the case of any OTP Holder, OTP 
Firm or OTP Associate which is not required to enter into an Ownership 
and Voting Agreement pursuant to the above clause, the Ownership and 
Voting Agreement has to be entered into no later than the fifth 
calendar day following the date on which: (x) such OTP Holder, OTP Firm 
or OTP Associate ceases being an ETP

[[Page 48617]]

Holder and (A) owns or acquires beneficial ownership of any shares of 
Archipelago stock or (B) is a party to or enters into any agreement, 
plan or other arrangement relating to the voting or ownership of any 
shares of Archipelago stock; or (y) such OTP Holder, OTP Firm or OTP 
Associate which is not an ETP Holder (A) acquires beneficial ownership 
of any shares of Archipelago stock or (B) enters into any agreement, 
plan or other arrangement relating to the voting or ownership of any 
shares of Archipelago stock.\53\
---------------------------------------------------------------------------

    \53\ Proposed PCX Rule 3.4(c).
---------------------------------------------------------------------------

    The ownership and voting limitations contained in the proposed PCX 
Rule 3.4 and the Ownership and Voting Agreement required by the 
proposed PCX Rule 3.4 are designed to impose on OTP Holders, OTP Firms 
and their related persons restrictions that are similar to those that 
are currently contained in the certificate of incorporation of 
Archipelago with respect to ETP Holders and their related persons. The 
corresponding provisions in the certificate of incorporation of 
Archipelago are designed to prevent any ETP Holder or any ETP Holders 
acting together, from exercising undue control over the operation of 
Archipelago and, therefore, ArcaEx. PCX believes that by extending the 
same restrictions to OTP Holders and OTP Firms as well as their related 
persons, the proposed rule would accomplish the same objectives with 
respect to the options business of PCX. Specifically, PCX believes that 
the proposed rules would deter any OTP Holder or OTP Firm, either alone 
or together with its related persons, from accumulating a substantial 
number of outstanding votes entitled to be cast on any matter without 
Commission review. PCX believes that the imposition of such 20% 
ownership and voting limitations would help ensure that Archipelago, 
and therefore PCX, would not be subject to undue influence from an OTP 
Holder or OTP Firm, or a group of OTP Holders or OTP Firms that control 
a substantial number of outstanding votes entitled to be cast on any 
matter that may be adverse to PCX's or the Commission's regulatory 
oversight responsibilities. The proposed voting limitations, along with 
the related ownership limitation, would serve to protect the integrity 
of PCX's and the Commission's regulatory oversight responsibilities and 
would allow PCX to review the acquisition of substantial voting power 
of Archipelago, and therefore PCX and PCXE, by any OTP Holder, OTP Firm 
and their related persons.
(iii) Certain Matters Related to the Implementation of the Ownership 
and Voting Limitations
    The proposed PCX Rule 3.4(d) provides that in the event that any 
OTP Holder or OTP Firm, either alone or with its related persons 
(including any related persons who are OTP Associates of such OTP 
Holder or OTP Firm), at any time owns beneficially shares of 
Archipelago stock in excess of the Ownership Limitation, Archipelago 
shall promptly call from such OTP Holder or OTP Firm, or an OTP 
Associate of such OTP Holder or OTP Firm, at a price per share equal to 
the par value thereof, shares of Archipelago stock owned by such OTP 
Holder, OTP Firm or OTP Associate that are necessary to decrease the 
beneficial ownership of such OTP Holder or OTP Firm, either alone or 
with its related persons, to 20% of the then outstanding votes entitled 
to be cast on any matter after giving effect to the redemption of the 
shares of Archipelago stock.\54\
---------------------------------------------------------------------------

