Federal Register / Vol. 76, No. 71 / Wednesday, April 13, 2011 / Notices 20771 

7 15 U.S.C. 78s(b)(3)(A). 

8 17 CFR 240.19b–4(f)(6)(iii). In addition, Rule 

19b–4(f)(6)(iii) requires that a self-regulatory 

organization submit to the Commission written 

notice of its intent to file the proposed rule change, 

along with a brief description and text of the 

proposed rule change, at least five business days 

prior to the filing of the proposed rule change, or 

such shorter time as designated by the Commission. 

The Commission notes that the Exchange has 

satisfied this requirement. 

9For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposed rule’s impact on efficiency, competition, 

and capital formation. See 15 U.S.C. 78c(f). 

10 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A)(iii). 

4 17 CFR 240.19b–4(f)(6). 

markets concerning review of 

transactions as clearly erroneous. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The proposed rule change does not 

impose any burden on competition that 

is not necessary or appropriate in 

furtherance of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

The Exchange has not solicited, and 

does not intend to solicit, comments on 

this proposed rule change. The 

Exchange has not received any 

unsolicited written comments from 

members or other interested parties. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not: (i) Significantly affect 

the protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A) of the Act 7 and Rule 19b– 

4(f)(6)(iii) thereunder.8 The Exchange 

has asked the Commission to waive the 

30-day operative delay so that the 

proposal may become operative 

immediately upon filing. The 

Commission believes that waiving the 

30-day operative delay is consistent 

with the protection of investors and the 

public interest because such waiver will 

allow the pilot program to continue 

uninterrupted and help ensure 

uniformity among the national 

securities exchanges and FINRA with 

respect to the treatment of clearly 

erroneous transactions.9 Accordingly, 

the Commission waives the 30-day 

operative delay requirement and 

designates the proposed rule change as 

operative upon filing with the 

Commission. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–EDGA–2011–12 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–EDGA–2011–12. This file 

number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street, NE., 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of such filing 

also will be available for inspection and 

copying at the principal office of the 

Exchange. All comments received will 

be posted without change; the 

Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

publicly available. All submissions 

should refer to File Number SR–EDGA– 

2011–12 and should be submitted on or 

before May 4, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–8805 Filed 4–12–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64243; File No. SR–CBOE– 

2011–038] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Regarding Close of 

Trading Hours for Expiring End of 

Week and End of Month Expirations 

April 7, 2011. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on April 6, 

2011, the Chicago Board Options 

Exchange, Incorporated (‘‘Exchange’’ or 

‘‘CBOE’’) filed with the Securities and 

Exchange Commission (‘‘Commission’’) 

the proposed rule change as described 

in Items I and II below, which Items 

have been prepared by the Exchange. 

The Exchange filed the proposal as a 

‘‘non-controversial’’ proposed rule 

change pursuant to Section 

19(b)(3)(A)(iii) of the Act 3 and Rule 

19b–4(f)(6) thereunder.4 The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of the Substance 

of the Proposed Rule Change 

CBOE proposes to amend Rule 24.9 to 

change the close of trading hours from 

3:15 p.m. (Chicago time) to 3 p.m. 

(Chicago time) on the last day of trading 

in expiring End-of-Week and End-of 

Month Expirations. The text of the rule 

proposal is available on the Exchange’s 

Web site (http://www.cboe.org/legal), at 

the Exchange’s Office of the Secretary 

and at the Commission’s Public 

Reference Room. 

mstockstill on DSKH9S0YB1PROD with NOTICES

20772 Federal Register / Vol. 76, No. 71 / Wednesday, April 13, 2011 / Notices 

5See Securities Exchange Act Release No. 34– 

62911 (September 14, 2010), 75 FR 57539 

(September 21, 2010) (SR–CBOE–2009–075). 

6See CBOE Rule 24.9(e). 

7See supra note 5. 

8 15 U.S.C. 78s(b)(1). 

9 15 U.S.C. 78f(b). 

10 15 U.S.C. 78f(b)(5). 

11The Exchange has satisfied this requirement. 

12 15 U.S.C. 78s(b)(3)(A). 

