15792 Federal Register / Vol. 74, No. 65 / Tuesday, April 7, 2009 / Notices 

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

6 17 CFR 240.19b–4(f)(4). 

7 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4 15 U.S.C. 78s(b)(3)(A). 

5 17 CFR 240.19b–4(f)(6). 

$150,000 minimum Clearing Fund 

contribution. OCC would expand this 

exemption to also apply to commodity 

options. 

The proposed rule change is 

consistent with the purposes and 

requirements of Section 17A of the Act 

because it provides for the clearance of 

various commodity futures and options 

products without adversely affecting the 

prompt and accurate clearance and 

settlement of transactions in securities 

options, the prompt and accurate 

clearance and settlement of securities 

transactions, or the protection of 

securities investors and the public 

interest. The proposed rule change 

accomplishes this purpose by applying 

substantially the same rules and 

procedures to transactions in futures 

products that OCC applies to 

transactions in securities options. The 

proposed rule change is not inconsistent 

with any rules of OCC, including any 

rules 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 

Written comments were not and are 

not intended to be solicited with respect 

to the proposed rule change, and none 

have been received. 

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)(iii) of the Act 5 and Rule 

19b–4(f)(4) 6 promulgated thereunder 

because the proposal changes 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 

which it is responsible and (ii) does not 

significantly affect the respective rights 

or obligations of the clearing agency or 

persons using the service. At any time 

within sixty days of the filing of the 

proposed rule change, the Commission 

may summarily abrogate 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–OCC–2009–04 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–OCC–2009–04. 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 inspection and copying 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 OCC. 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–OCC–2009–04 and should 

be submitted on or before April 28, 

2009. 

For the Commission by the Division of 

Trading and Markets, pursuant to delegated 

authority.7

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–7710 Filed 4–6–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59666; File No. SR–NYSE– 

2009–35] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by New York 

Stock Exchange LLC Amending Rule 

48.10 To Extend the Temporary 

Provisions of the Rule Relating to the 

Ability of the Exchange To Declare an 

Extreme Market Volatility Condition 

and Suspend Certain NYSE 

Requirements Relating to the Closing 

of Securities at the Exchange 

March 31, 2009. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that, on March 

23, 2009, New York Stock Exchange 

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

with the Securities and Exchange 

Commission (‘‘SEC’’ or 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 

Exchange filed the proposed rule change 

pursuant to Section 19(b)(3)(A) of the 

Act 4 and Rule 19b–4(f)(6) thereunder,5

which renders it 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 Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

Rule 48.10 to extend the temporary 

provisions of the rule relating to the 

ability of the Exchange to declare an 

extreme market volatility condition and 

suspend certain NYSE requirements 

relating to the closing of securities at the 

Exchange. The text of the proposed rule 

change is available at the Exchange, the 

Commission’s Public Reference Room, 

and http://www.nyse.com. 

Federal Register / Vol. 74, No. 65 / Tuesday, April 7, 2009 / Notices 15793 

6NYSE Amex LLC has filed a companion rule 

filing to conform its Equities Rules to the changes 

proposed in this filing. See SR–NYSEAmex–2009– 

05, formally submitted March 23, 2009). 

7See SEC Release No. 58743 (Oct. 7, 2008), 73 FR 

60742 (Oct. 14, 2008) (SR–NYSE–2008–102). 

8See SEC Release No. 59489 (Mar. 3, 2009), 74 

FR 10330 (Mar. 10, 2009 (SR–NYSE–2009–18). 

NYSE Amex US LLC [sic] (‘‘NYSE Amex’’) has filed 

a companion rule filings. See SEC Release No. 

59488 (Mar. 3, 2009), 74 FR 10334 (Mar. 10, 2009) 

(SR–NYSEALTR–2009–15). 

9 15 U.S.C. 78s(b)(2). 