    \54\ Proposed PCX Rule 3.4(d)(1). For purposes of illustration, 
if there are 1,000,000 votes entitled to be cast in total and an OTP 
Holder acquires beneficial ownership of shares of Archipelago stock 
representing in the aggregate 300,000 votes, then Archipelago has to 
call such number of shares from such OTP Holder so that the number 
of votes that the OTP Holder beneficially owns after giving effect 
to the reduction in such OTP Holder's stake and the consequent 
reduction in the total number of votes entitled to be cast, is not 
more than 20% of the new total number of votes entitled to be cast. 
Thus, using the number provided in this example, Archipelago would 
have to call shares of Archipelago stock representing in the 
aggregate 125,000 votes, leaving the OTP Holder with shares of 
Archipelago stock representing in the aggregate 175,000 votes, or 
20% of the new 875,000 votes entitled to be cast in total.
    In addition, assuming there is a second OTP Holder who 
beneficially owns shares of Archipelago stock representing 190,000 
votes, the calling of the shares of the first OTP Holder described 
above would result in an increase of the second OTP Holder's 
ownership from 19% to 21.7%. In this scenario, Archipelago would 
have to call shares of Archipelago stock representing 20,000 votes 
from the second OTP Holder and additional shares representing 5,000 
votes from the first OTP Holder (for a total of 130,000 shares 
called from the first OTP Holder) such that upon completion of these 
calls, each of these two OTP Holders owns shares of Archipelago 
stock representing 170,000 votes, or 20% of the new 850,000 votes 
entitled to be cast in total.
    The proposed PCX Rule 3.4(d)(1) further provides that in the 
event Archipelago shall call shares of Archipelago stock pursuant to 
the proposed PCX Rule 3.4(d)(1), notice of such call shall be given 
promptly by first-class mail, postage prepaid to the holders of the 
shares of Archipelago stock to be so called (such holders shall 
include holders whose ownership of Archipelago stock exceeded the 
20% ownership limitation solely as a result of the reduction in the 
total number of outstanding votes due to calls of shares of 
Archipelago stock from other stockholders), at such holders' 
addresses as the same appears on the stock register of Archipelago. 
Each such notice shall state: (a) The call date; (b) the number of 
shares to be called; (c) the aggregate call price; and (d) the place 
or places where shares are to be surrendered for payment of the call 
price. Failure to give notice as aforesaid, or any defect therein, 
shall not affect the validity of the call of the shares. From and 
after the call date (unless default shall be made by Archipelago in 
providing funds for the payment of the call price), shares which 
have been called as aforesaid shall be cancelled, shall no longer be 
deemed to be outstanding, and all rights of the holder of such 
shares as a stockholder of Archipelago (except the right to receive 
from Archipelago the call price against delivery to Archipelago of 
evidence of ownership of such shares) shall cease. Upon surrender in 
accordance with said notice of evidence of ownership of the shares 
of Archipelago stock so called (properly assigned for transfer, if 
the board of directors of Archipelago shall so require and the 
notice shall so state), such shares shall be called by Archipelago 
at par value.
---------------------------------------------------------------------------

    In addition, if any OTP Holder or OTP Firm, either alone or with 
its related persons (including any related persons who are OTP 
Associates of such OTP Holder or OTP Firm), acquires the right to vote 
more than 20% of the then outstanding votes entitled to be cast by 
stockholders of Archipelago on any matter, Archipelago shall have the 
right to vote and shall vote such shares of Archipelago stock owned by 
such OTP Holder, OTP Firm, or an OTP Associate of such OTP Holder or 
OTP Firm, in excess of the 20% voting limitation in proportion with the 
results of voting (excluding such excess shares) for such matter at a 
meeting of Archipelago stockholders.\55\
---------------------------------------------------------------------------

    \55\ Proposed PCX Rule 3.4(d)(2). For example, if, with respect 
to a particular proposal submitted to stockholder vote, 60% of the 
vote cast by Archipelago stockholders (excluding the excess shares) 
was in favor of the proposal and 40% of the vote cast by Archipelago 
stockholders (excluding the excess shares) was against the proposal, 
Archipelago would vote 60% of the excess shares in favor of the 
proposal and 40% of the excess shares against the proposal. See 
Amendment No. 1.
---------------------------------------------------------------------------

