Federal Register / Vol. 89, No. 225 / Thursday, November 21, 2024 / Notices 92241 

5 17 CFR 200.30–3(a)(85). 

publicly. We may redact in part or 

withhold entirely from publication 

submitted material that is obscene or 

subject to copyright protection. All 

submissions should refer to file number 

4–443 and should be submitted on or 

before December 12, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.5

Stephanie J. Fouse, 

Assistant Secretary. 

[FR Doc. 2024–27220 Filed 11–20–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

35388; File No. 812–15654] 

Figure Certificate Company 

(‘‘Applicant’’) 

November 15, 2024. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’ or ‘‘SEC’’). 

ACTION: Notice. 

Notice of application for an order 

under section 28(c) of the Investment 

Company Act of 1940 (the ‘‘Act’’). 

SUMMARY OF APPLICATION: Applicant 

seeks an order pursuant to section 28(c) 

of the Act approving certain proposed 

custodial arrangements. 

APPLICANTS: Figure Certificate 

Company. 

FILING DATES: The application was filed 

on November 7, 2024 and amended and 

restated on November 13, 2024. 

HEARING OR NOTIFICATION OF HEARING: 

An order granting the requested relief 

will be issued unless the Commission 

orders a hearing. Interested persons may 

request a hearing on any application by 

emailing the SEC’s Secretary at 

Secretarys-Office@sec.gov and serving 

the Applicant with a copy of the request 

by email, if an email address is listed for 

the Applicant below, or personally or by 

mail, if a physical address is listed for 

the Applicant below. Hearing requests 

should be received by the Commission 

by 5:30 p.m. on December 11, 2024 and 

should be accompanied by proof of 

service on the Applicant, in the form of 

an affidavit or, for lawyers, a certificate 

of service. Pursuant to rule 0–5 under 

the Act, hearing requests should state 

the nature of the writer’s interest, any 

facts bearing upon the desirability of a 

hearing on the matter, the reason for the 

request, and the issues contested. 

Persons who wish to be notified of a 

hearing may request notification by 

emailing the Commission’s Secretary at 

Secretarys-Office@sec.gov. 

ADDRESSES: The Commission: 

Secretarys-Office@sec.gov. Applicant: 

susan.gault-brown@aoshearman.com. 

FOR FURTHER INFORMATION CONTACT: 

Taylor Evenson, Senior Counsel, or 

Robert S. Shapiro, Assistant Director, at 

(202) 551–6825 (Division of Investment 

Management, Chief Counsel’s Office). 

SUPPLEMENTARY INFORMATION: The 

following is a summary of the 

application. For Applicant’s 

representations, legal analysis, and 

conditions, please refer to Applicant’s 

amended and restated application, 

dated November 13, 2024, which may 

be obtained via the Commission’s 

website by searching for the file number 

at the top of this document, or for the 

Applicant using the Company name 

search field, on the SEC’s EDGAR 

system. The SEC’s EDGAR system may 

be searched at, http://www.sec.gov/ 

edgar/searchedgar/legacy/ 

companysearch.html. You may also call 

the SEC’s Public Reference Room at 

(202) 551–8090. 

Applicant’s Representations 

1. Applicant, a Delaware corporation, 

intends to register under the Act as a 

face-amount certificate company and 

operate as a registered face-amount 

certificate company. Applicant 

currently intends to offer two types of 

face-amount certificates registered 

under the Securities Act of 1933, faceamount certificates of the installment 

type (the ‘‘Installment Certificates’’) and 

fully-paid certificates (the 

‘‘Transferrable Certificates’’ and, 

together with the Installment 

Certificates, the ‘‘Certificates’’). 

Applicant states that it does not 

contemplate, or seek approval for, 

custodial arrangements under which 

Applicant would deposit and maintain 

reserves associated with any faceamount certificates other than the 

Installment Certificates and 

Transferrable Certificates. Applicant 

represents that both types of Certificates 

will be issued and the fully-paid 

Certificates will be transferable using 

blockchain technology and, as a result, 

both types of Certificates will be ‘‘digital 

assets.’’ Applicant further represents 

that, although the Certificates will be 

digital assets, Applicant will not accept 

or hold any assets that are digital assets 

other than as necessary to destroy 

Certificates that have been surrendered. 

