6748 Federal Register / Vol. 75, No. 27 / Wednesday, February 10, 2010 / Notices 

9 17 C.F.R. 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3NASDAQ has provided co-location services at 

various data centers since approximately 2004. 

Currently, the Exchange provides its current colocation services through data centers located in the 

New York City and Mid-Atlantic areas. 

4NASDAQ is implementing a Cabinet Proximity 

Option program where, for a monthly fee, 

customers can obtain an option for future use on 

available currently unused cabinet floor space in 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 35 days of the date of 

publication of this notice in the Federal 

Register or within such longer period (i) 

as the Commission may designate up to 

90 days of such date if it finds such 

longer period to be appropriate and 

publishes its reasons for so finding or 

(ii) as to which the self-regulatory 

organization consents, the Commission 

will: 

A. By order approve such proposed 

rule change, or 

B. institute proceedings to determine 

whether the proposed rule change 

should be disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change, as amended, is consistent with 

the Act. Comments may be submitted by 

any of the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

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

rules/sro.shtml); or 

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

Number SR–BX–2010–012 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

Station Place, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–BX–2010–012. 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 

available publicly. All submissions 

should refer to File Number SR–BX– 

2010–012 and should be submitted on 

or before March 3, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.9

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–2864 Filed 2–9–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61488; File No. SR– 

NASDAQ–2010–019] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing of Proposed Rule Change To 

Codify Prices for Co-Location Services 

February 3, 2010. 

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 January 

29, 2010, The NASDAQ Stock Market 

LLC (‘‘NASDAQ’’ or ‘‘Exchange’’) filed 

with the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change as described in 

Items I, II, and III below, which Items 

have been substantially prepared by 

NASDAQ. 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 

NASDAQ is filing with the Securities 

and Exchange Commission 

(‘‘Commission’’) a proposed rule change 

to codify pricing for co-location 

services. The text of the proposed rule 

change is available at http:// 

nasdaqomx.cchwallstreet.com/, on the 

Commission’s Web site at http:// 

www.sec.gov, at the Exchange’s 

principal office, and at the 

Commission’s Public Reference Room. 

NASDAQ will implement the proposed 

rule change on the first day of the 

month immediately following 

Commission approval (or on the date of 

approval, if on the first business day of 

a month). 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

NASDAQ 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. 

NASDAQ 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 

NASDAQ is proposing to codify fees 

for its existing co-location services. Colocation services are a suite of hardware, 

power, telecommunication, and other 

ancillary products and services that 

allow market participants and vendors 

to place their trading and 

communications equipment in close 

physical proximity to the quoting and 

execution facilities of the Exchange and 

other NASDAQ OMX Group, Inc. 

markets. The Exchange provides colocation services and imposes fees 

through its wholly-owned subsidiary 

Nasdaq Technology Services LLC and 

pursuant to agreements with the owner/ 

operator of its data center where both 

the Exchange’s quoting and trading 

facilities and co-located customer 

equipment are housed.3 Users of colocation services include private 

extranet providers, data vendors, as well 

as NASDAQ Exchange members and 

non-members. The use of co-location 

services is entirely voluntary. 

As detailed in the proposed colocation fee schedule, NASDAQ 

imposes a uniform, non-discriminatory 

set of fees for various co-location 

services, including: Fees for cabinet 

space usage, or options for future space 

usage;4 installation and related power 


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Federal Register / Vol. 75, No. 27 / Wednesday, February 10, 2010 / Notices 6749 

proximity to their existing equipment. Under the 

program, customers can reserve up to maximum of 

20 cabinets which the Exchange will endeavor to 

provide as close as reasonably possible to the 

customer’s existing cabinet space, taking into 

consideration power availability within segments of 

the datacenter and the overall efficiency of use of 

datacenter resources as determined by the 

Exchange. Should reserved datacenter space be 

needed for use, the reserving customer will have 

three business days to formally contract with the 

Exchange for full payment for the reserved cabinet 

space in contention or it will be reassigned. In 

making determinations to require exercise or 

relinquishment of reserved space as among 

numerous customers, the Exchange will take into 

consideration several factors, including: Proximity 

between available reserved cabinet space and the 

existing space of a customer seeking additional 

space for actual cabinet usage; a customer’s ratio of 

cabinets in use to those reserved; the length of time 

that a particular reservation(s) has been in place; 

and any other factor that the Exchange deems 

relevant to ensure overall efficiency in use of the 

datacenter space. 