    Furthermore, the proposed PCX rules provide that in the event of 
any violation by any OTP Holder or OTP Firm of the Ownership 
Limitation, Voting Limitation or Nonvoting Agreement Prohibition 
(including, without limitation, any failure of an OTP Holder, OTP Firm 
or OTP Associate to enter into the Ownership and Voting Agreement as 
required by the proposed Rule 3.4(c) within the applicable time periods 
specified therein or any breach of the Ownership and Voting Agreement 
by an OTP Holder, OTP Firm or OTP Associate which is a party thereto), 
the Exchange shall suspend all trading rights and privileges of such 
OTP Holder or OTP Firm in accordance with proposed PCX Rule 
13.2(a)(2)(E), subject to the procedures provided therein.\56\
---------------------------------------------------------------------------

    \56\ Proposed PCX Rule 3.4(d)(3).
---------------------------------------------------------------------------

    The proposed PCX Rule 13.2(a)(2)(E) provides that in the event of 
any such failure to comply with Rule 3.4, the Exchange shall: (1) 
Provide notice to the

[[Page 48618]]

applicable OTP Holder or OTP Firm within five business days of learning 
of the failure to comply; (2) allow the applicable OTP Holder, OTP Firm 
or OTP Associate of such OTP Holder or OTP Firm fifteen calendar days 
to cure any such failure to comply; (3) in the event that the 
applicable OTP Holder, OTP Firm or OTP Associate of such OTP Holder or 
OTP Firm does not cure such failure to comply within such fifteen 
calendar day cure period, schedule a hearing to occur within thirty 
calendar days following the expiration of such fifteen calendar day 
cure period; and (4) render its decision as to the suspension of all 
trading rights and privileges of the applicable OTP Holder or OTP Firm 
no later than ten calendar days following the date of such hearing.\57\
---------------------------------------------------------------------------

    \57\ 57 Proposed PCX Rule 13.2(a)(2)(E).
---------------------------------------------------------------------------

    Finally, the proposed PCX rules provide that in the event any OTP 
Holder or OTP Firm, either alone or with its related persons (including 
any related person that is an OTP Associate of such OTP Holder or OTP 
Firm), has cast votes, in person or by proxy or through any voting 
agreement or other arrangement, in excess of the Voting Limitation, 
Archipelago may bring suit in a court of competent jurisdiction against 
such OTP Holder, OTP Firm or OTP Associates seeking enforcement of the 
Voting Limitation.\58\
---------------------------------------------------------------------------

    \58\ Proposed PCX Rule 3.4(d)(4).
---------------------------------------------------------------------------

c. Bylaws of Archipelago
(i) Duration of Certain Bylaw Provisions
    With respect to the ownership and voting limitations in the 
certificate of incorporation of Archipelago that apply specifically to 
ETP Holders and their related persons (as opposed to stockholders of 
Archipelago in general) and certain other provisions of the certificate 
of incorporation of Archipelago (such provisions, collectively, the 
``ArcaEx Limitations''),\59\ the certificate of incorporation of 
Archipelago provides that such provisions shall remain applicable for 
so long as ArcaEx remains a facility (as defined in Section 3(a)(2) of 
the Act) \60\ of PCX and PCXE and the Facility Services Agreement 
remains in full force and effect.\61\ As described previously in Item 
II.A.1, following completion of the Merger, ArcaEx will remain the 
exclusive equities trading facility of PCX and PCXE, and the Facility 
Services Agreement will remain in full force and effect in its current 
form. In order to ensure the continued force and effect of the ArcaEx 
Limitations in the event of any change in the relationship of PCX and 
PCXE to ArcaEx or the effectiveness of the Facility Services Agreement, 
PCX proposes to amend the bylaws of Archipelago to provide that 
Archipelago will not take any action, and will not permit any of its 
subsidiaries, which will include PCXH, PCX, PCXE and ArcaEx, to take 
any action, that will cause (i) ArcaEx to cease to be a facility of PCX 
and PCXE, or (ii) the Facility Services Agreement to cease to be in 
full force and effect, unless each of the provisions in the certificate 
of incorporation of Archipelago relating to the ArcaEx Limitations is 
amended pursuant to the terms thereof, the bylaws and applicable law, 
to provide that such provisions shall remain in full force and effect 
whether or not ArcaEx remains a facility of PCX and PCXE or the 
Facility Services Agreement is in full force and effect.\62\ The 
foregoing bylaw provisions may not be amended, modified or repealed 
unless such amendment, modification or repeal is (i) filed with and 
approved by the Commission \63\ or (ii) approved by Archipelago 
stockholders voting not less than 80% of the then outstanding votes 
entitled to be cast in favor of any such amendment, modification or 
repeal.\64\ PCX believes that, because Archipelago will own 100% of the 
ownership interest in PCX, these proposed Archipelago bylaw provisions, 
in conjunction with voting and ownership limitations currently in 
place, and the ownership and voting limitations that will be imposed by 
the Proposed Rule Changes on OTP Holders, OTP Firms and their related 
persons, will ensure that, regardless of whether ArcaEx remains a 
facility of PCX and PCXE or whether the Facility Services Agreement 
remains in full force and effect, the regulatory oversight 
responsibilities of PCX and PCXE will not be subject to any undue 
influences from a PCX member or a group of PCX members that control a 
substantial number of outstanding votes.
---------------------------------------------------------------------------

