Federal Register / Vol. 76, No. 153 / Tuesday, August 9, 2011 / Notices 48931 

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

2 17 CFR 240.19b–4. 

3CBOE Rule 8.3(e) provides that the Exchange 

may establish one or more types of tier 

appointments. In accordance with CBOE Rule 

8.3(e), a tier appointment is an appointment to trade 

one or more options classes that must be held by 

a Market-Maker to be eligible to act as a MarketMaker in the options class or options classes subject 

to that appointment. CBOE currently assesses a 

$1,000 monthly VIX Tier Appointment fee. The VIX 

Tier Appointment fee is assessed to any MarketMaker Trading Permit Holder that either (a) has a 

VIX Tier Appointment at any time during a 

calendar month; or (b) conducts any transactions in 

VIX at any time during a calendar month. 

issues, underwriting policies, credit 

policies, asset valuation and strategic 

direction, as well as serving on 

committees. Applicant believes that the 

availability of options under the Plan 

will provide significant at-risk 

incentives to Non-employee Directors to 

remain on the Board and devote their 

best efforts to ensure applicant’s 

success. Applicant states that the 

options will provide a means for the 

Non-employee Directors to increase 

their ownership interests in applicant, 

thereby ensuring close identification of 

their interests with those of applicant 

and its stockholders. Applicant asserts 

that by providing incentives such as 

options, applicant will be better able to 

maintain continuity in the Board’s 

membership and to attract and retain 

the highly experienced, successful and 

dedicated business and professional 

people who are critical to applicant’s 

success as a BDC. 

4. As noted above, applicant states 

that the amount of voting securities that 

would result from the exercise of all 

outstanding options issued to 

applicant’s directors, officers, and 

employees under the Other Plans and 

the Plan would be 50,200,843 shares of 

applicant’s common stock, or 14.3% of 

applicant’s outstanding voting 

securities, as of July 14, 2011. However, 

applicant represents that the maximum 

number of voting securities that would 

result from the exercise of all 

outstanding options issued and all 

options issuable to applicant’s directors, 

officers, and employees under the Plan 

and the Other Plans would be 

68,698,074 shares of applicant’s 

common stock, or 19.6% of applicant’s 

outstanding voting securities, as of July 

14, 2011. Applicant states that to the 

extent the number of shares of common 

stock that would be issued upon the 

exercise of options issued under the 

Other Plans and the Plan exceeds 15% 

of applicant’s outstanding voting 

securities, applicant will comply with 

the 20% limit in section 61(a)(3) of the 

Act. 

5. Applicant asserts that, given the 

relatively small amount of common 

stock issuable to Non-employee 

Directors upon their exercise of options 

under the Plan, the exercise of such 

options would not, absent extraordinary 

circumstances, have a substantial 

dilutive effect on the NAV of applicant’s 

common stock. 

For the Commission, by the Division of 

Investment Management, pursuant to 

delegated authority. 

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20103 Filed 8–8–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65019; File No. SR–CBOE– 

2011–073] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend its Fees 

Schedule and Circular Regarding 

Trading Permit Holder Application and 

Other Related Fees 

August 3, 2011. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that on August 1, 

2011, the Chicago Board Options 

Exchange, Incorporated (‘‘CBOE’’ or the 

‘‘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 

prepared by CBOE. 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 

Chicago Board Options Exchange, 

Incorporated (‘‘CBOE’’ or ‘‘Exchange’’) 

proposes to amend its Fees Schedule 

and circular regarding Trading Permit 

Holder application and other related 

fees (‘‘Trading Permit Fee Circular’’) to 

amend the fee assessed to Floor Broker 

Trading Permit Holders that conduct a 

certain level of activity in CBOE 

Volatility Index (‘‘VIX’’) options. The 

text of the proposed rule change 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. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

CBOE 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. CBOE 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 

CBOE Rule 2.20 grants the Exchange 

the authority to, from time to time, fix 

the fees and charges payable by Trading 

Permit Holders. CBOE is proposing to 

amend its Fees Schedule and Trading 

Permit Fee Circular effective August 1, 

2011 to amend the fee assessed to Floor 

Broker Trading Permit Holders that 

conduct a certain level of activity in VIX 

(‘‘VIX Floor Broker Fee’’) to assess one 

$1,000 fee monthly to each Trading 

Permit Holder and TPH organization 

that maintains one or more Floor Broker 

Trading Permits that collectively meet 

the criteria for the assessment of the VIX 

Floor Broker Fee rather than assessing 

the Fee to each Floor Broker Trading 

Permit Holder. CBOE is also proposing 

to eliminate one of the requirements 

used to calculate the minimum level of 

activity in VIX that subjects a Floor 

Broker Trading Permit Holder to this 

fee. 

