ATS-N/CA 0000851376-26-000011 LIVE 0000851376 XXXXXXXX 013-00127 false false The Barclays ATS Y The amendments made in this Correcting Amendment apply to all Subscribers and the Broker Dealer Operator. Barclays is updating Part II, Item 6(a) and Part II, Item 7(a) to clarify the controls applied to confidential trading information related to activity in the ATS when provided to certain groups within the BD Operator for purposes of performing their job functions. Y BARCLAYS CAPITAL INC. 008-41342 000019714 Financial Industry Regulatory Authority (FINRA) 10/19/1987 LATS www.barx.com/eqdisclosures Equinix NY4 Data Center 755 Secaucus Road Secaucus 07094 US-NJ false false The NMS Stock ATS ("LX") is operated by Barclays Capital Inc. ("BCI"), the Broker-Dealer Operator. BCI is a broker and dealer registered with the SEC. It is the entity through which the Barclays group of entities ("Barclays") conducts investment banking activity in the United States. BCI's Equities and Fixed Income business units have the ability to enter orders and trading interest into Barclays' order router and algorithms. Barclays' order router and algorithms may route the order, or part of the order, to LX. Those business units do not have the ability to enter orders utilizing a direct connection into LX. The Fixed Income business unit is comprised of the Credit (including credit-related ETF trading), Macro, Fixed Income Financing and Securitized Product businesses. The Fixed Income business unit trades in LX on a principal basis. The Equities business unit is comprised of the following trading desks: (1) program trading, which primarily executes baskets trading strategies such as guaranteed orders, blind risk bids, and the execution of special settlement orders for equities securities, (2) flow volatility trading, which provides market access, liquidity and makes markets in Equity Single Stock, Index and Sector based vanilla derivative products, (3) cash trading, registered market makers and "block positioners" in exchange-listed Equities, (4) ETF trading, which makes markets in and effects create and redeem transactions in ETFs, (5) prime services, which executes equity swaps and associated hedge transactions, extends financing against equity security collateral in the form of margin loans, and offers electronic execution services through its Quantitative Prime Services ("QPS") business, (6) convertible bonds, which works with a structured asset that involves an equity component as part of its structure but also involves corporate bonds and options; the products that the team works with are convertible bonds, preferreds, and mandatories, (7) Structured Derivatives trading, which executes a variety of OTC derivative transactions, structured notes, and corporate financing transactions along with their associated hedges and (8) equities syndicate, a client oriented business which provides a full service Capital Markets offering including marketed, back-stopped and underwritten offerings of both existing and new Cash Equities and Equity-Linked securities; this business is primarily engaged in underwriting activity to IPOs, follow on, block trade and convertible offerings. The Equities business unit is also comprised of the following three sales desks: (1) Cash, inclusive of electronic sales and origination, Institutional Sales, and High touch sales, which includes program sales, cash sales and convertible sales, (2) Derivatives, inclusive of Structured derivatives sales and flow volatility sales and (3) Prime sales. The Equities business units may enter orders as principal, riskless principal or as agent. Note, orders that will be traded on a riskless principal basis will come into LX with an order capacity of principal. The MPID for BCI is LEHM. The business units described above do not have the ability to enter orders utilizing a direct connection into LX. Like other Subscribers, however, they do have the ability to send orders using Barclays' order router and algorithms. Barclays' order router and algorithms may route the order, or part of the order, to LX. The business units do not have the ability to utilize Subscriber Type Blocking, Minimum Time Blocking or Barclays Principal Order Blocking as discussed in Part III, Item 14. The business units do not have the ability to request their order interactions be evaluated to determine if strategies or other Subscribers may be adversely affecting their interactions within LX and, if so, request that their orders be blocked from further interactions with those strategies or those other Subscribers. N N Any Affiliate of BCI may send orders to BCI or route orders to Barclays' order router and algorithms. Barclays' order router or algorithms may route the order, or part of the order, into LX. Affiliates do not have the ability to enter orders utilizing a direct connection into LX. Affiliates that enter orders into LX are Barclays Bank plc ("BBplc"), a foreign banking entity authorized by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority; Barclays Bank Ireland PLC ("BBI"), a foreign credit institution regulated by the Central Bank of Ireland; Barclays Capital Securities Limited ("BCSL"), a foreign Broker-Dealer authorized by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority; Barclays Capital Canada Inc. ("BCCI"), a foreign Broker-Dealer registered in Canada; Barclays Capital Derivatives Funding LLC ("BCDF"), a principal trading firm utilized primarily for hedging purposes. BBplc, BCSL, BBI and BCCI have the ability to route orders as principal, agent, or riskless principal to Barclays' order router and algorithms. BCDF routes orders only as principal to Barclays' order router and algorithms. The Barclays group of entities includes a number of special purpose vehicles. Most such entities have been formed in connection with specific structured derivative transactions. No such entities are engaged in client-facing business nor were any such entities formed for the purpose of transacting in LX. Some special purpose vehicles may transact in equity securities acting as principal for their own account, for example to hedge the structured transaction for which they were formed. Such orders are processed by BCI as agent and may utilize Barclays' order router or algorithms. Consequently, orders from such special purpose vehicles may be routed to LX by operation of the order router as further described in Part III, Item 5. The frequency with which any such entity transacts depends on the features of the transaction structure for which they were formed. Barclays Affiliates do not receive preferential treatment in LX. All of the Affiliates described above are categorized as Barclays Trading Desks for purposes of Subscriber Type segmentation, as described in Part III, Item 13, and consequently fall into Tier 2 for purposes of execution priority, as described in Part III, Item 11(c). Irrespective of the capacity in which the relevant Affiliate is acting, LX receives all orders from Affiliates as agency orders of BCI under the MPID "LEHM". The Affiliates described above do not have the ability to enter orders through a direct connection into LX, nor do they have the ability to utilize Subscriber Type Blocking, Minimum Time Blocking or Barclays Principal Order Blocking as discussed in Part III, Item 14. The Affiliates do not have the ability to request their order interactions be evaluated to determine if strategies or other Subscribers may be adversely affecting their interactions within LX and, if so, request that their orders be blocked from further interactions with those strategies or those other Subscribers. N N With respect to any order or trading interest (including LX Closing Cross ("LXCC") orders), Subscribers can opt out from interacting with the principal (including riskless principal) orders and trading interest of BCI and all orders and trading interests of BCI's Affiliates in LX. A Subscriber may apply this opt-out on an order-by-order basis or as a change to its default trading profile applicable to all of its orders. To effect this opt-out, a Subscriber can contact its Equities Sales Representative, request such restriction through Barclays' online SPECS tool, or by emailing the Barclays Service Desk at LXService@barclays.com. Barclays usually implements such requests within 24 hours of receipt. If a Subscriber elects such opt-out, it will block that Subscriber's interactions in LX with all principal (including riskless principal) orders and trading interests of BCI in LX. It will also block all interactions with all orders and trading interests of all Affiliates of BCI, whether that Affiliate is trading in a principal, riskless principal or agency capacity. Subscribers do not have the ability to opt-out from interacting with the orders of BCI where BCI is acting as agent for an unaffiliated Subscriber. As described in Part II, Item 2(a) above, Affiliates of BCI may send orders to LX. Subscribers can opt-out from interacting with all orders and trading interests of the Affiliates of BCI in LX (including LXCC orders) by contacting their Equities Sales Representative, requesting such restriction through Barclays' online SPECS tool, or by emailing the Barclays Service Desk at LXService@barclays.com. Barclays usually implements such requests within 24 hours of receipt. As described above in Part II, Item 3(a), any such opt-out will also restrict interactions with the principal (including riskless principal) orders of BCI. Y BCI connects to other Trading Centers through its order router. The following Trading Centers other than LX are accessible through BCI: BOFA Instinct X, Cboe BYX, Cboe BZX, NYSE Texas, Cboe EDGA, Cboe EDGX, IEX, IntelligentCross, JPM-X, Liquidnet H2O, NASDAQ, NASDAQ BX, NASDAQ PSX, NYSE, NYSE Arca, NYSE American, NYSE National, BIDS, Blockcross, CODA Markets, Fidelity CrossStream, Instinet CBX, Virtu Posit, LeveL, MS Pool, UBS ATS, Virtu Matchit, Citadel Connect, Jane Street JX, Virtu VEQ Link, ASPEN, XTX, LTSE, MEMX, MIAX, BNP Cortex, GS Sigma X, OneChronos, Hudson River Trading, Tower Research Capital, 24X National Exchange. Those Trading Centers, or the Broker-Dealer Operators of those Trading Centers, may also route orders to LX. They do not do so on a preferential basis and there is no obligation on either the Trading Center or BCI to route orders. LX treats each of the foregoing Trading Centers in the same manner as other ATS Subscribers. N BCI offers its clients a wide range of electronic order handling and execution products on its electronic trading platform. Products and services relevant to the means of entry into the ATS (as further described in Part III, Item 5) are Barclays' algorithms and order router, direct connection to LX and the order entry gateway provided by QPS. Barclays also offers various informational tools that provide clients with online access to information about their orders and that allow clients to configure their electronic trading profile. Portfolio WebBench is a proprietary software suite that allows clients to monitor their trade flow in near real-time and to access detailed reporting of both routing and LX results. SPECS is an online client interface where clients may view, verify and request changes to their order handling settings with Barclays. BCI also offers all clients a variety of information and reports regarding their own orders. This information may include information as to execution venues, percentage of order flow executed in various venues, crossing rates in LX, percentage of order flow executed against various Subscriber Types (described in Part III, Item 13), and a client's algorithmic and router settings. Barclays publishes monthly aggregated and anonymized statistics related to LX on its website (as described in Part III, Item 26). BCI offers the products and services described above to its clients and, through its Affiliates, to clients of those Affiliates trading US listed securities. To access these products and services, clients must be on-boarded as clients of the Barclays Equities business. Use of these products and services is governed by relevant contractual agreements, which contain no specific terms and conditions for routing orders to LX. Additional information regarding the terms and conditions for use of LX is provided in Part III, Items 2 and 3. BCI reserves the right and retains the ability to deny access to all or any part of any product or service described above to any client, or any client of any of its Affiliates, in its discretion. Any such denial of access may be applied to individual clients directly or to an entire subset of clients. N Barclays does not have any personnel solely responsible for LX. Barclays considers Subscribers' identities, information relating to live orders, trading interests and executions in LX and post-execution information that Barclays reasonably believes contains evidence of a Subscriber's contemporaneous interests in the same or additional live orders and trading interests in LX (as well as data or analytics related to such post-execution information) to be confidential trading information. The foregoing notwithstanding, Barclays does not consider post-execution information to include information made public under reporting or regulation (e.g., information that is reported to the consolidated tape pursuant to FINRA trade reporting requirements), or information of an aggregated and anonymized nature (e.g., aggregated and anonymous execution statistics of the type reported on Barclays website (as described in Part III, Item 26) and the information disclosed as described in Part II, Item 7(b) below) to be confidential trading information. Barclays administers the ability to monitor client electronic trading flow through permission-based systems. Below is a summary of the shared personnel that service both LX and BCI or a BCI Affiliate. ELECTRONIC TRADING DEPARTMENT. The Electronic Trading Department is responsible for the management, development and maintenance of all of Barclays' electronic trading products, including LX, the order router and algorithms. The Electronic Trading Department is part of the Barclays Equities business, but is separate and apart from the Equities Trading Desks that manage the risk books of BCI. Within the Electronic Trading Department are the Service Desk, those members of the Statistical Modeling and Development ("SMAD") group dedicated to the development of Equities products, the Electronic Product Development team ("Product Development") and dedicated Electronic Sales and Origination personnel. Each of the groups within the Electronic Trading Department have different levels of visibility of confidential trading information based on their designated role. SERVICE DESK: Service Desk personnel are responsible for addressing customer inquiries related to their electronic order flow (including orders in LX), setting and monitoring client market access limits, implementing Subscriber elections to opt-in or opt-out of ATS functionalities, monitoring the operation of LX and potentially engaging in an emergency shutdown of LX. The Service Desk also manages BCI's error account trading book. Service Desk personnel have access to all live order and execution details in LX. Service Desk personnel also have the ability to review post-trade order and execution information for transactions in LX. This visibility is necessary to confirm LX is operating in a manner consistent with the offering and to assist clients with any issues while trading. SMAD AND PRODUCT DEVELOPMENT. SMAD is responsible for development, analytics and testing of Barclays' electronic products, including its algorithms and order router. Product Development is responsible for the development of new, and enhancements to