    \59\ Certificate of Incorporation of Archipelago, paragraphs 
(C)(3)(y), (D)(2), (D)(2)(a) and (H)(3) of Article FOURTH, the third 
paragraph of Article EIGHTH, the penultimate paragraph of Article 
TENTH, Article THIRTEENTH, Article FOURTEENTH, Article FIFTEENTH, 
Article SIXTEENTH, Article SEVENTEENTH and Article NINETEENTH.
    \60\ Section 3(a)(2) defines the term ``facility,'' when used 
with respect to an exchange, to include its premises, tangible or 
intangible property whether on the premises or not, any right to the 
use of such premises or property or any service thereof for the 
purpose of effecting or reporting a transaction on an exchange 
(including, among other things, any system of communication to or 
from the exchange, by ticker or otherwise, maintained by or with the 
consent of the exchange), and any right of the exchange to the use 
of any property or service. 15 U.S.C. 78c(a)(2).
    \61\ The Exchange clarified that the provisions discussed in 
this section, the ArcaEx Limitations, include both the ownership and 
voting limitations and other provisions. See August 12, 2005 
Telephone Conversation.
    \62\ Amended Bylaws of Archipelago, Section 6.8(c).
    \63\ The current Bylaws of Archipelago provide that before any 
amendment to the bylaws shall be effective, such amendment shall be 
submitted to the Board of Directors of PCX and if such Board shall 
determine that the same is required, under Section 19 of the Act and 
the rules promulgated thereunder, to be filed with, or filed with 
and approved by, the Commission before such amendment may be 
effective under Section 19 of the Act and the rules promulgated 
thereunder, then such amendment shall not be effective until filed 
with, or filed with and approved by, the Commission, as the case may 
be. Amended Bylaws of Archipelago, Section 6.8(b).
    \64\ Amended Bylaws of Archipelago Section 6.8(g). Under Section 
216 of the Delaware General Corporation Law, a bylaw amendment by 
shareholders generally requires the affirmative vote of a majority 
of the shares present in person or represented by proxy at a 
stockholders' meeting and entitled to vote on such bylaw amendment, 
unless specified otherwise in the corporation's certificate of 
incorporation or bylaws. Del. Code Ann. tit. 8 sec. 216(2) (1998).
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(ii) No Waiver by the Board of Directors of Archipelago
    The certificate of incorporation of Archipelago currently contains 
provisions that allow the board of directors of Archipelago to, subject 
to certain conditions,\65\ waive the voting and ownership limitations 
with respect to a specific Archipelago stockholder and its related 
persons, provided that neither the stockholder subject to such waiver 
nor any of its related persons is an ETP Holder.\66\ These provisions 
reflect the heightened scrutiny with respect to ETP Holders and their 
related persons relative to other Archipelago stockholders due to the 
fact that ETP Holders are members of the Exchange