5These fees are for telecommunications 

connectivity only. Market Data fees are charged 

independently by NASDAQ and other exchanges. 

6Currently, the Exchange makes available to colocated customers a 10Gb fiber connection. The 

Exchange will likewise make available a 10Gb fiber 

connection to other customers in the first quarter 

of 2010. The Exchange has not received any 

requests for 10Gb fiber connections from firms that 

are not co-located. 

7 15 U.S.C. 78f. 

8 15 U.S.C. 78f(b)(5). 

provision for hosted equipment; 

connectivity among multiple cabinets 

being used by the same customer as well 

as customer connectivity to the 

Exchange and telecommunications 

providers;5 and related maintenance 

and consulting services. Fees related to 

cabinet and power usage are 

incremental, with additional charges 

being imposed based on higher levels of 

cabinet and/or power usage, the use of 

non-standard cabinet sizes or special 

cabinet cooling equipment, or the reselling of cabinet space. 

Co-location customers are not 

provided any separate or superior 

means of direct access to NASDAQ 

quoting and trading facilities. Nor does 

the Exchange offer any separate or 

superior means of access to the 

Exchange quoting and trading facilities 

as among co-location customers 

themselves within in [sic] the 

datacenter. Likewise, NASDAQ does not 

make available to co-located customers 

any market data or data feed product or 

service for data going into, or out of, the 

Exchange systems that is not likewise 

available to all the Exchange members.6

Finally, all orders sent to the Exchange 

market enter the marketplace through 

[sic] same central system quote and 

order gateway regardless of whether the 

sender is co-located in the Exchange 

data center or not. In short, the 

Exchange has created no special market 

technology or programming that is 

available only to co-located customers 

and the Exchange has organized its 

systems to minimize, to the greatest 

extent possible, any advantage for one 

customer versus another. 

Co-location services are generally 

available to all qualified market 

participants who desire them. With the 

exception of customers participating in 

the Cabinet Proximity Option program, 

the Exchange allocates cabinets and 

power on a first-come/first-serve basis. 

Should available cabinet inventory 

shrink to 40 cabinets or less, the 

Exchange will limit new cabinet orders 

to a maximum of 4 cabinets each, and 

all new cabinets will be limited to a 

maximum power level of 5kW. Should 

available cabinet inventory shrink to 

zero, the Exchange will place firms 

seeking services on a waiting list based 

on that date the Exchange receives 

signed orders for the services from the 

firm. In order to be placed on the 

waiting list, a firm must have utilized 

all existing cabinets they already have 

in the datacenter. Once on the list, the 

firms, on a rolling basis, will allocated 

a single 5kW cabinet each time one 

becomes available. After receiving a 

cabinet, the firm will move to the 

bottom of the waiting list. 

2. Statutory Basis 

NASDAQ believes that the proposed 

rule change is consistent with the 

provisions of Section 6 of the Act,7 in 

general, and with Sections 6(b)(5) of the 

Act,8 in particular, in that the proposal 

is designed to prevent fraudulent and 

manipulative acts and practices, to 

promote just and equitable principles of 

trade, to foster cooperation and 

coordination with persons engaged in 

regulating, clearing, settling, processing 

information with respect to, and 

facilitating transactions in securities, to 

remove impediments to and perfect the 

mechanism of a free and open market 

and a national market system, and, in 

general, to protect investors and the 

public interest. In particular, the filing 

codifies and makes transparent the 

uniform fees imposed by the Exchange’s 

technology subsidiary for co-location 

services. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

NASDAQ does not believe that the 

proposed rule change will result in any 

burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act, as amended. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 35 days of the date of 

publication of this notice in the Federal 

Register or within such longer period (i) 

as the Commission may designate up to 

90 days of such date if it finds such 

longer period to be appropriate and 

publishes its reasons for so finding or 

(ii) as to which the self-regulatory 

organization consents, the Commission 

will: 

A. By order approve such proposed 

rule change, or 

B. institute proceedings to determine 

whether the proposed rule change 

should be disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change, as amended, is consistent with 

the Act. Comments may be submitted by 

any of the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

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

rules/sro.shtml); or 

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

Number SR–NASDAQ–2010–019 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

Station Place, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–NASDAQ–2010–019. 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 


sroberts on DSKD5P82C1PROD with NOTICES
6750 Federal Register / Vol. 75, No. 27 / Wednesday, February 10, 2010 / Notices 

9 17 C.F.R. 200.30–3(a)(12). 

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

2 15 U.S.C. 78s(b)(3)(A)(iii). 