2. The Certificates are interest-bearing 

debt securities. The Certificates entitle 

the Certificate holder to receive, at 

maturity, the face-amount of the 

Certificate and interest credited thereon, 

less applicable expenses or fees. To 

meet its payment obligations, Applicant 

is required to maintain a minimum 

amount of reserves in ‘‘qualified 

investments’’ as defined in Section 28(b) 

of the Act (‘‘Reserves’’). 

3. Applicant proposes to enter into 

custodial arrangements, from time to 

time, with one or more banks as defined 

in Section 2(a)(5) of the Act, that 

possess the qualifications required by 

Section 26(a) of the Act for trustees of 

unit investment trusts (‘‘Custodians’’). 

Applicant seeks an order approving the 

Applicant’s proposed custodial 

arrangements under which the 

Applicant will (i) deposit and maintain, 

with one or more Custodians, the 

Reserves associated with the 

Certificates, pursuant to Section 28(c) of 

the Act, and (ii) enter into custody 

agreements (‘‘Custodial Agreements’’), 

the substantive portions of which will 

not vary in any material respects from 

those contained in the form of 

agreement attached to the application as 

Attachment 1 (the ‘‘Form of 

Agreement’’). Under the requested 

order, Applicant would be free to 

employ or terminate the Custodians 

from time to time in its sole discretion. 

4. Under the proposed custodial 

arrangements, one or more of the 

Custodians would be responsible for 

maintaining the safekeeping of all of 

Applicant’s assets, including the 

aggregate amount that Applicant must 

maintain as Reserves pursuant to 

Section 28(a) of the Act. The Custodian 

would (i) maintain Applicant’s Assets in 

compliance with Section 17(f) of the Act 

and the rules thereunder as though 

Section 17(f) and the rules thereunder 

were applicable to a face-amount 

certificate company and (ii) maintain 

Applicant’s Reserves to ensure the 

Applicant meets its payment obligations 

under the terms and conditions of any 

outstanding Certificate. If the Applicant 

were to default on any obligation under 

a Certificate, the Custodian would be 

authorized to cure such default by 

liquidating so much of the assets held 

by it as necessary to discharge 

Applicant’s obligations. The Custodian 

also would perform the duties and 

functions typically performed by a 

custodian, such as securities registration 

and delivery, income collection, 

periodic reporting, payment of monies, 

and other safekeeping and processing 

functions. 

Applicant’s Legal Analysis 

1. Section 28(c) provides that ‘‘[t]he 

Commission shall by rule, regulation, or 

order, in the public interest or for the 

protection of investors, require a 

registered face-amount certificate 


lotter on DSK11XQN23PROD with NOTICES1
92242 Federal Register / Vol. 89, No. 225 / Thursday, November 21, 2024 / Notices 

company to deposit and maintain, upon 

such terms and conditions as the 

Commission shall prescribe and as are 

appropriate for the protection of 

investors, with one or more institutions 

having the qualifications of paragraph 

(1) of Section 26(a) for a trustee of a unit 

investment trust, all or any part of the 

investments maintained by such 

company as certificate reserve 

requirements under the provisions of 

subsection (b) hereof.’’ 

2. Applicant states that the Form of 

Agreement contains numerous 

provisions designed to maintain and 

safeguard its assets, including 

provisions governing the (i) holding, 

segregation, registration, depositing, and 

delivery of securities and (ii) the 

payment of monies and maintenance of 

bank accounts, as well as (iii) provisions 

establishing procedures to cure any 

defaults by the Applicant on its 

obligations under the Certificates and 

procedures for periodic reporting and 

inspection of the assets. Applicant 

further states that, although tailored for 

the specific activities of a face-amount 

certificate company, these provisions 

are similar to those contained in 

custody agreements between registered 

open-end management investment 

companies and their custodians. 

