AMEX Equity Integration
June 2008
Filed by NYSE Euronext
Pursuant to Rule 425 under the
Securities Act of 1933, as amended
Subject Companies:
NYSE Euronext (Commission File No. 333-149480)
The Amex Membership Corporation
Disclaimer
IMPORTANT INFORMATION WITH RESPECT TO THE MERGER
In connection with the proposed acquisition by NYSE Euronext of The Amex Membership Corporation (“MC”), NYSE Euronext filed with
the U.S. Securities and Exchange Commission (“SEC”) a registration statement on Form S-4, containing a proxy statement/prospectus
regarding the proposed transaction. The parties have filed and will file other relevant documents concerning the proposed transaction
with the SEC. The SEC declared the Registration Statement on Form S-4 effective on May 8, 2008. MC MEMBERS ARE URGED TO
READ THE FINAL PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTION, BECAUSE IT CONTAINS
IMPORTANT INFORMATION. MC members can obtain a free copy of the final proxy statement/prospectus, as well as other filings
containing information about NYSE Euronext and Amex without charge, at the SEC’s website (http://www.sec.gov). Copies of the final
proxy statement/ prospectus can also be obtained, without charge, by directing a request to the Office of the Corporate Secretary, NYSE
Euronext, 11 Wall Street, New York 10005, 212-656-2061 or to Amex, Attention: Office of Corporate Secretary, 86 Trinity Place, NY, NY
10006, 212-306-1408.
This document shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of
securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as amended.
Cautionary Note Regarding Forward-Looking Statements
This document may contain forward-looking statements, including forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements concerning NYSE
Euronext’s and Amex’s plans, objectives, expectations and intentions and other statements that are not historical or current facts.
Forward-looking statements are based on NYSE Euronext’s and Amex’s current expectations and involve risks and uncertainties that
could cause actual results to differ materially from those expressed or implied in such forward-looking statements. Factors that could
cause NYSE Euronext’s and Amex’s results to differ materially from current expectations include, but are not limited to: NYSE Euronext’s
and Amex’s ability to implement their respective strategic initiatives, economic, political and market conditions and fluctuations,
government and industry regulation, interest rate risk and U.S. and global competition, and, in the case of NYSE Euronext, other factors
detailed in NYSE Euronext’s reference document for 2006 (“document de référence”) filed with the French Autorité des Marchés
Financiers (Registered on June 6, 2007 under No. R.07-0089), 2007 Annual Report on Form 10-K, and other periodic reports filed with
the U.S. Securities and Exchange Commission or the French Autorité des Marchés Financiers. In addition, these statements are based
on a number of assumptions that are subject to change. Accordingly, actual results may be materially higher or lower than those
projected. The inclusion of such projections herein should not be regarded as a representation by NYSE Euronext or Amex that the
projections will prove to be correct. This document speaks only as of this date. NYSE Euronext and Amex disclaim any duty to update
the information herein
Agenda
FINRA Membership
Qualifications
License Acquisition & Fees
Transaction & Equipment Fees
Technology Integration
Training
Facility/Broker Booth Setup
“Blueline” Trading
NYSE Arca Equity Trading Permits
FINRA Membership
Disclaimer: The regulatory information presented below is preliminary
only,
and subject to change. Neither FINRA nor the SEC has approved the
processes described below, which is a condition precedent to implementation.
All AMEX equities members will be required to become NYSE and
FINRA members
Non-FINRA members would be waived into FINRA membership
through a short-form waive-in process
Waive-in would give firms a limited form of FINRA membership that enables
them to continue their core floor-based businesses
If a waived-in firm subsequently wants to expand beyond its floor-based
business, it would need to go through FINRA’s Rule 1017 process.
If your firm is already a FINRA member, you don’t need to go through
the waive-in process
Qualifications
Firms will be required to submit U-4 updates for all personnel
(NYSE will work with Firms to expedite) to reflect dual NYSE/Amex
memberships
Members and staff will be fingerprinted in connection with the
issuance of NYSE Euronext identification badges
Firms or individuals may be required to satisfy additional regulatory
or legal requirements
License Acquisition
All AMEX Equity Brokers will be required to purchase a Trading
License at the then-current price of a NYSE trading license
(Current Price: $3,333/mo.)