13 17 CFR 240.19b–4(f)(6). 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

forth in Sections A, B, and C below, of 

the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend 

Rule 24.9 to change the close of trading 

hours from 3:15 p.m. (Chicago time) to 

3 p.m. (Chicago time) on the last day of 

trading in expiring End-of-Week 

Expirations and End-of-Month 

Expirations. On September 14, 2010, the 

Securities and Exchange Commission 

(‘‘Commission’’) approved the 

implementation of a pilot program that 

permits P.M.-settled options on broadbased indexes to expire on (a) any 

Friday of the month, other than the 

third Friday-of-the-month (‘‘End-ofWeek Expirations’’ or ‘‘EOWs’’) and (b) 

the last trading day of the month (‘‘Endof-Month Expirations’’ or ‘‘EOMs’’).5

EOWs and EOMs are treated the same 

as traditional options on the same 

underlying index that expire on the 

Saturday following the third Friday of 

the month; provided, however, that 

EOWs and EOMs are P.M.-settled.6

EOWs and EOMs are subject to the same 

rules that currently govern the trading of 

traditional index options, including 

sales practice rules, margin 

requirements, and floor trading 

procedures. Contract terms for EOWs 

and EOMs are similar to regular index 

options, with one general exception: 

The exercise settlement value is based 

on the index value derived from the 

closing prices of component stocks.7

Generally, EOWs and EOMs are 

priced in the market based on 

corresponding futures values. On the 

last day of trading, the closing prices of 

the component stocks (which are used 

to derive the exercise settlement value) 

are known at 3 p.m. (Chicago time) (or 

soon after) when the equity markets 

close. Despite the fact that the exercise 

settlement value is fixed at or soon after 

3 p.m. (Chicago time), trading in 

expiring EOWs and EOMs continues, 

however, for an additional fifteen 

minutes until 3:15 p.m. (Chicago time) 

and are not priced on corresponding 

futures values, but rather the known 

cash value. At the same time, the prices 

of non-expiring EOW and EOM series 

continue to move and be priced in 

response to changes in corresponding 

futures prices. 

Because of the potential pricing 

divergence that could occur between 

3:00 and 3:15 pm on the final trading 

day in expiring EOWs and EOMs (e.g., 

switch from pricing off of futures to 

cash), the Exchange believes that, in 

order to mitigate potential investor 

confusion, it is appropriate to cease 

trading in expiring EOWs and EOMs at 

3 p.m. on the last day of trading. The 

proposed change to the close of trading 

hours will apply to all outstanding 

expiring EOW and EOM Expirations 

listed on or before the effective date of 

this proposal and to all EOWs and 

EOMs listed thereafter under the EOW/ 

EOM Pilot Program. 

2. Statutory Basis 

The Exchange believes the proposed 

rule change is consistent with the Act 8

and the rules and regulations 

thereunder and, in particular, the 

requirements of Section 6(b) of the Act.9

Specifically, the Exchange believes the 

proposed rule change is consistent with 

the Section 6(b)(5) 10 requirements that 

the rules of an exchange be designed to 

promote just and equitable principles of 

trade, to prevent fraudulent and 

manipulative acts, to remove 

impediments to and to perfect the 

mechanism for a free and open market 

and a national market system, and, in 

general, to protect investors and the 

public interest. Preventing continued 

trading on a product after the exercise 

settlement value has been fixed 

eliminates potential confusion and 

thereby protects investors and the 

public interest. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

CBOE does not believe that the 

proposed rule change will impose any 

burden on competition not necessary or 

appropriate in furtherance of the 

purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

does not (i) significantly affect the 

protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate if 

consistent with the protection of 

investors and the public interest, 

provided that the self-regulatory 

organization has given the Commission 

written notice of its intent to file the 

proposed rule change at least five 

business days prior to the date of filing 

of the proposed rule change or such 

shorter time as designated by the 

Commission,11 the proposed rule 

change has become effective pursuant to 

Section 19(b)(3)(A) of the Act 12 and 

Rule 19b–4(f)(6) thereunder.13

At any time within 60 days of the 

filing of such proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

No. SR–CBOE–2011–038 on the subject 

line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 76, No. 71 / Wednesday, April 13, 2011 / Notices 20773 

14 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 54389 

(August 31, 2006), 71 FR 52829 (September 7, 

2006); Securities Exchange Act Release No. 57620 

(April 4, 2008) 73 FR 19271 (April 9, 2008). 