3. Application asserts that its 

discretion to employ and terminate the 

Custodians is consistent with the 

protection of investors and the public 

interest. Applicant states that it may add 

or change the Custodians for many 

reasons, including, but not limited to: (i) 

the availability of superior or 

specialized services through other 

Custodians, (ii) dissatisfaction with the 

quality of a Custodian’s services, (iii) fee 

increases or the availability of 

comparable services from other 

Custodians at more competitive rates, 

(iv) changes in a Custodian’s 

management, location, financial 

condition, or methods of operation, (v) 

regulatory developments or actions 

affecting the ability or qualification of a 

Custodian to serve as such, or (vi) a 

determination by a Custodian to cease 

offering its services. 

4. Applicant also asserts that the 

process by which it will select and 

retain the Custodians is consistent with 

the protection of investors and the 

public interest. Applicant represents 

that, before entering into a Custodial 

Agreement, Applicant will request and 

consider relevant information regarding 

the Custodian, including, without 

limitation, information about its ability 

to provide the services required by 

Applicant’s operations and the Act, its 

experience in providing such or similar 

services to other investment companies, 

the resources it intends to make 

available to Applicant in providing such 

services, the fees it intends to charge 

Applicant for such services, its internal 

controls, its ability to protect the assets 

entrusted to it, and its financial 

condition. 

Applicant’s Conditions 

Applicant agrees that any order 

granted by the Commission pursuant to 

the application will be subject to the 

following conditions: 

1. Before entering into a Custodial 

Agreement with a qualified custodian, 

Applicant will request and consider 

relevant information regarding the 

Custodian. Applicant’s officers and/or 

investment advisers, as appropriate, will 

perform the above inquiry and will 

present their findings to the Board (as 

defined below). 

2. Applicant shall only enter into a 

Custodial Agreement if (1) its 

substantive portions do not vary in any 

material respects from those contained 

in the Form of Agreement; and (2) that 

Custodial Agreement is approved by its 

board of directors (‘‘Board’’), including 

a majority of directors who are not an 

‘‘interested persons’’ as defined in 

Section 2(a)(19) of the Act 

(‘‘Disinterested Directors’’). 

3. The continuance of a Custodial 

Agreement shall be subject to annual 

review and reapproval by the Board, 

including a majority of the Disinterested 

Directors, to determine whether the 

quality of services provided by the 

Custodian remains satisfactory and the 

fees are reasonably competitive. 

4. Each Custodial Agreement shall 

contain provisions to maintain and 

safeguard Applicant’s Assets, including 

provisions governing the (i) holding, 

segregation, depositing, and delivery of 

securities, (ii) the payment of monies, 

and (iii) establishing of procedures to 

cure any defaults by Applicant on its 

obligations under the Certificates and 

procedures for periodic reporting and 

inspection of the Assets. 

5. Applicant shall establish and 

maintain procedures to cure any 

defaults by Applicant on its obligations 

under the Certificates and procedures 

for periodic reporting and inspection of 

Applicant’s Assets. 

6. Applicant shall comply with 

Section 17(f) of the Act and the rules 

thereunder as if it were a registered 

management investment company. 

7. Applicant shall obtain an amended 

order from the SEC prior to entry into 

a Custodial Agreement containing 

substantive provisions that vary in any 

material respects from those contained 

in the Form of Agreement. 

8. Applicant shall comply with the 

Bank Secrecy Act (31 U.S.C §§ 5311 et 

seq) and the rules thereunder, including 

31 CFR 1024.210, 31 CFR 1024.220 and 

31 CFR 1010.230, as if it were a 

registered open-end management 

investment company. 