Current transfer rules in place for NYSE Brokers to apply
Waive 10% premium for purchasing within a period after the
transition of Options trading
Submit Trading License application and names of transferring
Equity Brokers to Membership Services prior to transition date (will
be requested shortly)
Supply list of all employees prior to transition (will be requested
shortly)
Broker/Dealers interested in obtaining electronic memberships will
need to follow the same process and will only be required to
purchase one trading license in the name of the firm.
NYSE Transaction Fees
Equity Transactions – Rebate
Credit per Share – for executions of orders sent to the floor broker for representation on the
NYSE when adding liquidity to the NYSE Display Book system (including Percentage Orders)
equals $0.0004
Equity Transactions – No Charge
Equity per Share Charge - per transaction - when adding liquidity to the NYSE (off floor)
Agency cross trades (i.e., a trade where a Member Organization has customer orders to buy
and sell an equivalent amount of the same security) of 10,000 shares or more
Non-electronic agency transactions of 10,000 shares or more between floor brokers in the
crowd
At the opening or at the opening only orders
Equity Transactions – Charge
Routing Fee – per share (floor brokers) equals $0.0029
Routing Fee – per share (except floor brokers) equals $0.0030
Equity per Share Charge - per transaction (charged to both sides) equals $0.0004 – for all
odd lot transactions (including the odd lot portions of partial round lots),
market at-the-close and limit at-the-close orders, and
non-electronic agency transactions of less than 10,000 shares between floor brokers in the crowd
Equity per Share Charge for all other transactions (i.e., when taking liquidity from the NYSE) -
per transaction equals $0.0008
Floor Broker Equipment Fees –
Schedule of Annual Charges, unless otherwise noted
Clerk Badge Fee
Annual Fee per Clerk……………………………………………………………………………... $1,000.00
Radio Paging Service
Base charge (unit and first channel).……………………………………………………………. $408.50
Each additional channel………………………………………………………………………….. 139.75
Financial Vendor Services - Administrative Fee
Per ITPN User.…………………………………………………………………………………….. $480.00*
Per Terminal for Non-ITPN Product…………………………………………………………….. 480.00
Member Telephone Service - Toll call amount billed by Verizon plus a per call surcharge on
Toll calls $0.69 and below..…………………..………………………………………………….. $0.16
Toll calls greater than $0.69……………………………………………………………………… 0.26
Cellular Phones
Phone and Headset……………………………………………………………………………….. No Charge
Ongoing Maintenance – per phone..…………………..………………………………………... $240.00
Booth Telephone System
Annual Telephone Line Charge………………………………………………………………….. $400.00 per phone number
Single line phone, jack, and data jack…………………………………………………………... 129.00
Service Charges
Install single jack (voice or data).……………………………………………………………….. $161.25
Relocate jack………………………………………………………………………………………. 107.50
Remove jack……………………………………………………………………………………….. 53.75
Install voice or data line…………………………………………………………………………... 107.50
Disconnect data line………………………………………………………………………………. 53.75
Change phone line subscriber…………………………………………………………………… 53.75
Broker Subscriber Service
e-Broker Hand Held Device (annual charge per handheld device)………………………….. $5,000.00
*ITPN “User” is a member or person associated with a member, who has been entitled to receive one or more third party
market Data vendor service offerings via the Exchanges Integrated Program Network
Technology Integration
The ability to trade both NYSE and Amex equities from the NYSE Trading Floor. Trades
facilitated through the Display Book automatically comply with Reg NMS routing requirements
Broker Booth Support System (BBSS) – a booth terminal
Ability to receive orders from outside customers and local order entry
Ability to send orders to e-Broker or the Post
Messaging capabilities (market looks) between upstairs and e-Broker, with archiving solution available
Three day online history of Trading activity and available after-hours logs
Orders entered in BBSS guarantee full FESC compliance (Rule 123e)
Available direct submission to comparison systems
NYSE e-Broker – a wireless hand held device that allows brokers to:
Receive orders from BBSS and systemically route orders to the Post (as DOT orders, e-Quotes or CAPs)
Receive and respond to market looks, with archiving solution available
Trade verbally in the crowd
Receive real time market data, OpenBook data and Broker Volume
Available afterhours logs
Future enhancements to connect to an external algorithm with several trading strategies
Your Firm Must:
Establish clearing arrangements with an approved clearing firm
Fulfill all necessary training and membership certifications
Adopt written policies and procedures reasonably designed to properly surveil trading activity
and maintain proper books and records.