20549–1090. All submissions should 

refer to File No. SR–CBOE–2011–038. 

This file number should be included on 

the subject line if e-mail is used. To help 

the Commission process and review 

your comments more efficiently, please 

use only one method. The Commission 

will post all comments on the 

Commission’s Internet Web site (http:// 

www.sec.gov/rules/sro.shtml). Copies of 

the submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street, NE., 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of such filing 

also will be available for inspection and 

copying at the principal office of the 

CBOE. All comments received will be 

posted without change; the Commission 

does not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. All 

submissions should refer to File No. 

SR–CBOE–2011–038 and should be 

submitted on or before May 4, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–8804 Filed 4–12–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64249; File No. SR–Phlx– 

2011–47] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by NASDAQ 

OMX PHLX LLC To Establish a 

Qualified Contingent Cross Order 

April 7, 2011. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’) 1, and Rule 19b–4 thereunder,2

notice is hereby given that on April 1, 

2011, NASDAQ OMX PHLX LLC 

(‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

PHLX Rule 1080 to establish a Qualified 

Contingent Cross Order (‘‘QCC Order’’) 

for execution in the PHLX XL II System 

(‘‘System’’ or ‘‘Exchange System’’). The 

QCC Order will facilitate the execution 

of stock/option Qualified Contingent 

Trades that satisfy the requirements of 

the trade through exemption in 

connection with Rule 611(d) of 

Regulation NMS (‘‘QCT Trade 

Exemption’’).3 The text of the proposed 

rule change is below. Proposed new 

language is italicized; proposed 

deletions are in brackets. 

* * * * * 

NASDAQ OMX PHLX Rules 

* * * * * 

Rule 1080. PHLX XL and XL II 

(a)–(n) No Change. 

(o) Qualified Contingent Cross Order. 

A Qualified Contingent Cross Order is 

comprised of an order to buy or sell at 

least 1,000 contracts that is identified as 

being part of a qualified contingent 

trade, as that term is defined in 

subsection (3) below, coupled with a 

contra-side order to buy or sell an equal 

number of contracts. 

(1) Qualified Contingent Cross Orders 

are immediately executed upon entry 

into the System by an Order Entry Firm 

provided that (i) no Customer Orders 

are at the same price on the Exchange’s 

limit order book and (ii) the price is at 

or between the NBBO. 

(a) Qualified Contingent Cross Orders 

will be automatically rejected if they 

cannot be executed. 

(b) Qualified Contingent Cross Orders 

may only be entered in the regular 

trading increments applicable to the 

options class under Rule 1034. 

(2) Qualified Contingent Cross Orders 

shall only be submitted electronically 

from off the Floor to the PHLX System. 

Order Entry Firms must maintain books 

and records demonstrating that each 

Qualified Contingent Cross Order was 

routed to the Exchange System from off 

of the Floor. Any Qualified Contingent 

Cross Order that does not have a 

corresponding record required by this 

subsection shall be deemed to have been 

entered from on the Floor in violation of 

this Rule. 

(3) A ‘‘qualified contingent trade’’ is a 

transaction consisting of two or more 

component orders, executed as agent or 

principal, where: 

(a) At least one component is an NMS 

Stock, as defined in Rule 600 of 

Regulation NMS under the Exchange 

Act; 

(b) All components are effected with 

a product or price contingency that 

either has been agreed to by all the 

respective counterparties or arranged 

for by a broker-dealer as principal or 

agent; 

(c) The execution of one component is 

contingent upon the execution of all 

other components at or near the same 

time; 

(d) The specific relationship between 

the component orders (e.g., the spread 

between the prices of the component 

orders) is determined by the time the 

contingent order is placed; 

(e) The component orders bear a 

derivative relationship to one another, 

represent different classes of shares of 

the same issuer, or involve the securities 

of participants in mergers or with 

intentions to merge that have been 

announced or cancelled; and 

(f) The transaction is fully hedged 

(without regard to any prior existing 

position) as a result of other 

components of the contingent trade. 

* * * * * 

(b) Not applicable. 

(c) Not applicable. 

* * * * * 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

forth in sections A, B, and C below, of 

the most significant aspects of such 

statements. 

mstockstill on DSKH9S0YB1PROD with NOTICES