existing, electronic trading products. Product Development is also responsible for compiling and analyzing statistics and metrics related to the ATS, including relating to Liquidity Profiling, described in Part III, Item 13. Both SMAD and Product Development have access on a post-execution basis to order and execution information in LX. The purpose of such access for SMAD is, among other things, for conducting execution quality analysis for clients as well as for monitoring for compliance with BCI's best execution obligations. Additionally, both SMAD and Product Development have access in order to analyze the potential for and implementation of product improvements. ELECTRONIC SALES AND ORIGINATION: Electronic Sales and Origination personnel assist with sales coverage of clients and analysis related to client requests from both Subscribers to LX and other electronic clients of BCI. Electronic Sales and Origination personnel who cover clients that trade through a direct connection to LX have the ability to generate and provide LX direct Subscribers with post-trade reports of their activity in LX and the ability to review client activity on a post execution basis. Similarly, where a client places an order using Barclays' algorithms or order router (or asks Electronic Sales and Origination personnel to do so on their behalf), Electronic Sales and Origination personnel have the ability to monitor the orders and the resulting executions, including executions taking place in LX. ELECTRONIC TRADING SENIOR MANAGEMENT. Senior management within the Electronic Trading Department are responsible for the operations of LX as well as the operations of the Electronic Trading Department as a whole. Electronic Trading Senior Management may have access to all of the information available to any member of the Electronic Trading Department. All members of the Barclays' Electronic Trading Department may also assist with the operation of LX by providing ideas for the design of LX. CHIEF CONTROLS OFFICE. Certain personnel within the Chief Control Office are responsible for assisting the Electronic Trading Department with the development and implementation of governance and control processes related to LX. These personnel within the Chief Control Office have access on a post-execution basis to order and execution information in LX. This visibility is necessary to confirm LX is operating in a manner consistent with the offering and to assist with the development and enforcement of governance controls. EQUITIES QPS PERSONNEL. Barclays QPS business unit is a part of Barclays' broader prime brokerage offering. QPS offers electronic execution services (including use of Barclays' algorithms and order router) to Barclays' prime brokerage clients. Members of the QPS group can view the orders and executions of QPS covered Subscribers executing via the SubM product suite, whether they are targeting LX directly or entering orders through Barclays' algorithms or order router. Additionally, certain members of QPS responsible for conducting cost analysis have visibility of all order and execution information related to trading in LX for all Subscribers that utilize Barclays' algorithms or order router. EQUITIES SALES AND TRADING. Barclays' Equities Sales and Trading personnel outside the Electronic Trading Department have limited ability to view Subscriber confidential trading information. EQUITIES SALES. Barclays Equities Sales who place and execute a client's order using Barclays' algorithms and order router (which may then place orders in LX as well as other venues) have the ability to monitor the orders and resulting executions. Equities Sales personnel do not otherwise have the ability to (1) view client electronic trading flow, unless a client specifically requests such coverage, or if a client otherwise authorizes visibility, or (2) view the trading flow of clients who route orders to LX through a direct connection. EQUITIES TRADING. Barclays' Equities Trading Desks have the ability to execute a client's order using Barclays' algorithms and order router. When a trading desk places a client's order in Barclays' algorithms and order router, that desk as well as the client's sales coverage have the ability to monitor that individual order and resulting executions, including any executions in LX. Barclays' Equities Trading Desks managing the risk books of the firm do not otherwise have the ability to (1) view clients' electronic trading flow, unless a client authorizes visibility, e.g., through the use of a trading product or upon client consent; or (2) view the trading flow of clients who route orders to LX through a direct connection. BARCLAYS SENIOR MANAGEMENT. On a post-execution basis, senior management of Barclays, BCI and the Equities business are able to view client electronic trading revenue, aggregate execution information and, where necessary, trade details. Additionally, certain senior management personnel may view order information in accordance with Barclays' internal controls and approval process. TECHNOLOGY. Various technology-related groups within Barclays (including development teams within Barclays' "Build the Bank" or "BTB" group and application support teams within Barclays' "Run the Bank" or "RTB" group) are responsible for the technological implementation, operation and stability of all of Barclays' systems, including the systems of BCI. A dedicated subset of these groups serve as developers or network engineers for LX and are responsible for reviewing and testing LX's coding and network infrastructure to ensure stability and functionality. These dedicated groups have access to LX's real-time production environment. Accordingly, a small number of technology-oriented personnel have the ability to access Subscriber order and execution information. BEST EXECUTION WORKING GROUP. BCI's Best Execution Working Group meets periodically to review execution and routing metrics of BCI and assess its compliance with its general duty of "best execution". BCI's Best Execution Working Group is comprised of senior members of the Electronic Trading Department, Equities Senior Management, Equities Sales Supervisors, Chief Controls Office, Electronic Trading Compliance and Equities Legal. The Best Execution Working Group evaluates execution metrics across all Trading Centers to which Barclays routes orders, including LX. As a part of their review, members of the Best Execution Working Group will receive aggregate statistics related to execution and historic order details related to the routing of orders to LX, including volume statistics of transactions in LX over a trailing 12-month period. Members of the Best Execution Working Group do not receive information about live orders or specific client executions. ATS GOVERNANCE FORUM. The ATS Governance Forum reviews the operation of LX, the effectiveness of LX's risk and control framework and the adequacy of client disclosures related to LX. The ATS Governance Forum also reviews LX's Liquidity Profiling framework and considers the appropriateness of any Overrides (each, as described in Part III, Item 13). The ATS Governance Forum is comprised of representatives from the Service Desk, Electronic Sales and Origination, Electronic Product Development, Chief Controls Office, Technology, Electronic Trading Compliance and Equities Legal. The ATS Governance Forum receives information on the Liquidity Profiling categories of specific Subscribers and may receive post trade execution information. The ATS Governance Forum uses this information in furtherance of its governance control and oversight purpose. CONTROL FUNCTIONS. Personnel within Compliance, Audit, Risk, and Legal departments can service both the operations of LX and other business units of BCI or its Affiliates. Personnel within these groups are employed by Barclays Services Corporation or a foreign affiliate, not the Broker-dealer Operator. Personnel within these groups have the ability to view order information on a post-execution basis for surveillance, rule compliance and monitoring purposes. They also may request real-time order, execution and revenue information on an as needed basis. MARKETING: Employees in Equities Marketing have access to Marketing Materials related to LX which may contain Subscriber Confidential Trading Information. This access is related to the tracking of and responding to subscriber requests for information and involves only post-trade Confidential Trading Information. OTHER GROUPS. Client Onboarding, Finance (related to Business Managers who were previously part of the Electronic Trading Department or Equities Sales and Trading), Middle Office and Operations may also have access to Subscriber information. Client On-boarding is privy to information regarding Barclays' on-boarded Equities customers, which customers have access to Barclays' algorithms and order router and which customers have a direct connection to LX. Finance, Middle Office and Operations personnel, including third-party service providers as further described in Part III, Item 22, have access to post-execution information related to executions that took place in LX for purposes of transaction settlement and associated regulatory obligations which may include subscriber identities and limited details of actual executions. Given the type of information provided to these groups, not all of the controls applied to confidential trading information, as defined above and discussed in Part II, Item 7(a) below are applied to the post-execution information provided to these groups; however, the information provided to these groups and the individuals in these groups are subject to the firm-wide confidential information restrictions set out in Part II, Item 7(a) below. The personnel mentioned above are not permitted to use the information they have access to for unauthorized purposes. BCI has entered into an agreement with Operations and Compliance Network, LLC ("Ocean"), an affiliate of Nasdaq, under which Ocean will host, operate and support the technology platform for LX subject to the direction and oversight of BCI as the Broker Dealer Operator. Pursuant to the agreement, Ocean also provides certain support services related to BCI's compliance, surveillance, supervisory, recordkeeping and reporting obligations subject to the direction and oversight of BCI as the Broker Dealer Operator. Certain aspects of the services provided by Ocean to BCI utilize infrastructure and support services shared by Ocean and its affiliates. As the Broker Dealer Operator, BCI is responsible for the operation of LX in compliance with the federal securities laws. Ocean is responsible for carrying out the operation of LX and all aspects of Part III of the Form ATS-N with the exception of Items 6 (Co-location and Connectivity), 12 (Liquidity Providers), 15 (Display), 16 (Routing), 18 (Trading Outside of Regular Trading Hours), 19 (Fees), 22 (Clearance and Settlement), 24 (Order Display and Execution Access) and 25 (Fair Access). Certain of these enumerated functions do not apply to LX or are handled by BCI personnel. As discussed in Part I, Item 7, LX is located at the NY4 Data Centers in Secaucus, NJ. LX utilizes Equinix as the provider of the co-location services. As discussed in Part III, Item 23, LX utilizes direct market data feeds; for those markets where Ocean does not have direct market data feeds, Ocean utilizes the SIP for market data. Broadridge Business Process Outsourcing LLC ("Broadridge") provides clearance and settlement services for Barclays including in respect of executions that take place in LX as further described in Part III, Item 22. N GENERAL BACKGROUND AND SCOPE OF SUBSCRIBER CONFIDENTIAL TRADING INFORMATION. The LX matching engine and associated gateways on the Ocean technology platform are on separate hardware from other systems hosted and/or operated by Ocean and gateways for LX hosted on Barclays' technology platform run on standalone hardware (i.e., server) that is not shared with any other Barclays trading venue (such as BARX Book, Barclays' single dealer platform) or other trading system (such as order management and trade capture systems). The hardware for LX on the Barclays technology platform is housed in the same data center as other Barclays systems; Ocean's technology platform is housed in a different data center from Barclays' systems. All orders bound for LX, whether through the Barclays smart order router, the router component of Barclays' algorithms, or direct connection to LX, pass through the LX gateways hosted on Barclays' technology platform as the access point to LX; Barclays then sends orders in those symbols to OCEAN. Barclays maintains physical restrictions, policies and procedures designed to safeguard the confidential trading information of Subscribers. Barclays considers Subscribers' identities, information relating to live orders, trading interests and executions in LX and post-execution information that Barclays reasonably believes contains evidence of a Subscriber's contemporaneous interests in the same or additional live orders and trading interests in LX (as well as data or analytics related to such post-execution information) to be confidential trading information. The foregoing notwithstanding, Barclays does not consider post-execution information to include information made public under reporting or regulation (e.g., information that is reported to the consolidated tape pursuant to FINRA trade reporting requirements), or information of an aggregated and anonymized nature (e.g., aggregated and anonymous execution statistics of the type reported on Barclays website (as described in Part III, Item 26) and the information disclosed as described in Part II, Item 7(b) below) to be confidential trading information. Barclays administers the ability to monitor client electronic trading flow through permission-based systems. BARCLAYS PERSONNEL WITH ACCESS TO SUBSCRIBER CONFIDENTIAL TRADING INFORMATION. Barclays does not have any personnel solely responsible for LX. The shared personnel described in response to Part II, Item 6(a) are the only Barclays personnel who have access to Subscriber confidential trading information. Barclays prohibits those personnel from sharing any Subscriber confidential trading information with persons not authorized to receive such information by policy. Violations of such policies are punishable under Barclays Compliance breach process and/or by dismissal from the firm. Barclays does not provide Subscriber confidential trading information to Barclays' business units or to Barclays' clients in furtherance of Barclays' principal trading activities. OCEAN PERSONNEL WITH ACCESS TO SUBSCRIBER CONFIDENTIAL TRADING INFORMATION. Certain Ocean and Nasdaq employees have access to Subscriber confidential trading information. Such employees include Ocean and Nasdaq staff from Compliance, Operations, Technology Development (including trading and surrounding systems), Product Management, and Business Management. OCEAN's policies and procedures (i) restrict which employees have access to Subscriber Confidential Trading Information, and (ii) implement information barriers that prohibit employees with Subscriber Confidential Trading Information from sharing such information in an unauthorized fashion, as well as (iii) impose personal trading limitations. The confidential trading information consists of information regarding individual orders and executions, names of Subscribers, and volume of orders in LX. Ocean's policies and procedures employ a three-pronged approach to permission access to LX. First, an Ocean employee's manager must request, and Ocean Compliance and Legal must approve, access to each specific system based on the manager's request and