9. Any advisory agreement entered 

into between Applicant and an adviser 

shall provide that the adviser will 

provide quarterly reports to the Board 

stating, as of the last day of the 

preceding quarter: 

(a) the aggregate value of assets on 

deposit with the Custodian, 

(b) the aggregate value of assets 

identified by Applicant as qualifying 

investments on deposit with the 

Custodian, and 

(c) the aggregate amount of reserves, 

as governed by Section 28(a)(2) of the 

Act, required to be maintained by 

Applicant in respect of all outstanding 

Certificates. 

The first quarterly report every year 

shall be made and certified by an 

independent public accountant and the 

others shall be verified by the adviser’s 

chief compliance officer or his or her 

delegate. 

10. Any advisory agreement entered 

into between the Applicant and an 

adviser shall provide that the adviser’s 

compliance program shall include 

procedures for generating monthly 

reports of: 

(a) the aggregate value of Applicant’s 

assets on deposit with the Custodian; 

(b) the aggregate value of assets 

identified by Applicant as qualifying 

investments on deposit with the 

Custodian; and 

(c) the aggregate amount of reserves, 

as governed by Section 28(a)(2) of the 

Act, required to be maintained by 

Applicant in respect of all outstanding 

Certificates; and for the review of such 

monthly reports by the adviser’s chief 

compliance officer or his or her 

delegate. 

11. Any advisory agreement entered 

into between Applicant and an adviser 

shall provide that if, at any time, it is 

determined by the adviser’s chief 

compliance officer or his or her delegate 

that the amount of Applicant’s qualified 

investments on deposit with the 

Custodian is less than the required 

reserves, as governed by Section 28(a)(2) 

of the Act, the adviser and/or Applicant 

shall notify the SEC in writing of such 

deficiency promptly upon ascertaining 

such fact. 

12. In the event Applicant were to 

default on any obligation under a 

Certificate, Custodian would be 

authorized, at the instruction of the 

Board or a court of competent 

jurisdiction, to cure the default as 


lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 89, No. 225 / Thursday, November 21, 2024 / Notices 92243 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4The proposed rule change establishing the 

NYSE Arca Agg Lite data feed was immediately 

effective on February 27, 2024. See Securities 

Exchange Act Release No. 99713 (March 12, 2024), 

89 FR 19381 (March 18, 2024) (SR–NYSEARCA– 

2024–22) (Notice of Filing and Immediate 

Effectiveness of Proposed Rule Change To Establish 

the NYSE Arca Aggregated Lite Market Data Feed). 

5The Exchange originally filed to amend the Fee 

Schedule on May 13, 2024 (SR–NYSEARCA–2024– 

39). On July 11, 2024, the Exchange withdrew SR– 

NYSEARCA–2024–39 and replaced it with SR– 

NYSEARCA–2024–60. On September 6, the 

Exchange withdrew SR–NYSEARCA–2024–60 and 

replaced it with SR–NYSEARCA–2024–75. On 

November 4, 2024, the Exchange withdrew SR– 

NYSEARCA–2024–75 and replaced it with this 

filing. 

6See Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005) 

(File No. S7–10–04) (Final Rule) (‘‘Regulation 

NMS’’). 

7See Securities Exchange Act Release No. 61358, 

75 FR 3594, 3597 (January 21, 2010) (File No. S7– 

02–10) (Concept Release on Equity Market 

Structure). 

8See Cboe U.S Equities Market Volume 

Summary, available at https://markets.cboe.com/us/ 

equities/market_share. See generally https://

www.sec.gov/fastanswers/divisionsmarket

regmrexchangesshtml.html. 

9See FINRA ATS Transparency Data, available at 

https://otctransparency.finra.org/otctransparency/ 

AtsIssueData. A list of alternative trading systems 

registered with the Commission is available at 

https://www.sec.gov/foia/docs/atslist.htm. 

10See Cboe Global Markets, U.S. Equities Market 

Volume Summary, available at http://

markets.cboe.com/us/equities/market_share/. 

necessary to discharge Applicant’s 

obligations. In connection with any 

such default, the Applicant shall notify 

the SEC in writing of such default 

promptly upon ascertaining that a 

default has occurred. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

J. Matthew DeLesDernier, 

Deputy Secretary. 