CBOE assesses a tier appointment fee 

to CBOE Market-Maker Trading Permit 

Holders for certain proprietary classes 

in recognition of the cost to develop 

those products and of the profit 

potential in those classes.3 Additionally, 

TPH organizations frequently staff more 

than one Market-Maker in the VIX 

trading crowd, as in doing so, each 

Market-Maker present in the trading 

crowd may participate on a trade. 

In January 2011, CBOE amended its 

Fees Schedule to establish a fee (the VIX 

Floor Broker Fee) to be assessed to any 

Floor Broker Trading Permit Holder (a) 

that executes more than 20,000 VIX 

contracts during the month and (b) 

whose aggregate VIX executed contracts 

during the month comprise more than 


sroberts on DSK5SPTVN1PROD with NOTICES
48932 Federal Register / Vol. 76, No. 153 / Tuesday, August 9, 2011 / Notices 

4See Securities Exchange Act Release No. 63706 

(January 12, 2011), 76 FR 3184 (January 19, 2011) 

(SR–CBOE–2011–004). 5See CBOE Rule 6.55. 

6 15 U.S.C. 78f(b). 

7 15 U.S.C. 78f(b)(4). 

30% of the Floor Broker Trading Permit 

Holder’s exchange-wide total executed 

contracts.4 This fee was implemented to 

reflect the opportunity provided to 

agents servicing customers in such a 

high-volume, fast-growing product. In 

addition, CBOE implemented this fee 

for Floor Broker Trading Permit Holders 

in an effort to equalize this opportunity 

between Market-Makers and Floor 

Brokers in VIX options. Specifically, the 

VIX Floor Broker Fee is assessed to 

CBOE Floor Broker Trading Permit 

Holders in recognition of the type of 

business that is conducted in VIX 

options classes through solicitation of 

interest for contra parties on orders. 

CBOE is proposing to simplify the 

manner in which this fee is assessed by 

(i) allocating one fee to each Trading 

Permit Holder or TPH organization that 

maintains more than one Floor Broker 

Trading Permit and that collectively 

through those Floor Broker Trading 

Permits meets the criteria to be assessed 

the VIX Floor Broker Fee rather than to 

assess the VIX Floor Broker Fee in that 

instance for each of the individual Floor 

Broker Trading Permits; and (ii) 

removing the criterion for the 

assessment of the fee that looks to 

aggregate VIX executed contracts during 

the month in relation to a Floor Broker 

Trading Permit Holder’s exchange-wide 

total executed contracts. Instead, the 

only applicable requirement for 

assessment of the fee would be the 

current first criterion (i.e. whether more 

than 20,000 VIX contracts have been 

executed during the month). For 

example, under the proposal, if Trading 

Permit Holder A has one Floor Broker 

Trading Permit that is utilized to 

execute VIX options transactions 

(acronym ABC), Trading Permit Holder 

A will be assessed a single $1,000 

monthly fee if ABC’s executions exceed 

20,000 contracts per month. If Trading 

Permit Holder B has two Floor Broker 

Trading Permits that are utilized to 

execute VIX options transactions 

(acronyms DEF and XYZ), the VIX 

executions of DEF and XYZ shall be 

aggregated for purposes of determining 

this additional monthly fee and Trading 

Permit Holder B shall be charged a 

single $1,000 fee for the combined VIX 

executions through DEF and XYZ if the 

executions exceed 20,000 contracts per 

month. Thus, if DEF executes 15,000 

VIX contracts and XYZ executes 10,000 

contracts in August 2011, Trading 

Permit Holder B will be assessed a 

single $1,000 VIX Floor Broker Fee for 

the month of August 2011. 