[[Page 48619]]

and present more of a concern for undue influence than other 
stockholders of Archipelago. In connection with the Merger and the 
expansion of the voting and ownership limitations to OTP Holders, OTP 
Firms and their related persons through the new proposed PCX rules 
described in Item 3.1(b), PCX proposes to amend the bylaws of 
Archipelago to provide that the board of directors of Archipelago will 
not adopt any resolution waiving the Voting Limitation, the Nonvoting 
Agreement Prohibition and the ``Concentration Limitation'' (as such 
term is defined in the certificate of incorporation of Archipelago) 
\67\ with respect to any OTP Holder, OTP Firm or any of their related 
persons.\68\ The foregoing bylaw provisions may not be amended, 
modified or repealed unless such amendment, modification or repeal is 
filed and approved by the Commission or approved by Archipelago 
stockholders voting not less than 80% of the then outstanding votes 
entitled to be cast in favor of any such amendment, modification, or 
repeal.\69\ These proposed bylaw provisions, in conjunction with the 
ownership and voting limitations that would be imposed by the Proposed 
Rule Changes on OTP Holders, OTP Firms and their related persons, are 
designed to apply a comparable level of scrutiny that has been in place 
for ETP Holders and their related persons to OTP Holders, OTP Firms and 
their related persons after completion of the Merger. By proscribing 
any discretion by the board of directors of Archipelago with respect to 
granting waivers of the ownership and voting limitations to the OTP 
Holders and OTP Firms \70\ and their related persons, the proposed 
bylaw provisions further ensure that these limitations will be strictly 
enforced to fulfill their intended purpose of protecting the integrity 
of the regulatory oversight of PCX and the Commission.
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    \65\ Before adopting any waiver with respect to (i) the exercise 
of any voting rights in excess of the voting limitation set forth in 
the certificate of incorporation of Archipelago, (ii) the entering 
into of any agreement, plan or other arrangement in violation of the 
non-voting agreement prohibition set forth in the certificate of 
incorporation of Archipelago, or (iii) the ownership of Archipelago 
stock in excess of the concentration limitation set forth in the 
certificate of incorporation of Archipelago, the board of directors 
of Archipelago has to determine that: (x) the undertaking of any of 
the actions described in (i), (ii) or (iii) above by any person, 
either alone or with its related persons, will not impair any of 
Archipelago's, PCX or PCXE's ability to discharge its 
responsibilities under the Act and the rules and regulations 
thereunder and is otherwise in the best interests of Archipelago and 
its stockholders; (y) the undertaking of any of the actions 
described in (i), (ii) or (iii) above by any person, either alone or 
with its related persons, will not impair the Commission's ability 
to enforce the Act; and (z) neither such person nor any of its 
related persons is subject to any statutory disqualification (as 
defined in Section 3(a)(39) of the Act). Certificate of 
Incorporation of Archipelago, Article FOURTH, paragraphs C(3) and 
D(1)(b).
    \66\ Certificate of Incorporation of Archipelago, Article 
FOURTH, paragraph C(3).
    \67\ The ``Concentration Limitation,'' as defined in the 
certificate of incorporation of Archipelago, provides that no 
person, either alone or with its related persons, shall be permitted 
at any time to own beneficially shares of Archipelago stock 
representing in the aggregate more than 40% of the then outstanding 
votes entitled to be cast on any matter. Certificate of 
Incorporation of Archipelago, Article FOURTH, Paragraph D(1).
    \68\ Amended Bylaws of Archipelago, Section 6.8(d.). See 
Amendment No. 1.
    \69\ Amended Bylaws of Archipelago, Section 6.8(g).
    \70\ See Amendment No. 1.
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(iii) Extension of Certain Provisions Related to ArcaEx
    Among other things, the certificate of incorporation of Archipelago 
provides for the inspection and copying by PCX and PCXE of 
Archipelago's books and records, requires that Archipelago take 
reasonable steps necessary to cause its agents to cooperate with PCX 
and PCXE in connection with certain of such agents' activities and 
requires that Archipelago cause its officers, directors and employees 
to consent to the applicability to them of certain provisions of 
Archipelago's certificate of incorporation in connection with certain 