the employee's designated role and responsibilities. Second, an employee must complete compliance training specific to the Ocean business unit before a technical operations manager will activate an employee's access rights. Third, all approved systems access persons must complete Ocean's annual Compliance training, every year. Ocean employees that have access to confidential trading information are subject to Ocean's "Information Barriers and Conflict Management Policies and Procedures. " Pursuant to these procedures, Ocean employees are prohibited from sharing Subscriber Confidential Trading Information with other employees (including at Nasdaq) who are not expressly authorized to receive such information. All Ocean employees are subject to Nasdaq's Global Trading Policy ("GTP"), which outlines all requirements and restrictions related to personal trading activity including holding periods, annual attestations, IPO restrictions and a prohibited list. Ocean employees are required to disclose personal investment and brokerage accounts, positions, and transactions. Nasdaq's Global Ethics Team monitors personal trade activities against the GTP. Ocean also conducts electronic communications reviews to identify policy violations including non-compliance with the above referenced policies and procedures. In addition to the foregoing, Ocean maintains written policies and procedures concerning unauthorized disclosures, which include escalation procedures for such incidents. Ocean is also obligated to notify BCI of any actual or suspected unauthorized access to confidential information, which includes Subscriber confidential trading information, in a timely manner. BCI has the right to audit Ocean's operation of LX, including Ocean's access to and use of Subscriber confidential trading information either through audits conducted by BCI's own audit team or by third-party auditors. Such audits may be conducted onsite or offsite. OTHER THIRD PARTY VENDOR ACCESS TO SUBSCRIBER CONFIDENTIAL TRADING INFORMATION. Barclays may, as needed for diagnostic and analytical purposes, provide Subscriber confidential trading information to third party vendors who provide services to LX and are subject to contractual non-disclosure obligations. An example of this is a vendor who has developed software designed to report on latency within LX. SYSTEMS WITH ACCESS TO SUBSCRIBER CONFIDENTIAL TRADING INFORMATION. LX provides information to Barclays' order router and the order router component of Barclays' algorithms on a real time basis about Firm Orders (as described in Part III, Item 9(a)) posted to the LX order book. The order router and the order router component of Barclays' algorithms use the Firm Order information from LX solely to decide whether to route an order to LX. The information provided to the order router and the order router component of Barclays' algorithms contains aggregated buy and sell interest per symbol pegged to the current National Best Bid Offer ("NBBO"). LX does not provide any information to Barclays' order router or the order router component of Barclays' algorithms about Conditional Orders (as described in Part III, Item 9(a)). Barclays order router and Barclays' algorithms do, however, receive enhanced information about Conditional Invitations. In addition to the price, side and symbol of a potential match, which information is included in a Conditional Invitation message (as described in Part III, Item 9 above), the order router and Barclays' algorithms are informed of the size of the match (which is the smaller of the Conditional Order size and the potential contra side order size). LX does not provide client-specific information to the order router or the order router component of Barclays' algorithms. The order router and the order router component of Barclays' algorithms do not share any information they receive from LX with any other Barclays trading venue (such as BARX Book, Barclays' single dealer platform), trading system (such as order management and trade capture systems), desk or any third-party (other than personnel who require access to perform maintenance or to address technological, legal or compliance issues that may arise with LX or the router or the order router component of Barclays' algorithms). In addition, because Subscribers can direct Firm Orders or Conditional Orders s to the ATS through the order router and because the order router and/or the router component of Barclays' algorithms may decide to route Firm Orders or Conditional Orders to LX, the order router and/or the router component of Barclays' algorithms have information about these Firm Orders or Conditional Orders that are bound for LX. With respect to both Firm Orders and Conditional Orders routed to LX through or by the order router or the order component of Barclays algorithms, the order router and/or the router component of Barclays' algorithms, as the case may be, will have information relating to the identity of the Subscriber submitting the order, as well as the price, side, symbol, order type, whether the order is Conditional Eligible, and the order attributes and parameters described in Part III, Item 7. In addition, with respect to Conditional Orders and Firm-up Orders (as described in Part III, Item 9) routed to LX through or by the order router or the order component of Barclays algorithms, the order router and/or the router component of Barclays' algorithms, as the case may be, will have information relating to the additional features of those order types described in Part III, Item 9. The order router and the order router component of Barclays' algorithms do not generate indications of interest based on information from LX. Subscribers can opt out of having their Posted Order information included in the aggregated information provided to the order router and the order router component of Barclays' algorithms by contacting their Equities sales coverage, requesting such restriction through Barclays' online SPECS tool, or by emailing the Barclays Service Desk at LXService@barclays.com. Additionally, the order and execution management systems (including Barclays' algorithms and order router) used by Barclays' Electronic Trading Department and Equities Sales and Trading personnel described in response to Part II, Item 6(a) can transmit Subscribers' confidential trading information to the extent orders handled by any such person are routed to the ATS. These systems communicate information to Sales and Trading personnel that identifies the Trading Centers to which their clients' orders were routed and/or executed, including LX. All Subscriber orders entering LX pass through the FIX interface. Barclays maintains multiple databases containing historical trading information, including information relating to transactions executed in LX. The Electronic Trading Department and Equities Sales may use this information to run queries and generate reports as described above. Legal, Compliance or other control functions may use this information to investigate historic trading activity or to respond to regulatory requests. Barclays employs various tools for real-time monitoring of LX. The Service Desk and RTB use these applications to research Subscriber's orders and executions and monitor the health of LX. SAFEGUARDING AND OVERSEEING SUBSCRIBER TRADING INFORMATION. Barclays restricts access to systems containing Subscriber confidential trading information by policies and procedures. These policies and procedures apply across all entities in the Barclays group. Access to LX, other relevant Barclays' systems and Subscriber trading information requires permissioned log-ons and/or physical access. Permissions are handled through Barclays' Request system or by way of separate supervisory and Compliance and/or Legal approval. Permissions logged in the Request system require supervisory and Compliance approval. In reviewing such access requests, a Supervisor considers factors including the person's current role and whether the person performs a function related to LX. A person's request will be denied if it is deemed unnecessary or inappropriate. Supervisors review all permissions logged in the Request system annually as part of Barclays' One Cert review process. Because of this certification process, permissions will be cut off if access is no longer required or appropriate. Additionally, Barclays removes systems access as part of its Joiner/Mover/Leaver processes should a relevant person leave Barclays or change roles within the firm to a job function for which such access is unnecessary or inappropriate. SEPARATION. Barclays has information barriers to separate personnel and systems with access to Subscriber confidential trading information from those not permitted to access such information. Barclays also relies on information barriers to separate personnel and systems with access to different types of Subscriber confidential trading information. The Electronic Trading Department is situated in a different area on the Equities Trading floor from Equities Sales and Trading. The BTB and RTB Technology teams that service LX are situated in a different area on the Equities Trading Floor from Equities Sales and Trading. QPS is on a different floor from the Electronic Trading Department and the BTB and RTB Technology teams that service LX. FIRM-WIDE CONFIDENTIAL INFORMATION RESTRICTIONS. Barclays subjects all personnel to firm-wide policies restricting the use and disclosure of confidential information, including confidential information relating to information of Subscribers to LX. Additionally, Barclays' policies and procedures prohibit trading on material non-public information. All Barclays employees must comply with the following standards and policies regarding the handling of client information: Information Barriers & Insider Dealing Standard, Employee Compliance Standard, Business Conflicts of Interest Standard, Business Communications Standard, the Barclays Way (Barclays' internal code of conduct), Market Manipulation Standard, and Acceptable Use Requirements for Information and Technology Assets. Broadly, these standards and policies establish a "need-to-know" standard for internal information sharing and prohibitions on the use of client information in ways which would conflict with the client and Barclays' relationship. Employees with access to Subscriber confidential trading information (as identified in Part II, Item 6) are provided additional training regarding the sensitivity of such information and limitations on permitted use. PERSONAL TRADING RESTRICTIONS. All Barclays' personnel are subject to firm-wide policies that control the trading of a person's account. Personnel are required to disclose all personal trading accounts, managed accounts and private investments held by themselves and their Connected Persons (e.g., spouse, domestic partner, children, etc.). The policy also requires personnel and their Connected Persons to disclose and receive prior approval for personal investments to prevent conflicts of interest and/or the misuse of material non-public information and non-public information. Additionally, Barclays' policy empowers it to suspend, restrict or rescind the ability of any Barclays personnel to conduct personal investment activity for failure to comply with the policy. The policy also requires specific holding periods for certain types of securities held by personnel. A failure to comply with such policies may result in discipline, including but not limited to a Compliance breach. Barclays monitors compliance with such policy using reports that incorporate trading information received in connection with the approved accounts of Barclays personnel. By virtue of their use of LX, Barclays considers all Subscribers to have consented to the disclosure of its confidential trading information as described in Part II, Items 6(a) and 7(a) above and in the following ways. Clients have the ability to opt out of certain of the disclosures described below. MARKETING. Barclays publishes aggregated and anonymized monthly statistics related to LX on its website. Barclays also may include in its marketing materials or its client presentations aggregated and anonymized analysis related to various order and execution metrics derived from orders and executions in LX. Subscribers do not have the ability to opt out of their information being included in the monthly statistics related to LX on Barclays' website or from having their information included in client presentations or marketing material as part of aggregated and anonymized metrics related to orders and executions in LX. ADVERTISEMENTS. Barclays publishes aggregated executed trading volume on a per symbol basis, including executions which took place in LX. This advertising is done on a delay after the transaction has been printed to the consolidated tape report, with no side information displayed. Subscribers can opt out of their execution details being included in such advertisements. ALGORITHM, ORDER ROUTER AND HIGH TOUCH TRADING INFORMATION. Barclays personnel may have access to, and use information, including but not limited to client orders (i.e., orders executed in full or part, called or expired), trade and other data and analytics (collectively, "Data") that is generated through the utilization of Barclays algorithms, order router or by accessing the services offered by Barclays high touch trading and sales personnel. Barclays may use Data for market color reports, analytical tools, trade idea generators, risk management strategies, liquidity provisions and other Barclays products and services. The nature of any Data provided to one client may differ from that provided to others in terms of quantity, scope, methodology or otherwise and may be changed from time to time without notice. Barclays limits access to counterparty specific Data that is not anonymous to those personnel who have a need to know such information to perform their duties and to carry out the purpose for which the information is provided to them. PRIVATE COUNTERPARTY INTERACTIONS. As described below in Part III, Item 14(a), Subscribers may enter into arrangements whereby they interact only with Subscriber-selected counterparties. As a result of these arrangements, the Subscribers in such an arrangement may be able to ascertain confidential trading information about one another based upon their activities within LX. Barclays views the entry into such an arrangement as consent by the Subscriber to the disclosure of its confidential trading information to the other parties during the existence of the arrangement. Subscribers have the ability to withdraw consent to the information described in Item 7(b) by contacting their Equities Sales Representative, or by emailing LXService@barclays.com to request such an update. The shared personnel described in response to Part II, Item 6(a) and Ocean personnel described in response to Part II, Item 7(a) are the only persons who have access to Subscriber confidential trading information. The type of information that such personnel can access along with the reasons for such access is described in response to Part II, Item 6(a) and Part II, Item 7(a). Except as described in Part II, Items 7(a) and 7(b), unaffiliated third parties do not have access to Subscriber confidential trading information. Investment Companies Issuers Brokers NMS Stock ATSs Asset Managers Principal Trading Firms Hedge Funds Market Makers Banks Dealers N To access the ATS services, whether by way of a direct connection or otherwise, a Subscriber must be an active client of BCI or one of its Affiliates and be on-boarded to trade equities. In order to be on-boarded and active, any required on-boarding agreements applicable to