CBOE believes the proposal to 

allocate one fee to each Trading Permit 

Holder or TPH organization, as 

applicable, is reasonable and 

appropriate in that each Market-Maker 

present in the VIX trading crowd has the 

ability to participate on a trade, 

regardless of whether those MarketMakers are associated with the same 

TPH organization. However, for Floor 

Broker Trading Permit Holders, each 

Trading Permit Holder or TPH 

organization, as a single agent, is limited 

in their ability to participate on behalf 

of any account in which the Trading 

Permit Holder has an interest or on 

behalf of a non-Market-Maker customer 

to a single Floor Broker Trading Permit 

Holder.5 The presence of multiple Floor 

Broker Trading Permit Holders that are 

associated with the same TPH 

organization does not provide 

additional participation rights. Only one 

Floor Broker Trading Permit Holder 

associated with a TPH organization 

representing such a proprietary or nonMarket-Maker customer account may 

participate on each transaction. 

Therefore, CBOE believes the 

assessment of one VIX Floor Broker fee 

to each Trading Permit Holder or TPH 

organization is appropriate and 

reasonable to ensure it is in congruence 

with that level of opportunity available 

to Floor Broker Trading Permit Holders 

in comparison to Market-Makers. 

In addition, the proposal will level 

the playing field between Trading 

Permit Holders and TPH organizations 

that maintain multiple Floor Broker 

Trading Permits in VIX rather than one 

Floor Broker Trading Permit in VIX. 

Under the existing structure, Trading 

Permit Holders may have only one Floor 

Broker Trading Permit assigned to 

execute orders in VIX but may have 

others providing VIX orders to that 

particular Floor Broker for execution. 

This enables these Trading Permit 

Holders and TPH organizations to avoid 

being assessed more than one VIX Floor 

Broker Fee. Thus, this proposal will 

eliminate the disparity between the VIX 

Floor Broker Fees that are assessed to 

those Trading Permit Holders or TPH 

organizations that elect to maintain 

multiple Floor Broker Trading Permits 

to execute VIX orders and those that 

choose to only maintain one Floor 

Broker Trading Permit to execute VIX 

orders. 

In addition, by removing the 30% 

aggregate calculation, affiliated Trading 

Permit Holders and TPH organizations 

will be able to better monitor whether 

the fee will be assessed throughout the 

month. Based on the numbers generated 

for May 2011, the removal of this 

criterion would not subject additional 

Trading Permit Holders to the fee. 

In addition to the proposed changes to 

the Fees Schedule described above, 

CBOE is proposing to revise its 

regulatory circular that sets forth the 

existing Trading Permit Holder 

application and other related fees. The 

Exchange proposes to revise this 

circular to incorporate the changes to 

Section 10 of the CBOE Fees Schedule 

that are described above. The proposed 

changes to the circular are included as 

Exhibit 2 to the Form 19b–4. 

2. Statutory Basis 

The proposed rule change will treat 

all Trading Permit Holders in the same 

manner and is equitable and not 

discriminatory in that there is an 

objective test for the application of this 

fee. CBOE believes this proposal is 

reasonable in that, based on the data for 

May 2011, the removal of the criterion 

that aggregates VIX executed contracts 

during the month to determine if the 

aggregated amount comprises more than 

30% of the Floor Broker Trading Permit 

Holder’s exchange-wide total executed 

contracts does not appear to increase, in 

and of itself, the number of Trading 

Permit Holders that are subject to this 

fee. In addition, CBOE believes the 

assessment of one VIX Floor Broker fee 

to each Trading Permit Holder or TPH 

organizations is reasonable to ensure it 

is in congruence with that level of 

opportunity available to Floor Broker 

Trading Permit Holders as compared to 

the level of opportunity available to 

Market-Makers. Further, the assessment 

of one fee to each Trading Permit Holder 

or TPH organization ‘‘levels the playing 

field’’ for Trading Permit Holders and 

TPH organizations that maintain more 

than one Floor Broker Trading Permit to 

execute orders in VIX options. 

Accordingly, the Exchange believes that 

the proposed rule change is consistent 

with Section 6(b) of the Act,6 in general, 

and furthers the objectives of Section 

6(b)(4) of the Act 7 in particular, in that 

it is designed to provide for the 

equitable allocation of reasonable dues, 

fees, and other charges among persons 

using its facilities. 