of such persons' activities.\71\ These provisions, however, apply only 
to the extent that such books and records or activities, as the case 
may be, relate to ArcaEx. As described previously in Item II.A.1, 
following completion of the Merger, PCX and PCXE will become wholly-
owned subsidiaries of Archipelago. In order to ensure that these 
provisions apply also to the operations of PCX and PCXE, PCX proposes 
to amend the bylaws of Archipelago to provide that, in addition to the 
current requirements of the certificate of incorporation of 
Archipelago, (i) Archipelago's books and records shall be subject at 
all times to inspection and copying by PCX and PCXE to the extent such 
books and records are related to the operation and administration of 
PCX or PCXE, (ii) Archipelago shall take reasonable steps necessary to 
cause its agents to cooperate with PCX and PCXE pursuant to their 
regulatory authority with respect to such agents' activities related to 
PCX or PCXE, (iii) Archipelago shall take reasonable steps necessary to 
cause its officers, directors and employees prior to accepting a 
position as an officer, director or employee, as applicable, of the 
Corporation to consent in writing to the applicability to them of 
certain specified provisions of the certificate of incorporation of 
Archipelago with respect to their activities related to PCX or PCXE, 
and (iv) Archipelago, its directors and officers, and those of its 
employees whose principal place of business and residence is outside 
the United States shall be deemed to irrevocably submit to the 
exclusive jurisdiction of the United States federal courts, the 
Commission and PCX for the purposes of any suit, action or proceeding 
pursuant to the United States federal securities laws, and the rules 
and regulations thereunder, arising out of, or relating to, the 
activities of PCX or PCXE, and Archipelago and each such director, 
officer or employee, in the case of any such director, officer or 
employee by virtue of his acceptance of any such position, shall be 
deemed to waive, and agree not to assert by way of motion, as a defense 
or otherwise in any suit, action or proceeding, any claims that it or 
they are not personally subject to the jurisdiction of the Commission, 
that the suit, action or proceeding is an inconvenient forum or that 
the venue of the suit, action or proceeding is improper, or that the 
subject matter thereof may not be enforced in or by such courts or 
agency.\72\ The foregoing proposed bylaw provisions may not be amended, 
modified or repealed unless such amendment, modification or repeal is 
(i) filed with and approved by the Commission or (ii) approved by 
Archipelago stockholders voting not less than 80% of the then 
outstanding votes entitled to be cast in favor of any such amendment, 
modification or repeal.\73\ PCX believes that, because Archipelago will 
own 100% of the ownership interest in PCX (and, through PCX, in PCXE as 
well), these proposed Archipelago bylaw provisions will ensure that the 
regulatory oversight responsibilities of PCX and PCXE will also extend 
to such books and records, agents, officers, directors and employees of 
Archipelago as may relate to, or be involved in, the operations of PCX 
and PCXE (as well as ArcaEx).
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    \71\ Certificate of Incorporation of Archipelago, Article 
THIRTEENTH, Article FOURTEENTH, Article SEVENTEENTH and Article 
EIGHTEENTH.
    The Exchange clarified that Article THIRTEENTH of the 
Certificate of Archipelago should be included in the preceding list. 
See August 12, 2005 Telephone Conversation.
    \72\ Amended Bylaws of Archipelago, Section 6.8(e).
    \73\ Amended Bylaws of Archipelago, Section 6.8(g).
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(iv) Calling of Shares by Archipelago
    The certificate of incorporation of Archipelago also contains 
provisions that govern the process that Archipelago will follow in 
order to call shares from certain of its stockholders in the event of 
breaches of certain ownership limitations.\74\ The proposed Archipelago 
bylaw amendment clarifies that, in order to effect the purposes of 
these provisions of Archipelago's certificate of incorporation, 
Archipelago recognizes that the call must be undertaken and completed 
promptly. To that end, under the proposed bylaw amendment, the Board of 
Directors of Archipelago will cause Archipelago to call promptly shares 
of stock of Archipelago and also to give notice of such call 
promptly.\75\ The foregoing proposed bylaw provisions may not be 
amended, modified or repealed unless such amendment, modification or 
repeal is (i) filed with and approved by the