Transferring Equity Brokers will be given the same technology and trading
capabilities as the NYSE Equity Brokers. The complete NYSE broker system
package offers:
Training/Examinations
AMEX will adopt a version of the NYSE equities rules
All equities brokers and clerks will have to complete regulatory training
on new AMEX equities rules:
New Member Orientation Beginning last week of June
Beginner Trading Assistant Beginning mid to late June
All AMEX equities brokers and clerks will have hands-on training
on:
BBSS Starting end of June and continue throughout July
e-Broker Starting end of June and continue throughout July
Mock Trading Starting early July and continue until early August
All AMEX equities license holders would have to complete annual
Floor Member Continuing Education Program (to be administered
by NYSE)
Facility / Broker Booth Setup
AMEX Brokers must contact Floor Facilities and Broker Services to set up
their NYSE Trading Floor Operation
All Necessary support groups required to walk firms through this process
are accessible on the 20th floor of 11 Wall Street
Firms will be allocated booth space based on staffing and equipment
requirements
Firms will select and contract directly with a financial market data provider
(Reuters Thomson, Track Data)
Firms will select and contract directly with a telephone turret provider (BT or IPC)
Note – NYSE is working with BT to migrate existing telephone circuits from 86 Trinity to
11 Wall Street.
Firms can contract for “Exchange authorized” Verizon Wireless cellular phones
(with 4-digit broker to booth dialing). Calling plans to fit various calling patterns
are available.
Floor Facilities will then work with the firm to configure the booth space(s)
to the firms specification.
“Blueline” Trading
NYSE rules do not permit trading in away markets while in the
Crowd on the Exchange Floor
Blueline trading refers to operating an on-Floor booth premise as an
“upstairs” location
Permits member organizations approved by NYSE Regulation to
trade in away markets both in listed and non-listed securities
Cannot be for member organization’s own account
Must meet relevant registration and qualification requirements,
e.g., NYSE Arca ETP to trade ETFs
Must comply with relevant order entry requirements
Adopt written procedures and guidelines governing the conduct
of such a business
Information Memo 07-77
NYSE Arca Equity Trading Permit (ETP)
Broker/Dealers interested in becoming members of NYSE Arca
must complete the Equity Trading Permit Applications and
Agreements to trade on NYSE Arca and become an ETP holder
Review and approval process for an ETP application can take
between 10-12 weeks
All Exchange Traded Funds (ETFs) are moving to NYSE Arca. In
order to trade ETFs, your firm mustbe an NYSE Arca ETP holder
Fees: $55 per Registered Representative per year, billed annually
in December thru WebCRD
If NYSE Arca is the DEA, there is a $2,000 monthly DEA fee
ETP applications and information are available online at
http://www.nyse.com/etpmembership
Submit completed ETP application and requested information to
Client Relationship Services at 1.888.689.7739 (option #3) or
crs@nyx.com
KEY CONTACTS
hweber@nyx.com
212-656-5157
Harry Weber
MD, Trading Services/Telecommunications
Trading Floor Booth
Set-up and
Telecommunications
cfredrickson@nyx.com
212-656-5390
Camille Fredrickson
Director, Specialist & Broker Training
Specialist & Broker
Training
crs@nyx.com
1.888.689.7739 (option 3)
Client Relationship Services
NYSE & NYSE Arca
Membership
rairo@nyx.com
212-656-5663
Robert Airo
VP, Trading Floor Operations
Operations
mpaulyson@nyx.com
212-656-2721
Michael Paulyson
MD, Implementation Planning
Technology
emcelduff@nyx.com
212-656-8499
Eileen McElduff
Director, Membership Services
NYSE Trading Licenses
csaperstein@nyx.com
212-656-2355
Clare Saperstein
Director, NYSE Regulation
Membership Regulation
mrutigliano@nyx.com
212-656-4679
Michael Rutigliano
VP, Market Development
General Inquiries