the proposed trading relationship for that type of client must be signed or acknowledged by the Subscriber, BCI must have completed its know-your-customer requirements, and BCI must have given the Subscriber a limit required under the Securities and Exchange Commission Rule 15c3-5. BCI does not require additional on-boarding conditions for Subscribers that wish to access LX by way of a direct connection. Y N BCI has discretion to exclude a client from the ATS services. BCI may exclude a client from the use of Barclays' algorithms or order router, both of which may route orders to LX. If BCI denies a client access to Barclays' algorithms or order router, such denial would affect access to all Trading Centers, including LX. BCI may also exclude a Subscriber from accessing LX by way of a direct connection, at any time. BCI may also exclude a Subscriber from access to certain functionality of LX. BCI has the discretion to determine for any reason that a functionality or service of LX is not appropriate for a Subscriber. These reasons may not be the same for every Subscriber as it could be specific to the trading relationship with the specific Subscriber whose access is being restricted. LX operates from 9:30 A.M. ET to 4:00 P.M. ET. LX will be closed or will close early during market holidays or shortened trading days. Both Firm Orders and Conditional Orders are accepted from 8:00 A.M. ET to 4:00 P.M ET. All orders received by LX prior to its open are entered into the queue and become eligible for execution at or after 9:30 A.M. ET. All orders received by LX prior to its open are time stamped in the order received for purposes of determining order priority. Stocks will become eligible for execution in LX once the primary listing market has opened the stock and LX receives via direct feeds and the SIP, as set forth in Part III, Item 23, a security status code of OPEN. At 4:00 P.M. ET (or such earlier time in the event of a shortened trading day or early closure), any unexecuted orders will be canceled. Barclays has discretion to close or not to open LX (in whole or in part) in the event of a market disruption or technological or other issue. LX allows Subscribers utilizing Barclays' order router and algorithms to submit market-on-close orders to LXCC, as described further below in Part II, Items 7, 11, and 17. Market-on-close orders may be entered beginning at 8:00 A.M. ET until a pre-determined cut-off time ("LXCC Offset Time"). The same LXCC Offset Time applies to all Subscribers. The LXCC Offset Time is 30 seconds before the market-on-close deadline on the primary listing exchange for the relevant NMS Stock. Following the LXCC Offset Time, Subscribers will not be able to place or modify LXCC orders. LXCC orders are matched immediately following the Offset Time and the algorithm or smart order router used to submit the LXCC order is notified of the quantity of the orders matched by LX. For information about when a matched order will receive execution prices (or cancellations, as applicable), see Part III, Item 17. Y LX permits orders to be entered directly. Subscribers with a direct connection to LX can enter orders directly utilizing Financial Information eXchange "FIX" protocol Version 4.2. Clients of BCI's QPS group may also submit orders by way of FIX protocol Version 4.2. Orders of QPS Subscribers must first enter through the QPS business's own FIX gateway before the order enters the LX gateway. The LX gateway through which the orders of QPS Subscribers enter the ATS is the same gateway utilized by non-QPS Subscribers. The initial submission of QPS Subscriber orders through the QPS gateway, however, is an intermediate order-processing step that may add additional latency to the order depending on the specific client connection. BCI and its Affiliates do not have the ability to enter orders utilizing a direct connection to LX. Clients of BCI's QPS business utilize a FIX protocol that is different from the protocol used by the clients of BCI's Equities business that have a direct connection to LX. Subscribers' Firm Orders and Conditional Orders can enter LX (i) through Barclays' order router, (ii) through Barclays' algorithms or (iii) by submitting orders to BCI or its Affiliates to execute on the client's behalf. Barclays order router may route orders, or parts of orders, to any Trading Center to which it has connectivity (as described in Part II, Item 4), including LX. Except where a client has specifically opted out, Barclays' order router may route the order, or part of the order, into LX. Barclays' algorithms utilize Barclays' order router and may separately submit Conditional Orders. Any time a Barclays algorithm utilizes the order router, unless a client has opted out, all or part of that order may be routed to LX. Conditional Orders are an order type specific to LX (described further in Part III, Item 9). BCI and its Affiliates may enter orders and trading interest into Barclays' order router and algorithms whether trading as principal for its own account, as riskless principal or as agent for clients. If a client submits an order to BCI to execute on its behalf, all or part of that order may be routed to LX, unless that client has specifically opted out. Y LX offers cross connection services to all Subscribers, except for the Broker-Dealer Operator and its Affiliates (as noted in Part II, Items 1 and 2), that wish to connect directly to LX. Cross connection to LX is available to connect directly to the LX gateway housed in the Equinix NY5 data center in Secaucus, NJ. All orders bound for LX via direct connection to LX will first pass through the LX gateways hosted on Barclays' technology platform as the access point to LX and Barclays will then send the order to the LX matching engine hosted by Ocean in the Equinix NY4 data center in Secaucus, NJ. Direct connectivity to LX via cross connections is available by request made to Equinix. Barclays supports Gigabit (copper/multi-mode fiber/single-mode fiber) and 10Gig (single-mode fiber) connections. Barclays does not charge any fees for a direct connection. Connectivity to LX requires the client to lease private connectivity, either by establishing a cross connection or leveraging a private connectivity network (e.g., a leased fiber optics line or a network like SFTI). Subscriber cross-connects terminate on Barclays owned and managed network switches. All of the equipment in the cabinets hosting LX infrastructure on the Barclays technology platform is solely owned and managed by Barclays. Subscriber hardware is kept separate from Barclays' equipment. Barclays does not share its cabinets with any clients or third parties. Subscriber access to the LX gateways is controlled via network routing rules and a standard FIX SenderCompID/TargetCompID log-on process. Subscribers must successfully log on before submitting orders. As noted in Part II, Items 1 and 2, neither the Broker-Dealer Operator nor subscribers who are Affiliates of the Broker-Dealer Operator are permitted to utilize a cross-connection to route orders to LX. N N Except where expressly noted, this Part III, Item 7 describes only non-LXCC Orders. LXCC Orders and their handling are discussed below in Part III, Item 17. ORDER TYPES. LX accepts limit orders, pegged orders (including pegged orders with limit prices), and Conditional Orders. Each order type is available across all forms of connectivity. Limit orders are orders to buy or sell at a specific price or better. Pegged Orders are orders to buy or sell by reference to a market benchmark. Pegged orders in LX may be (i) "market pegged" so that an execution occurs at the far side of the NBBO spread, (ii) "primary pegged" so that executions occur on the passive side of the NBBO spread or (iii) "midpoint pegged", meaning pegged to the midpoint of the NBBO spread. LX will re-price pegged orders as the NBBO spread changes so that the relationship of the pegged order to the NBBO level is maintained. Conditional Orders are described in Part III, Item 9. LX does not accept market orders. LX does not route to other Trading Centers. All orders are time stamped at the time of receipt. Orders do not receive new time stamps unless modified (other than to reduce quantity) or canceled and resubmitted. TIME IN FORCE. The only time in force parameters accepted by LX are Day and Immediate or Cancel ("IOC"). OTHER PARAMETERS. Subscribers also have the option to set execution parameters based on their trading objectives on an order-by-order or default basis. These optional execution parameters include NoLockCross, MinQty, LeavesQtyasMinQty, TradewithOddLots Add Liquidity Only (ALO), and AllowConditionals (Conditional Eligible). The use of particular order types or parameters may affect the execution priority and the fill rate. NoLockCross: By default, LX does not cross orders during a locked market. Subscribers may opt into having their orders cross in a locked market for all of their orders or on an order-by-order basis. MinQty: Except with respect to LXCC orders, Subscribers have the ability to elect a minimum execution size for orders with which it will interact. LX will not execute an order with a minimum execution size parameter in place against contra-side interest that does not meet the minimum size requirement. Subscribers have the ability to elect the consequence of any leaves quantity falling below their elected minimum execution size (LeavesQtyasMinQty parameter). Subscribers can elect to have any such leaves quantity canceled back or to have their minimum execution size reset to be equal to that leaves quantity. If a Subscriber has elected to reset their minimum execution quantity election to be equal to that leaves quantity and such leaves quantity is an odd-lot, such leaves quantity will remain in the order book or be canceled back to the Subscriber according to the odd-lot settings applicable to that order (as described in Part III, Item 8(c)). Add Liquidity Only (ALO): Subscribers can select the ALO parameter when they want to have their order rest on the order book instead of the order being able to execute against contra interests that are already on the order book. AllowConditionals (Conditional Eligible): Conditional Eligible Firm Orders will trigger the sending of a Conditional Invitation if and when there is a contra-side Conditional Order in LX that is a potential match against the Conditional Eligible Firm Order. As a result, LX will send a message to the Conditional Order submitter indicating that a potential match has been found. The submitter of the Conditional Eligible Firm Order will not receive any indication that its Firm Order is a potential match for a Conditional Order. Firm Orders in LX that are not Conditional Eligible will not trigger the sending of a Conditional Invitation. Barclays' default configurations mark all Firm Orders being sent by Barclays' order router and algorithms as Conditional Eligible. Subscriber that routes orders to LX via Barclays' algorithms and/or order router may opt out of the Conditional Eligible Firm Order functionality; opting out of the functionality will not prevent that Subscriber from being able to use Conditional Orders. Similarly, such Subscriber may opt out of using Conditional Orders and still be able to utilize the Conditional Eligible Firm Order functionality. For Subscribers using a direct connection to LX, Barclays will treat all Firm Orders with a time in force of Day as eligible to interact with Conditional Orders by default; Firm Orders with a time in force of IOC are marked not eligible to interact with Conditional Orders by default. Subscribers using a direct connection have the ability to designate a Firm Order's eligibility to interact with Conditional Orders on an order-by-order basis or as a change to their default trading profile. Subscribers using a direct connection to LX may opt out of using Conditional Eligible Firm Order functionality without affecting the Subscriber's ability to use Conditional Orders. The treatment of Conditional Eligible Firm Orders with a time in force of IOC is described further below. LX treats Conditional Eligible Firm Orders as any other Firm Orders sent to LX, including abiding by Effective Price/Tier/Time priority, based upon the time the Conditional Eligible Firm Order is received. The NoLockCross, MinQty, LeavesQtyasMinQty,TradewithOddLots Add Liquidity Only (ALO), and AllowConditionals (Conditional Eligible) elections can be made on an order-by-order basis or as a default setting in the Subscriber's profile. To establish or make amendments to a profile, Subscribers can contact their Equities Sales Representative, request such settings through Barclays' online SPECS tool, or by emailing the Barclays Service Desk at LXService@barclays.com. ORDER BOOK AND CANCELLATION. LX maintains a limit order book for each NMS Stock traded in the system. All orders executed by LX execute at or within the NBBO. Posted Orders remain on the limit order book until fully filled, canceled by the Subscriber, cancelled due to LeavesQtyasMinQty parameter, cancelled due to TradewithOddLots parameter or, if not canceled otherwise, canceled automatically at the end of the trading session that day (e.g., 4:00 P.M. EST on a regular trading day or such earlier time in the event of a shortened trading day or early closure) or by administrative action of BCI (See Part III, Item 20). LX evaluates orders with a time in force of IOC upon receipt. If a crossing opportunity is present at the time of receipt, LX will execute the IOC order. If an IOC order is a Firm Order marked not eligible to interact with Conditional Orders (not Conditional Eligible), and there is no crossing opportunity or the order is not fully executed, the unexecuted quantity will automatically be canceled back to the Subscriber (i.e., IOC orders, other than Firm-Up Orders received prior to the expiration of the match timer as described in Part III, Item 9, will not rest in the limit order book). If an IOC order is a Conditional Eligible Firm Order, and there is no crossing opportunity or the order is not fully executed, the unexecuted quantity will be evaluated for any potential contra-side Conditional Order in LX match, and may trigger the sending of a Conditional Invitations. If the sending of a Conditional Invitation is triggered at this time, then the Conditional Eligible IOC Firm Order will remain on the order book until it is either fully filled or until the expiration of the "match timer", as further described in Part III, Item 9. If the Conditional Eligible Firm Order with a time in force of IOC does not trigger the sending of a Conditional Invitation, the unexecuted quantity will automatically be cancelled back to the Subscriber. EXECUTION PRIORITY. LX determines the execution priority of firm Posted Orders and Conditional Orders (as described in Part III, Item 9) separately, but using the same factors for the orders within each category. Firm Posted Order priority is determined by comparing (1) Effective Price, (2) Tier and (3) time of order receipt among all firm Posted Orders. Conditional Order priority is determined by comparing (1) Effective Price, (2) Tier and (3) time of order receipt among all Conditional Orders. LX determines whether any firm Posted Orders can be executed before evaluating the marketability of any Conditional Orders. Firm Posted Orders, therefore, always have priority over Conditional Orders. The execution priority parameters apply irrespective of whether any such order is for a round-lot, mixed-lot, or odd-lot quantity. See Part III, Item 11(c) for a more detailed description of the Execution Priority logic used by LX. Y BCI may place maximum order or trading interest sizes for purposes of compliance with SEC Rule 