[[Page 48620]]

Commission or (ii) approved by Archipelago stockholders voting not less 
than 80% of the then outstanding votes entitled to be cast in favor of 
any such amendment, modification or repeal.\76\
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    \74\ Certificate of Incorporation of Archipelago, Article 
FOURTH, paragraph F.
    \75\ Amended Bylaws of Archipelago, Section 6.8(f).
    \76\ Amended Bylaws of Archipelago, Section 6.8(g).
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d. Undertakings by Archipelago
    In connection with the submission of the Proposed Rule Changes, 
Archipelago undertakes that, prior to the earlier of (1) the 2006 
annual general meeting of Archipelago stockholders and (2) the first 
meeting of Archipelago stockholders to occur after the closing of the 
Merger (other than any meeting or meetings of Archipelago stockholders 
convened for the purpose of considering and approving the merger of 
Archipelago and New York Stock Exchange, Inc.), the board of directors 
of Archipelago shall: (a) Propose amendments to the certificate of 
incorporation of Archipelago to (x) extend the application of voting 
and ownership limitations imposed on ETP Holders currently contained in 
the certificate of incorporation of Archipelago to OTP Holders and OTP 
Firms, (y) delete the phrase ``[f]or so long as ArcaEx remains a 
Facility of PCX and PCX Equities and the FSA remains in full force and 
effect'' from each paragraph that contains such language, which 
paragraphs shall include paragraphs (C)(3)(y), (D)(2), (D)(2)(a) and 
(H)(3) of Article FOURTH, the third paragraph of Article EIGHTH, the 
penultimate paragraph of Article TENTH, Article THIRTEENTH, Article 
FOURTEENTH, Article FIFTEENTH, Article SIXTEENTH, Article SEVENTEENTH 
and Article NINETEENTH, and (z) incorporate into Articles THIRTEENTH, 
FOURTEENTH, SEVENTEENTH AND EIGHTEENTH, as appropriate, the 
requirements set forth in Section 6.8(e) of the proposed Archipelago 
bylaw amendment; (b) declare the advisability of such amendments; and 
(c) direct such amendments be submitted for stockholder approval at the 
earlier of (1) the 2006 annual meeting of Archipelago stockholders and 
(2) the first meeting of Archipelago stockholders to occur after the 
closing of the Merger (other than any meeting or meetings of 
Archipelago stockholders convened for the purpose of considering and 
approving the merger of Archipelago and New York Stock Exchange, Inc.). 
The Ownership and Voting Agreement will provide that any OTP Holder, 
OTP Firm or OTP Associate that is subject to the Ownership and Voting 
Agreement shall vote, or authorize Archipelago to vote on its behalf, 
shares of Archipelago stock owned by such OTP Holder, OTP Firm or OTP 
Associate in favor of the amendments to the certificate of 
incorporation of Archipelago described in (x) above.\77\
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    \77\ Proposed PCX Rule 3.4(c)(3).
    PCX clarified that the Ownership and Voting Agreement also would 
apply to OTP Associates, and that such agreement would only require 
a vote in favor of the amendments described in (x) above. See August 
4, 2005 Telephone Conversation.
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    In addition, Archipelago undertakes to take reasonable steps 
necessary to cause Archipelago's directors and officers and those 
Archipelago employees whose principal place of business and residence 
is outside the United States prior to accepting a position as an 
officer, director or employee, as applicable, of Archipelago to consent 
in writing to the applicability to them of the proposed Section 
6.8(e)(iv) of the proposed Archipelago bylaw amendment. Furthermore, 
Archipelago undertakes that it will take reasonable steps necessary to 
cause Archipelago's current directors and officers and those current 
Archipelago employees whose principal place of business and residence 
is outside the United States to consent in writing prior to the 
consummation of the Merger to the applicability to them of Section 
6.8(e)(iv) of the proposed Archipelago bylaw amendment.
e. Certain Additional Matters \78\
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    \78\ See Amendment No. 1.
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    (i) The Exchange is also requesting the Commission's approval for 
the following temporary exceptions for the following persons, each of 
whom would be subject to and exceed the voting and ownership 
limitations imposed by Article Nine of the certificate of incorporation 
of PCXH (as proposed to be amended as described in this filing) as of 
the date of the closing of the Merger, so that such persons be 
permitted to exceed such limitations imposed by Article Nine to the 
following extent and for the following time periods:
    (x) Archipelago may, until December 31, 2005, continue to own all 
of its ownership interest in Wave Securities, L.L.C., a broker-dealer 
and wholly-owned subsidiary of Archipelago, following the closing of 
its acquisition of PCXH notwithstanding the terms of the certificate of 
incorporation of PCXH, as proposed to be amended as described in this 
filing.
    (y) Gerald D. Putnam, Chairman and Chief Executive Officer of 
Archipelago, may, until December 31, 2005, continue to own in excess of 
5% of Terra Nova Trading, L.L.C. and continue to serve as a director of 
TAL Financial Services, LLC following the closing of the Archipelago's 
acquisition of PCXH notwithstanding the terms of the certificate of 
incorporation of PCXH, as proposed to be amended as described in this 
filing.
    (ii) In order to abide by the terms of the certificate of 
incorporation of PCXH, as proposed to be amended as described in this 
filing, each of Kevin J.P. O'Hara, Chief Administrative Officer and 
General Counsel of Archipelago, and Paul Adcock, Managing Director, 
Trading, of Archipelago, shall resign from the board of directors of 
White Cap Trading LLC prior to the effective time of the Merger.
2. Basis
    The Exchange believes that this filing is consistent with Section 
6(b) \79\ of the Act, in general, and furthers the objectives of 
Section 6(b)(1),\80\ in particular, in that it enables the Exchange to 
be so organized so as to have the capacity to be able to carry out the 
purposes of the Act and to comply, and (subject to any rule or order of 
the Commission pursuant to Section 17(d) or 19(g)(2) of the Act) to 
enforce compliance by its exchange members and persons associated with 
its exchange members, with the provisions of the Act, the rules and 
regulations thereunder, and the rules of the Exchange. The Exchange 
also believes that this filing furthers the objectives of Section 
6(b)(5),\81\ in particular, because the rules summarized herein would 
create a governance and regulatory structure with respect to the 
operation of the options business of PCX that is designed to help 
prevent fraudulent and manipulative acts and practices; to promote just 
and equitable principals of trade; to foster cooperation and 
coordination with persons engaged in regulating, clearing, settling, 
processing information with respect to, and facilitating transactions 
in securities; and to remove impediments to and perfect the mechanism 
of a free and open market and a national market system, and, in 
general, to protect investors and the public interest.
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    \79\ 15 U.S.C. 78f(b).
    \80\ 15 U.S.C. 78f(b)(1).
    \81\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.