[FR Doc. 2024–27229 Filed 11–20–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–101636; File No. SR– 

NYSEARCA–2024–94] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Establish Fees for the 

NYSE Arca Aggregated Lite Data Feed 

November 15, 2024. 

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

Securities Exchange Act of 1934 

(‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on 

November 4, 2024, NYSE Arca, Inc. 

(‘‘NYSE Arca’’ or the ‘‘Exchange’’) filed 

with the Securities and Exchange 

Commission (the ‘‘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 Exchange proposes to establish 

fees for the NYSE Arca Aggregated Lite 

data feed. The proposed rule change is 

available on the Exchange’s website at 

www.nyse.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 those 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 parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend the 

NYSE Arca Equities Proprietary Market 

Data Fees Schedule (‘‘Fee Schedule’’) 

and establish fees for the NYSE Arca 

Aggregated Lite (‘‘NYSE Arca Agg Lite’’) 

data feed,4 effective November 4, 2024.5

In summary, the NYSE Arca Agg Lite 

is a NYSE Arca-only frequency-based 

depth of book market data feed of the 

NYSE Arca’s limit order book for up to 

ten (10) price levels on both the bid and 

offer sides of the order book for 

securities traded on the Exchange and 

for which the Exchange reports quotes 

and trades under the Consolidated Tape 

Association (‘‘CTA’’) Plan or the 

Nasdaq/UTP Plan. The NYSE Arca Agg 

Lite is a compilation of limit order data 

that the Exchange provides to vendors 

and subscribers. The NYSE Arca Agg 

Lite includes partial depth of book order 

data as well as security status messages. 

The security status message informs 

subscribers of changes in the status of a 

specific security, such as trading halts, 

short sale restriction, etc. In addition, 

the NYSE Arca Agg Lite includes order 

imbalance information prior to the 

opening and closing of trading. 

Background 

The Exchange operates in a highly 

competitive market. The Commission 

has repeatedly expressed its preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. In Regulation NMS, the 

Commission highlighted the importance 

of market forces in determining prices 

and SRO revenues and, also, recognized 

that current regulation of the market 

system ‘‘has been remarkably successful 

in promoting market competition in its 

broader forms that are most important to 

investors and listed companies.’’ 6

While Regulation NMS has enhanced 

competition, it has also fostered a 

‘‘fragmented’’ market structure where 

trading in a single stock can occur 

across multiple trading centers. When 

multiple trading centers compete for 

order flow in the same stock, the 

Commission has recognized that ‘‘such 

competition can lead to the 

fragmentation of order flow in that 

stock.’’ 7 Indeed, cash equity trading is 

currently dispersed across 16 

exchanges,8 numerous alternative 

trading systems,9 and broker-dealer 

internalizers and wholesalers, all 

competing for order flow. Based on 

publicly-available information, no 

single exchange currently has more than 

20% market share (whether including or 

excluding auction volume).10

Proposed NYSE Arca Agg Lite Data Feed 

Fees 

The Exchange proposes to establish 

the fees listed below for the NYSE Arca 

Agg Lite data feed. The Exchange 

proposes to charge fees for the same 

categories of market data use as its 

affiliated exchanges (namely, NYSE, 

NYSE American and NYSE National) 

currently charge. The Exchange believes 

that adopting the same fee structure as 

its affiliated exchanges would reduce 

administrative burdens on market data 

subscribers that also currently subscribe 

to market data feeds from the 

Exchange’s affiliates. 

1. Access Fee. For the receipt of 

access to the NYSE Arca Agg Lite data 

feed, the Exchange proposes to charge 

$1,500 per month. This proposed 

Access Fee would be charged to any 

data recipient that receives the NYSE 

Arca Agg Lite data feed. Data recipients 

that only use display devices to view 

NYSE Arca Agg Lite market data and do 


lotter on DSK11XQN23PROD with NOTICES1