10See SEC Release No. 59168 (Dec. 29, 2008), 74 

FR 483 (Jan. 6, 2009) (SR–NYSE–2008–139). NYSE 

Amex also filed a companion rule filing. See SEC 

Release No. 59169 (Dec. 29, 2008), 74 FR 485 (Jan. 

6, 2009) (SR–NYSEALTR–2008–18). 

11 15 U.S.C. 78f(b)(5). 

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

13 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires the self-regulatory organization 

to 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 date 

of filing of the proposed rule change, or such 

shorter time as designated by the Commission. The 

Exchange has satisfied this requirement. 

14For purposes only of waiving the 30-day 

operative delay of this proposal, the Commission 

has considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

15 U.S.C. 78c(f). 

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 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend 

Rule 48.10 to temporarily extend the 

provisions of the rule relating to 

declaring an extreme market volatility 

condition at the close.6

On October 2, 2008, the Exchange 

filed for immediate effectiveness to 

amend NYSE Rule 48 to provide the 

Exchange with the ability to suspend 

certain rules at the close when 

extremely high market volatility could 

negatively affect the ability to ensure a 

fair and orderly close.7 The Exchange 

amended Rule 48 on an immediate 

effectiveness basis in order to respond 

swiftly to market conditions at that 

time. Those amendments were adopted 

on a temporary basis with the 

understanding that if the Exchange 

would like to adopt the closing 

provisions on a permanent basis, such 

proposal must be filed for notice and 

comment. 

The Exchange has filed a rule 

proposal to amend Rules 48 and 123C 

to delete from Rule 48 the provisions 

relating to declaring an extreme market 

volatility condition at the close and add 

them in modified form to Rule 123C (the 

‘‘Rule 48/123C filing’’).8 That rule 

proposal has been filed under Section 

19(b)(2) of the Securities Exchange Act 

of 1934 (the ‘‘Act’’) 9 and has been 

noticed for public comment. The 

comment period for that filing ends on 

March 31, 2009. In anticipation of the 

Rule 48/123C filing, the Exchange 

previously amended Rule 48.10 to 

extend from December 31, 2009 to 

March 27, 2009 the temporary time 

period that the Rule 48 at-the-close 

provisions would be in effect.10 The 

Exchange now proposes to temporarily 

extend the Rule 48 at-the-close 

provisions pending the outcome of the 

Rule 48/123C filing. Accordingly, the 

Exchange proposes to amend Rule 48.10 

to provide that the provisions of that 

rule relating to declaring an extreme 

market volatility condition at the close 

will end April 30, 2009. 

2. Statutory Basis 

The basis under the Act for this 

proposed rule change is the requirement 

under Section 6(b)(5) 11 that an 

Exchange have rules that are designed to 

promote just and equitable principles of 

trade, 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, this rule proposal will permit 

the temporary provisions of Rule 48 to 

continue without interruption pending 

the outcome of the Rule 48/123C filing. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will 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 

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 

change: 

(i) Does not significantly affect the 

protection of investors or the public 

interest; 

(ii) Does not impose any significant 

burden on competition; and 

(iii) By its terms, does not 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, it has 

become effective pursuant to Section 

19(b)(3)(A) of the Act 12 and Rule 19b– 

4(f)(6) thereunder.13

The Exchange has requested that the 

Commission waive the 30-day operative 

delay in order to permit the temporary 

provisions of Rule 48 to continue 

without interruption pending the 

outcome of the Rule 48/123C filing. The 

Commission believes such waiver is 

consistent with the protection of 

investors and the public interest.14

Accordingly, the Commission 

designates the proposed rule change 

operative upon filing with the 

Commission. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission may summarily abrogate 

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–NYSE–2009–35 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–NYSE–2009–35. This file 

15794 Federal Register / Vol. 74, No. 65 / Tuesday, April 7, 2009 / Notices 

15 17 CFR 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). 

4There are exceptions to this general prohibition. 