15c3-5. Y LX supports odd-lot order quantities on Firm Orders and Firm-up Orders (as described in Part III, Item 9(a)). LX does not support odd-lot order quantities on Conditional Orders (as described in Part III, Item 9(a)). Odd-lot orders reside in the same order queue and have the same priority as round-lot orders. By default, all orders submitted to LX will be eligible to interact with odd-lot order quantities. Subscribers can opt-out from interacting with orders with an odd-lot quantity either on an order-by-order basis or as a Subscriber profile setting. To mark an individual order as ineligible to interact with odd-lot orders, Subscribers must include the appropriate flag on their order in compliance with Barclays' FIX specifications (TradewithOddLots parameter). To opt-out of interacting with odd-lot order quantities as a Subscriber profile setting, Subscribers can contact their Equities Sales Representative, request such restriction through Barclays' online SPECS tool, or by emailing the Barclays Service Desk at LXService@barclays.com. Any odd-lot order submitted by a Subscriber will automatically be eligible to interact with odd-lot orders irrespective of any election or profile setting made by that Subscriber. Y LX supports mixed-lot order quantities. Mixed-lot orders reside in the same order queue and have the same priority as round-lot orders. Mixed-lot orders are automatically eligible to interact with other mixed-lot orders. Mixed-lot orders are not automatically eligible to interact with odd-lot orders and will interact with odd-lot quantities according to the elections of the Subscriber submitting the mixed-lot order (whether in respect of that order or as a profile setting as described in Part III, Item 8(c) above). When two mixed-lot orders are of the exact same quantity, the full order size will cross (e.g., 140 shares bought against 140 shares sold). If a mixed-lot order and a round-lot cross, the quantity executed depends on whether the Subscriber submitting the round-lot order opted-out of interacting with odd-lot quantities. If the round-lot is eligible to interact with odd-lot quantities, the maximum order quantity will cross. Any residual odd-lot leaves quantity relating to an order with a time in force of Day will remain in the order book and retain its execution priority or be canceled back to the submitting Subscriber according to the odd-lot elections made by the Subscriber submitting the larger of the two orders. For example, if 240 shares to buy crosses with 300 shares to sell and the round-lot sell order had a time in force of Day and was submitted by a Subscriber that is eligible to interact with odd-lot quantities, 240 shares will trade and the 60 share leaves quantity will remain in the order book as an odd-lot quantity. If a Subscriber submitting a round lot has opted-out of interacting with odd-lot orders (whether in respect of that order or as a profile setting), any cross between that round-lot order and a mixed-lot order will be limited to the largest common round lot quantity. Any residual odd-lot leaves quantity will either remain in the order book and retain its execution priority or be canceled back to the submitting Subscriber according to the time in force and the odd-lot elections made by the Subscriber submitting the larger of the two orders. For example, if 240 shares to buy crosses with 200 shares to sell, 200 shares will trade and 40 shares will either be immediately canceled back to the buyer or remain in the order book according to the elections of the Subscriber submitting the buy order. If two mixed-lot orders of different quantities cross, the maximum order quantity will cross and the residual odd-lot leaves quantity will either remain in the order book and retain its execution priority or be canceled back to the submitting Subscriber according to the time in force and odd-lot elections made by the Subscriber submitting the larger of the two mixed-lot orders. For example, if 240 shares to buy, crosses with 220 shares to sell, 220 shares will trade and 20 shares will either be immediately canceled back to the buyer or remain in the order book according to the elections of that Subscriber. In any case, any mixed-lot leaves quantity for orders with a time in force of Day will remain in the order book. Y CONDITIONAL ORDERS. LX provides a process for negotiating trades based on conditional parameters, called the Conditional Order Negotiation. A Subscriber may initiate a Conditional Order Negotiation by submitting a Conditional Order. An order that is not a Conditional Order is referred to as a Firm Order. Subscribers may submit Conditional Orders to LX using a direct connection, Barclays' order router or Barclays' algorithms. Barclays' algorithms submit Conditional Orders directly to LX, bypassing Barclays' order router. Conditional Orders are not immediately executable but may match, following additional message interactions, against contra-side orders in LX. Conditional Orders will only interact with Firm Orders in LX marked as Conditional Eligible or with other Conditional Orders. Barclays' default client configuration provides for the use of Conditional Orders by both Barclays order router and algorithms. Barclays' default configurations also mark all Firm Orders sent by Barclays order router and algorithms to be marked Conditional Eligible. Clients may alter these settings by contacting their Equities Sales Coverage, adjusting their settings in Barclays SPECS system or by emailing the Barclays Service Desk at LXService@barclays.com. Such adjustments are usually effective within 24 hours. A Subscriber that routes orders to LX via Barclays' algorithms and/or order router may opt out of the Conditional Eligible Firm Order functionality; opting out of the functionality will not prevent that Subscriber from being able to use Conditional Orders. Similarly, such Subscriber may opt out of using Conditional Orders and still be able to utilize the Conditional Eligible Firm Order functionality. Conditional Orders describe the symbol, price, size, and side at which a Subscriber may be interested to trade. If and when there is a Conditional Eligible contra-side order in LX that could match against the Conditional Order, LX will send a message to the Conditional Order submitter indicating that a potential match has been found. This message is called a Conditional Invitation. The submitter of the Conditional Eligible Firm Order, however, will not receive any indication that its Firm Order is a potential match for a Conditional Order. Firm Orders in LX that are not Conditional Eligible will not trigger the sending of a Conditional Invitation. The Conditional Invitation describes the price, side and symbol of the potential match and includes a specific match ID. In addition to the above order characteristics, Barclays order router and Barclays' algorithms will receive information on the size of the match (which is the smaller of the Conditional Order size and the potential contra-side order size). LX sends Conditional Invitations to the source of the relevant Conditional Order, whether direct connection, or Barclays' order router or algorithms. The dispatch of the Conditional Invitation also begins a "match timer" of 100ms, as further described below. The recipient of the Conditional Invitation may indicate its interest to match against the identified contra-side Conditional Eligible Firm Order by submitting a Firm-up Order. Subscribers must submit Firm-up Orders in compliance with Barclays' FIX specifications and Firm-up Orders must include all information included in a Firm Order plus the match ID that corresponds to the relevant Conditional Invitation. Firm-up Orders will match against the contra-side order identified in the Conditional Invitation so long as that contra-side order remains in the order book as of the time the matching engine receives the Firm-up Order. Firm-up Orders received by the matching engine after the identified contra-side order has either executed against an intervening order or been canceled will not execute against the identified contra-side order. LX treats Firm-up Orders as any other Firm Orders sent to LX, including abiding by Effective Price/Tier/time priority, based upon the time the Firm-up Order is received. The treatment of Firm-up Orders that do not cross against the identified contra-side order depends on the time in force for that Firm-up Order and whether the Firm-up Order was received before or after the expiration of the "match timer". A Conditional Order submitter may mark a Firm-up Order with a time in force of either IOC or Day. If a Firm-up Order does not cross against the identified contra-side order, Firm-up Orders with a time in force of IOC received prior to the expiration of the match timer, will remain on the order book until the match timer expires. LX will immediately cancel back to the submitter any Firm-up Orders with a time in force of IOC received after the expiration of the match timer unless another order resting on the book can execute against the Firm-up Order. For example, assume two Conditional Orders potentially match. LX will send Conditional Invitations to both Conditional Order submitters. One Conditional Invitation recipient sends a Firm-up Order 20ms and the other sends a Firm-up Order 110ms after the Conditional Invitations were dispatched. If no other potential matching orders are present in LX, first Firm-up Order will remain on the order book until the expiry of the match timer and then will be cancelled back. The second Firm-up Order will cancel back immediately because it was received by LX after the expiry of the match timer. Firm-up Orders with a time in force of Day will be posted on the order book even if submitted after the expiry of the match timer. Note that the limitations described above relate to all Conditional Orders. These limitations are in addition to the effect of any Counter-Party Selection criteria described in Part III, Item 14. Information about Conditional Orders posted to the LX order book is not shared with Barclays' order router or the router component of Barclays' algorithms (as discussed in Part II, Item 7(a) and Part III, Item 15(b)). LX does not support odd-lot order quantities on Conditional Orders (as discussed in Part III, Item 8). Barclays only offers Conditional Order functionality to Barclays Institutional Clients & Client Algo/Router Users, Broker-Dealers, and Barclays Trading Desks (as defined in Part III, Item 13). Barclays reserves the right to limit or prohibit the use of the Conditional Order type by Subscribers or groups of Subscribers at its own discretion. OPENING OF TRADING. LX begins trading each security after the opening of trading on the primary exchange for that security. Both Firm Orders and Conditional Orders are accepted from 8:00 A.M. ET to 4:00 P.M ET. LXCC orders are accepted from 8:00 A.M. ET until the LXCC Offset Time, as described in Part III, Item 4(a). Stocks will become eligible for execution in LX once the primary listing market has opened the stock and LX receives through the SIP (via Exegy) a security status code of "Open" and Limit Up-Limit Down ("LULD") bands. RE-OPENING FOLLOWING REGULATORY HALT: If the ATS receives an instrument status of "HALTED" (regulatory halt), the matching engine stops trading the given instrument. The matching engine then waits for an OPEN status, LULD trading band and for a trade to occur in that symbol on another Trading Center, to begin trading again. LX does not trade any orders during a halt, or when a security is not "OPEN". Once a halt occurs, Subscribers can continue to send orders into LX, however they will not execute until trading resumes on LX. RE-OPENING FOLLOWING BARCLAYS INITIATED HALT: If for any reason, Barclays in its discretion has to halt the trading in a symbol or all trading in LX it can elect one of two means to implement such halt. The first is through the disabling of trading. This will cancel all open orders and reject any new orders from entering LX. The second method for halting is through the use of a "SafetyCatch", which will stop all executions (either in that symbol or all symbols) but will allow orders to remain on the order book. During this time new Day orders will be accepted, IOC orders will be cancelled back and order cancellations will be accepted. Effective Price/Tier/Time will be utilized for determining the priority (as described in Part III, Item 11) for these resting orders when trading commences. Pegged orders (including pegged orders with limit prices) are priced according to the current market data and maintain their time priority in the limit order book even if they are re-priced as a result of changes in the NBBO. They are handled in the same manner as non-pegged limit orders. When this "SafetyCatch" is reverted, any order resting on the order book will be eligible for crossing. LX does not employ any special opening or re-opening process, auctions or order types. Y Orders received by LX prior to its open are entered into the queue and become eligible for execution at or after 9:30 A.M. EST. Orders received by LX prior to open are time stamped in the order received for purposes of determining order priority. Following a stoppage of trading, LX handles unexecuted Firm Orders and incomplete Conditional Order Negotiations as described in Part III, Item 20. Y N LX is an NMS Stock ATS operated by Barclays Electronic Trading Department within Barclays' Equities business. LX offers matching services in all eligible NMS stocks. LX is a matching system that (for other than LXCC) matches non-displayed orders based on an Effective Price/Tier/time priority methodology. LX supports Conditional Orders as described in Part III, Item 9 that allow Subscribers to place non-firm trading interests into LX for matching through a Firm-up process. LX establishes a non-displayed order book for each NMS stock available for matching that is comprised of all unexecuted Firm orders with a time in force of Day. The order book is further described in Part III, Items 11(c) and 15. LX also accepts LXCC orders designated for the LXCC; LXCC orders and their handling are discussed below in Part III, Item 17. Y Except where expressly noted, LXCC Orders and their handling are discussed below in Part III, Item 17. LIMIT ORDER BOOK. LX maintains a limit order book for each NMS Stock traded in the system. All orders with a time in force of Day received from Subscribers are placed in the limit order book. LX processes new orders, order cancellations, and replacement orders sequentially in the order received. The limit order book is updated to reflect new and replacement orders and any order cancellations. LX evaluates the limit order book for crossing opportunities following each update. The limit order book also attempts to cross orders when there is a change in the state of market data for an NMS stock (e.g., a new NBBO, Limit Up Limit Down band change, changes in halt conditions) or when an order otherwise becomes eligible to execute against (i.e., the MinTime duration has lapsed, see Part III, Item 14). We refer to orders that are posted to the limit order book (whether such orders are Firm Orders or Conditional Orders) as Posted Orders. Posted Orders remain on the limit order book until fully filled, canceled by the Subscriber or, if not canceled by the Subscriber, canceled automatically at the end of the trading session that day (e.g., 4:00 P.M. ET on a regular trading day or such earlier time in the event of a shortened trading day or early closure) or by administrative action of BCI (See Part III, Item 20). LX evaluates Firm Orders with a time in force of IOC upon receipt. If a crossing opportunity exists, the IOC order will