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 that is not 

necessary or appropriate in furtherance 

of purposes of the Act. 


sroberts on DSK5SPTVN1PROD with NOTICES
Federal Register / Vol. 76, No. 153 / Tuesday, August 9, 2011 / Notices 48933 

8 15 U.S.C. 78s(b)(3)(A). 

9 17 CFR 240.19b–4(f)(2). 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Options classes subject to maker/taker fees are 

identified by their ticker symbol on the Exchange’s 

Schedule of Fees. See Securities Exchange Act 

Release Nos. 61869 (April 7, 2010), 75 FR 19449 

(April 14, 2010) (SR–ISE–2010–25), 62048 (May 6, 

2010), 75 FR 26830 (May 12, 2010) (SR–ISE–2010– 

43), 62282 (June 11, 2010), 75 FR 34499 (June 17, 

2010) (SR–ISE–2010–54), 62319 (June 17, 2010), 75 

FR 36134 (June 24, 2010) (SR–ISE–2010–57), 62508 

(July 15, 2010), 75 FR 42809 (July 22, 2010) (SR– 

ISE–2010–65), 62507 (July 15, 2010), 75 FR 42802 

(July 22, 2010) (SR–ISE–2010–68), 62665 (August 9, 

2010), 75 FR 50015 (August 16, 2010) (SR–ISE– 

2010–82), 62805 (August 31, 2010), 75 FR 54682 

(September 8, 2010) (SR–ISE–2010–90), 63283 

(November 9, 2010), 75 FR 70059 (November 16, 

2010) (SR–ISE–2010–106), 63534 (December 13, 

2010), 75 FR 79433 (December 20, 2010) (SR–ISE– 

2010–114); 63664 (January 6, 2011), 76 FR 2170 

(January 12, 2011) (SR–ISE–2010–120); and 64303 

(April 15, 2011), 76 FR 22425 (April 21, 2011) (SR– 

ISE–2011–18). 

4Market Makers who remove liquidity in the 

Select Symbols from the Complex Order Book by 

trading with orders preferenced to them are charged 

$0.28 per contract. 

5A Market Maker Plus is a market maker who is 

on the National Best Bid or National Best Offer 80% 

of the time for series trading between $0.03 and 

$5.00 (for options whose underlying stock’s 

previous trading day’s last sale price was less than 

or equal to $100) and between $0.10 and $5.00 (for 

options whose underlying stock’s previous trading 

day’s last sale price was greater than $100) in 

Continued 

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 

The foregoing rule change has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act 8 and subparagraph (f)(2) of 

Rule 19b–4 9 thereunder. 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–CBOE–2011–073 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–CBOE–2011–073. 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 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–2011–073 and should be 

submitted on or before August 30, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20066 Filed 8–8–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65021; File No. SR–ISE– 

2011–45] 

Self-Regulatory Organizations; 

International Securities Exchange, 

LLC; Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change Relating to Fees for Complex 

Orders 

August 3, 2011. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that on August 1, 

2011, the International Securities 

Exchange, LLC (the ‘‘Exchange’’ or 

‘‘ISE’’) filed with the Securities and 

Exchange Commission the proposed 

rule change as described in Items I and 

II below, which Items have been 

prepared by the self-regulatory 

organization. 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 ISE is proposing to amend fees 

for certain complex orders executed on 

the Exchange. The text of the proposed 

rule change is available on the 

Exchange’s Web site (http:// 

www.ise.com), at the principal office of 

the Exchange, and at the Commission’s 

Public Reference Room. 

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 

self-regulatory organization 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 self-regulatory organization 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 currently assesses per 

contract transaction charges and credits 

to market participants that add or 

remove liquidity from the Exchange 

(‘‘maker/taker fees’’) in a number of 

options classes (the ‘‘Select Symbols’’).3

For complex orders in the Select 

Symbols, the Exchange currently 

charges a ‘‘take’’ fee of: (i) $0.30 per 

contract for Market Maker,4 Market 

Maker Plus,5 Firm Proprietary and 


sroberts on DSK5SPTVN1PROD with NOTICES