3 17 CFR 240.19b–4(f)(4). 

4 15 U.S.C. 78q–1. 

5 15 U.S.C. 78s(b)(3)(A)(i). 

6 17 C.F.R. 240.19b(f)(1). 

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 

available publicly. All submissions 

should refer to File Number SR– 

NASDAQ–2010–019 and should be 

submitted on or before March 3, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.9

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–2861 Filed 2–9–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61485; File No. SR–OCC– 

2010–01] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change Relating to 

Options for Which the Premium and 

Exercise Price Are Expressed as a 

Multiple of the Per-Share Amount 

February 3, 2010. 

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

Securities Exchange Act of 1934,1 notice 

is hereby given that on January 14, 2010, 

The Options Clearing Corporation 

(‘‘OCC’’) filed with the Securities and 

Exchange Commission the proposed 

rule change as described in Items I, II, 

and III below, which Items have been 

prepared primarily by OCC. OCC filed 

the proposed rule change pursuant to 

Section 19(b)(3)(A)(iii) of the Act 2 and 

Rule 19b–4(f)(4) thereunder 3 so that the 

proposal was effective upon filing with 

the Commission. 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 

The proposed rule change would 

revise OCC’s By-Laws and Rules to 

accommodate options for which the 

premium and exercise price are 

expressed on other than a per-unit basis. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

OCC 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. OCC 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 

The purpose of this rule change is to 

revise OCC By-Law, Article I.A.5 

(definition of ‘‘Aggregate Exercise 

Price’’) and OCC Rule 805(d)(2) to 

accommodate options for which the 

premium and exercise price are 

expressed as other than a per-unit basis. 

NYSE Amex LLC (‘‘NYSE Amex’’) is 

proposing to trade physically-settled 

options on exchange-traded funds 

(‘‘ETFs’’) with a unit of trading of 1,000 

shares (‘‘Grand Options’’) rather than the 

standard unit of trading of 100 shares. 

When NYSE Amex previously 

introduced ETF options with units of 

trading of 1,000 shares, NYSE Amex 

followed the usual convention of 

quoting premiums and exercise prices 

as per-share amounts. The extended 

premium and aggregate exercise price 

were then calculated in the usual way 

by multiplying the per-share amount by 

the unit of trading (i.e. 1,000). In NYSE 

Amex’s experience, this approach 

caused investor confusion because 

investors in some cases failed to realize 

that they were trading large-sized 

options until premiums equal to ten 

times the expected amount were debited 

from their accounts. To address this, 

NYSE Amex intends to modify the 

standard method of stating premiums 

and exercise prices for Grand Options 

by multiplying the per-share amount by 

10. Extended premiums and exercise 

prices for such contracts would then be 

calculated by multiplying by 100 rather 

than the actual unit of trading of 1,000. 

NYSE Amex believes that, by increasing 

the size of the stated premiums and 

exercise prices by a factor of 10, the 

larger size of these options will be more 

apparent to investors. 

To accommodate options for which 

the premium and exercise price are 

expressed as a multiple of the per-share 

amount, OCC proposes to make minor 

technical amendments to a few 

definitions in its By-Laws and to its rule 

governing expiration date exercise 

procedures. The changes being 

proposed can be viewed at http:// 

www.optionsclearing.com/components/ 

docs/legal/rules_and_bylaws/ 

sr_occ_10_01.pdf. 

OCC believes that the proposed 

changes to OCC’s By-Laws and Rules are 

consistent with the purposes and 

requirements of Section 17A of the Act 4

because the changes promote the 

prompt and accurate clearance and 

settlement of Grand Options, protect 

investors by reducing the likelihood of 

investor confusion, and permit Grand 

Options to be traded, cleared, and 

settled in the same basic manner as 

other currently available options and be 

subject to the same rules and procedures 

that have been successfully used by 

OCC to clear and settle other options. 

Furthermore, OCC states that the 

proposed rule change is not inconsistent 

with OCC’s existing rules, including 

those proposed to be amended. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

OCC does not believe that the 

proposed rule change would impose any 

burden on competition. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

OCC has not solicited or received 

written comments relating to the 

proposed rule change. OCC will notify 

the Commission of any written 

comments it receives. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(i) of the Act 5 and Rule 19b– 

4(f)(4) 6 thereunder because the 

proposed rule change effects a change in 

an existing service of a registered 

clearing agency that (i) does not 

adversely affect the safeguarding of 

securities or funds in the custody or 

control of the clearing agency or for 


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