be executed. If an IOC order is a Firm Order marked not eligible to interact with Conditional Orders (not Conditional Eligible), and there is no crossing opportunity or the order is not fully executed, the unexecuted quantity will automatically be cancelled back to the Subscriber (i.e., IOC orders, other than Firm-Up Orders received prior to the expiration of the match timer as described in Part III, Item 9, will not rest in the limit order book). If an IOC order is a Conditional Eligible Firm Order, and there is no crossing opportunity or the order is not fully executed, the unexecuted quantity will be evaluated for any potential contra-side Conditional Order in LX match, and may trigger the sending of a Conditional Invitation. If the sending of a Conditional Invitation is triggered at this time then the Conditional Eligible IOC Firm Order will remain on the order book until it is either fully filled or until the expiration of the match timer, as further described in Part III, Item 9. Please note that in the event a Conditional Eligible IOC Firm Order triggers a Conditional Invitation, the order will continue to abide by the trading rules of LX, including being eligible to interact with firm orders in the book during the period of the "match timer." If the Conditional Eligible Firm Order with a time in force of IOC does not trigger the sending of a Conditional Invitation, the unexecuted quantity will automatically be canceled back to the Subscriber. EXECUTION PRIORITY. LX determines the execution priority of firm Posted Orders and Conditional Orders (as described in Part III, Item 9) separately, but using the same factors for the orders within each category. Firm Posted Order priority is determined by comparing (1) Effective Price (defined below), (2) Tier (described below) and (3) time of order receipt among all firm Posted Orders. Conditional Order priority is determined by comparing (1) Effective Price, (2) Tier and (3) time of order receipt among all Conditional Orders. LX determines whether any firm Posted Orders can be executed before evaluating the marketability of any Conditional Orders. Firm Posted Orders, therefore, always have priority over Conditional Orders. Effective Price is the first execution priority parameter. The Effective Price is the limit price of an order bounded by either the NBBO or a peg instruction. For example, if the NBBO is 12.45/12.49 and a client sends an order to buy with a limit price of 12.50, the order's Effective Price is 12.49. In the same example, if the client instead sends a midpoint peg order to buy with a limit of 12.50, the order's Effective Price is the midpoint price of 12.47. Please note that for any midpoint peg orders in names priced under $1.00 and where the midpoint of the NBBO extends to five decimal places, LX will assign an Effective Price equal to the midpoint of the NBBO rounded to the nearest valid passive 4-decimal price level. For example, if the NBBO is 0.0020/0.0023 a midpoint peg order to buy will be assigned an Effective Price of 0.0021. The execution price for two matched orders will be at or within (but never outside) the NBBO based on current market data used by LX, subject to the Price Improvement Logic described below. The execution price must be consistent with any applicable price conditions placed on the orders, such as a limit price or peg instruction. Subscriber Tier is the second execution priority parameter. All Posted Orders are assigned to one of two Tiers. Tier 1 consists of orders from Barclays Institutional Clients & Client Algo/Router Users (as defined in Part III, Item 13(a)). Tier 2 consists of orders from all other Subscribers including Broker-Dealers, Electronic Liquidity Providers, and Barclays Trading Desks. When the Effective Price is equal, Tier 1 receives execution priority over Tier 2. Time of order is the third execution priority parameter. All orders, even those orders entered pre-open, are time stamped (by millisecond) when they enter LX. Where the Effective Price and Tier are equal, LX executes firm Posted Orders in the chronological order in which they are received. Pegged orders (including pegged orders with limit prices) maintain their time priority in the limit order book even if they are re-priced because of changes in the NBBO. The execution priority parameters described above apply irrespective of whether any such order is for a round-lot, mixed-lot, or odd-lot quantity. SHORT SALES. LX does not accept short sale or short sale exempt orders for the LXCC. Otherwise, Subscribers may enter short sale orders into LX, subject to compliance with Regulation SHO. Barclays will make all "affirmative determinations" in connection with short sales. LX will verify that, in case of a short sale, the "locate" field in Barclays' order-taking system has been checked. However, pursuant to Regulation SHO Rule 203(b)(2)(i), Barclays relies upon the exception to the locate requirement when accepting short sale orders from its U.S. registered broker-dealer clients. In order to comply with the requirements set forth in Rule 201 of Regulation SHO, when short sale restrictions are in effect for a particular NMS Stock, LX will comply with the price test obligation by executing only short sale orders in such NMS Stock when priced higher than the national best bid. Additionally, LX only accepts orders marked short sale exempt from other broker-dealers. REGULATION NMS. The Barclays ATS will reject any order that violates Rule 612 of Regulation NMS (the "Sub-Penny Rule"), and all executions effected by LX will be at or within the NBBO as required by Rule 611 of Regulation NMS (the "Order Protection Rule"). While LX will accept orders outside of the LULD bands, where the market is in a Straddle State, LX pauses all matching. LX will not re-price orders to allow for crossing within the bands. LX will not automatically reject or cancel orders if the crossing price is outside of the crossing constraints. During a trading pause or regulatory halt in an NMS stock subject to the LULD Plan, LX will not reject or cancel orders (including LXCC orders) in the security. Following the trading pause or regulatory halt, LX will resume executing orders once trading has commenced on the primary listing exchange, LX has received the LULD bands from the SIP (provided that if the primary listing exchange is unable to reopen due to technology or system issues, LX will resume trading upon receipt of the price bands from the direct market data feeds and SIP, as set forth in Part III, Item 23 and at least one execution has occurred on any other Trading Center. For LXCC orders, where the LULD halt occurs before the LXCC Offset Time but is lifted after the LXCC Offset Time, or where the LULD halt occurs at or after the LXCC Offset Time, all LXCC orders will be cancelled. LOCKED & CROSSED MARKETS. By default, LX does not cross non-LXCC orders during a locked market. Subscribers may opt into having their orders cross in a locked market for all of their orders or on an order-by-order basis. LX will not execute non-LXCC orders during a crossed market. Orders will reside on the order book until the crossed market has ended. Because LXCC orders are not priced by reference to the continuous limit order book, they can be matched and executed without regard to a locked or crossed market state. PRICE IMPROVEMENT LOGIC. LX supports a price improvement logic that will split any overlap in effective limit prices with 50% of the overlap going to the liquidity provider and 50% going to the liquidity taker, where the split results in an execution price within 4 decimal places. For example, suppose that a buyer has a posted order in the order book at a limit price of $10.01. Subsequently, a seller sends an order with a limit price of $10.00, creating a $0.01 overlap. Both parties will get 50% of the overlap, and these two orders will be crossed at a price of $10.005 as long as all of the standard crossing constraints are met (e.g., the crossing price is at, or within, the NBBO). If the 50% split is outside 4-decimal point precision then the execution price will be conservatively rounded to the nearest 4-decimal place price level, such that any residual amount is allocated to the provider as long as all of the standard crossing constraints are met (e.g., the crossing price is at, or within, the NBBO). For example, suppose that a buyer has a posted order in the order book at a limit price of $0.0025. Subsequently, a seller sends an order with a limit price of $0.0020. The two orders will be crossed at a price of $0.0022 (each side gets $0.0002 from the price overlap of $0.0005 leaving the residual $0.0001 to be allocated to the provider because it cannot be divided into a 4-decimal place value). ERRORS. LX handles execution errors in accordance with Barclays' Global Cash Equities Error Procedure (the "Error Procedure"). The Error Procedure applies to bona fide mistakes and general errors made by the Barclays business or a client. The Error Procedure requires notification of Barclays' errors to the relevant Supervisor. Barclays aims to unwind Barclays' errors with a view to minimizing market impact and protecting client interests. Generally, for Barclays technology-related errors, Barclays will determine a course of action based on the facts and circumstances surrounding such errors. This could result in one or both sides of the trade being cancelled. Barclays handles executions at clearly erroneous prices consistent with the applicable rules of the self-regulatory organizations. Following a determination of erroneous trading by the primary market, LX will cancel both sides of any erroneous trade. Y N Barclays segments Subscribers both by a process called Liquidity Profiling and by Subscriber Type. Further, Barclays groups Subscribers by Subscriber Type into Tier 1 and Tier 2, which is used to determine Execution Priority as described in Party III, Item 11(c). Subscribers have the ability to block interactions with other Subscribers based on the Liquidity Profiling or Subscriber Type categorizations (but not a combination of both) of those other Subscribers as described in Part III, Item 14(a). The use of Subscriber segmentation based blocking may reduce execution rates, either because a Subscriber may have chosen to suppress certain categories of flow or because a Subscriber is within a category of flow that has been suppressed by other Subscribers. A. LIQUIDITY PROFILING. Barclays applies Liquidity Profiling categories to Subscribers that route Firm Orders (excluding Firm-up Orders described in Part III, Item 9 and LXCC orders) directly to LX when removing liquidity. Liquidity Profiling categories are based on one-second alpha, which is the midpoint-to-midpoint market movement over a one-second horizon, normalized by the daily average spread. Based on this metric, Barclays places Subscribers into one of three alpha categories: Low, Medium, and High (Low being the lowest alpha category and High being the highest alpha category). LX places orders routed to LX by Barclays' order router or Barclays' algorithms into the Low alpha category by default. This group of Subscribers includes clients that utilize Barclays' order router to send directed orders to LX, and Barclays' trading desks and Subscribers that utilize Barclays' algorithms and Barclays' order router. At least once a month, Barclays reviews the Liquidity Profiling categorizations of Subscribers that route directly to LX (excluding Barclays' order router and algorithms). That given month's review will be based on the trading data from the prior three calendar months. Barclays uses these results to reassess Subscriber categorizations and, if necessary, assign Subscribers into new Liquidity Profiling categories. Barclays retains discretion to override a Subscriber's Liquidity Profiling categorization and place that Subscriber into a higher alpha category than what would have been assigned based solely on the objective application of the liquidity profiling metric described above (an "Override"). Barclays reserves the right to Override a Subscriber to a higher alpha category intra-month if a review of that Subscriber's alpha metric warrants such Override in Barclays' discretion. Barclays may consider previous trading behavior when determining whether to apply an Override to a Subscriber's Liquidity Profiling categorization and may wait for additional data before changing a profile to a lower alpha category. Barclays does not discretionarily place Subscribers into lower alpha categories. Barclays may employ an Override when a Subscriber has a low volume of trading in the prior period, the Subscriber has exhibited unusual or inconsistent behavior for the prior period or such other reasons as Barclays deems relevant. Liquidity Profiling category changes, including Overrides, usually take effect within 24 hours of Barclays determining that such change is appropriate. Barclays provides details of the number of Subscribers that have been subject to an Override for the prior observation period on its website. Barclays assigns newly onboarded Subscribers into the Low alpha category. Those Subscribers are reassigned following the first monthly review should their trading activity during that first observation period place them into a higher category. Note, some Subscribers may execute under multiple Subscriber identifiers (or acronyms) for different trading strategies, different groups within a firm or different means of accessing LX. Barclays evaluates each Subscriber identifier for Liquidity Profiling purposes and places them into the applicable category independently. As a result, a Subscriber may have multiple Liquidity Profiling categories associated with it. B. SUBSCRIBER TYPE. Barclays categorizes Subscribers into one of the following four Subscriber types (each, a "Subscriber Type") (1) Barclays Institutional Clients & Client Algo/Router Users, comprised of institutional and broker-dealer clients that route orders to LX via Barclays' algorithms and/or order router and institutional clients (i.e., non-broker-dealer clients) that route orders directly to LX; (2) Broker-Dealers, comprised of third-party broker-dealers that route orders directly to LX on behalf of their clients, or on behalf of their clients and themselves; (3) Electronic Liquidity Providers ("ELPs"), comprised of third-party broker-dealers that route orders directly to LX solely on a principal basis and any other Subscribers that self-identify to BCI as an ELP; (4) Barclays Trading Desks, comprised of Barclays' client-facing trading desks and Affiliate trading desks executing in LX. Barclays uses its best efforts in placing Subscribers into a Subscriber Type based on publicly available information and information obtained by Barclays from the Subscriber. Subscribers in the Broker-Dealer group may have (and be executing in LX for) underlying clients that are institutional clients, ELP clients or other Broker-Dealer clients. Barclays does not categorize based on the Broker-Dealer's underlying clients, unless Barclays has a direct relationship with a Broker-Dealer's underlying client, as that client will be on-boarded with Barclays directly and will be categorized accordingly. Additionally, some Subscribers may execute under multiple Subscriber identifiers (or acronyms), e.g., for different trading strategies, different groups within a firm or different means of accessing LX. Barclays evaluates each Subscriber identifier for the purposes of Subscriber Type categorization and places them into the applicable Subscriber Type independently. As a result, some Subscribers may have multiple Subscriber Types associated with it. For example, a Broker-Dealer that comes into LX both with a direct connection as well