Subject to certain aggregation requirements for 

cash-settled options, CBOE permits flexibly 

structured options to expire on the same day as 

non-flexibly structured quarterly options and nonflexibly structured weekly options. Non-flexibly 

structured weekly options are called ‘‘short term 

options’’ in OCC’s By-Laws and Rules. CBOE Rules 

24A.7(d) and 24B.7(d). 

5Securities Exchange Act Release No. 59417 (Feb. 

18, 2009), 74 FR 8591 (Feb. 25, 2009) [SR–CBOE– 

2008–115]. 

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 inspection and copying in 

the Commission’s Public Reference 

Room 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–NYSE– 

2009–35 and should be submitted on or 

before April 28, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–7711 Filed 4–6–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59675; File No. SR–OCC– 

2009–05] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change Relating to 

Flexibly Structured Options 

April 1, 2009. 

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

Securities Exchange Act of 1934,1 notice 

is hereby given that on March 19, 2009, 

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 will amend 

OCC’s By-Laws in order to clear and 

settle flexibly structured options traded 

on the Chicago Board Options Exchange 

(‘‘CBOE’’). 

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 

Flexibly structured options are 

options that give investors the ability to 

customize basic option features 

including size, expiration date, exercise 

style, and certain exercise prices. 

Currently, options exchanges generally 

do not permit flexibly structured 

options to be customized to expire on 

the same expiration date as any series of 

non-flexibly structured options that are 

listed for trading.4 However, pursuant to 

a recent CBOE rule change, CBOE 

eliminated this restriction so that the 

parties to a flexibly structured option 

transaction can choose an expiration 

date that coincides with that of a series 

of non-flexibly structured options.5 As a 

result of eliminating the expiration date 

restriction, it is now possible for new 

flexibly structured options to become 

fungible with a series of non-flexibly 

structured options that are subsequently 

listed for trading. Thus, CBOE now 

permits flexibly structured options to be 

traded before identical non-flexibly 

structured options are listed for trading. 

Once an option series is listed on CBOE 

for trading as a non-flexibly structured 

option series, (i) all existing flexibly 

structured options having identical 

terms as the non-flexibly structured 

option series will be fully fungible with 

options in such series and (ii) any 

further trading in such series would be 

as non-flexibly structured options. As 

an exception to the foregoing, flexibly 

structured options will not become 

fungible with subsequently-introduced 

non-flexibly structured quarterly 

options or short term options. 

In order to clear and settle flexibly 

structured options traded on CBOE in a 

manner that is consistent with CBOE’s 

rules, OCC will change the definition of 

‘‘flexibly structured option’’ in Article I 

of its By-Laws to clarify that an option 

will be classified as a flexibly structured 

option only if its variable terms do not 

correspond to the variable terms of any 

series of non-flexibly structured options 

listed for trading other than a series of 

quarterly options or short term options. 

Furthermore, existing flexibly 

structured options will be fungible with 

options in a subsequently listed nonflexibly structured option series other 

than quarterly options or short term 

options that have identical variable 

terms and will not be classified as 

flexibly structured options. The 

definition of ‘‘flexibly structured 

option’’ in Article XVII, Section 1 of 

OCC’s By-Laws will be deleted because 

such definition is redundant. OCC will 

also amend the definition of ‘‘variable 

terms’’ in Article I of the By-Laws to 

clarify that the expiration date is a 

variable term for all types of options. 

Finally, other parts of the definition will 

also be revised to group together 

variable terms of option contracts and 

variable terms of futures contracts. 

Prior to this rule change, OCC’s rules 

provided that an expiring flexibly 

structured index option with an exercise 

settlement amount of $1.00 or more was 

automatically exercised on its 

expiration date. In comparison, an 

expiring non-flexibly structured index 

option with an exercise settlement 

amount of $1.00 or more except 

quarterly options or short term options 

was subject to the ‘‘exercise by 

exception’’ procedures under which the 

option will be exercised on its 

expiration date if the option holder does 

not give contrary exercise instructions. 

However, as described above, flexibly