REG 2008-37

SEC Emergency Order prohibiting short sales in 799 financial companies - READ CAREFULLY AS RULES ARE IMMEDIATELY EFFECTIVE

Effective immediately the SEC Emergency Order (see attached link) prohibits short sales for 799 securities noted in Appendix A of the linked SEC Order.

Please note that the SEC exempted the following from the prohibition: "registered market makers, block positioners, or other market makers obligated to quote in the over-the-counter market, in each case that are selling short a publicly traded security of an Included Financial Firm as part of bona fide market making in such security." Please refer to the Order for a full list of exemptions.

The SEC has also confirmed verbally that ETF specialists and market makers are exempt from the short sale prohibition when selling underlying components as a part of bona fide market making in such ETFs.

In addition there is a one-day exemption for options market makers when selling short as part of bona fide market making and hedging activities.

Please also note that Amex systems will not block sell short orders. The SEC Order requires that firms be responsible for compliance with this Order.
http://www.sec.gov/rules/other/2008/34-58592.pdf

Please direct any questions about this Notice to Rick Farber at 212-306-5310.