as via Barclays' algorithms would be classified as a Broker-Dealer for the transactions that come in directly and would be placed in the Barclays Institutional Clients & Client Algo/Router Users group when utilizing Barclays' algorithms. Barclays does not override any Subscriber Type determinations. C. SUBSCRIBER TIERING. As described in Part III, Item 11(c), Barclays places Subscribers into Tiers that are used to determine the Execution Priority of Posted Orders. Tier 1 consists of orders from Barclays Institutional Clients & Client Algo/Router Users. Tier 2 consists of orders from all other Subscribers including Broker-Dealers, Electronic Liquidity Providers, and Barclays Trading Desks. Because Barclays does not override any Subscriber Type determinations, Tiering is not subject to override. Y If requested, Barclays will inform a Subscriber as to the segment, Tier or Liquidity Profiling category or otherwise, in which that Subscriber is placed. For example, Barclays may inform a Subscriber that it is in the Broker-Dealer segment since it is a registered broker-dealer, is in Tier 2 and is in the Low alpha Liquidity Profiling category. Additionally, if requested, Barclays will provide the details of the relevant factors that lead to that Subscriber's categorization. Information about a Subscriber's own segmentation category is available to any Subscriber that requests it. Barclays does not provide any details of the categorization or identity of other Subscribers. Subscribers do not have the ability to contest their segmentation categorization. Y N Subscribers can designate orders and trading interests, including LXCC orders, not to interact with certain orders or trading interests in LX by several means. Note that for LXCC orders, with respect to the methods set out below for limiting interactions with certain orders or trading interests in LX, only the Principal Blocking, Self Dealing and Private Counterparty Interaction methods are available. Subscribers can make these elections by contacting their Equities Sales Representative, requesting such restriction through Barclays' online SPECS tool, or by emailing the Barclays Service Desk at LXService@barclays.com. Barclays usually implements such requests within 24 hours of receipt. SELF DEALING. LX has in place functionality to prevent transactions in a security resulting from the unintentional interaction of orders or trading interests originating from the same Subscriber identifier that involve no change in the beneficial ownership of the security. For Subscribers with multiple identifiers, the Subscriber must notify Barclays if they would like to prevent the interaction of their orders or trading interests originating from different identifiers associated with the Subscriber and may specify the interactions by pairs of identifiers. Subscribers that are registered broker-dealers with a single identifier must confirm whether Barclays may cross orders under the same identifier and that a change in beneficial ownership will occur. SEGMENTATION BASED BLOCKING. Subscribers have the ability to limit their interactions with other Subscribers based on the Subscriber segmentation categories of either (but not a combination of both) Liquidity Profiling or Subscriber Type as described in Part III, Item 13(a). A. LIQUIDITY PROFILING. Subscribers that send Posted Orders, whether directly to LX or through Barclays' algorithms or Barclays' order router, can block interactions with other Subscribers based on Liquidity Profiling. A Subscriber may customize its Posted Order interactions in LX by designating those Liquidity Profiling categories with which it does not wish to interact (e.g., block counterparties categorized as High alpha). Subscribers cannot use Liquidity Profiling to block interactions when taking liquidity from LX. B. SUBSCRIBER TYPE BLOCKING. As an alternative to Liquidity Profiling, Barclays Institutional Clients & Client Algo/Router Users (as defined in Part III, Item 13(a)) may block one or more Subscriber Types (as defined in Part III, Item 13(a)) from interacting with their order flow (e.g., block counterparties categorized as ELPs). Barclays does not offer the Subscriber Type Blocking functionality to Subscribers that are ELPs, Broker-Dealers or Barclays Trading Desks. Unlike blocking by Liquidity Profiling category, which is only available to a Subscriber when providing liquidity, Subscriber Type Blocking is available to a Subscriber when providing liquidity, taking liquidity, or both. Barclays Institutional Clients & Client Algo/Router Users can use Subscriber Type Blocking for orders sent directly to LX or routed through Barclays' algorithms or Barclays' order router. Subscriber Type Blocking is an alternative to Liquidity Profiling. LX does not support the simultaneous application of Subscriber Type Blocking on an order-by-order basis and blocking by Liquidity Profiling category. INDIVIDUAL BLOCKING REQUESTS. Barclays Institutional Clients & Client Algo/Router Users may also request that Barclays suppress the interaction of their orders in LX with specific Subscribers. While Barclays will not confirm to a Subscriber whether an entity that it wishes to block is an LX Subscriber, Barclays will use commercially reasonable efforts to suppress interaction with the entity if it is a Subscriber. Barclays does not offer this type of counterparty restriction functionality to Subscribers that are ELPs, Broker-Dealers or Barclays Trading Desks. PRIVATE COUNTERPARTY INTERACTION REQUESTS. Subscribers may request that their orders and trading interests (including firm orders, Conditional Orders, and related Firm-Up Orders) only interact with one or more specific Subscribers (a "Private Counterparty Interaction"), thereby suppressing interaction with the remaining Subscribers in LX. Aside from limiting eligible counterparties, all orders are maintained in the common LX order book and abide by the same ATS rules, including execution priority (further described in Part III, Items 11(c) and 15). In order to enable Private Counterparty Interaction, each Subscriber to the arrangement must submit a written request to their Equities Sales Representative, or the Barclays Service Desk at LXService@barclays.com, indicating their desire to only interact with the designated Subscribers. Barclays will not fulfill Private Counterparty Interaction requests unless requests are made by all designated parties to the arrangement. A Subscriber to such Private Counterparty Interactions may request, in writing to their Equities Sales Representative or the Barclays Service Desk, to discontinue the arrangement without the notification or consent of the other parties to the arrangement. EVALUATION BASED BLOCKING. Barclays offers Institutional Clients & Client Algo/Router Users the ability to contact Barclays to evaluate orders and/or transactions to determine if strategies of other Subscribers may be adversely affecting their interactions within LX. If Barclays determines that a certain Subscriber or group of Subscribers may be adversely affecting the Subscriber that inquired, Barclays will allow the Subscriber the ability to block further interactions with those Subscribers, without disclosing their identities. Note that a Subscriber can elect to block that Subscriber entirely or block a specific order type from interacting with that Subscriber. For example, Subscriber A could request that Subscriber A's IOC orders not interact with another Subscriber who Barclays has determined is adversely affecting Subscriber A's interactions, or could request that Barclays block all interactions between Subscriber A and the other Subscriber. MINIMUM TIME BLOCKING. As an alternative to the Subscriber Type Blocking and Liquidity Profiling described above, Barclays Institutional Clients & Client Algo/Router Users may elect to limit interactions with orders of Subscribers that access LX through a direct connection to those orders that have rested on the order book for a minimum duration or longer ("LX MinTime"). Any such restriction is limited to orders in LX entered utilizing a direct connection and would not restrict the client's interactions with any other order flow in LX that is entered by way of other means (e.g., Barclays' algorithms or order router). The LX MinTime length is set at one second. Barclays configures the MinTime length at its discretion and may periodically update it. Barclays Institutional Clients & Client Algo/Router Users can utilize this feature with firm order types, including Conditional Eligible Firm Orders. Such Subscribers cannot use LX MinTime for Conditional Orders (including the related Firm-Up Orders). Barclays Institutional Clients & Client Algo/Router Users cannot use LX MinTime in conjunction with blocking based on Subscriber Types or Liquidity Profiling categories (described above). Institutional Clients & Client Algo/Router User can, however, utilize LX MinTime in conjunction with a specific Subscriber block. If a client has Subscriber Type Blocking or Liquidity Profiling enabled as a default for all of their orders, and the Subscriber enables LX MinTime, LX MinTime will apply, and blocking by Subscriber Type or Liquidity Profiling will no longer apply. Note that a contra-side order that is otherwise subject to, and has met, a Subscriber's LX MinTime requirement may have enabled a form of counterparty blocking that may suppress interactions with that Subscriber. LX MinTime has no effect on a Subscriber's interactions with Conditional Orders, including the related Firm-up Orders. For instance, for interactions with contra-side Conditional Orders, if a Barclays Institutional Clients & Client Algo/Router User has Subscriber Type Blocking or Liquidity Profiling enabled as a default for all of their orders, and they enable LX MinTime, LX MinTime will not apply and only the default blocking will apply. See Conditional Order Negotiations and Conditional Eligible Firm Orders, in Part III, Item 9. If a Barclays Institutional Clients & Client Algo/Router User has blocked interactions with Barclays Principal Orders (as described below) or requested to block specific Subscribers (as described above), and has enabled LX MinTime for the order, all enabled blocking methods will apply. A Barclays Institutional Clients & Client Algo/Router User may use all three of these blocking formats. Barclays Institutional Clients that route directly to LX may elect to utilize LX MinTime on an order-by-order or default basis. A client that utilizes Barclays' order router and algorithms may utilize LX MinTime across all orders or on an individually configured basis depending on the client's execution objectives. Barclays does not offer this type of counterparty restriction to Subscribers that are ELPs, Broker-Dealers or Barclays Trading Desks. BARCLAYS PRINCIPAL ORDER BLOCKING. In addition to the counterparty restriction functionalities described above, Subscribers have the ability to restrict interaction with all Barclays orders with an order capacity marked as principal. Please note, however, that if a Subscriber elects this restriction, it will also be restricted from interacting with all Barclays' Affiliates' order flow in LX (whether such Affiliate is trading as principal or agent for its clients). POTENTIAL EFFECT OF COUNTERPARTY SELECTION FUNCTIONALITIES. The counterparty selection functionalities described above may result in reduced execution rates, either because a Subscriber may have chosen to suppress certain categories of flow or because a Subscriber is within a category of flow that has been suppressed by other Subscribers. The purpose of the counterparty restriction functionality is to allow Subscribers more control over the execution of their orders. Each Subscriber has its own execution objectives. Such objectives might include (but are not limited to), maximizing fill rates, limiting adverse selection, and interacting only with specific Subscriber Types. For example, a Subscriber may disable interaction with Barclays' principal order flow, Subscribers that are categorized as High alpha under Liquidity Profiling, or with specific Subscriber Types. Each Subscriber determines whether it will use any counterparty restriction functionality available to them. Barclays reserves the right to deny Subscribers' access to any counterparty selection functionality described above. Y N LX does not display its order book, or provide any information with respect to orders bound for LX, to Subscribers. LX does, however, share certain information about Subscriber trading interest for purposes of conducting Conditional Order Negotiations (as discussed in Part III, Item 9). Additionally, LX provides Posted Order information to Barclays' order router and the router component of Barclays' algorithms on a real-time basis; note that the information shared with the router component of Barclays' algorithms is only shared with that component for purposes of routing decisions and is not used by the algorithms for any non-routing purposes, including order generation. The information provided to the router and the router component of Barclays' algorithms contains aggregated Firm Order buy and sell interest per symbol within the current NBBO. Barclays order router and Barclays' algorithms also receive enhanced information about Conditional Invitations. In addition to the price, side, and symbol of a potential match, which information is included in a Conditional Invitation message (as described in Part III, Item 9 above), the order router and Barclays' algorithms are informed of the size of the match (which is the smaller of the Conditional Order size and the potential contra side order size). No client-specific information is provided to the order router or Barclays' algorithms. No information about posted Conditional Orders (as discussed in Part III, Item 9(a)) and no client-specific information is included in the information provided to the order router or the router component of Barclays' algorithms. The order router and the router component of Barclays' algorithms use the Posted Order information from LX solely to decide whether to route Firm Orders or Conditional Orders to LX. In addition, because Subscribers can direct Firm Orders or Conditional Orders to the ATS through the order router and because the order router and/or the router component of Barclays' algorithms may decide to route Firm Orders or Conditional Orders to LX, the order router and/or the router component of Barclays' algorithms have information about these Firm Orders or Conditional Orders that are bound for LX. With respect to both Firm Orders and Conditional Orders routed to LX through or by the order router or the order component of Barclays algorithms, the order router and/or the router component of Barclays' algorithms, as the case may be, will have information relating to the identity of the Subscriber submitting the order, as well as the price, side, symbol, order type, whether the order is Conditional Eligible, and the order attributes and parameters described in Part III, Item 7. In addition, with respect to Conditional Orders and Firm-up Orders routed to LX through or by the order router or the order component of Barclays algorithms, the order router and/or the router component of Barclays' algorithms, as the case may be, will have information relating to the additional features of those order types described in Part III, Item 9. The order router and the router component of Barclays' algorithms do not share any such information that they receive from LX with any other Barclays trading venue (such as BARX Book, Barclays' single dealer platform), trading system (such as order management and trade capture systems), desk or any third-party (other than personnel