[[Page 48621]]

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    Written comments on the proposed rule change 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 (1) 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 (2) as to 
which the Exchange 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.
    The board of directors of PCXH and the board of directors of PCX 
approved the proposed amendment to the certificate of incorporation of 
PCXH at their respective meetings on June 1, 2005. The board of 
directors of PCX approved this filing, including the Proposed Rule 
Changes contained therein, at its meeting on August 2, 2005. The board 
of directors of Archipelago approved the proposed amendment to the 
bylaws of Archipelago at its meeting on July 18, 2005. In addition, 
PCXH will be submitting the Amended Merger Agreement to its 
stockholders for approval. This vote is expected to occur at a special 
meeting of PCXH stockholders in September 2005. To the extent 
necessary, the Exchange hereby consents to an extension of the time 
period specified in Section 19(b)(2) of the Act until at least 35 days 
after the Exchange has filed an appropriate amendment to this filing 
setting forth the completion of all such necessary corporate 
actions.\82\
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    \82\ See Amendment No. 1.
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IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to [email protected]. Please include 
File Number SR-PCX-2005-90 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, Station Place, 100 F 
Street, NE., Washington, DC 20549-9303.
    All submissions should refer to File Number SR-PCX-2005-90. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, 
all written statements with respect to the proposed rule change that 
are filed with the Commission, and all written communications relating 
to the proposed rule change between the Commission and any person, 
other than those that may be withheld from the public in accordance 
with the provisions of 5 U.S.C. 552, will be available for inspection 
and copying in the Commission's Public Reference Room. Copies of such 
filing also will be available for inspection and copying at the 
principal office of PCX. 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-PCX-2005-90 and should be submitted on or before September 8, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\83\
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    \83\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-4510 Filed 8-17-05; 8:45 am]
BILLING CODE 8010-01-P