who require access to perform maintenance or to address technological, legal or compliance issues that may arise with LX or the router or the router component of Barclays' algorithms). Subscribers can opt out of having their Posted Order information included in the aggregated information provided to the router and the router component of Barclays' algorithms. Subscribers cannot opt out of the order router and the router component of Barclays' algorithms having knowledge of Firm Orders or Conditional Orders bound for LX. This information is inherent in the operation of the system. The order router and the router component of Barclays' algorithms do not generate indications of interest based on information from LX. The order router and the router component of Barclays' algorithms do receive indications of interest from third-party venues. Please also see the information provided regarding disclosure of confidential trading information provided in Part II, Item 7. Y N LX accepts LXCC orders for matching and execution in the LXCC. LXCC orders must contain the following combination of FIX instructions: market orders with a TIF of "at the close". No other order types and TIF combinations will be eligible for the LXCC. LXCC is available only to Subscribers utilizing Barclays' algorithms or smart order router and, by default, orders with the aforementioned FIX instruction combination may be routed to the LXCC or the closing auction at the primary exchange. These Subscribers may request that LXCC be disabled as a routing option for their orders, thus limiting routing options to the primary exchange's closing auction, by contacting their Equities Sales Representative or by emailing LXService@barclays.com. LXCC Orders may be received up until the LXCC Offset Time as defined above in Part III, Item 4(a). Immediately following the LXCC Offset Time, LXCC orders are matched and the algorithm or smart order router used to submit the LXCC order is notified of the quantity of the orders matched by LX. Any unmatched quantity is cancelled back to the algorithm or smart order router at this time. LXCC orders may only match with other LXCC orders. They may not match with any other orders or conditional placements. LXCC orders are prioritized based on (1) size, and then (2) time of receipt. Subscribers may not apply, and LX will not act upon, a MinQty parameter (as defined above in Part III, Item 7) on their LXCC orders. Subscribers can apply a principal order exclusion (as defined above in Part II, Item 3) to their LXCC orders. LXCC orders are subject to the Self Dealing prevention feature described above in Part III, Item 14. Subscribers cannot apply segment classification or liquidity profiling restrictions to their LXCC orders. Before LXCC orders are matched, prior to the LXCC Offset Time, they can be cancelled or modified. After the LXCC Offset Time, LXCC orders are matched and cannot be cancelled or modified. Once LX receives the official closing price disseminated by the primary listing market for the relevant NMS Stock, matched LXCC orders will be executed at that price, and the price will be reported to any Subscriber with a matched LXCC order. If an official closing price for an NMS Stock is not received by 5:00 P.M. Eastern Time, all LXCC orders to buy or sell that stock will be cancelled. If a closing price for an NMS Stock is announced but taken down by the primary listing exchange without being replaced before 5:00 P.M. Eastern Time, all LXCC orders to buy or sell that stock will be cancelled. If the primary listing exchange updates the closing price of an NMS Stock at or before 5:00 P.M. EST, LX will adjust the price for any previously executed order, and it will send an updated execution report to the Subscriber that submitted the order. If the primary listing exchange updates the closing price of an NMS Stock after 5:00 P.M. Eastern Time, LX will adjust the execution reports on a T+1 basis. If a disconnect occurs prior to the LXCC Offset Time, standard cancel on disconnect rules will be applied. At or after the LXCC Offset Time, a matched order will not be cancelled, even if the Subscriber has not yet been notified of the execution. The Error Policy described above in response to Part III, Item 11 also applies to LXCC orders. Only orders routed to LX via Barclays' smart order router or algorithms, whether by Client algo/router users or the Broker Dealer Operator or its Affiliates are eligible for LXCC. All other Subscribers are unable to enter LXCC Orders and will trade pursuant to the regular trading rules at all times. N Barclays does not charge LX Subscribers access fees. Barclays may charge Subscribers a commission for transactions executed in LX. Commissions for trading in LX are negotiated on a client-by-client basis and may differ depending on the means of accessing the ATS. Commissions are not standardized among Subscribers or for any specific offering. The range of commissions charged to Subscribers who access the ATS through a direct connection to the NMS Stock ATS are between $0.00 and $0.0525 per share. Note, the above represents the range that clients typically pay in commissions, and can be changed upon request and acceptance between Barclays and the client on a one-off or continuing basis. Some of the factors on which a commission rate could depend include, but are not limited to, the amount of trading the specific client executes with Barclays, characteristics of the client's orders (for example number of symbols traded, average order size, amount of price improvement, adding or removing liquidity), and the specific services Barclays offers to the client relationship as a whole (for example, provision of research, prime brokerage financing or capital introduction). Barclays does not charge its own internal trading desks commissions when accessing LX for principal orders. As Barclays is identified as the CAT Executing Broker on both sides of every transaction on LX, CAT fees which FINRA assesses to buyers and sellers are charged only to Barclays for transactions occurring in LX. For those Subscribers who access LX through a direct connection, Barclays passes through to the Subscriber the CAT fees associated with their activity on the venue. Subscribers that access LX through Barclays' algorithms, order router or through Barclays Sales or Trading personnel may pay a commission whether their order is executed in LX or on another Trading Center. Commissions are negotiated on a client-by-client basis. Commissions are not standardized across clients and may vary depending on the means by which LX or other Trading Centers are accessed. The range of commissions charged to Subscribers who access the ATS through Barclays algorithms, order router or Barclays Sales or Trading personnel are between $0.00 and $0.20 per share. Note, the above represents the range that clients typically pay in commissions, and can be changed upon request and acceptance between Barclays and the client on a one-off or continuing basis. Commission rates are bundled commissions for all services BCI offers its client, including the use of the algorithms, order router or utilization of the sales and trading teams. These fees may also include such full service investment banking offerings as the ability to access research, corporate access or similar services that Investment Banks offer. Some of the factors on which a commission rate could depend include, but are not limited to, the amount of trading the specific client executes with Barclays, the characteristics of the client's orders (for example number of symbols traded, average order size, amount of price improvement, adding or removing liquidity), and the specific services Barclays offers to the client relationship as a whole (for example, provision of research, prime brokerage financing or capital introduction). Barclays does not charge its own internal trading desks commissions when accessing LX for principal orders. As Barclays is identified as the CAT Executing Broker on both sides of every transaction on LX, CAT fees which FINRA assesses to buyers and sellers are charged only to Barclays for transactions occurring in LX. For those Subscribers who access LX through Barclays' algorithms, order router, or Barclays Sales and trading personnel and which have a cost-plus relationship with Barclays, Barclays passes through to the Subscriber the CAT fees associated with their activity on the venue. BCI does not offer any rebates or discount of fees or charges for clients for accessing LX. Depending on the negotiated fee arrangement, clients may receive rebates from Barclays for transactions executed on Trading Centers other than LX. Those rebates may offset any commissions owed to Barclays for transactions executed on LX. LX will not cross orders during a regulatory halt, except for LXCC orders, or when Barclays has elected, for any reason, to suspend trading in a particular symbol. REGULATORY HALT. Other than for LXCC orders, the matching engine will automatically stop trading in the affected instrument any time LX receives an instrument status of "HALTED" (regulatory halt). The matching engine will not resume trading in the affected symbol until it receives an OPEN status signal, the LULD trading band and evidence of a trade executed in that symbol on a different Trading Venue. For LXCC orders, if a LULD or other regulatory halt is in effect prior to or during any portion of the time between the LXCC Offset Time and the time the official closing price is disseminated by the primary listing market for the NMS Stock, but is lifted prior to the time the official closing price is disseminated, the LXCC order will be eligible for matching and execution in the LXCC. If the halt is still in effect at the time the official closing price should have been disseminated by the primary listing exchange, the LXCC orders will be cancelled back unexecuted. BARCLAYS INITIATED HALT. Barclays may initiate a trading freeze or halt in any instrument for any reason, including the suspension of individual NMS stocks for, among other reasons, approaching Regulation ATS Fair Access and Regulation SCI volume thresholds. Barclays can initiate discretionary trading freezes or halts by either "disabling trading" of an instrument or temporarily freezing trading in an instrument. Either method may be applied to individual securities or to all securities within LX. HANDLING OF NON-LXCC ORDERS: If Barclays disables trading in a symbol, LX will cancel all open orders and reject all new orders in that symbol. During any regulatory halt and during a suspension of trading as a result of a freeze, LX permits orders to remain on the order book and it will continue to accept new Day orders and order cancellations and modifications. IOC orders (including Firm-up Orders and Conditional Eligible Firm Orders with a time in force of IOC as described in Part III, Item 9) will be cancelled back. Effective Price/Tier/time will be utilized for determining the priority for any resting orders when trading commences based on the time at which they were accepted (even during a suspension of trading). Pegged orders (including pegged orders with limit prices) are priced according to the current market data and maintain their time priority in the limit order book even if they are re-priced as a result of changes in the NBBO. HANDLING OF LXCC ORDERS: If Barclays disables trading in a symbol before or during any portion of the time between the LXCC Offset Time and the dissemination of the official closing price by the primary exchange but reenables trading prior to dissemination of the official closing price, all open orders will remain open and new orders will be accepted in the LXCC. If a Barclays-initiated halt is in effect at the time that the official closing price is disseminated by the primary listing exchange, all LXCC Orders will be cancelled. During a freeze initiated by Barclays, if the freeze occurs prior to or during any portion of the time between the LXCC Offset Time and the time the official closing price is disseminated by the primary listing market for the NMS Stock, but is no longer in effect at the time the official closing price is disseminated, the LXCC Order will be eligible for matching and execution in the LXCC. If the freeze is in effect at the time the official closing price is disseminated by the primary listing exchange for the NMS Stock, all LXCC Orders will be cancelled. Barclays will make reasonable efforts to notify Subscribers electronically in the event of a suspension or stoppage of trading. Y Ocean will submit reports of trade executions on LX under the LATS MPID (in compliance with the FINRA Rule 6160) to a Trade Reporting Facility ("TRF"). All transactions executed in LX for all Subscribers will be reported to the NASDAQ TRF. Barclays also maintains an audit trail of orders and executions involving LX and submits Consolidated Audit Trail ("CAT") reports to FINRA as required by FINRA's CAT Rules. Barclays will not submit CAT reports for Conditional Order Negotiations in compliance with FINRA's CAT Frequently Asked Questions - B3. For purposes of Rule 605 of Regulation NMS, Barclays compiles a monthly report regarding execution quality and publishes the report in accordance with the rule. Y BCI is a member of the National Securities Clearing Corporation ("NSCC") and the Depository Trust & Clearing Corporation ("DTC"). As such, BCI submits all trades for clearing at NSCC and settlement at DTC. BCI utilizes a third-party service provider, Broadridge, for clearance and settlement services. BCI clears and settles all trades for LX using its existing infrastructure, which function is performed by Broadridge. LX does not have any unique procedures or material arrangements to facilitate the clearance and settlement of transactions. While Barclays does not require Subscribers to a have a specific clearing arrangement, all Subscribers must have an established clearing method and provide appropriate settlement instructions to allow BCI to submit their transactions to NSCC and DTC. Trades involving the orders of third-party broker-dealers are cleared and settled through the submission of locked-in trades to the NSCC either through a FINRA facility or through a direct submission to the NSCC. Other Subscribers are required to submit their transactions to NSCC for clearance, either directly or through a correspondent clearing arrangement, and DTC on a delivery versus payment basis for settlement. Barclays does not become a counterparty to a transaction executed in LX by interposing itself between two counterparties to the transaction. BCI, however, may be a counterparty to a transaction if one of its sales or trading desks executes a principal transaction in LX against a different Subscriber's order. Y LX uses an NBBO constructed by Ocean. The NASDAQ Ocean platform uses a combination of full network redundant market data feeds and market data disseminated by the Securities Information Processors ("SIP") to construct the NBBO. Specifically, Ocean uses direct market data feeds for all exchanges other than LTSE and FINRA ADF. Separately, Ocean uses full network redundant SIP feeds as a secondary source of the NBBO. The constructed NBBO is used to price, prioritize, and execute orders. LX will arbitrate between the two feeds, direct or SIP, based on the detection of any market data latency. If there is an issue with the direct feed from a particular market, the constructed NBBO will use the SIP data as it relates to that particular market while continuing to rely on direct market data feeds and the SIP, as applicable, for all other markets. Accordingly, all executions in LX are programmed to match at or within the constructed NBBO or the SIP NBBO. Y N N true true